# EDGAR Filing Document

**Accession Number:** 0001642122
**File Stem:** 0001437749-23-006786
**Filing Date:** 2023-3
**Character Count:** 217238
**Document Hash:** 03e6fed67acb7c566849bafc07c05d87
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-23-006786.hdr.sgml**: 20230316

**ACCESSION NUMBER**: 0001437749-23-006786

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 80

**CONFORMED PERIOD OF REPORT**: 20221231

**FILED AS OF DATE**: 20230316

**DATE AS OF CHANGE**: 20230315

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Associated Capital Group, Inc.
- **CENTRAL INDEX KEY:** 0001642122
- **STANDARD INDUSTRIAL CLASSIFICATION:** SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211]
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-37387
- **FILM NUMBER:** 23736954

**BUSINESS ADDRESS:**
- **STREET 1:** 191 MASON STREET
- **CITY:** GREENWICH
- **STATE:** CT
- **ZIP:** 06830
- **BUSINESS PHONE:** 914-921-5135

**MAIL ADDRESS:**
- **STREET 1:** 191 MASON STREET
- **CITY:** GREENWICH
- **STATE:** CT
- **ZIP:** 06830

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Gabelli Securities Group, Inc.
- **DATE OF NAME CHANGE:** 20150512

ac20221231_10k.htm

[**Table of Contents**](#toc)

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-K**

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2022

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number 001-37387

## Associated Capital Group, Inc.
(Exact name of registrant as specified in its charter)

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| | |
|:---|:---|
| Delaware | 47-3965991 |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |

---

---

| | |
|:---|:---|
| 191 Mason Street, Greenwich, CT 06830 | (203) 629-9595 |
| (Address of principal executive offices)(Zip Code) | (Registrant's telephone number, including area code) |

---

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

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| | |
|:---|:---|
| **Title of each class** | **Name of each exchange on which registered** |
| Class A Common Stock, par value $0.001 per share<br> AC | New York Stock Exchange |

---

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act Yes ☐ No ☒.

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act Yes ☐ No ☒.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days Yes ☒ No ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer", "accelerated filer", "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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| | |
|:---|:---|
| Large accelerated filer ☐ | Accelerated filer ☐ |
| Non-accelerated filer ☒ | Smaller reporting company ☒ |
|  | Emerging growth company ☐ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to § 240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2) Yes ☐ No ☒.

The aggregate market value of the class A common stock held by non-affiliates of the registrant as of June 30, 2022 (the last business day of the registrant's most recently completed second fiscal quarter) was $111,632,521.

As of March 3, 2023, 2,994,616 shares of class A common stock and 18,962,754 shares of class B common stock were outstanding. GGCP, Inc., a private company controlled by the Company's Executive Chair, held 77,165 shares of class A common stock and indirectly held 18,423,741 shares of class B common stock. Other executive officers and directors of GGCP, Inc. held 29,866 and 36,758 shares of class A and class B common stock, respectively. In addition, there are 210,910 Phantom Restricted Stock Awards outstanding as of December 31, 2022.

DOCUMENTS INCORPORATED BY REFERENCE: Portions of the registrant's definitive proxy statement relating to the 2023 Annual Meeting of Shareholders are incorporated by reference in Items 10, 11, 12, 13 and 14 of Part III of this report.

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**Associated Capital Group, Inc.**

**Annual Report on Form 10-K for the Fiscal Year Ended December 31, 2022**

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| | | | |
|:---|:---|:---|:---|
| <u>**Part I**</u> |  |  |  |
|  | <u>**Item 1**</u> | [Business](#business) | [4](#business) |
|  |  | [Business Strategy](#businessstrategy) | [6](#businessstrategy) |
|  |  | [Competition](#competition) | [6](#competition) |
|  |  | [Intellectual Property](#intproperty) | [7](#intproperty) |
|  |  | [Regulation](#regulation) | [7](#regulation) |
|  |  | [Employees](#employees) | [9](#employees) |
|  | <u>**Item 1A**</u> | [Risk Factors](#riskfactors) | [10](#riskfactors) |
|  | <u>**Item 1B**</u> | [Unresolved Staff Comments](#unresolvedcomments) | [10](#unresolvedcomments) |
|  | <u>**Item 2**</u> | [Properties](#properties) | [10](#properties) |
|  | <u>**Item 3**</u> | [Legal Proceedings](#legalproceedings) | [10](#legalproceedings) |
|  | <u>**Item 4**</u> | [Mine Safety Disclosures](#minesafety) | [10](#minesafety) |
| <u>**Part II**</u> |  |  |  |
|  | <u>**Item 5**</u> | [Market For The Registrant's Common Equity, Related Stockholder Matters And Issuer Purchases Of Equity Securities](#marketregistrant) | [11](#marketregistrant) |
|  | <u>**Item 6**</u> | [Selected Financial Data](#selectfindata) | [11](#selectfindata) |
|  | <u>**Item 7**</u> | [Management's Discussion And Analysis ("MD&A") Of Financial Condition And Results Of Operations](#mdna) | [11](#mdna) |
|  | <u>**Item 7A**</u> | [Quantitative And Qualitative Disclosures About Market Risk](#qnq) | [18](#qnq) |
|  | <u>**Item 8**</u> | [Financial Statements And Supplementary Data](#finstateandsuppdata) | [19](#finstateandsuppdata) |
|  | <u>**Item 9**</u> | [Changes In And Disagreements With Accountants On Accounting And Financial Disclosure](#changesindisagreements) | [50](#changesindisagreements) |
|  | <u>**Item 9A**</u> | [Controls And Procedures](#controlsandproc) | [50](#controlsandproc) |
|  | <u>**Item 9B**</u> | [Other Information](#otherinfo) | [51](#otherinfo) |
|  | <u>**Item 9C**</u> | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#disclosureforeign) | [51](#disclosureforeign) |
| <u>**Part III**</u> |  |  |  |
|  | <u>**Item 10**</u> | [Directors, Executive Officers and Corporate Governance](#direxecorpgov) | [51](#direxecorpgov) |
|  | <u>**Item 11**</u> | [Executive Compensation](#execcomp) | [51](#execcomp) |
|  | <u>**Item 12**</u> | [Security Ownership Of Certain Beneficial Owners And Management And Related Stockholder Matters](#secownership) | [51](#secownership) |
|  | <u>**Item 13**</u> | [Certain Relationships And Related Transactions, and Director Independence](#certainrelationships) | [51](#certainrelationships) |
|  | <u>**Item 14**</u> | [Principal Accountant Fees And Services](#principalaccount) | [51](#principalaccount) |
| <u>**Part IV**</u> |  |  |  |
|  | <u>**Item 15**</u> | [Exhibits, Financial Statement Schedules](#exhibits) | [51](#exhibits) |
|  | <u>**Item 16**</u> | [Form 10-K Summary](#form10ksumm) | [52](#form10ksumm) |
|  |  | [Signatures](#sigs) | [53](#sigs) |
|  |  | [Power of Attorney](#poa) | [54](#poa) |
|  |  | [Exhibit 21.1 - Subsidiaries of Associated Capital Group, Inc.](ex_449372.htm) |  |
|  | **Certifications** | [Exhibit 31.1](ex_448609.htm) |  |
|  |  | [Exhibit 31.2](ex_448610.htm) |  |
|  |  | [Exhibit 31.3](ex_448611.htm) |  |
|  |  | [Exhibit 32.1](ex_448612.htm) |  |
|  |  | [Exhibit 32.2](ex_448613.htm) |  |

---

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**Forward-Looking Statements**

*Our disclosure and analysis in this report and in documents that are incorporated by reference contain some forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended (the* "*Exchange Act*"*). Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements because they do not relate strictly to historical or current facts. You should not place undue reliance on these statements. They use words such as* "*anticipate,*" "*estimate,*" "*expect,*" "*project,*" "*intend,*" "*plan,*" "*believe,*" *and other words and terms of similar meaning. They also appear in any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance of our products, expenses, the outcome of any legal proceedings, and financial results.*

*Although we believe that we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know about our business and operations, there can be no assurance that our actual results will not differ materially from what we expect or believe. Some of the factors that could cause our actual results to differ from our expectations or beliefs include, without limitation: the adverse effect from a decline in the securities markets; a decline in the performance of our products; a general downturn in the economy; changes in government policy or regulation; changes in our ability to attract or retain key employees; and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations. We also direct your attention to any more specific discussions of risk contained in our other public filings or in documents incorporated by reference here or in prior filings or reports.*

*We are providing these statements as permitted by the Private Litigation Reform Act of 1995. We do not undertake to update publicly any forward-looking statements if we subsequently learn that we are unlikely to achieve our expectations or if we receive any additional information relating to the subject matters of our forward-looking statements.*

**Definitions**

*Unless we have indicated otherwise, or the context otherwise requires, references in this report to* "*Associated Capital Group, Inc.,*" "*AC Group,*" "*the Company,*" "*AC,*" "*we,*" "*us*" *and* "*our*" *or similar terms are to Associated Capital Group, Inc., its predecessors and its subsidiaries through which our operations are actually conducted.* "*GAMCO*"*,* "*GAMI*"*, or similar terms refer to our former parent GAMCO Investors, Inc.* 

*The information provided in response to Item 7. Management*'*s Discussion and Analysis (*"*MD&A*"*) of Financial Condition and Results of Operations is provided as a supplement to, and should be read in conjunction with, the Consolidated Financial Statements and the notes thereto included in Item 8 to this report.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3

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[**Table of Contents**](#toc)

**PART 1: OVERVIEW**

**Giving Back to Society - (Y)our** "**S**" **in ESG**

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| | |
|:---|:---|
| **ITEM 1:** | **BUSINESS** |

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**(Y)our Business**

We are a Delaware corporation, incorporated in 2015, that provides alternative investment management services and operates a direct investment business that over time invests in businesses that fit our criteria. Additionally, we derive income from proprietary investments.

**Alternative Investment Management**

We conduct our investment management activities through our wholly-owned subsidiary Gabelli & Company Investment Advisers, Inc. ("GCIA") and its wholly-owned subsidiary, Gabelli & Partners, LLC ("Gabelli & Partners"). GCIA is an investment adviser registered with the Securities and Exchange Commission ("SEC") under the Investment Advisers Act of 1940, as amended (the "Advisers Act"). GCIA and Gabelli & Partners together serve as general partners or investment managers to investment funds including limited partnerships and offshore companies (collectively, "Investment Partnerships"), and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The business earns management and incentive fees from its advisory activities. Management fees are largely based on a percentage of assets under management ("AUM"). Incentive fees are based on a percentage of the investment returns of certain client portfolios.

We manage assets on a discretionary basis and invest in a variety of U.S. and foreign securities mainly in the developed global markets. We primarily employ absolute return strategies with the objective of generating positive returns. We serve a wide variety of investors globally, including private wealth management clients, corporations, corporate pension and profit-sharing plans, foundations and endowments, as well as serving as sub-advisor to certain third-party investment funds.

In merger arbitrage, the goal is to earn absolute positive returns. We introduced our first limited partnership, Gabelli Arbitrage (renamed Gabelli Associates Fund), in February 1985. Our typical investment process begins when a deal is announced, buying shares of the target at a discount to the stated deal terms, earning the spread until the deal closes, and reinvesting the proceeds in new deals in a similar manner. By owning a diversified portfolio of transactions, we mitigate the adverse impact of single deal-specific risks. Since inception, we have compounded net annual returns of 7.2% with 36 of 38 positive years, net, overall. As a result, a $10 million investment by a tax free vehicle in this fund at its inception would be worth more than $140 million as of December 31, 2022. In addition, the value of the investment would have exhibited significantly less volatility than that of broad equity indices.

As the business and investor base expanded, we launched an offshore version in 1989. Building on our strengths in global event-driven value investing, several investment vehicles have been added to balance investors' geographic, strategic and sector-specific needs. Today, we manage investments in multiple categories, including merger arbitrage, event-driven value and other strategies.

In 2021, our Board of Directors approved the launch of a private equity fund.

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***Assets Under Management***

As of December 31, 2022, we managed approximately $1.84 billion in assets. The following table sets forth AC's total AUM, including investment funds and separately managed accounts, for the dates shown:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
| ($ in millions) | **2022** | **2021** | **2020** | **2019** | **2018** | **2017** | **2016** | **2015** |
| Merger Arbitrage | $1588 | $1542 | $1126 | $1525 | $1342 | $1384 | $1076 | $869 |
| Event-Driven Value<sup>(a)</sup> | 222 | 195 | 180 | 132 | 118 | 91 | 133 | 145 |
| Other<sup>(b)</sup> | 32 | 44 | 45 | 59 | 60 | 66 | 63 | 66 |
| Total AUM | $1842 | $1781 | $1351 | $1716 | $1520 | $1541 | $1272 | $1080 |

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(a) Assets under management represent the assets invested in this strategy that are attributable to AC.

(b) Includes investment vehicles focused on private equity, merchant banking, non-investment grade credit and capital structure arbitrage.

**Proprietary Capital**

Proprietary capital is earmarked for our direct investment business that invests in new and existing businesses, using a variety of techniques and structures. We launched our direct private equity and merchant banking activities in August 2017. The direct investment business is developing along several core pillars:

● Gabelli Private Equity Partners, LLC ("GPEP"), formed in August 2017 with $150 million of authorized capital as a "fund-less" sponsor.

● Gabelli Principal Strategies Group, LLC ("GPS") was created to pursue strategic operating initiatives broadly.

Our direct investing efforts are organized to invest in various ways, including growth capital, leveraged buyouts and restructurings, with an emphasis on small and mid-sized companies. Our investment sourcing is across a variety of channels, including direct owners, private equity funds, classic agents, and corporate carve outs (which are positioned for accelerated growth, as businesses seek to enhance shareholder value through financial engineering). The Company's direct investing vehicles allow us to acquire companies and create long-term value with no pre-determined exit timetable.

We have a proprietary portfolio of cash and investments which we expect to use to invest primarily in funds that we will manage, provide seed capital for new products, expand our geographic presence, develop new markets and pursue strategic acquisitions and alliances.

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**Business Strategy**

Our business strategy targets global growth of the business through continued leveraging of our proven asset management strengths, including the long-term performance record of our alternative investment funds, diverse product offerings and experienced investment, research and client relationship professionals. In order to achieve performance and growth in AUM and profitability, we are pursuing a strategy which includes the following key elements:

***Continuing an Active Fundamental Investment Approach***

Since 1985, our results demonstrate our core competence in absolute return, event driven investing through varying market cycles to earn rates of return independent of the broad markets' direction. Our proprietary "Private Market Value (PMV) with a Catalyst" investing approach remains the principal management philosophy guiding our global research efforts and forms the backbone of our M&A investment activities. The PMV methodology is based on investing principles first articulated by Graham & Dodd, and further refined by our Executive Chair, Mario J. Gabelli. Our M&A portfolios provide access to Gabelli's deep history of investing in mergers and is a natural extension of our long standing research-driven investment process oriented toward undervalued assets as articulated through our PMV methodology. The investment team takes an active approach to merger investing, analyzing the various qualitative and quantitative aspects of the transaction from announcement to deal completion, coupled with our fundamental understanding of business valuations, building and monitoring transactions in the portfolio across the deal timeline.

***Growing our Investment Partnerships Advisory Business***

We intend to grow our Investment Partnerships advisory operations by gaining share with existing products and introducing new products within our core competencies, such as event and merger arbitrage. In addition, we intend to grow internationally.

***Capitalizing on Acquisitions and Alliances - Direct Investments***

We intend to leverage our research and investment capabilities by pursuing acquisitions and alliances that will broaden our product offerings and add new sources of distribution. In addition, we may make direct investments in operating businesses using a variety of techniques and structures.

***Opportunities in Private Equity***

One of our initiatives is to launch a private equity business to capitalize on the developing opportunities in the capital market place.

***Pursuing Partnerships and Joint Ventures***

We plan to pursue partnerships and joint ventures with firms that fit with AC's product quality and that can provide Asian/European distribution capabilities that would complement our U.S. equity product expertise. We expect to target opportunities for investors interested in non-market correlated returns.

**Competition**

The alternative asset management industry is intensely competitive. We face competition in all aspects of our business from other managers in the United States and around the globe. We compete with alternative investment management firms, insurance companies, banks, brokerage firms and financial institutions that offer products that have similar features and investment objectives. Many of these investment management firms are subsidiaries of large diversified financial companies and may have access to greater resources than we do. Many are larger in terms of AUM and revenues and, accordingly, have larger investment and sales organizations and related budgets. Historically, we have competed primarily on the basis of the long-term investment performance of our investment products. We have recently taken steps to increase our distribution channels, brand awareness and marketing efforts.

The market for providing investment management services to institutional and private wealth management clients is also highly competitive. Selection of investment advisors by U.S. institutional investors is often subject to a screening process and to favorable recommendations by investment industry consultants. Many of these investors require their investment advisors to have a successful and sustained performance record, often five years or longer, and focus on one-year and three-year performance records. Currently, we believe that our investment performance record would be attractive to potential new institutional and private wealth management clients. While we have significantly increased our AUM from institutional investors since our founding, no assurance can be given that our efforts to obtain new business will be successful.

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**Intellectual Property**

Service marks and brand name recognition are important to our business. We have rights to the service marks under which our products are offered. We have rights to use the "Gabelli" name, and the "GAMCO" brand, pursuant to a non-exclusive, royalty-free license agreement we have entered into with GAMCO (the "Service Mark and Name License Agreement"). We can use these names with respect to our funds, collective investment vehicles, Investment Partnerships and other investment products pursuant to the Service Mark and Name License Agreement. The Service Mark and Name License Agreement has a perpetual term, subject to termination only in the event we are not in compliance with its quality control provisions. Pursuant to an assignment agreement signed in 1999, Mario J. Gabelli had assigned to GAMCO all of his rights, title and interests in and to the "Gabelli" name for use in connection with investment management services and institutional research services. In addition, the funds managed by Mario J. Gabelli outside GAMCO and AC have entered into a license agreement with GAMCO permitting them to continue limited use of the "Gabelli" name under specified circumstances.

**Regulation**

Virtually all aspects of our businesses are subject to federal, state and foreign laws and regulations. These laws and regulations are primarily intended to protect investment advisory clients and investors and the financial markets. Under such laws and regulations, agencies that regulate investment advisors have broad powers, including the power to limit, restrict or prohibit such an advisor from carrying on its business in the event that it fails to comply with such laws and regulations. Possible sanctions that may be imposed for non-compliance include civil and criminal liability, the suspension of individual employees, injunctions, limitations on engaging in certain lines of business for specified periods of time, revocation of the investment advisor and other registrations, censures and fines.

***Existing U.S. Regulation Overview***

AC and certain of its U.S. subsidiaries are currently subject to extensive regulation, primarily at the federal level, by the SEC, the United States Department of Labor, and other regulatory bodies. Certain of our U.S. subsidiaries are also subject to anti-terrorist financing, privacy, and anti-money laundering regulations, as well as economic sanctions laws and regulations established by these agencies.

*The Advisers Act*

GCIA is registered with the SEC under the Advisers Act and is regulated by and subject to examination by the SEC. The Advisers Act imposes numerous obligations on registered investment advisers including fiduciary duties, disclosure obligations and record keeping, operational and marketing requirements. The SEC is authorized to institute proceedings and impose sanctions for violations of the Advisers Act, ranging from censure to termination of an investment adviser's registration. The failure of GCIA to comply with the requirements of the SEC could have a material adverse effect on us.

We derive substantially all of our revenues from investment advisory services under investment management agreements. Under the Advisers Act, our investment management agreements cannot be assigned without the client's consent.

*Employee Retirement Income Security Act of 1974 (*"*ERISA*"*)*

GCIA is subject to ERISA and to regulations promulgated thereunder, insofar as it is a "fiduciary" under ERISA with respect to certain of its clients. ERISA and applicable provisions of the Internal Revenue Code of 1986, as amended, impose certain duties on persons who are fiduciaries under ERISA and prohibit certain transactions involving ERISA plan clients. Our failure to comply with these requirements could have a material adverse effect on us.

*Anti-Tax Evasion Legislation*

Our global business may be impacted by the Foreign Account Tax Compliance Act ("FATCA"), which was enacted in 2010 and introduced expansive new investor onboarding, withholding and reporting rules aimed at ensuring U.S. persons with financial assets outside of the United States pay appropriate taxes. In many instances, however, the precise nature of what needs to be implemented will be governed by bilateral Intergovernmental Agreements ("IGAs") between the United States and the countries in which we do business or have accounts. While many of these IGAs have been put into place, others have yet to be concluded.

The Organization for Economic Cooperation and Development ("OECD") has developed the Common Reporting Standard ("CRS") to address the issue of offshore tax evasion on a global basis. Aimed at maximizing efficiency and reducing cost for financial institutions, the CRS provides a common standard for due diligence, reporting and exchange of information regarding financial accounts. Pursuant to the CRS, participating jurisdictions will obtain from reporting financial institutions, and automatically exchange with partner jurisdictions on an annual basis, financial information with respect to all reportable accounts identified by financial institutions on the basis of common due diligence and reporting procedures. As a result, the Investment Partnerships will be required to report information on the investors of the Partnerships to comply with the CRS due diligence and reporting requirements, as adopted by the countries in which the Investment Partnerships are organized.

The FATCA and CRS rules will impact both U.S. and non-U.S. Investment Partnerships and separately managed accounts and subject us to extensive additional administrative burdens. Our business could also be impacted to the extent there are other changes to tax laws, such as the recent tax reform legislation. Such changes could adversely affect our financial results.

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*The Patriot Act*

The USA Patriot Act of 2001 contains anti-money laundering and financial transparency laws and mandates various regulations applicable to financial services companies, including standards for verifying client identification at account opening, and obligations to monitor client transactions and report suspicious activities. Anti-money laundering laws outside of the United States contain some similar provisions. Our failure to comply with these requirements as applicable to us could have a material adverse effect on us.

*Laws and Other Issues Relating to Taking Significant Equity Stakes in Companies*

Investments by AC, its affiliates, and those made on behalf of their respective advisory clients and Investment Partnerships often represent a significant equity ownership position in an issuer's equity. This may be due to the fact that AC is deemed to be a member of a "group" that includes GAMCO, an entity under common control with AC, and, therefore, may be deemed to beneficially own the securities owned by other members of the group under applicable securities regulations. As of December 31, 2022, by virtue of being a member of the group, AC was deemed to hold five percent or more beneficial ownership with respect to approximately 70 equity securities. This activity raises frequent regulatory, legal and disclosure issues regarding our aggregate beneficial ownership level with respect to portfolio securities, including issues relating to issuers' stockholder rights plans or "poison pills", various federal and state regulatory limitations, including (i) state gaming laws and regulations, (ii) federal communications laws and regulations, (iii) federal and state public utility laws and regulations, (iv) federal proxy rules governing stockholder communications, and (v) federal laws and regulations regarding the reporting of beneficial ownership positions. Our failure to comply with these requirements could have a material adverse effect on us.

*Potential Legislation Relating to Private Pools of Capital*

We manage a variety of private pools of capital, including hedge funds. Congress, regulators, tax authorities and others continue to explore increased regulation related to private pools of capital, including changes with respect to: investor eligibility; trading activities, record-keeping and reporting; the scope of anti-fraud protections; safekeeping of client assets; tax treatment; and a variety of other matters. AC may be materially and adversely affected by new legislation, rule-making or changes in the interpretation or enforcement of existing rules and regulations imposed by various regulators.

***Existing European Regulation Overview***

*Alternative Investment Fund Managers Directive*

Our European activities are impacted by the European Union's ("EU") Alternative Investment Fund Managers Directive ("AIFMD"). AIFMD regulates managers of, and service providers to, a broad range of alternative investment funds ("AIFs") domiciled within and, potentially, outside the EU. AIFMD also regulates the marketing of all AIFs inside the European Economic Area. AIFMD's requirements restrict AIF marketing and impose additional compliance and disclosure obligations on AC regarding items such as remuneration, capital requirements, leverage, valuation, stakes in EU companies, depositaries, domicile of custodians and liquidity management. These compliance and disclosure obligations and the associated risk management and reporting requirements will subject us to additional expenses.

*Undertakings for Collective Investment in Transferable Securities*

The EU has also adopted directives on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities ("UCITS") impacting depositary functions, remuneration policies and sanctions. The latest initiative in this area, UCITS V, seeks to align the depositary regime, remuneration rules and sanctioning powers of regulators under the UCITS Directive with the requirements of AIFMD.

Similarly, the European Securities and Markets Authority recently revised its guidelines for exchange-traded and other UCITS funds. These guidelines introduced new collateral management requirements for UCITS funds concerning collateral received in the context of derivatives using Efficient Portfolio Management ("EPM") techniques (including securities lending) and over-the-counter derivative transactions. We are following the guidelines with respect to our collateral management arrangements applicable to the EPM of the UCITS funds for which GCIA acts as a sub-advisor. The costs of complying with increasing regulation in the EU may negatively impact the net performance of the UCITS fund that GCIA sub advises and therefore may result in decreased remuneration to GCIA for this sub advisory activity.

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*Markets in Financial Instruments Directive*

The EU's revised Markets in Financial Instruments Directive ("MiFID II"), which was fully implemented in 2018, created specific new rules regarding the use of "soft dollars" to pay for research. A MiFID licensed investment firm that provides portfolio management services or independent investment advisory services to clients may not pay for third-party research with soft dollars generated through client trading activity. Research must be paid for either (i) by the investment firm out of its own resources, or (ii) through a separate research payment account for each client to pay for the research. While currently GCIA is not directly subject to MiFID II: (a) GCIA may be invoiced separately by any EU brokers from whom it purchases research in the future; and (b) clients may begin to require that GCIA "unbundle" research payments from commission trading.

The Financial Conduct Authority ("FCA") currently regulates Gabelli Securities International (UK) Limited ("GSIL UK"), our MiFID licensed entity in the United Kingdom. Authorization by the FCA is required to conduct certain financial services-related business in the United Kingdom under the Financial Services and Markets Act 2000. The FCA's rules adopted under that Act provide requirements dealing with a firm's capital resources, senior management arrangements, conduct of business, interaction with clients and systems and controls. The FCA supervises GSIL UK through a combination of proactive engagement, event-driven and reactive supervision and thematic-based reviews in order to monitor our compliance with regulatory requirements. Breaches of the FCA's rules may result in a wide range of disciplinary actions against GSIL UK and/or its employees.

Clients whose assets we manage in the EU are additionally subject to EU regulations on OTC derivatives which require (i) the central clearing of standardized OTC derivatives, (ii) the application of risk-mitigation techniques to non-centrally cleared OTC derivatives and (iii) the reporting of all derivative contracts.

*Brexit Impact*

Through The European Union (Withdrawal) Act of 2018, GSIL UK remained subject to the requirements of MiFID II as in effect on December 31, 2020 (the "Transition End Date"). MiFID II sets out detailed requirements governing the organization and conduct of business of investment firms and regulated markets. MiFID II also includes pre- and post-trade transparency requirements for equity markets and extensive transaction reporting requirements. In addition, relevant entities must comply with revised obligations on capital resources for banks and certain investment firms set out in the Capital Requirements Directive. This directive includes requirements not only on capital, but also governance and remuneration as well. The obligations introduced through these directives have a direct effect on some of our European operations. The Company cannot assure you the extent to which the future amendments to or replacement of MiFID II or other EU regulations will be adopted into UK law and continue to apply to GSIL UK after the Transition End Date.

***Regulatory Matters Generally***

The investment management industry is likely to continue to face a high level of regulatory scrutiny and to become subject to additional rules designed to increase disclosure, tighten controls and reduce potential conflicts of interest. In addition, the SEC has substantially increased its use of focused inquiries which request information from investment advisors regarding particular practices or provisions of the securities laws. We participate in some of these inquiries in the normal course of our business. Changes in laws, regulations and administrative practices by regulatory authorities, and the associated compliance costs, have increased our cost structure and could in the future have a material adverse impact. Although we have installed procedures and utilize the services of experienced administrators, accountants and lawyers to assist us in adhering to regulatory guidelines and satisfying these requirements, and maintain insurance to protect ourselves in the case of client losses, there can be no assurance that the precautions and procedures that we have instituted and installed, or the insurance that we maintain to protect ourselves in case of client losses, will protect us from all potential liabilities.

**Employees**

On March 3, 2023, we had a full-time staff of 24 teammates, of whom 8 served in the portfolio management, research and trading areas, 8 served in the marketing and shareholder servicing areas and 8 served in the finance, legal, operations and administrative areas. We also avail ourselves of services provided by GAMCO in accordance with a transitional services agreement that was entered into with GAMCO as part of AC's spin-off from GAMCO on November 30, 2015.

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**Status as a Smaller Reporting Company**

We are a "smaller reporting company" as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K. As a result, we are eligible to take advantage of certain exemptions from various reporting requirements that are not available to other public companies that are not "smaller reporting companies".

Our website address is <u>www.associated-capital-group.com</u>. Information on our website is not incorporated by reference herein and is not part of this report. We provide a link on our website to the following filings as soon as reasonably practicable after they are electronically filed with or furnished to the SEC: our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All such filings on our website are available free of charge. In addition, these reports and the other documents we file with the SEC are available at <u>www.sec.gov</u>.

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| | |
|:---|:---|
| **ITEM 1A:** | **RISK FACTORS** |

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Smaller reporting companies are not required to provide the information required by this item.

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| | |
|:---|:---|
| **ITEM 1B:** | **UNRESOLVED STAFF COMMENTS** |

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None.

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| | |
|:---|:---|
| **ITEM 2:** | **PROPERTIES** |

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Our offices are owned by a wholly-owned subsidiary of AC and are located at 191 Mason Street, Greenwich, CT 06830. A portion of the office space is leased to affiliates. AC received $116.4 thousand and $118.1 thousand from affiliates (primarily GAMCO) pursuant to lease agreements for this property for 2022 and 2021, respectively. These amounts are included in other revenues in the consolidated statements of income.

AC acquired 3 St. James Place, London, UK on March 3, 2020, which was fully leased to GAMCO commencing 2021. For the years ended December 31, 2022 and 2021, the Company received $309.8 thousand and $275.4 thousand, respectively, under the lease agreement. These amounts are included in other revenues in the consolidated statements of income.

During 2022 and 2021, AC paid $72.1 thousand and $73.7 thousand, respectively, to GAMCO pursuant to a sublease based on the percentage of square footage occupied by several AC teammates (including pro rata allocation of common space) at GAMCO's offices at One Corporate Center, Rye, NY 10580. These amounts are included in other operating expenses in the consolidated statements of income.

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| | |
|:---|:---|
| **ITEM 3:** | **LEGAL PROCEEDINGS** |

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Currently, we are not subject to any legal proceedings that individually or in the aggregate involved a claim for damages in excess of 10% of our consolidated assets. From time to time, we may be named in legal actions and proceedings. These actions may seek substantial or indeterminate compensatory as well as punitive damages or injunctive relief. We are also subject to governmental or regulatory examinations or investigations. Examinations or investigations can result in adverse judgments, settlements, fines, injunctions, restitutions or other relief. For any such matters, the consolidated financial statements include the necessary provisions for losses that we believe are probable and estimable. Furthermore, we evaluate whether there exist losses which may be reasonably possible and, if material, make the necessary disclosures. Management is not aware of any probable or reasonably possible losses at December 31, 2022. See also Note 12, *Guarantees, Contingencies and Commitments*, to the consolidated financial statements in Part II, Item 8 of this Form 10-K.

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| | |
|:---|:---|
| **ITEM 4:** | **MINE SAFETY DISCLOSURES** |

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Not applicable.

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**PART II**

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|:---|:---|
| **ITEM 5:** | **MARKET FOR THE REGISTRANT**'**S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES** |

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**Market for our Stock, Dividends and Stock Repurchase Program**

Shares of our Class A common stock are traded on the New York Stock Exchange ("NYSE") under the symbol AC.

As of March 3, 2023, there were 114 and 20 holders of record of the Company's Class A and Class B common stock, respectively. These figures do not include beneficial holders of Class A shares held in "street" name at various brokerage firms.

In December 2015, the Board of Directors established a stock repurchase program authorizing the Company to repurchase up to 500,000 shares. On February 7, 2017, the Board of Directors reset the available number of shares to be purchased under the stock repurchase program to 500,000 shares. On August 3, 2017 and May 8, 2018, the Board of Directors authorized the repurchase of an additional 1 million and 500,000 shares, respectively. Our stock repurchase program is not subject to an expiration date.

The following table provides information for our repurchase of our Class A common stock during the quarter ended December 31, 2022:

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| | | | | |
|:---|:---|:---|:---|:---|
|  |  |  | Total Number of | Maximum |
|  | Total | Average | Shares Repurchased as | Number of Shares |
|  | Number of | Price Paid Per | Part of Publicly | That May Yet Be |
|  | Shares | Share, net of | Announced Plans | Purchased Under |
| Period | Repurchased | Commissions | or Programs | the Plans or Programs |
| 10/01/22 - 10/31/22 | 1305 | $39.16 | 1305 | 621259 |
| 11/01/22 - 11/30/22 | 9326 | 39.39 | 9326 | 611933 |
| 12/01/22 - 12/31/22 | 2581 | 40.87 | 2581 | 609352 |
| Totals | 13212 | $39.66 | 13212 |  |

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We have adopted the 2015 Stock Award and Incentive Plan (the "Equity Compensation Plan"). A maximum of 2.0 million shares of Class A Stock have been reserved for issuance as approved by the Company's stockholders at the annual meeting of stockholders held on May 3, 2016. The Company withdrew the registration statement covering the issuance of those shares as of December 29, 2017.

The number of shares remaining available for future issuance under equity compensation plans is 1.3 million.

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| | |
|:---|:---|
| **ITEM 6:** | **SELECTED FINANCIAL DATA** |

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Smaller reporting companies are not required to provide the information required by this item.

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| | |
|:---|:---|
| **ITEM 7:** | **MANAGEMENT**'**S DISCUSSION AND ANALYSIS (**"**MD&A**"**) OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS** |

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**Overview**

Associated Capital Group, Inc. (NYSE: AC), a company incorporated under the laws of Delaware, provides alternative investment management services and operates a direct investment business. Our revenues are based primarily on the Company's level of assets under management ("AUM").

In response to the invasion of Ukraine by Russia, economic sanctions were imposed on individuals and entities within Russia by governments around the world, including the U.S. and the European Union. Furthermore, a novel strain of coronavirus, and its variants ("COVID-19"), continue to disrupt global supply chains, adding broad inflationary pressures impacting companies worldwide. As a result of this pandemic, many of our employees ("teammates") were working remotely in early 2021. The Company's remote work arrangements were mostly discontinued as of July 2021 and a majority of our teammates are now back in our offices. The resulting economic dislocations from the pandemic and the Ukraine-Russia conflict did not have a significant adverse impact on our AUM.

There was no material impact of remote work arrangements on our operations, including our financial reporting systems, internal control over financial reporting, and disclosure controls and procedures, and there was no material challenge in implementing our business continuity plan.

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**Financial Highlights**

*Financial Performance*

The following is a summary of the Company's financial performance for the quarters and years ended December 31, 2022 and 2021:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Fourth Quarter** | **Fourth Quarter** | **Full Year** | **Full Year** |
|  | **2022** | **2021** | **2022** | **2021** |
| AUM - end of period (in millions) | $1842 | $1781 | $1842 | $1781 |
| AUM - average (in millions) | 1811 | 1735 | 1817 | 1595 |
| Net income/(loss) per share-diluted | $0.62 | $0.43 | $(2.22) | $2.68 |
| Book value per share at December 31 | $40.48 | $42.48 | $40.48 | $42.48 |

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*Financial Condition Overview*

The Company consolidates certain investment partnerships and other entities for which it has a controlling financial interest. The following table reflects the net impact of the consolidated investment partnerships and other entities ("Consolidated Entities") on the consolidated statements of financial condition (in thousands):

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| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** |
|  | **Prior to** | **Consolidated** |  |
| **Assets** | **Consolidation** | **Entities** | **As Reported** |
| Cash and cash equivalents | $209941 | $8521 | $218462 |
| Investments | 660445 | (2151) | 658294 |
| Other | 42861 | 8073 | 50934 |
| Total assets | $913247 | $14443 | $927690 |
| **Liabilities and equity** |  |  |  |
| Total liabilities | $23051 | $4250 | $27301 |
| Redeemable noncontrolling interests |  | 10193 | 10193 |
| Total Associated Capital Group, Inc. equity | 890196 |  | 890196 |
| Total liabilities and equity | $913247 | $14443 | $927690 |

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| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2021** | **December 31, 2021** | **December 31, 2021** |
|  | **Prior to** | **Consolidated** |  |
| **Assets** | **Consolidation** | **Entities** | **As Reported** |
| Cash and cash equivalents | $315009 | $4039 | $319048 |
| Investments | 606382 | 16709 | 623091 |
| Other | 69713 | 191484 | 261197 |
| Total assets | $991104 | $212232 | $1203336 |
| **Liabilities and equity** |  |  |  |
| Total liabilities | $45024 | $20510 | $65534 |
| Redeemable noncontrolling interests |  | 202456 | 202456 |
| Total Associated Capital Group, Inc. equity<sup>(1)</sup> | 946080 | (8978) | 937102 |
| Noncontrolling interests<sup>(1)</sup> |  | (1756) | (1756) |
| Total liabilities and equity | $991104 | $212232 | $1203336 |

---

(1) Debit adjustments to Associated Capital Group, Inc. equity and noncontrolling interests reflects the amortization of the discount related to the issuance of PMV SPAC's (as defined in Note 1) redeemable noncontrolling interest. The discount is amortized through an adjustment to additional paid-in capital and noncontrolling interest (proportionate to ownership interest in PMV Sponsor, as defined in Note 1) and is also adjusted periodically for income/loss allocated to redeemable noncontrolling interest.

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*Consolidated Statements of Income*

Incentive fees generally consist of an incentive allocation on the absolute gain in a portfolio generally equating to 20% of the economic profit, as defined in the agreements governing the investment vehicle or account. We recognize such revenue only when the measurement period has been completed or at the time of an investor redemption.

Compensation includes variable and fixed compensation and related expenses paid to officers, portfolio managers, sales, trading, research and all other professional staff. Variable compensation is paid to sales personnel and portfolio management and may represent up to approximately 55% of revenues.

Management fee expense is incentive-based equal to 10% of adjusted aggregate pre-tax profits paid to the Executive Chair or his designees for his services pursuant to an employment agreement.

Other operating expenses include general and administrative operating costs.

Other income and expense includes net gains and losses from investments (which include both realized and unrealized gains and losses from securities and equity in earnings of investments in partnerships), interest and dividend income, and interest expense. Net gains and losses from investments are derived from our proprietary investment portfolio consisting of various public and private investments and from consolidated investment funds.

Net income attributable to noncontrolling interests represents the share of net income attributable to third-party limited partners of certain partnerships and offshore funds we consolidate. Please refer to Notes 1 and 5 in our consolidated financial statements included elsewhere in this report.

*Consolidated Statements of Financial Condition*

We ended 2022 with approximately $873.9 million in cash and investments, net of securities sold, not yet purchased of $2.9 million. This includes $218.5 million of cash and cash equivalents; $186.0 million of short-term U.S. Treasury obligations; $192.7 million of securities, net of securities sold, not yet purchased, including shares of GAMCO with a market value of $36.7 million; and $276.7 million invested in affiliated and third-party funds and partnerships, including investments in closed end funds managed by affiliates (primarily GAMCO) which have a value of $56.8 million and more limited liquidity. Our financial resources provide flexibility to pursue strategic objectives that may include acquisitions, lift-outs, seeding new investment strategies, and co-investing, as well as shareholder compensation in the form of share repurchases and dividends.

Total equity attributable to shareholders of the Company was $890.2 million or $40.48 per share as of December 31, 2022, compared to $937.1 million or $42.48 per share as of the prior year-end. Shareholders' equity per share is calculated by dividing the total Associated Capital Group, Inc. equity by the number of common shares outstanding.

**Assets Under Management Highlights**

We reported assets under management as follows (dollars in millions):

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| | | | |
|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** |  |
|  | **2022** | **2021** | **% Change** |
| Merger Arbitrage | $1588 | $1542 | 3.0 |
| Event-Driven Value | 222 | 195 | 13.8 |
| Other | 32 | 44 | (27.3) |
| Total AUM (a) | $1842 | $1781 | 3.4 |

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(a) Includes $239 million and $238 million of proprietary capital, respectively.

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Changes in our AUM during 2022 were as follows (dollars in millions):

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31,** |  |  | **Investment** | **Foreign** | **December 31,** |
|  | **2021** | **Inflows** | **Outflows** | **Return** | **Currency<sup>(1)</sup>** | **2022** |
| Merger Arbitrage | $1542 | $573 | $(504) | $50 | $(73) | $1588 |
| Event-Driven Value | 195 | 40 | (2) | (11) |  | 222 |
| Other | 44 |  | (7) | (5) |  | 32 |
| Total AUM | $1781 | $613 | $(513) | $34 | $(73) | $1842 |

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(1) Reflects the impact of currency fluctuations of non-US dollar classes of investment funds.

The majority of our AUM have calendar year-end measurement periods, and our incentive fees are primarily recognized in the fourth quarter. Assets under management increased on a net basis by $61 million for the year ended December 31, 2022 due to net investor inflows of $100 and market appreciation of $34, partially offset by the impact of currency fluctuations of $73 from non-US dollar classes of investment funds.

**Operating Results for the Year Ended December 31, 2022 as Compared to the Year Ended December 31, 2021**

***Revenues***

Total revenues were $15.2 million for the year ended December 31, 2022, $5.7 million lower than total revenues of $20.9 million for the year ended December 31, 2021. Total revenues by type were as follows (dollars in thousands):

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** | **Change** | **Change** |
|  | **2022** | **2021** | **$** | **%** |
| Investment advisory and incentive fees | 14801 | 20530) |  | (27.9) |
| Other revenues | 427 | 394 |  | 8.4 |
| Total revenues | $15228 | $20924) |  | (27.2) |

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<u>Investment advisory and incentive fees</u>: We earn advisory fees based on our AUM. Investment advisory fees are directly influenced by the amount of average AUM and the fee rates applicable to various accounts.

Advisory and incentive fees were $14.8 million for 2022 compared to $20.5 million for 2021, a decrease of $5.7 million. This decrease is the result of lower performance-based incentive fees, partially offset by higher management fees based on higher average AUM in 2022.

Incentive fees are directly related to the gains generated for our clients' accounts. We earn a percentage, usually 20%, of such gains. Incentive fees were $5.1 million in 2022, down $7.3 million from $12.4 million in 2021, due to superior investment performance in 2021.

<u>Other revenues</u>: Other revenues were $0.4 million in 2022 and $0.4 million in 2021.

***Expenses***

<u>Compensation</u>: Compensation, which includes variable compensation, salaries, bonuses and benefits, was $18.9 million for the year ended December 31, 2022, a decrease of $5.6 million from $24.5 million for the year ended December 31, 2021. Fixed compensation expense, which includes salaries, stock-based compensation, bonuses and benefits, increased to $11.5 million in 2022 from $11.1 million in 2021. The remainder of compensation expense represents variable compensation that fluctuates with management and incentive fee revenues as well as the investment results of certain proprietary accounts. Variable payouts are also impacted by the mix of products upon which performance fees are earned and the extent to which they may exceed their allocated costs. For 2022, these variable payouts (based on the investment performance of the products with incentive fees) were $7.4 million, a decrease of $6.0 million from $13.4 million in 2021.

<u>Management fees</u>: Management fee expense is incentive-based and entirely variable compensation equal to 10% of the aggregate adjusted pre-tax profits, which is paid to the Executive Chair or his designees pursuant to his employment agreement with AC. In 2022 AC recorded no management fee expense due to pre-tax losses compared to management fee expense of $8.4 million in 2021.

<u>Other operating expenses</u>: Our other operating expenses were $7.6 million in 2022 compared to $7.1 million in 2021.

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***Investment and other non-operating income/(expense), net***

<u>Net gain/(loss) from investments</u>: Net gain/(loss) from investments is directly related to the performance of our proprietary portfolio. For the year ended December 31, 2022, net losses from investments were $56.5 million compared to gains of $93.4 million in 2021. In 2022, market volatility brought on by rising interest rates, geo-political factors, and accelerating inflation impacted AC's investments, other than investments in merger arbitrage funds, on a mark-to-market basis.

<u>Interest and dividend income</u>: Interest and dividend income decreased to $10.7 million in 2022 from $12.1 million in 2021, primarily due to the $5.1 million ($2 per share) special dividend declared on our holdings of GAMCO in 2021, partially offset by higher interest income on our investments in treasury bills as a result of higher nominal interest rates in 2022.

***Income Taxes***

In 2022, we recorded an income tax benefit of $14.9 million resulting in an effective tax rate ("ETR") of 24.7%. In 2021, we recorded income tax expense of $17.7 million resulting in an ETR of 21.8%. The increase in rate from 2021 is primarily driven by foreign investments and foreign income, which increased the 2022 rate by approximately 0.9% and decreased the 2021 rate by approximately 1.2%.

***Noncontrolling Interests***

Net income attributable to noncontrolling interests was $3.4 million in 2022 compared to $4.4 million in 2021. The decrease of $1.0 million was driven primarily by the deconsolidation of Consolidated PMV (as defined in Note 1) in Q3 2022 and the Gabelli Merger Plus+ Trust tender offer in Q3 2022.

***Net Income/(Loss)***

Net loss for the year ended December 31, 2022 was $48.9 million compared to net income of $59.2 million for the prior year. The change was primarily driven by market uncertainty in 2022, which impacted AC's investments, other than our investments in merger arbitrage funds, on a mark-to-market basis.

**Liquidity and Capital Resources**

Our principal assets consist of cash and cash equivalents; short-term treasury securities; marketable securities, primarily equities, including 2.4 million shares of GAMCO; and interests in affiliated and third-party funds and partnerships. Although Investment Partnerships may be subject to restrictions as to the timing of distributions, the underlying investments of such Investment Partnerships are generally liquid, and the valuations of these products reflect that underlying liquidity.

Summary cash flow data is as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **Year Ended December 31,** | **Year Ended December 31,** |
|  | **2022** | **2021** |
| Cash flows provided by (used in): |  |  |
| Operating activities | $(70552) | $238194 |
| Investing activities | 402 | 65285 |
| Financing activities | (37175) | (14394) |
| Net (decrease)/increase in cash, cash equivalents and restricted cash | (107325) | 289085 |
| Cash, cash equivalents and restricted cash at beginning of period | 328594 | 39509 |
| Cash, cash equivalents and restricted cash at end of period | $221269 | $328594 |

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We require relatively low levels of capital expenditures and have a highly variable cost structure where costs increase and decrease based on the level of revenues we receive. Our revenues, in turn, are highly correlated to the level of AUM and to investment performance. We anticipate that our available liquid assets should be sufficient to meet our cash requirements as we build out our operating business. At December 31, 2022, we had cash and cash equivalents of $218.5 million, investments in U.S. Treasury Bills of $186.0 million and $192.7 million of investments, net of securities sold, not yet purchased of $2.9 million. Included in cash and cash equivalents are $8.5 million and $4.0 million as of December 31, 2022 and 2021, respectively, which were held by consolidated investment funds and may not be readily available for the Company to access.

Net cash used in operating activities was $70.6 million in 2022 due to $89.4 million of net increases driven by increases of securities less net distributions from investment partnerships and our net loss of $45.5 million, partially offset by $43.6 million of adjustments for noncash items, primarily unrealized losses on investment securities and partnership investments and deferred taxes, and $20.7 million in net receivables/payables.

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Net cash provided by operating activities was $238.2 million in 2021 due to $278.1 million of net decreases of securities and net contributions to investment partnerships and our net income of $63.6 million, offset by $82.9 million of adjustments for noncash items, primarily gains on investments securities and partnership investments and deferred taxes, and $20.6 million in net receivables/payables.

Net cash provided by investing activities was $0.4 million in 2022 due to proceeds from maturities of debt securities held to maturity of $5.1 million, proceeds from sales of securities of $2.9 million, return of capital on securities of $2.3 million, partially offset by purchases of securities of $8.5 million and the impact of deconsolidation of our subsidiary of $1.4 million.

Net cash provided by investing activities was $65.3 million in 2021 due to proceeds from sales of securities of $35.3 million and return of capital on securities of $38.7 million, partially offset by purchases of securities of $8.7 million.

Net cash used in financing activities was $37.2 million in 2022 resulting from redemptions of redeemable noncontrolling interests of $30.2 million, dividends paid of $4.4 million and stock buyback payments of $2.6 million.

Net cash used in financing activities was $14.4 million in 2021 resulting from stock buyback payments of $7.6 million, dividends paid of $4.4 million and redemptions of redeemable noncontrolling interests of $2.3 million.

**Off-Balance Sheet Arrangements**

We do not have any off-balance sheet arrangements.

**Critical Accounting Policies**

In the ordinary course of business, we make a number of estimates and assumptions relating to the reporting of results of operations and financial condition in the preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP"). We base our estimates on historical experience, when available, and on other various assumptions that are believed to be reasonable under the circumstances. Actual results could differ significantly from those estimates under different assumptions and conditions.

We believe that the following critical accounting policies require management to exercise significant judgment:

***Major Revenue-Generating Services and Revenue Recognition***

The Company's revenues are derived primarily from investment advisory and incentive fees.

Investment advisory and incentive fees are directly influenced by the level and mix of AUM as fees are derived from a contractually-determined percentage of the balance of each account, as well as a percentage of the investment performance of certain accounts. Management fees from Investment Partnerships and offshore funds are computed either monthly or quarterly, and amounts receivable are included in investment advisory fees receivable on the consolidated statements of financial condition. These revenues vary depending upon the level of capital flows, financial market conditions, investment performance and the fee rates applicable to each account.

Incentive allocations or fees are generally recognized at the end of an annual measurement period and amounts receivable are included in investment advisory fees receivable on the consolidated statements of financial condition.

See Note 2, *Significant Accounting Policies*, in the consolidated financial statements for additional information.

***Investments in Securities***

Investments in securities are recorded at fair value in the consolidated statements of financial condition in accordance with U.S. GAAP. Securities transactions and any related gains and losses are recorded on a trade date basis. Realized gains and losses from securities transactions are recorded on the specific identified cost basis and are included in net gain/(loss) from investments on the consolidated statements of income.

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Management determines the appropriate classification of securities at the time of purchase. Government debt with maturities of greater than three months at the time of purchase are considered investments in debt securities. The Company has investments in debt securities accounted for as trading, including investments in marketable securities held in trust by PMV in 2021 and prior to the deconsolidation of Consolidated PMV in August 2022.

Securities sold, but not yet purchased are recorded on the trade date, and are stated at fair value and represent obligations of AC to purchase the securities at prevailing market prices. Therefore, the future satisfaction of such obligations may be for an amount greater or less than the amounts recorded on the consolidated statements of financial condition. The ultimate gains or losses recognized are dependent upon the prices at which these securities are purchased to settle the obligations under the sales commitments. Unrealized gains and losses and realized gains and losses from covers of securities sold, not yet purchased transactions are included in net gain/(loss) from investments on the consolidated statements of income.

***Consolidation***

The Company assesses all entities with which it is involved for consolidation on a case by case basis depending on the specific facts and circumstances surrounding each entity. Pursuant to the accounting guidance, the Company first evaluates whether it holds a variable interest in an entity. The Company considers all economic interests, including proportionate interests through related parties, to determine if such interests are to be considered a variable interest. Fees paid to the Company that are customary and commensurate with the level of services provided from entities in which the Company does not hold other economic interests in the entity are not considered as a variable interest.

For any entity in which the Company has determined that it does hold a variable interest, the Company performs an assessment to determine whether it qualifies as a variable interest entity ("VIE"). A VIE is an entity in which either the equity investment at risk is not sufficient to permit the entity to finance its own activities without additional financial support or the group of holders of the equity investment at risk lack certain characteristics of a controlling financial interest.

The granting of substantive kick-out rights is a key consideration in determining whether a limited partnership or similar entity is a VIE and whether or not that entity should be consolidated. The Company evaluates consolidation on a case by case basis for those VIEs in which substantive kick-out rights have been granted to the unaffiliated investors to either dissolve the fund or remove the general partner.

Under the variable interest entity model, the Company consolidates those entities where it is determined that the Company is the primary beneficiary of the entity. The Company is determined to be the primary beneficiary when it has a controlling financial interest in the VIE, which is defined as possessing both (a) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance, and (b) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. If the Company alone is not considered to have a controlling financial interest in the VIE but the Company and its related parties under common control in the aggregate have a controlling financial interest in the VIE, the Company will be deemed to be the primary beneficiary if it is the party that is most closely associated with the VIE. When the Company and its related parties not under common control in the aggregate have a controlling financial interest in a VIE, the Company would be deemed to be the primary beneficiary if substantially all the activities of the entity are performed on behalf of the Company.

The Company determines whether it is the primary beneficiary of a VIE at the time it becomes initially involved with the VIE and reconsiders that conclusion as required. Investments and redemptions (either by the Company, related parties of the Company or third parties) or amendments to the governing documents of the respective entity may affect an entity's status as a VIE or the determination of the primary beneficiary.

Entities that do not qualify as VIEs are assessed for consolidation as voting interest entities ("VOEs") under the voting interest model. The Company evaluates whether the entity should be evaluated under the guidance for partnerships and similar entities, or corporations, and consolidates those entities it controls through a majority voting interest or other means. If the Company is the general partner or managing member it generally will not be required to consolidate a VOE.

The Company records noncontrolling interests in consolidated Investment Partnerships for which the Company's ownership is less than 100%.

See Note 5, *Investment Partnerships and Other Entities* in the consolidated financial statements for additional information.

***Investments in Partnerships and Affiliates***

The Company is general partner or co-general partner of various managed funds. We also have investments in unaffiliated partnerships, offshore funds and other entities (collectively, "investments in partnerships and affiliates"). The Company accounts for its investments in partnerships and affiliates under the equity method. Substantially all of the Company's equity method investees are entities that record their underlying investments at fair value and are included in investments in partnerships in the consolidated statements of financial condition. Therefore, under the equity method of accounting, the Company's share of the investee's underlying net income predominantly represents fair value adjustments in the investments held by the equity method investees. The Company's share of the investee's underlying net income or loss is based upon the most currently available information and is recorded in net gain/(loss) from investments on the consolidated statements of income. Capital contributions are recorded as an increase in investments when payable, and withdrawals and distributions are recorded as reductions of the investments when receivable. Depending on the terms of the investment, the Company may be restricted as to the timing and amounts of withdrawals.

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***Income Taxes***

For purposes of the preparation of the consolidated financial statements, the provision for income taxes is computed using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method deferred tax assets and liabilities are recorded for temporary differences between the tax basis of assets and liabilities and the reported amounts on the consolidated financial statements using the statutory tax rates in effect for the year when the reported amount of the asset or liability is expected to be recovered or settled, respectively. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying values of deferred tax assets to the amount that is more likely than not to be realized. For each tax position taken or expected to be taken in a tax return, the Company determines whether it is more likely than not that the position will be sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation. A tax position that meets the more likely than not recognition threshold is measured to determine the amount of benefit to recognize. The tax position is measured at the largest amount of benefit that is greater than 50% likely of being realized upon settlement. To the extent uncertain tax positions exist, the Company recognizes the accrual of interest on uncertain tax positions and penalties in the income tax provision on the consolidated statements of income.

**Recent Accounting Developments**

See Note 2, *Significant Accounting Policies* – Recent Accounting Developments, in the consolidated financial statements.

**Seasonality and Inflation**

We do not believe that our operations are subject to significant seasonal fluctuations. We do not believe inflation will significantly affect our compensation costs, as they are substantially variable in nature. The rate of inflation may affect certain other expenses, however, such as information technology and occupancy costs. To the extent inflation results in rising interest rates and has other effects upon the securities markets, it may adversely affect our financial position and results of operations by reducing our AUM, revenues or otherwise.

---

| | |
|:---|:---|
| **ITEM 7A:** | **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK** |

---

Smaller reporting companies are not required to provide the information required by this item.

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| | |
|:---|:---|
| **ITEM 8:** | **FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA** |

---

**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm](#auditreport) (PCAOB ID #34) | [20](#auditreport) |
| Consolidated Financial Statements: |  |
| [Consolidated Statements of Income for the years ended December 31, 2022 and 2021](#stateofincome) | [21](#stateofincome) |
| [Consolidated Statements of Comprehensive Income for the years ended December 31, 2022 and 2021](#statecompincome) | [22](#statecompincome) |
| [Consolidated Statements of Financial Condition at December 31, 2022 and 2021](#statefincondition) | [23](#statefincondition) |
| [Consolidated Statements of Equity for the years ended December 31, 2022 and 2021](#stateequity) | [24](#stateequity) |
| [Consolidated Statements of Cash Flows for the years ended December 31, 2022 and 2021](#statecashflows) | [26](#statecashflows) |
| Notes to Consolidated Financial Statements: |  |
| [1. Organization](#note1) | [28](#note1) |
| [2. Significant Accounting Policies](#note2) | [29](#note2) |
| [3. Revenue](#note3) | [36](#note3) |
| [4. Investments in Securities](#note4) | [36](#note4) |
| [5. Investments in Partnerships and Other Entities](#note5) | [37](#note5) |
| [6. Fair Value](#note6) | [41](#note6) |
| [7. Income Taxes](#note7) | [43](#note7) |
| [8. Earnings per Share](#note8) | [45](#note8) |
| [9. Related Party Transactions](#note9) | [45](#note9) |
| [10. Equity](#note10) | [47](#note10) |
| [11. Retirement Plan](#note11) | [48](#note11) |
| [12. Guarantees, Contingencies, and Commitments](#note12) | [48](#note12) |
| [13. Shareholder Designated Contribution Plan](#note13) | [49](#note13) |
| [14. Subsequent Events](#note14) | [49](#note14) |

---

All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission that are not required under the related instructions or are inapplicable have been omitted.

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the shareholders and the Board of Directors of Associated Capital Group, Inc.

**Opinion on the Financial Statements**

We have audited the accompanying consolidated statements of financial condition of Associated Capital Group, Inc. and subsidiaries (the "Company") as of December 31, 2022 and 2021, the related consolidated statements of income, comprehensive income, equity, and cash flows, for each of the two years in the period ended December 31, 2022, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

**Basis for Opinion**

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

**Critical Audit Matters**

The critical audit matter communiacted below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involve our especially challenging, subjective, or complex judgments. The communication of critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.

***Deconsolidation of PMV Consumer Acquisition Corp - Refer to Notes 1, 2 and 5 to the financial statements***

*Critical Audit Matter Description*

The Company assesses all entities with which it is involved for consolidation on a case-by-case basis depending on the specific facts and circumstances surrounding each entity. Pursuant to the accounting guidance, the Company first evaluates whether it holds a variable interest in an entity. The Company considers all economic interests, including proportionate interests through related parties, to determine if such interests are variable interests. For any entity where the Company has determined that it does hold a variable interest, the Company performs an assessment to determine whether it qualifies as a variable interest entity ("VIE"). Entities that do not qualify as VIEs are assessed for consolidation as voting interest entities ("VOEs") under the voting interest model. The Company evaluates whether the entity should be evaluated under the guidance for partnerships and similar entities, or corporations, and consolidates those entities it controls through a majority voting interest or other means.

PMV Consumer Acquisition Corp. ("PMV", or "PMV SPAC"), a special purpose acquisition corporation, and its sponsor, PMV Consumer Acquisition Holding Company, LLC ("Sponsor", collectively "Consolidated PMV") were previously consolidated in the financial statements of the Company because the Company had a controlling financial interest in these entities through the Company's 100% ownership of the manager of the Sponsor. Commencing in August 2022, as a result of management and organizational restructuring negotiations at the Sponsor to extend the life of PMV, the Company no longer controlled the manager of the Sponsor and thus no longer controlled Consolidated PMV. As a result, Consolidated PMV was deconsolidated from the financial statements.

We identified the deconsolidation of Consolidated PMV, as a Critical Audit Matter because of the significant judgement involved in the application of the consolidation accounting principles in Accounting Standards Codification ("ASC") No. 810, Consolidation ("ASC 810"). The judgement was related to whether the Company continued to have substantive control of Consolidated PMV.

*How the Critical Audit Matter was Addressed in the Audit:*

1. We evaluated management's consolidation analysis, including their conclusion that the Company no longer has a controlling financial interest in Consolidated PMV.

2. We considered whether management's conclusions were supported by transaction documents and other relevant facts.

3. We involved senior, more experienced audit team members to perform audit procedures.

4. We evaluated the financial statement impact and related disclosures associated with the deconsolidation of these entities.

/s/ Deloitte & Touche, LLP

Stamford, Connecticut

March 15, 2023

We have served as the Company's auditor since 2015.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF INCOME**

**(Dollars in thousands, except per share data)**

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| Revenues |  |  |
| Investment advisory and incentive fees | $14801 | $20530 |
| Other revenues | 427 | 394 |
| Total revenues | 15228 | 20924 |
| Expenses |  |  |
| Compensation | 18883 | 24457 |
| Management fee |  | 8426 |
| Other operating expenses | 7607 | 7117 |
| Total expenses | 26490 | 40000 |
| Operating loss | (11262) | (19076) |
| Other income/(expense) |  |  |
| Net gain/(loss) from investments | (56513) | 93405 |
| Interest and dividend income | 10653 | 12109 |
| Interest expense | (216) | (310) |
| Shareholder-designated contribution | (3127) | (4789) |
| Total other income/(expense), net | (49203) | 100415 |
| Income/(loss) before income taxes | (60465) | 81339 |
| Income tax expense/(benefit) | (14943) | 17705 |
| Income/(loss) before noncontrolling interests | (45522) | 63634 |
| Income attributable to noncontrolling interests | 3385 | 4431 |
| Net income/(loss) attributable to Associated Capital Group, Inc.'s shareholders | $(48907) | $59203 |
| Net income/(loss) per share attributable to Associated Capital Group, Inc.'s shareholders: |  |  |
| Basic | $(2.22) | $2.68 |
| Diluted | $(2.22) | $2.68 |
| Weighted average shares outstanding (in thousands): |  |  |
| Basic | 22024 | 22120 |
| Diluted | 22024 | 22120 |
| Actual shares outstanding (in thousands) | 21990 | 22058 |

---

See accompanying notes.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME**

**(Dollars in thousands)**

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| Net income/(loss) before noncontrolling interests | $(45522) | $63634 |
| Less: Comprehensive income attributable to noncontrolling interests | 3385 | 4431 |
| Comprehensive income/(loss) attributable to Associated Capital Group, Inc. | $(48907) | $59203 |

---

See accompanying notes.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION**

**(Dollars in thousands, except per share data)**

---

| | | |
|:---|:---|:---|
|  | ***December 31,*** | ***December 31,*** |
| ASSETS | ***2022*** | ***2021*** |
| Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) | $218462 | $319048 |
| Investments in U.S. Treasury Bills with greater than 3 month maturities | 186001 | 60996 |
| Investments in equity securities (includes GAMCO stock with a value of $36.7 million and $60.4 million, respectively) | 195585 | 273087 |
| Investments in affiliated registered investment companies | 126210 | 134548 |
| Investments in partnerships | 150498 | 154460 |
| Receivable from brokers | 12072 | 42478 |
| Investment advisory fees receivable | 3807 | 8315 |
| Receivable and investment in note receivable from affiliates | 2517 | 10094 |
| Income taxes receivable, including deferred tax assets, net | 10320 |  |
| Goodwill | 3519 | 3519 |
| Other assets | 18699 | 21682 |
| Investments in marketable securities held in trust |  | 175109 |
| Total assets | $927690 | $1203336 |
| LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY |  |  |
| Payable to brokers | $7784 | $9339 |
| Income taxes payable, including deferred tax liabilities, net |  | 8575 |
| Compensation payable | 13936 | 19730 |
| Securities sold, not yet purchased | 2874 | 12905 |
| Accrued expenses and other liabilities | 2707 | 3580 |
| Deferred underwriting fee payable |  | 6125 |
| PMV warrant liability |  | 5280 |
| Total liabilities | 27301 | 65534 |
| Redeemable noncontrolling interests | 10193 | 202456 |
| Commitments and contingencies (Note 12) |  |  |
| Equity: |  |  |
| Preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding |  |  |
| Class A Common Stock, $0.001 par value; 100,000,000 shares authorized; 6,629,254 shares issued; 3,027,541 and 3,095,169 shares outstanding, respectively | 6 | 6 |
| Class B Common Stock, $0.001 par value; 100,000,000 shares authorized; 19,196,792 shares issued; 18,962,754 and 18,962,918 outstanding, respectively | 19 | 19 |
| Additional paid-in capital | 999047 | 990069 |
| Retained earnings | 15126 | 68435 |
| Treasury stock, at cost (3,601,877 and 3,534,085 shares, respectively) | (124002) | (121427) |
| Total Associated Capital Group, Inc. equity | 890196 | 937102 |
| Noncontrolling interests |  | (1756) |
| Total equity | 890196 | 935346 |
| Total liabilities and equity | $927690 | $1203336 |

---

As of December 31, 2022 and 2021, certain balances include amounts related to consolidated variable interest entities ("VIEs") and voting interest entities ("VOEs"), see Note 5.

See accompanying notes.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF EQUITY**

**(Dollars in thousands)**

**For the three months ended March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* |  |  |  |
|  |  |  | *Additional* |  |  |  |  | *Redeemable* |
|  | *Common* | *Retained* | *Paid-in* | *Treasury* |  | *Noncontrolling* | *Total* | *Noncontrolling* |
|  | *Stock* | *Earnings* | *Capital* | *Stock* | *Total* | *Interests* | *Equity* | *Interests* |
| Balance at December 31, 2021 | $25 | $68435 | $990069 | $(121427) | $937102 | $(1756) | $935346 | $202456 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (486) |
| Net income/(loss) |  | (16186) |  |  | (16186) | 197 | (15989) | 2484 |
| Purchases of treasury stock |  |  |  | (293) | (293) |  | (293) |  |
| Accretion of redeemable noncontrolling interest |  |  | (584) |  | (584) | (292) | (876) | 876 |
| Other changes to redeemable noncontrolling interests |  |  |  |  |  |  |  | (10) |
| Balance at March 31, 2022 | $25 | $52249 | $989485 | $(121720) | $920039 | $(1851) | $918188 | $205320 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (486) |
| Net income/(loss) |  | (29887) |  |  | (29887) | 83 | (29804) | (288) |
| Dividends declared ($0.10 per share) |  | (2203) |  |  | (2203) |  | (2203) |  |
| Purchases of treasury stock |  |  |  | (1317) | (1317) |  | (1317) |  |
| Accretion of redeemable noncontrolling interest |  |  | 662 |  | 662 | 331 | 993 | (993) |
| Other changes to redeemable noncontrolling interests |  |  |  |  |  |  |  | (226) |
| Balance at June 30, 2022 | $25 | $20159 | $990147 | $(123037) | $887294 | $(1437) | $885857 | $203327 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (29001) |
| Net income/(loss) |  | (16498) |  |  | (16498) |  | (16498) | 494 |
| Purchases of treasury stock |  |  |  | (441) | (441) |  | (441) |  |
| Reversal of accretion of redeemable noncontrolling interest |  |  | 8900 |  | 8900 | 4305 | 13205 | (13205) |
| Effect of deconsolidation |  |  |  |  |  | (2868) | (2868) | (152100) |
| Other changes to redeemable noncontrolling interests |  |  |  |  |  |  |  | 263 |
| Balance at September 30, 2022 | $25 | $3661 | $999047 | $(123478) | $879255 | $- | $879255 | $9778 |
| Net income/(loss) |  | 13664 |  |  | 13664 |  | 13664 | 415 |
| Dividends declared ($0.10 per share) |  | (2199) |  |  | (2199) |  | (2199) |  |
| Purchases of treasury stock |  |  |  | (524) | (524) |  | (524) |  |
| Balance at December 31, 2022 | $25 | $15126 | $999047 | $(124002) | $890196 | $- | $890196 | $10193 |

---

See accompanying notes.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF EQUITY**

**(Dollars in thousands)**

**For the three months ended March 31, 2021, June 30, 2021, September 30, 2021 and December 31, 2021**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* | *Associated Capital Group, Inc. shareholders* |  |  |  |
|  |  |  | *Additional* |  |  |  |  | *Redeemable* |
|  | *Common* | *Retained* | *Paid-in* | *Treasury* |  | *Noncontrolling* | *Total* | *Noncontrolling* |
|  | *Stock* | *Earnings* | *Capital* | *Stock* | *Total* | *Interests* | *Equity* | *Interests* |
| Balance at December 31, 2020 | $25 | $13649 | $999047 | $(113783) | $898938 | $2451 | $901389 | $206828 |
| Contributions from redeemable noncontrolling interests |  |  |  |  |  |  |  | 136 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (12066) |
| Net income |  | 18555 |  |  | 18555 |  | 18555 | 172 |
| Purchases of treasury stock |  |  |  | (4198) | (4198) |  | (4198) |  |
| Balance at March 31, 2021 | $25 | $32204 | $999047 | $(117981) | $913295 | $2451 | $915746 | $195070 |
| Contributions from redeemable noncontrolling interests |  |  |  |  |  |  |  | 665 |
| Net income/(loss) |  | 29716 |  |  | 29716 |  | 29716 | (532) |
| Dividends declared ($0.10 per share) |  | (2211) |  |  | (2211) |  | (2211) |  |
| Purchases of treasury stock |  |  |  | (1893) | (1893) |  | (1893) |  |
| Accretion of redeemable noncontrolling interest |  |  | (6001) |  | (6001) | (2892) | (8893) | 8893 |
| Other changes to redeemable noncontrolling interests |  |  |  |  |  |  |  | (7527) |
| Balance at June 30, 2021 | $25 | $59709 | $993046 | $(119874) | $932906 | $(441) | $932465 | $196569 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (2161) |
| Net income/(loss) |  | 1503 |  |  | 1503 | 122 | 1625 | 3879 |
| Purchases of treasury stock |  |  |  | (1396) | (1396) |  | (1396) |  |
| Accretion of redeemable noncontrolling interest |  |  | (1028) |  | (1028) | (478) | (1506) | 1506 |
| Balance at September 30, 2021 | $25 | $61212 | $992018 | $(121270) | $931985 | $(797) | $931188 | $199793 |
| Redemptions of noncontrolling interests |  |  |  |  |  |  |  | (973) |
| Net income/(loss) |  | 9429 |  |  | 9429 | 15 | 9444 | 775 |
| Dividends declared ($0.10 per share) |  | (2206) |  |  | (2206) |  | (2206) |  |
| Purchases of treasury stock |  |  |  | (157) | (157) |  | (157) |  |
| Accretion of redeemable noncontrolling interest |  |  | (1949) |  | (1949) | (974) | (2923) | 2923 |
| Other changes to redeemable noncontrolling interests |  |  |  |  |  |  |  | (62) |
| Balance at December 31, 2021 | $25 | $68435 | $990069 | $(121427) | $937102 | $(1756) | $935346 | $202456 |

---

See accompanying notes.

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Dollars in thousands)**

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| **Operating activities** |  |  |
| Net income/(loss) | $(45522) | $63634 |
| Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities: |  |  |
| Equity in net (gains)/losses from partnerships | 1895 | (23392) |
| Depreciation and amortization | 341 | 379 |
| Deferred income taxes | (14211) | 8742 |
| Donated securities | 711 | 2213 |
| Unrealized (gains)/losses on securities | 64078 | (26791) |
| Dividends received as securities |  | (5066) |
| Loss on deconsolidation of subsidiary | 3634 |  |
| Realized gains on sales of securities | (12846) | (38971) |
| (Increase)/decrease in assets: |  |  |
| Investments in trading securities | (92484) | 281986 |
| Investments in partnerships: |  |  |
| Contributions to partnerships | (7510) | (15172) |
| Distributions from partnerships | 10643 | 11308 |
| Receivable from affiliates | 2511 | (285) |
| Receivable from brokers | 23667 | (10097) |
| Investment advisory fees receivable | 4462 | (916) |
| Income taxes receivable | (2644) |  |
| Other assets | 2609 | (1454) |
| Increase/(decrease) in liabilities: |  |  |
| Payable to affiliates |  | (2188) |
| Payable to brokers | (1555) | 2843 |
| Income taxes payable | (2040) | (7706) |
| Compensation payable | (5794) | 1163 |
| Accrued expenses and other liabilities | (497) | (2036) |
| Total adjustments | (25030) | 174560 |
| Net cash (used in)/provided by operating activities | (70552) | 238194 |
| **Investing activities** |  |  |
| Maturities of marketable securities held in trust |  | 175109 |
| Purchases of marketable securities held in trust |  | (175109) |
| Purchases of securities | (8462) | (8738) |
| Proceeds from sales of securities | 2940 | 35329 |
| Return of capital on securities | 2329 | 38694 |
| Deconsolidation of subsidiary cash | (1471) |  |
| Proceeds from maturities of debt securities held to maturity | 5066 |  |
| Net cash provided by investing activities | $402 | $65285 |

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**ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)**

**(Dollars in thousands)**

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| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| **Financing activities** |  |  |
| Dividends paid | $(4402) | $(4417) |
| Purchases of treasury stock | (2575) | (7644) |
| Redemptions of redeemable noncontrolling interests | (30198) | (2333) |
| Net cash used in financing activities | (37175) | (14394) |
| Net (decrease)/increase in cash, cash equivalents and restricted cash | (107325) | 289085 |
| Cash, cash equivalents and restricted cash at beginning of period | 328594 | 39509 |
| Cash, cash equivalents and restricted cash at end of period | $221269 | $328594 |
| Supplemental disclosures of cash flow information: |  |  |
| Cash paid for interest | $216 | $310 |
| Cash paid for taxes | $4024 | $16741 |
| Reconciliation of Cash, cash equivalents and restricted cash at end of period: |  |  |
| Cash and cash equivalents | $218462 | $319048 |
| Restricted cash included in receivable from broker | 2807 | 9546 |
| Cash, cash equivalents and restricted cash | $221269 | $328594 |

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Non-cash activity:

For 2022, the Company deconsolidated certain subsidiaries which resulted in a reduction of $176.9 million of assets, $7.4 million of liabilities and $165.0 million of Redeemable noncontrolling interests. The deconsolidated assets are almost entirely attributable to $175.4 million of Investments in marketable securities held in trust and $1.5 million of cash held by Consolidated PMV (as defined in Note 1), the latter of which is reflected as an Investing outflow. The deconsolidated liabilities are almost entirely attributable to $6.1 million Deferred underwriting fee payable, and $0.9 million of PMV warrant liability. As a result of deconsolidation, $9.9 million of Investments in securities and $1.0 million of Investments in partnerships, which were previously eliminated in consolidation, were recognized in the consolidated statement of financial condition (see Note 5).<br>

See accompanying notes.

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***1.* Organization**

Unless we have indicated otherwise, or the context otherwise requires, references in this report to "Associated Capital Group, Inc.," "AC Group," "the Company," "AC," "we," "us" and "our" or similar terms are to Associated Capital Group, Inc., its predecessors and its subsidiaries.

We are a Delaware corporation that provides alternative investment management, and we derive investment income/(loss) from proprietary investment of cash and other assets in our operating business. Our proprietary portfolio of cash and investments will be used to invest primarily in funds that we will manage, provide seed capital for new products, expand our geographic presence, develop new markets and pursue strategic acquisitions and alliances.

GCIA and its wholly-owned subsidiary, Gabelli & Partners, LLC ("Gabelli & Partners"), collectively serve as general partners or investment managers to investment funds, including limited partnerships and offshore companies (collectively, "Investment Partnerships"), and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The businesses earn management and incentive fees from their advisory activities. Management fees are largely based on a percentage of assets under management. Incentive fees are based on a percentage of the investment returns of certain clients' portfolios. GCIA is an investment adviser registered with the Securities and Exchange Commission under the Investment Advisers Act of *1940,* as amended (the "Advisers Act").

*PMV Consumer Acquisition Corp.*

PMV Consumer Acquisition Corp. ("PMV", or "PMV SPAC"), a special purpose acquisition corporation, and its sponsor, PMV Consumer Acquisition Holding Company, LLC ("Sponsor", collectively "Consolidated PMV") were previously consolidated in the financial statements of AC because AC had a controlling financial interest in these entities through AC's 100% ownership of the manager of the Sponsor. Commencing in *August 2022,* as a result of management and organizational restructuring negotiations at the Sponsor to extend the life of PMV, AC *no* longer controlled the manager of the Sponsor and thus *no* longer controlled Consolidated PMV. As a result, Consolidated PMV was deconsolidated from the financial statements in *August 2022.* 

As of *December 31, 2021,* the Consolidated PMV entity resulted in the consolidation of $163.8 million of assets, $11.5 million of liabilities, $161.8 million of redeemable noncontrolling interests and $1.8 million of noncontrolling interests. There are several other entities that are consolidated within the financial statements for both *2022* and *2021.* The details on the impact of consolidating these entities on the consolidated financial statements can be seen in Note *5. Investment Partnerships and Other Entities*.

See Note *5* for a further discussion of PMV Consumer Acquisition Corp., as well as its registration statement, Annual Reports, and Quarterly Reports, which are all located on the U.S. Securities and Exchange Commission website <u>https://www.sec.gov</u> under the symbol PMVC.

*AC Spin-off*

On *November 30, 2015,* GAMCO Investors, Inc. ("GAMCO" or "GAMI") distributed all the outstanding shares of each class of AC common stock on a pro rata one-for-one basis to the holders of each class of GAMCO's common stock (the "Spin-off").

As part of the Spin-off, AC received 4,393,055 shares of GAMCO Class A common stock for $150 million. The Company currently holds 2,407,000 shares as of *December 31, 2022*.

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***2.* Significant Accounting Policies**

*Consolidated Financial Statements*

All intercompany transactions and balances have been eliminated. Subsidiaries are fully consolidated from the date the Company obtains control and continue to be consolidated until the date that such control ceases. The Company's principal market is in the United States.

*Use of Estimates*

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the amounts reported on the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

*Cash and Cash Equivalents*

Cash equivalents primarily consist of an affiliated money market mutual fund which is highly liquid. U.S. Treasury Bills and Notes with maturities of *three* months or less at the time of purchase are also considered cash equivalents.

*Investments in Securities*

Securities owned are recorded at fair value in the statements of financial condition with any unrealized gains or losses reported in current period earnings in net gain/(loss) from investments on the consolidated statements of income. Securities transactions and any related gains and losses are recorded on a trade date basis. Realized gains and losses from securities transactions are recorded on the specific identified cost basis and are included in net gain/(loss) from investments on the consolidated statements of income.

Management determines the appropriate classification of debt securities at the time of purchase. Government debt securities with maturities of greater than *three* months at the time of purchase are considered investments in debt securities.

Investments in securities are reflected in U.S. Treasury Bills, investments in equity securities, investments in affiliated registered investment companies and investments in marketable securities held in trust.

Securities sold, but *not* yet purchased are recorded on the trade date, and are stated at fair value and represent obligations of AC to purchase the securities at prevailing market prices. Therefore, the future satisfaction of such obligations *may* be for an amount greater or less than the amounts recorded on the consolidated statements of financial condition. The ultimate gains or losses recognized are dependent upon the prices at which these securities are purchased to settle the obligations under the sales commitments. Unrealized gains and losses and realized gains and losses from covers of securities sold, *not* yet purchased transactions are included in net gain/(loss) from investments on the consolidated statements of income.

*Fair Value of Financial Instruments*

The Company's assets and liabilities recorded at fair value have been categorized based upon a fair value hierarchy in accordance with the guidance on fair value measurement. The levels of the fair value hierarchy and their applicability to the Company are described below:

• Level *1* inputs are unadjusted quoted prices in active markets for identical assets or liabilities at the reporting date. Level *1* assets include cash equivalents, government obligations, open-end mutual funds, closed-end funds and equities.

• Level *2* inputs are inputs other than quoted prices included in Level *1* that are observable for the asset or liability, either directly or indirectly. Level *2* inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities that are *not* active and inputs other than quoted prices that are observable for the asset or liability such as interest rates and yield curves that are observable at commonly-quoted intervals. Assets included in this category are over-the-counter derivatives that have valuation inputs that can generally be corroborated by observable market data.

• Level *3* inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. Assets in this category generally include equities that trade infrequently and direct private equity investments.

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In certain cases, the inputs used to measure fair value *may* fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy in which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

The availability of observable inputs can vary from instrument to instrument and is affected by a wide variety of factors, including, for example, the type of instrument, whether the instrument is new and *not* yet established in the marketplace, and other characteristics particular to the instrument. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized as Level *3.*

In the absence of a closing price, an average of the bid and ask price is used. Bid prices reflect the highest price that market participants are willing to pay for an asset. Ask prices represent the lowest price that market participants are willing to accept for an asset.

<u>Cash equivalents</u>—Cash equivalents primarily consist of short-term Treasury Bills and an affiliated money market mutual fund which is invested solely in U.S. Treasury securities and valued based on the net asset value of the fund. Other cash equivalents are valued using unadjusted quoted market prices. Accordingly, cash equivalents are categorized in Level *1* of the fair value hierarchy.

<u>Investments in securities</u>—Investments in securities and securities sold, *not* yet purchased are generally valued based on quoted prices from an exchange or an active dealer market. To the extent these securities are actively traded, valuation adjustments are *not* applied, and they are categorized in Level *1* of the fair value hierarchy. Securities categorized as Level *2* investments are valued using other observable inputs. Nonpublic and infrequently traded investments are included in Level *3* of the fair value hierarchy because significant inputs to measure fair value are unobservable.

<u>Investment in note receivable from affiliate</u> – Investment in note receivable from affiliate is *not* measured at fair value on a recurring basis, however fair value is estimated based on observed market inputs for similar instruments and therefore is classified as Level *2.*

<u>PMV warrant liability</u> – PMV warrant liability was valued based on quoted prices from an exchange and is categorized in Level *1* of the fair value hierarchy.

*Investments in marketable securities held in trust account*

At *December 31, 2021,* debt securities of Consolidated PMV were held in a trust account and consisted of U.S. Treasury Bills accounted for as trading in accordance with ASC *320* "Investments – Debt and Equity Securities." Trading securities are recorded at fair value, with changes in fair value recorded in the consolidated statements of income.

*Receivables from Affiliates and Payables to Affiliates*

Receivables from affiliates consist primarily of sub-advisory fees due from Gabelli Funds, LLC, a subsidiary of GAMCO. Payables to affiliates primarily consist of expenses paid by affiliates on behalf of the Company pursuant to a transitional services agreement with GAMCO entered into in connection with the AC Spin-off.

*Receivables from and Payables to Brokers*

Receivables from and payables to brokers consist of amounts related to purchases and sales of securities, restricted cash held on deposit and cash amounts held in anticipation of investment.

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*Consolidation*

The Company assesses all entities with which it is involved for consolidation on a case by case basis depending on the specific facts and circumstances surrounding each entity. Pursuant to the accounting guidance, the Company *first* evaluates whether it holds a variable interest in an entity. The Company considers all economic interests, including proportionate interests through related parties, to determine if such interests are considered a variable interest. Fees paid to the Company that are customary and commensurate with the level of services provided from entities in which the Company does *not* hold more than an insignificant economic interest are *not* considered as a variable interest.

For any entity in which the Company has determined that it does hold a variable interest, the Company performs an assessment to determine whether it qualifies as a variable interest entity ("VIE"). A VIE is an entity in which either the equity investment at risk is *not* sufficient to permit the entity to finance its own activities without additional financial support or the group of holders of the equity investment at risk lack certain characteristics of a controlling financial interest. The granting of substantive kick-out or participating rights is a key consideration in determining whether a limited partnership or similar entity is a VIE and whether or *not* that entity should be consolidated. The Company evaluates for consolidation on a case by case basis those entities in which substantive kick-out or participating rights have been granted to the unaffiliated investors to either dissolve the fund or remove the general partner.

Under the variable interest entity model, the Company consolidates those entities where it is determined that the Company is the primary beneficiary of the entity. The Company is determined to be the primary beneficiary when it has a controlling financial interest in the VIE, which is defined as possessing both (i) the power to direct the activities of the VIE that most significantly impact the VIE's economic performance, and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. When the Company alone is *not* considered to have a controlling financial interest in the VIE but the Company and its related parties under common control in the aggregate have a controlling financial interest in the VIE, the Company will be deemed the primary beneficiary if it is the party that is most closely associated with the VIE. When the Company and its related parties *not* under common control in the aggregate have a controlling financial interest in the VIE, the Company would be deemed to be the primary beneficiary if substantially all the activities of the entity are performed on behalf of the Company.

The Company determines whether it is the primary beneficiary of a VIE at the time it becomes initially involved with the VIE and reconsiders that conclusion as required. Investments and redemptions (either by the Company, related parties or *third* parties) or amendments to the governing documents of the respective entity *may* affect an entity's status as a VIE or the determination of the primary beneficiary.

Entities that do *not* qualify as VIEs are assessed for consolidation as voting interest entities ("VOEs") under the voting interest model. The Company evaluates whether the entity should be evaluated under the guidance for partnerships and similar entities, or corporations, and consolidates those entities it controls through a majority voting interest or other means. If the Company is the general partner or managing member it generally will *not* be required to consolidate a VOE.

The Company records noncontrolling interests in consolidated entities for which the Company's ownership is less than *100%.* Refer to Noncontrolling Interests below for additional information.

*Investments in Partnerships and Affiliates*

The Company is general partner or co-general partner of various affiliated entities. We also have investments in unaffiliated partnerships, offshore funds and other entities (collectively, "unaffiliated entities"). Given that we are *not* a general partner or investment manager in any unaffiliated entity, we neither earn any management or incentive fees nor have a controlling financial interest in such entity. We do *not* consolidate any unaffiliated entity.

The financial statement caption investments in partnerships, in the consolidated statements of financial condition, includes investments in both affiliated and unaffiliated entities.

The Company accounts for its investments in partnerships and affiliates under the equity method. Substantially all of the Company's equity method investees are entities that record their underlying investments at fair value and are included in investments in partnerships. Therefore, under the equity method of accounting, the Company's share of the investee's underlying net income predominantly represents fair value adjustments in the investments held by the equity method investees. The Company's share of the investee's underlying net income or loss is based upon the most currently available information and is recorded in net gain/(loss) from investments on the consolidated statements of income. Capital contributions are recorded as an increase in investments when payable, and withdrawals and distributions are recorded as reductions of the investments when receivable. Depending on the terms of the investment, the Company *may* be restricted as to the timing and amounts of withdrawals.

*Derivative Financial Instruments*

The Company recognizes all derivatives as either assets or liabilities measured at fair value and includes such derivatives in either investments in securities or securities sold, *not* yet purchased on the consolidated statements of financial condition. From time to time, the Company will enter into hedging transactions to manage its exposure to foreign currencies or equity prices related to its proprietary investments. These transactions are *not* designated as hedges for accounting purposes, and changes in fair values of these derivatives are included in net gain/(loss) from investments on the consolidated statements of income.

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*Major Revenue-Generating Services and Revenue Recognition*

The Company's revenues are derived primarily from investment advisory and incentive fees.

Investment advisory and incentive fees are directly influenced by the level and mix of AUM as fees are derived from a contractually-determined percentage of the balance of each account as well as a percentage of the investment performance of certain accounts. Management fees from Investment Partnerships and offshore funds are computed either monthly or quarterly, and amounts receivable are included in investment advisory fees receivable on the consolidated statements of financial condition. These revenues vary depending upon the level of capital flows, financial market conditions, investment performance and the fee rates applicable to each account.

Incentive allocations or fees are generally recognized at the end of an annual measurement period and amounts receivable are included in investment advisory fees receivable on the consolidated statements of financial condition.

The Company's major revenue sources are as follows:

*<u>Investment advisory and incentive fees.</u>* The Company and its subsidiaries act as general partner, investment manager or sub-advisor to investment funds and/or separately managed accounts of institutional investors (e.g., corporate pension plans). The fees that are paid to the Company are set forth in the offering documents for the investment fund or the separately managed account agreement. Investment advisory and incentive fee revenue consists of:

a) Asset-based advisory fees – The Company receives a management fee, payable monthly in advance based on value of the net assets of the client. It is generally set at a rate of 1%-1.5% per annum. Asset-based management fee revenue is recognized only as the services are performed over the period.

b) Performance-based advisory fees – Certain client contracts call for additional fees and or allocations of income tied to a certain percentage, generally 15%-20%, of the investment performance of the account over a measurement period, typically the calendar year. In addition, the contracts provide that performance-based fees or allocations become fixed in the event of an investor redemption prior to the end of the measurement period. In the event that an account suffers a loss in *one* period, it must be recovered before incentive fees are earned by the Company; this is commonly referred to as a "high water mark" provision. While the Company's performance obligation is satisfied over time, the Company does *not* recognize performance-based fees until the end of the measurement period or the time of the investor redemption when the uncertainty surrounding the amount of the variable consideration is resolved.

c) Sub-advisory fees – Pursuant to agreements with other investment advisors, the Company receives a percentage of advisory fees received by such advisors from certain of their investment fund clients. These fees *may* be either asset- or performance-based. In addition, they *may* be subject to reduction by certain expenses as set forth in the respective agreements. Sub-advisory fee revenue which is asset-based is recognized ratably as the services are performed over the relevant contractual performance period. Sub-advisory fee revenue which is performance-based is recognized only when it becomes fixed and *not* subject to adjustment. Amounts receivable are included in receivable and investment in note receivable from affiliates in the consolidated statements of financial condition.

The Company reserves the right to waive or reduce asset-based and performance-based fees with respect to certain investors in the investment funds, which *may* include investments by employees and other related parties. Advisory and incentive fees payable by investment funds are typically approved by *third*-party administrators and paid directly from the accounts' assets. Such fees attributable to separate accounts *may* be subject to review and approval by the client and *may* be paid either from the accounts' assets or directly by the client.

Our advisory fee revenues are influenced by both the amount of AUM and the investment performance of our products. An overall decline in the prices of securities *may* cause our advisory fees to decline by either causing the value of our AUM to decrease or causing our clients to withdraw funds in favor of investments they perceive to offer greater opportunity or lower risk. Similarly, success in the investment management business is dependent on investment performance as well as distribution and client services. Good performance can stimulate sales of our investment products and tends to keep withdrawals and redemptions low, which generates higher asset-based management fees. Conversely, poor performance, both in absolute terms and/or relative to peers and industry benchmarks, tends to result in decreased sales, increased withdrawals and redemptions and in the loss of clients, with corresponding decreases in revenues to us.

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*Depreciation*

Fixed assets are recorded at cost and depreciated using the straight-line method over their estimated useful lives of four to thirty-nine years and are included in other assets on the consolidated statements of financial condition.

Fixed assets as of *December 31, 2022* and *2021* consisted of the following (in thousands):

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| | | |
|:---|:---|:---|
|  | ***December 31,*** | ***December 31,*** |
|  | ***2022*** | ***2021*** |
| Buildings | $17748 | $17745 |
| Equipment | 207 | 206 |
| Total | 17955 | 17951 |
| Less: accumulated depreciation | (1102) | (761) |
| Net book value | $16853 | $17190 |

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*Allocated Expenses*

The Company is charged or incurs certain overhead expenses that are paid by, or paid on our behalf by, other affiliates and are included in other operating expenses on the consolidated statements of income. These overhead expenses primarily relate to centralized functions, including finance and accounting, legal, compliance, treasury, tax, internal audit, information technology, human resources and risk management. These overhead expenses are allocated to the Company by other affiliates (primarily GAMCO) or allocated by the Company to other affiliates as the expenses are incurred, based upon direct usage when identifiable, or by revenue, headcount, space or other allocation methodologies periodically reviewed by the management of the Company and the affiliates.

The compensation expense and related payroll taxes and benefits of certain dual employees that provide services to both AC and affiliates are allocated based upon the relative time each employee devotes to each affiliate. These allocated compensation expenses are included in compensation on the consolidated statements of income.

All of the allocations and estimates in the financial statements are based on assumptions that management of AC believes are reasonable. However, these allocations *may not* be indicative of the actual expenses we would have incurred or *may* incur in the future.

*Management Fee*

Management fee expense in the amount of 10% of the aggregate pre-tax profits, before consideration of this fee and before consideration of the income attributable to consolidated funds and partnerships, is paid to the Executive Chair or his designees in accordance with his employment agreement.

*Stock-Based Compensation*

From time to time, the Company's Board of Directors approves grants of Phantom Restricted Stock awards ("Phantom RSAs"). The Phantom RSAs are settled by a cash payment, net of applicable withholding tax, on the vesting dates. In addition, an amount equivalent to the cumulative dividends declared on shares of the Company's Class A common stock during the vesting period will be paid to participants on vesting.

The Phantom RSAs are accounted for as a liability because cash settlement is required and compensation will be recognized over the vesting period. The Company amortizes each award based on the applicable vesting period. In determining the compensation expense to be recognized each period, the Company will remeasure the fair value of the liability at each reporting date taking into account the remaining vesting period attributable to each award and the current market value of the Company's Class A stock. In making these determinations, the Company will consider the impact of Phantom RSAs that have been forfeited prior to vesting (e.g., due to an employee termination). The Company has elected to consider forfeitures as they occur.

*Goodwill*

Goodwill is initially measured as the excess of the cost of an acquired business over the sum of the fair value assigned to assets acquired less the liabilities assumed. Goodwill is tested for impairment at least annually on *November 30th* and whenever certain triggering events are met. In assessing the recoverability of goodwill as of *November 30, 2022* and *2021*, we performed a qualitative assessment of whether it was more likely than *not* that an impairment had occurred and concluded that a quantitative analysis was *not* required. As such, no impairment was recorded during *2022* or *2021.*

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*Income Taxes*

For purposes of the preparation of the consolidated financial statements, the provision for income taxes is computed using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income tax expense/benefit in the period that includes the enactment date of the change in tax rate.

The Company records net deferred tax assets to the extent the Company believes these assets will more likely than *not* be realized. A valuation allowance would be recorded to reduce the carrying value of deferred tax assets to the amount that is more likely than *not* to be realized. In making such a determination of whether a valuation allowance is necessary, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. In the event the Company were to determine that the Company would be able to realize the Company's deferred income tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes.

For uncertain tax positions the Company *first* determines whether it is more likely than *not* that the tax positions will be sustained based on the technical merits of the position. For those tax positions that meet the more-likely-than-*not* recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than *50%* likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes the accrual of interest on uncertain tax positions and penalties in income tax provision on the consolidated statements of income. Uncertain tax positions and accrued interest and penalties on those uncertain tax positions, if any, are included within accrued expenses and other liabilities on the consolidated statements of financial condition.

*Redeemable Noncontrolling Interests and Noncontrolling Interests*

Noncontrolling interests in Investment Partnerships or other entities that are redeemable at the option of the holder are classified as redeemable noncontrolling interests in the mezzanine section of the consolidated statements of financial condition between liabilities and equity. Noncontrolling interests in other entities that are *not* redeemable at the option of the holder are classified as such as a separate component of shareholder's equity.

*Redeemable Noncontrolling Interests-PMV*

Prior to the deconsolidation of Consolidated PMV, the Company accounted for the common stock held by noncontrolling interest holders of PMV SPAC as subject to possible redemption in accordance with the guidance in Accounting Standards Codification ("ASC") Topic *480* "Distinguishing Liabilities from Equity" ("ASC *480"*). Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events *not* solely within the Company's control) is classified as mezzanine equity. PMV SPAC's common stock features certain redemption rights that are considered to be outside of the Company's control and subject to occurrence of uncertain future events. Accordingly, at *December 31, 2021,* common stock held by noncontrolling interest holders of Consolidated PMV is presented at redemption value in redeemable noncontrolling interests, outside of the stockholders' equity section of the Company's consolidated statements of financial condition. As a result of the deconsolidation of Consolidated PMV in *August 2022,* there was no such balance at *December 31, 2022.*

The discount amount related to the issuance of redeemable noncontrolling interest was amortized through an adjustment to additional paid-in capital and noncontrolling interest (proportionate to our ownership of the Sponsor) and was adjusted periodically for income/loss allocated to redeemable noncontrolling interest.

For the years ended *December 31, 2022* and *2021*, net income attributable to noncontrolling interests on the consolidated statements of income represents the share of net income/(loss) attributable to *third*-party investors in consolidated entities.

*PMV Warrant Liability*

In connection with its initial public offering, PMV sold 17,500,000 units, at $10.00 per unit. Each unit consisted of one share of Class A common stock and one-half of *one* redeemable warrant ("Public Warrant").

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant's specific terms and applicable authoritative guidance in ASC *480* and ASC *815,* Derivatives and Hedging ("ASC *815"*). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC *480,* meet the definition of a liability pursuant to ASC *480,* and whether the warrants meet all of the requirements for equity classification under ASC *815,* including whether the warrants are indexed to the Company's own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

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For warrants that do *not* meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized in net gain/(loss) from investments on the consolidated statements of income.

The warrant liability related to the Public Warrant was charged against the redeemable noncontrolling interest of PMV.

*Offering Costs*

Offering costs incurred by the initial public offering of PMV consist of legal, accounting, underwriting fees and other costs. Offering costs amounting to $9,957,390, including deferred underwriting fees of $6,125,000, net of a $175,000 credit paid by the underwriter, were allocated as follows, $502,848 in offering costs was charged to other operating expenses in the consolidated statements of income in *2021* and $9,454,542 was charged to redeemable noncontrolling interest of PMV in *2021,* similar to the warrant liability.

*Concentration of Credit Risk*

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and receivables from brokers. The Company maintains cash and cash equivalents primarily in the Gabelli U.S. Treasury Money Market Fund, which invests fully in instruments issued by the U.S. government. Receivables from brokers and financial institutions can exceed the federally insured limit. The concentration of credit risk with respect to advisory fees and incentive fees, which are included in investment advisory fees receivable and receivables from affiliates on the consolidated statements of financial condition, is generally limited due to the short payment terms extended to clients by the Company. All investments in securities are held at *third* party brokers or custodians.

*Business Segment*

The Company operates in one business segment. The Company's chief operating decision maker reviews the Company's financial performance at an aggregate level.

*Recent Accounting Developments*

In *June 2016,* the FASB issued ASU *2016*-*13, Accounting for Financial Instruments - Credit Losses (Topic *326*)* ("ASU *2016*-*13"*), which requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Currently, U.S. GAAP requires an "incurred loss" methodology that delays recognition until it is probable a loss has been incurred. Under ASU *2016*-*13,* the allowance for credit losses must be deducted from the amortized cost of the financial asset to present the net amount expected to be collected. The Statement of Income will reflect the measurement of credit losses for newly recognized financial assets as well as the expected increases or decreases of expected credit losses that have taken place during the period. In *November 2019,* the FASB issued ASU *2019*-*10,* which deferred the effective date of this guidance for smaller reporting companies for *three* years. This guidance is effective for the Company on *January 1, 2023* and requires a modified retrospective transition method, which will result in a cumulative-effect adjustment in retained earnings upon adoption. Adoption of this standard will *not* have a material impact on the consolidated financial statements.

In *January 2017,* the FASB issued ASU *2017*-*04, Intangibles* – *Goodwill and Other*, to simplify the process used to test for impairment of goodwill. Under the new standard, an impairment loss must be recognized in an amount equal to the excess of the carrying amount of a reporting unit over its fair value, limited to the total amount of goodwill allocated to that reporting unit. As a smaller reporting company pursuant to ASU *2019*-*10,* the ASU is effective for the Company on *January 1, 2023.* Further, a prospective transition method and early adoption is permitted. Adoption of this standard will *not* have a material impact on the consolidated financial statements.

In *December 2019,* the FASB issued ASU *2019*-*12,* Income Taxes (Topic *740*): Simplifying the Accounting for Income Taxes. The amendments simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic *740.* The amendments also improve consistent application of and simplify US GAAP for other areas of Topic *740* by clarifying and amending the existing guidance. We adopted this standard prospectively on *January 1, 2021.* The adoption of this standard did *not* have a material impact on our financial condition or results of operations.

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***3.* Revenue**

The Company's revenue is accounted for as contracts with customers, and the timing of revenue recognition is based on the Company's analysis of the provisions of each respective contract. Depending upon the specific terms, revenue *may* be recognized over time or at a point in time. Modifications to contracts *may* affect the timing of the satisfaction of performance obligations, the determination of the transaction price, and the allocation of the price to performance obligations, any of which *may* impact the timing of the recognition of the related revenue.

Total revenues by type were as follows for the years ended *December 31, 2022* and *2021* (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| <u>Investment advisory and incentive fees</u> |  |  |
| Asset-based advisory fees | $5178 | $5021 |
| Performance-based advisory fees | 2544 | 7006 |
| Sub-advisory fees | 7079 | 8503 |
| Sub-total | 14801 | 20530 |
| <u>Other</u> |  |  |
| Miscellaneous | 427 | 394 |
| Total | $15228 | $20924 |

---

***4.* Investments in Securities**

Investments in securities at *December 31, 2022* and *2021*, consisted of the following (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2021*** | ***December 31, 2021*** |
|  | ***Cost*** | ***Fair Value*** | ***Cost*** | ***Fair Value*** |
| Debt - Trading Securities: |  |  |  |  |
| U.S. Treasury Bills | $184636 | $186001 | $60992 | $60996 |
| Equity Securities: |  |  |  |  |
| Common stocks | 221794 | 189977 | 239383 | 265156 |
| Mutual funds | 539 | 906 | 524 | 1351 |
| Other investments | 6364 | 4702 | 6253 | 6580 |
| Total equity securities | 228697 | 195585 | 246160 | 273087 |
| Total investments in securities | $413333 | $381586 | $307152 | $334083 |
| Investments in marketable securities held in trust<sup>(1)</sup> | $- | $- | $175109 | $175109 |

---

(*1*) At *December 31, 2021*, marketable securities held in the trust account through PMV were comprised primarily of U.S. Treasury Bills which mature in less than *one* year with an amortized cost and fair value of approximately $175 million, due to the short maturity profile.

The Company's held to maturity investments at *December 31, 2022* and *2021*, consisted of the following (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** |
|  | ***Amortized Cost*** | ***Gross Unrealized Holding Gains*** | ***Gross Unrealized Holding Losses*** | ***Estimated Fair Value*** |
| Held to maturity: |  |  |  |  |
| Investment in note receivable from affiliate | $- | $- | $- | $- |

---

During the year ended *December 31, 2022,* the Company received proceeds of $5.1 million from the exercise of a put option on its investment in note receivable from affiliate. The exercise of the put option was determined to occur at the instrument's maturity date and *no* gain or loss was recognized.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** |
|  | ***Amortized Cost*** | ***Gross Unrealized Holding Gains*** | ***Gross Unrealized Holding Losses*** | ***Estimated Fair Value*** |
| Held to maturity: |  |  |  |  |
| Investment in note receivable from affiliate<sup>(2)</sup> | $5066 | $- | $- | $5066 |

---

(*2*) Investment in note receivable from affiliate relates to 2-Year Puttable and Callable Subordinated Notes due *2023* issued as part of a *2021* special dividend on GAMCO's Class A Common Stock and Class B Common Stock. The Company has the intent to hold these investments until maturity, and as such they were recorded at amortized cost.

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Securities sold, *not* yet purchased at *December 31, 2022* and *2021*, consisted of the following (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2021*** | ***December 31, 2021*** |
|  | ***Cost*** | ***Fair Value*** | ***Cost*** | ***Fair Value*** |
| Equity securities: |  |  |  |  |
| Common stocks | $2918 | $2509 | $9021 | $9838 |
| Other investments | 499 | 365 | 2767 | 3067 |
| Total securities sold, not yet purchased | $3417 | $2874 | $11788 | $12905 |

---

Investments in affiliated registered investment companies at *December 31, 2022* and *2021* consisted of the following (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2021*** | ***December 31, 2021*** |
|  | ***Cost*** | ***Fair Value*** | ***Cost*** | ***Fair Value*** |
| Equity securities: |  |  |  |  |
| Closed-end funds | $45029 | $56772 | $42484 | $64381 |
| Mutual funds | 50224 | 69438 | 49362 | 70167 |
| Total investments in affiliated registered investment companies | $95253 | $126210 | $91846 | $134548 |

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***5.* Investment Partnerships and Other Entities**

The Company is general partner or co-general partner of various affiliated entities whose underlying assets consist primarily of marketable securities ("Affiliated Entities"). We also had investments in unaffiliated partnerships, offshore funds and other entities of $35.8 and $41.9 million at *December 31, 2022* and *2021*, respectively ("Unaffiliated Entities"). We evaluate each entity to determine its appropriate accounting treatment and disclosure. Certain of the Affiliated Entities, and *none* of the Unaffiliated Entities, are consolidated.

Investments in partnerships that are *not* required to be consolidated are accounted for using the equity method and are included in investments in partnerships on the consolidated statements of financial condition. The Company had investments in Affiliated Entities totaling $114.7 million and $112.6 million at *December 31, 2022* and *2021*, respectively. The Company reflects the equity in earnings of these Affiliated Entities and Unaffiliated Entities as net gain/(loss) from investments on the consolidated statements of income.

Capital *may* generally be redeemed from Affiliated Entities on a monthly basis upon adequate notice as determined in the sole discretion of each entity's investment manager. Capital invested in Unaffiliated Entities *may* generally be redeemed at various intervals ranging from monthly to annually upon notice of 30 to 95 days. Certain Unaffiliated Entities and Affiliated Entities *may* require a minimum investment period before capital can be voluntarily redeemed (a "Lockup Period"). *No* investment in an Unaffiliated Entity has an unexpired Lockup Period. The Company has *no* outstanding capital commitments to any Affiliated or Unaffiliated Entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *37*

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*PMV Consumer Acquisition Corp.*

Commencing in *August 2022,* as a result of management and organizational restructuring negotiations at the Sponsor to extend the life of PMV, AC *no* longer controlled Consolidated PMV. As a result, Consolidated PMV was deconsolidated from the financial statements and a loss of $3.6 million was recognized and recorded in Net gain/(loss) from investments in the consolidated statements of income. The loss represents the difference between the carrying value and fair value of our remaining interest as of the transaction date.

We accounted for our remaining interest in PMV (comprising 1 million shares of Class A common stock and 500,000 PMV Public Warrants) at fair value. The initial fair value of these investments was $9.9 million based on the respective closing prices of both instruments on the transaction date. Our investments in Class A common stock and PMV Public Warrants were recorded in Investments in equity securities in the condensed consolidated statements of financial condition and related earnings or loss from subsequent changes in fair value recognized in Net gain/(loss) from investments in the consolidated statements of income. On *December 27, 2022,* our 1 million shares of Class A common stock were redeemed in full at $10.10 per share. We have continuing involvement with PMV through our ownership of the 500,000 PMV Public Warrants.

We accounted for our remaining interest in the Sponsor (comprising our original $4.0 million investment) under the equity method. The initial fair value was $1.0 million which was valued using the market approach. Our investment is recorded in Investments in partnerships in the consolidated statements of financial condition and related earnings or loss from our share of the underlying net income or loss will be recognized in Net gain/(loss) from investments in the consolidated statements of income. We have continuing involvement with the Sponsor through our ownership interest.

In *2021* and prior to *August 2022,* AC consolidated the assets, liabilities and the results of operations of both PMV and Sponsor. AC invested $4.0 million, or approximately 62% of the $6.48 million total Sponsor partnership commitment. The Sponsor was managed primarily by AC executives. AC determined that the Sponsor was a variable interest entity (VIE) and that AC was the primary beneficiary and therefore consolidated the assets and liabilities and results of operations of the Sponsor. In addition, AC has determined that PMV is a VIE due to the lack of equity at risk and therefore was consolidated by the Sponsor, who was deemed to be the primary beneficiary. Neither AC nor PMV had a right to the benefits from nor did it bear the risks associated with the marketable securities held in trust assets held by PMV.

The registration statement for the PMV initial public offering was declared effective on *September 21, 2020.* On *September 24, 2020,* PMV consummated the initial public offering of 17,500,000 units (the "Units" and, with respect to the shares of common stock included in the Units Sold, the "Public Shares"), at $10.00 per Unit, generating gross proceeds of $175,000,000.

Simultaneously with the closing of the initial public offering, PMV consummated the sale of 6,150,000 warrants (the "Private Warrants") at a price of $1.00 per Private Warrant in a private placement to the Sponsor, generating gross proceeds of $6,150,000.

AC invested $10 million in the Class A shares in PMV and the Sponsor invested $6.15 million in Private Warrants, both of which were eliminated in the consolidation of PMV for periods in which PMV was consolidated.

Following the closing of the initial public offering on *September 24, 2020,* an amount of $175,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the initial public offering and the sale of the Private Warrants was placed in a trust account (the "Trust Account") located in the United States, which were generally invested in U.S. Treasury Bills.

The following table reflects the net impact of the consolidated investment partnerships and other entities ("Consolidated Entities") on the consolidated statements of financial condition (in thousands):

---

| | | | |
|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** |
|  | ***Prior to*** | ***Consolidated*** |  |
| **Assets** | ***Consolidation*** | ***Entities*** | ***As Reported*** |
| Cash and cash equivalents | $209941 | $8521 | $218462 |
| Investments in U.S. Treasury Bills | 183528 | 2473 | 186001 |
| Investments in securities | 129942 | 65643 | 195585 |
| Investments in affiliated registered investment companies | 178689 | (52479) | 126210 |
| Investments in partnerships | 168286 | (17788) | 150498 |
| Receivable from brokers | 4002 | 8070 | 12072 |
| Investment advisory fees receivable | 3814 | (7) | 3807 |
| Other assets<sup>(1)</sup> | 35045 | 10 | 35055 |
| Total assets | $913247 | $14443 | $927690 |
| **Liabilities and equity** |  |  |  |
| Securities sold, not yet purchased | $2678 | $196 | $2874 |
| Payable to brokers and other liabilities<sup>(1)</sup> | 20373 | 4054 | 24427 |
| Redeemable noncontrolling interests |  | 10193 | 10193 |
| Total equity | 890196 |  | 890196 |
| Total liabilities and equity | $913247 | $14443 | $927690 |

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| | | | |
|:---|:---|:---|:---|
|  | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** |
|  | ***Prior to*** | ***Consolidated*** |  |
| **Assets** | ***Consolidation*** | ***Entities*** | ***As Reported*** |
| Cash and cash equivalents | $315009 | $4039 | $319048 |
| Investments in U.S. Treasury Bills | 60996 |  | 60996 |
| Investments in securities | 184229 | 88858 | 273087 |
| Investments in affiliated registered investment companies | 186474 | (51926) | 134548 |
| Investments in partnerships | 174683 | (20223) | 154460 |
| Receivable from brokers | 21993 | 20485 | 42478 |
| Investment advisory fees receivable | 8320 | (5) | 8315 |
| Other assets<sup>(1)</sup> | 39400 | (4105) | 35295 |
| Investments in marketable securities held in trust |  | 175109 | 175109 |
| Total assets | $991104 | $212232 | $1203336 |
| **Liabilities and equity** |  |  |  |
| Securities sold, not yet purchased | 11199 | 1706 | 12905 |
| Accrued expenses and other liabilities<sup>(1)</sup> | 33825 | 18804 | 52629 |
| Redeemable noncontrolling interests |  | 202456 | 202456 |
| Total equity | 946080 | (10734) | 935346 |
| Total liabilities and equity | $991104 | $212232 | $1203336 |

---

(*1*) Represents the summation of multiple captions from the consolidated statements of financial condition.

The following table reflects the net impact of the Consolidated Entities on the consolidated statements of income (in thousands):

---

| | | | |
|:---|:---|:---|:---|
|  | ***Year Ended December 31, 2022*** | ***Year Ended December 31, 2022*** | ***Year Ended December 31, 2022*** |
|  | ***Prior to*** | ***Consolidated*** |  |
|  | ***Consolidation*** | ***Entities*** | ***As Reported*** |
| Total revenues | $15884 | $(656) | $15228 |
| Total expenses | 24538 | 1952 | 26490 |
| Operating loss | (8654) | (2608) | (11262) |
| Total other income/(expense), net | (55196) | 5993 | (49203) |
| Income before income taxes | (63850) | 3385 | (60465) |
| Income tax expense | (14943) |  | (14943) |
| Income/(loss) before noncontrolling interests | (48907) | 3385 | (45522) |
| Income attributable to noncontrolling interests, net of taxes |  | 3385 | 3385 |
| Net income/(loss) | $(48907) | $- | $(48907) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | ***Year Ended December 31, 2021*** | ***Year Ended December 31, 2021*** | ***Year Ended December 31, 2021*** |
|  | ***Prior to*** | ***Consolidated*** |  |
|  | ***Consolidation*** | ***Entities*** | ***As Reported*** |
| Total revenues | $23852 | $(2928) | $20924 |
| Total expenses | 39245 | 755 | 40000 |
| Operating loss | (15393) | (3683) | (19076) |
| Total other income/(expense), net | 92301 | 8114 | 100415 |
| Income before income taxes | 76908 | 4431 | 81339 |
| Income tax expense | 17705 |  | 17705 |
| Income/(loss) before noncontrolling interests | 59203 | 4431 | 63634 |
| Income attributable to noncontrolling interests, net of taxes |  | 4431 | 4431 |
| Net income/(loss) | $59203 | $- | $59203 |

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*Variable Interest Entities*

With respect to each consolidated VIE, its assets *may* only be used to satisfy its obligations. The investors and creditors of any consolidated VIE have *no* recourse to the Company's general assets. In addition, the Company neither benefits from such VIE's assets nor bears the related risk beyond its beneficial interest in the VIE.

The following table presents the balances related to VIEs that are consolidated and included on the consolidated statements of financial condition as well as the Company's net interest in these VIEs (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2021*** |
| Cash and cash equivalents | $500 | $1911 |
| Investments in securities | 8396 | 11227 |
| Receivable from brokers | 304 | 1106 |
| Investments in marketable securities held in trust |  | 175109 |
| Other assets |  | 103 |
| Accrued expenses and other liabilities<sup>(1)</sup> | (33) | (7074) |
| PMV warrant liability |  | (5280) |
| Redeemable noncontrolling interests | (428) | (162314) |
| Nonredeemable noncontrolling interests |  | 1757 |
| AC Group's net interests in consolidated VIEs | $8739 | $16545 |

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(*1*) Represents the summation of multiple captions from the consolidated statements of financial condition.

*Voting Interest Entities*

We have an investment partnership that is consolidated as a VOE for both *2022* and *2021* because AC has a controlling interest in the entity. This resulted in the consolidation of $75.6 million of assets, $4.4 million of liabilities, and $9.8 million of redeemable noncontrolling interests for *2022* and $109.3 million of assets, $8.4 million of liabilities, and $40.1 million of redeemable noncontrolling interests for *2021*. AC's net interest in the consolidated VOE for *2022* and *2021* was $61.4 million and $60.8 million, respectively. In *2022,* approximately $29.0 million of redeemable noncontrolling interests tendered their shares in the entity.

*Equity Method Investments*

The Company's equity method investments include investments in partnerships and offshore funds. These equity method investments are *not* consolidated but on an aggregate basis exceed *10%* of the Company's consolidated total assets or income.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *40*

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***6.* Fair Value**

The following tables present information about the Company's assets and liabilities by major category measured at fair value on a recurring basis as of *December 31, 2022* and *2021*, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands):

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** |
| **Assets** | ***Quoted Prices in Active Markets for Identical Assets (Level 1)*** | ***Significant Other Observable Inputs (Level 2)*** | ***Significant Unobservable Inputs (Level 3)*** | ***Total*** |
| Cash equivalents | $216313 | $- | $- | $216313 |
| Investments in securities (including GAMCO stock): |  |  |  |  |
| Trading - U.S. Treasury Bills | 186001 |  |  | 186001 |
| Common stocks | 185952 | 1990 | 2035 | 189977 |
| Mutual funds | 906 |  |  | 906 |
| Other | 4132 | 317 | 253 | 4702 |
| Total investments in securities | 376991 | 2307 | 2288 | 381586 |
| Investments in affiliated registered investment companies: |  |  |  |  |
| Closed-end funds | 45286 |  | 11486 | 56772 |
| Mutual funds | 69438 |  |  | 69438 |
| Total investments in affiliated registered investment companies | 114724 |  | 11486 | 126210 |
| Total investments held at fair value | 491715 | 2307 | 13774 | 507796 |
| **Total assets at fair value** | $708028 | $2307 | $13774 | $724109 |
| **Liabilities** |  |  |  |  |
| Common stocks | $2509 | $- | $- | $2509 |
| Other | 132 | 233 |  | 365 |
| Securities sold, not yet purchased | 2641 | 233 |  | 2874 |
| Total liabilities at fair value | $2641 | $233 | $- | $2874 |

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| | | | | |
|:---|:---|:---|:---|:---|
|  | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** |
| **Assets** | ***Quoted Prices in Active Markets for Identical Assets (Level 1)*** | ***Significant Other Observable Inputs (Level 2)*** | ***Significant Unobservable Inputs (Level 3)*** | ***Total*** |
| Cash equivalents | $314172 | $- | $- | $314172 |
| Investments in securities (including GAMCO stock): |  |  |  |  |
| Trading - U.S. Treasury Bills | 60996 |  |  | 60996 |
| Common stocks | 260763 | 2320 | 2073 | 265156 |
| Mutual funds | 1351 |  |  | 1351 |
| Other | 4833 | 1220 | 527 | 6580 |
| Total investments in securities | 327943 | 3540 | 2600 | 334083 |
| Investments in affiliated registered investment companies: |  |  |  |  |
| Closed-end funds | 56381 |  | 8000 | 64381 |
| Mutual funds | 70167 |  |  | 70167 |
| Total investments in affiliated registered investment companies | 126548 |  | 8000 | 134548 |
| Total investments held at fair value | 454491 | 3540 | 10600 | 468631 |
| **Total assets at fair value** | $768663 | $3540 | $10600 | $782803 |
| **Liabilities** |  |  |  |  |
| Common stocks | $9838 | $- | $- | $9838 |
| Other | 1959 | 1108 |  | 3067 |
| Securities sold, not yet purchased | 11797 | 1108 |  | 12905 |
| PMV warrant liability | 5280 |  |  | 5280 |
| Total liabilities at fair value | $17077 | $1108 | $- | $18185 |

---

The following table presents additional information about assets and liabilities by major category measured at fair value on a recurring basis as of the dates specified (in thousands) and for which the Company has utilized Level *3* inputs to determine fair value:

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31, 2022*** | ***Year Ended December 31, 2021*** |
| Assets: | ***Total*** | ***Total*** |
| Beginning balance | $10600 | $6498 |
| Total gains/(losses) | 27 | (546) |
| Purchases | 5900 | 6053 |
| Sales/return of capital | (2753) | (1046) |
| Transfers |  | (359) |
| Ending balance | $13774 | $10600 |
| Changes in net unrealized gain/(loss) included in Net gain/(loss) from investments related to level 3 assets still held as of the reporting date | $27 | $(546) |

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---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31, 2022*** | ***Year Ended December 31, 2021*** |
| Liabilities: | ***Total*** | ***Total*** |
| Beginning balance | $- | $- |
| Total (gains)/losses |  | (3053) |
| Issuances |  | 8333 |
| Transfers |  | (5280) |
| Ending balance | $- | $- |
| Changes in net unrealized (gain)/loss included in Net gain/(loss) from investments related to level 3 liabilities still held as of the reporting date | $- | $- |

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Total realized and unrealized gains and losses for level *3* assets are reported in net gain/(loss) from investments in the consolidated statements of income.

During the years ended *December 31, 2022* and *2021*, the Company transferred *no* investments from Level *1* to Level *3.* For the year ended *December 31, 2022*, the Company transferred *no* investments from Level *3* to Level *1.* For the year ended *December 31, 2021*, the Company transferred investments with a value of approximately *$359* thousand from Level *3* to Level *1* due to increased availability of market price quotations.

Transfers out of Level *3* liabilities during the year ended *December 31, 2021*, reflected the transfer of the PMV warrant liability to Level *1* principally due to increased availability of market price quotations.

The aforementioned warrant liability is *not* subject to qualified hedge accounting.

The following table presents the carrying amounts and estimated fair values of financial assets that are *not* measured at fair value on a recurring basis (in thousands) and their respective levels within the fair value hierarchy:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2022*** | ***December 31, 2021*** | ***December 31, 2021*** | ***December 31, 2021*** |
| **Assets** | ***Level within Fair Value Hierarchy*** | ***Fair Value*** | ***Amortized Cost*** | ***Level within Fair Value Hierarchy*** | ***Fair Value*** | ***Amortized Cost*** |
| Investment in note receivable from affiliate<sup>(1)</sup> |  | $- | $- | *2* | $5066 | $5066 |
| Total assets |  | $- | $- |  | $5066 | $5066 |

---

(*1*) Included in Receivable and investment in note receivable from affiliates in the consolidated statement of financial condition.

***7.* Income Taxes**

The provision for income taxes for the years ended *December 31, 2022* and *2021*, consisted of the following (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***2022*** | ***2021*** |
| Federal: |  |  |
| &nbsp;&nbsp;&nbsp; Current | $(348) | $8512 |
| &nbsp;&nbsp;&nbsp; Deferred | (13237) | 7966 |
| State and local: |  |  |
| &nbsp;&nbsp;&nbsp; Current | (463) | 453 |
| &nbsp;&nbsp;&nbsp; Deferred | (925) | 722 |
| Foreign: |  |  |
| &nbsp;&nbsp;&nbsp; Current | 41 | 36 |
| &nbsp;&nbsp;&nbsp; Deferred | (11) | 16 |
| Total | $(14943) | $17705 |

---

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A reconciliation of the federal statutory rate to the effective tax rate for the years ended *December 31, 2022* and *2021*, is set forth below:

---

| | | |
|:---|:---|:---|
|  | ***2022*** | ***2021*** |
| Statutory Federal income tax rate | 21 | 21 |
| State income tax, net of Federal benefit | 1.7 | 1.2 |
| Dividends received deduction | 0.6 | (1.0) |
| Deferred tax asset valuation allowance | (1.0) | (0.5) |
| Foreign investments |  | (0.5) |
| Foreign-derived intangible income | 0.9 | (0.7) |
| Noncontrolling interests | 0.6 | (1.1) |
| Nondeductible compensation | (0.1) | 2 |
| Other | 1 | 1.4 |
| Effective income tax rate | 24.7% | 21.8% |

---

Significant components of our deferred tax assets and liabilities as of *December 31, 2022* and *2021*, are as follows (in thousands):

---

| | | |
|:---|:---|:---|
|  | ***2022*** | ***2021*** |
| Deferred tax assets: |  |  |
| &nbsp;&nbsp;&nbsp; Stock-based compensation expense | $1073 | $683 |
| &nbsp;&nbsp;&nbsp; Deferred compensation | 542 | 277 |
| &nbsp;&nbsp;&nbsp; Investments in securities and partnerships | 4660 |  |
| &nbsp;&nbsp;&nbsp; Shareholder-designated contribution carryover | 1902 | 2990 |
| &nbsp;&nbsp;&nbsp; Other | 56 | 755 |
|  | 8233 | 4705 |
| Deferred tax liabilities: |  |  |
| &nbsp;&nbsp;&nbsp; Investments in securities and partnerships |  | (9683) |
| &nbsp;&nbsp;&nbsp; Other liabilities | (221) | (182) |
|  | (221) | (9865) |
| Gross deferred tax assets/(liabilities) | 8012 | (5160) |
| Valuation allowance | (336) | (1336) |
| Net deferred tax assets/(liabilities) | $7676 | $(6496) |

---

The Company believes that it is more-likely-than-*not* that the benefit from a portion of the shareholder-designated charitable contribution carryforwards will *not* be realized. In recognition of this risk, the Company has provided a valuation allowance of $336 and $1,336 as of *December 31, 2022* and *2021*, respectively, on the deferred tax assets related to these charitable contribution carryforwards.

The Company records penalties and interest related to tax uncertainties in income taxes. These amounts are included in accrued expenses and other liabilities on the consolidated statements of financial condition. As of and for the periods ended *December 31, 2022* and *2021*, the Company had *not* established a liability for uncertain tax positions as no such positions existed.

The Company remains subject to income tax examination by the IRS for the years *2019* through *2021* and state examinations for years after *2016.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *44*

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***8.* Earnings per Share**

Basic earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares, plus any potentially dilutive securities (if any) outstanding during the period.

The computations of basic and diluted net income/(loss) per share are as follows:

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
| (In thousands, except per share amounts) | ***2022*** | ***2021*** |
| Income/(loss) before noncontrolling interests | $(45522) | $63634 |
| Less: Income attributable to noncontrolling interests | 3385 | 4431 |
| Net income/(loss) attributable to Associated Capital Group, Inc.'s shareholders | $(48907) | $59203 |
| Weighted average number of shares of Common Stock outstanding - basic | 22024 | 22120 |
| Weighted average number of shares of Common Stock outstanding - diluted | 22024 | 22120 |
| Basic and Diluted EPS | $(2.22) | $2.68 |

---

***9.* Related Party Transactions**

The following is a summary of certain related party transactions.

GGCP, Inc., a private company controlled by the Executive Chair, indirectly owns a majority of our Class B stock, representing approximately 96% of the combined voting power and 84% of the outstanding shares of our common stock at *December 31, 2022*.

*Investments in Securities*

At *December 31, 2022* and *2021*, the value of the Company's investment in GAMCO common stock was $36.7 million and $60.4 million, respectively. As of *December 31, 2022* and *2021*, AC and its subsidiaries own approximately 2.4 million of GAMCO Class A stock. The Company recorded investment income of $0.5 million and $5.4 million in *2022* and *2021*, respectively, from GAMCO, which is included in interest and dividend income on the consolidated statements of income. For the year, GAMCO's stock price decreased 39.0% to $15.24 per share, resulting in a $23.5 million net realized and unrealized loss for the Company versus a net realized and unrealized gain of $20.4 million in *2021*.

At *December 31, 2022* and *2021*, the Company invested $209.3 million and $6.0 million, respectively, in the Gabelli U.S. Treasury Money Market Fund, which is recorded in cash and cash equivalents on the consolidated statements of financial condition. For the year ended *December 31, 2022*, the Company earned $0.4 million from the investment in this fund. For the year ended *December 31, 2021*, the Company earned insignificant interest.

Investments in equity mutual funds advised by our affiliates (primarily Gabelli Funds, an investment advisor under common control with the Company), totaled $126.2 million and $134.5 million at *December 31, 2022* and *2021*, respectively, and are included in investments in affiliated registered investment companies on the consolidated statements of financial condition. Included in other income/(expense) is loss of $10.2 million and $24.2 million of gains from investments and dividends related to these funds for the years ending *December 31, 2022* and *2021*, respectively.

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*Investments in Partnerships*

The Company serves as an investment advisor and/or general partner for certain affiliated investment partnerships and receives management fees and performance-based incentive fees for providing such services. Investment advisory and incentive fees relating to such services were $7.7 million and $12.0 million for the years ending *December 31, 2022* and *2021* respectively, and are included in investment advisory and incentive fees on the consolidated statements of income. We had an aggregate investment in these affiliated Investment Partnerships of approximately $114.7 million and $112.6 million at *December 31, 2022* and *2021*, respectively.

*Investment Advisory Services*

Pursuant to a sub-advisory agreement between GCIA, a wholly owned subsidiary of the Company, and Gabelli Funds, Gabelli Funds pays GCIA 90% of the net revenues received by Gabelli Funds related to investment advisory services provided to GAMCO International SICAV – GAMCO Merger Arbitrage, an investment company incorporated under the laws of Luxembourg (the "SICAV"). For this purpose, net revenues are defined as gross advisory fees less expenses related to payouts and expenses of the SICAV paid by Gabelli Funds. GCIA received $7.1 million and $8.9 million during *2022* and *2021*, respectively, under this sub-advisory agreement. These payments are included in investment advisory and incentive fees on the consolidated statements of income. In addition, GAMCO makes certain payments to employees of the Company primarily related to marketing of SICAV.

The Company also serves as sub-advisor to Gabelli Merger Plus+ Trust Plc., an investment company based in the United Kingdom, which is consolidated due to the Company's controlling interest in the entity. As such, the Company's portion of management and/or incentive fees received for services provided are eliminated in the consolidation of the entity.

*Compensation*

In accordance with an employment agreement, the Company pays the Executive Chair, or his designated assignees, a management fee equal to 10% of the Company's pretax profits before consideration of this fee and before consolidation of Investment Partnerships. In *2022*, there was no management fee expense due to pre-tax losses. In *2021*, the Company recorded management fee expense of $8.4 million. This fee is recorded as management fee on the consolidated statements of income.

*Affiliated Receivables/Payables*

At *December 31, 2022* and *2021*, the receivable and investment in note receivable from affiliates consisted primarily of sub-advisory fees due from Gabelli Funds, and for *2021* the balance also included the 2-Year Puttable and Callable Subordinated Notes due *2023* issued as part of a *2021* special dividend on GAMCO's Class A Common Stock and Class B Common Stock.

There were *no* material payables to affiliates at *December 31, 2022* and *2021*.

*Leases*

Our offices are owned by a wholly owned subsidiary of AC and are located at *191* Mason Street, Greenwich, CT *06830.* A portion of the office space is leased to affiliates. AC received $116.4 thousand and $118.1 thousand from affiliates (primarily GAMCO) pursuant to lease agreements for this property for *2022* and *2021*, respectively. These amounts are included in other revenues on the consolidated statements of income.

AC acquired a building at *3* St. James Place, London, UK on *March 3, 2020* which was fully leased to GAMCO commencing *2021.* For the years ending *December 31, 2022* and *2021*, the Company received $309.8 thousand and $275.4 thousand, respectively, under the lease agreement. These amounts are included in other revenues on the consolidated statements of income.

In *June 2016,* AC entered into a sublease agreement with GAMCO which is subject to annual renewal. Pursuant to the sublease, AC and its subsidiaries pay a monthly fixed lease amount based on the percentage of square footage occupied by its employees (including pro rata allocation of common space) at GAMCO's Rye office. For the years ended *December 31, 2022* and *2021*, the Company paid $72.1 thousand and $73.7 thousand under the sublease agreement. These amounts are included in other operating expenses on the consolidated statements of income.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *46*

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*Other*

AC and GAMCO entered into a transitional administrative and management services agreement in connection with the spin-off of AC from GAMCO on *November 30, 2015.* The agreement calls for GAMCO to provide to AC certain administrative services, including but *not* limited to: human resources, compliance, legal, payroll, information technology, and operations. The agreement is terminable by either party on 30 days' prior written notice to the other party. All services provided under the agreement by GAMCO to AC or by AC to GAMCO are charged at cost. Amounts charged under this agreement are included in compensation expense, if related to fixed or variable compensation, or other operating expenses, on the consolidated statements of income. For the years ended *December 31, 2022* and *2021*, we recorded $2.7 million and $5.5 million, respectively, of compensation expense related to employees shared with GAMCO. In addition, we recorded approximately $1.4 million and $1.8 million of other operating expense, primarily related to GAMCO's share of management and incentive fees in funds we consolidate and the ancillary services provided by GAMCO as noted above, for the years ended *December 31, 2022* and *2021*, respectively. Certain officers and employees of the Company receive additional compensation from GAMCO.

***10.* Equity**

*Voting Rights*

The holders of Class A Common stock ("Class A Stock") and Class B Common stock ("Class B Stock") have identical rights except that holders of Class A Stock are entitled to one vote per share, while holders of Class B Stock are entitled to ten votes per share, on all matters to be voted on by shareholders in general. Holders of each share class, however, are *not* eligible to vote on matters relating exclusively to the other share class.

*Stock Award and Incentive Plan*

The Company maintains one stock award and incentive plan (the "Plan") approved by the shareholders on *May 3, 2016,* which is designed to provide incentives to attract and retain individuals key to the success of AC through direct or indirect ownership of our common stock. Benefits under the Plan *may* be granted in any *one* or a combination of stock options, stock appreciation rights, restricted stock, restricted stock units, stock awards, dividend equivalents and other stock or cash-based awards. A maximum of 2 million shares of Class A Stock have been reserved for issuance under the Plan by the Compensation Committee of the Board of Directors (the "Compensation Committee") which is responsible for administering the Plan. Under the Plan, the Compensation Committee *may* grant restricted stock awards ("RSAs") and either incentive or nonqualified stock options with a term *not* to exceed ten years from the grant date and at an exercise price that it *may* determine. Through *December 31, 2022*, approximately 0.7 million shares have been awarded under the Plan leaving approximately 1.3 million shares available for future grants.

There were no RSAs outstanding as of *December 31, 2022* or *2021*.

Based on the closing price of the Company's Class A Common Stock on *December 31, 2022* and *2021*, the total liability recorded by the Company in compensation payable in our consolidated statements of financial condition with respect to the Phantom RSAs was $4.8 million and $3.0 million, respectively.

The following table summarizes our stock-based compensation, as well as unrecognized compensation, for the periods ended *December 31, 2022* and *2021* respectively. Stock-based compensation expense is included in compensation expense in the consolidated statements of income (in thousands, unless otherwise noted):

---

| | | |
|:---|:---|:---|
|  | ***Year Ended December 31,*** | ***Year Ended December 31,*** |
|  | ***2022*** | ***2021*** |
| Stock-based compensation expense | $1811 | $2092 |
| Remaining expense to be recognized, if all vesting conditions are met<sup>(1)</sup> | 4142 | 6640 |
| Weighted average remaining contractual term (in years) | 1.8 | 2.2 |

---

(*1*) Does *not* include an estimate for projected future dividends.

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The following table summarizes Phantom RSA ("PRSA") activity:

---

| | | |
|:---|:---|:---|
|  | ***PRSA's*** | ***Weighted Average Grant Date Fair Value*** |
| Balance at December 31, 2021 | 222905 | $36.03 |
| Granted |  |  |
| Forfeited | (945) | 37.40 |
| Vested |  |  |
| Balance at March 31, 2022 | 221960 | $36.02 |
| Granted |  |  |
| Forfeited | (6050) | 35.63 |
| Vested |  |  |
| Balance at June 30, 2022 | 215910 | $36.04 |
| Granted | 4500 | 41.70 |
| Forfeited | (8500) | 35.82 |
| Vested |  |  |
| Balance at September 30, 2022 | 211910 | $36.16 |
| Granted |  |  |
| Forfeited | (1000) | 35.12 |
| Vested |  |  |
| Balance at December 31, 2022 | 210910 | $36.17 |

---

*Stock Repurchase Program*

In *December 2015,* the Board of Directors established a stock repurchase program authorizing the Company to repurchase up to 500,000 shares. On *February 7, 2017,* the Board of Directors reset the available number of shares to be purchased under the stock repurchase program to 500,000 shares. On *August 3, 2017* and *May 8, 2018,* the Board of Directors authorized the repurchase of an additional 1 million and 500,000 shares, respectively. Our stock repurchase program is *not* subject to an expiration date.

The following table presents the Company's stock repurchase activity and remaining authorization:

---

| | | |
|:---|:---|:---|
|  | ***Number of shares purchased*** | ***Average price per share*** |
| Remaining repurchase authorization January 1, 2021 | 893102 |  |
| Share repurchases under stock repurchase program <sup>(1)</sup> | (215958) | $35.40 |
| Remaining repurchase authorization December 31, 2021 | 677144 |  |
| Share repurchases under stock repurchase program <sup>(1)</sup> | (67792) | $37.98 |
| Remaining repurchase authorization December 31, 2022 | 609352 |  |

---

(*1*) Repurchases totaled $2.6 million and $7.6 million in *2022* and *2021*, respectively,

*Dividends*

During *2022* and *2021*, the Company declared and paid dividends of $0.20 per share to class A and class B shareholders totaling $4.4 million and $4.4 million, respectively.

***11.* Retirement Plan**

The Company participates in an incentive savings plan (the "Savings Plan") covering substantially all employees. Company contributions to the Savings Plan are determined annually by management of the Company but *may not* exceed the amount permitted as a deductible expense under the Internal Revenue Code of *1986,* as amended. The expense for contributions to the Savings Plan was approximately $8 thousand and $7 thousand in *2022* and *2021*, respectively, and is included in compensation on the consolidated statements of income.

***12.* Guarantees, Contingencies and Commitments**

From time to time, the Company *may* be named in legal actions and proceedings. These actions *may* seek substantial or indeterminate compensatory, as well as punitive, damages or injunctive relief. We are also subject to governmental or regulatory examinations or investigations. The examinations or investigations could result in adverse judgments, settlements, fines, injunctions, restitutions or other relief. For any such matters, the consolidated financial statements include the necessary provisions for losses, if any, that the Company believes are probable and estimable. Furthermore, the Company evaluates whether losses exist which *may* be reasonably possible and will, if material, make the necessary disclosures. is *not* aware of any probable or reasonably possible losses at *December 31, 2022*.

The Company has also entered into arrangements with various other *third* parties, many of which provide for indemnification of the *third* parties against losses, costs, claims and liabilities arising from the performance of obligations under the agreements. The Company has had *no* claims or payments pursuant to these or prior agreements and believes the likelihood of a claim being made is remote, and, therefore, *no* accrual has been made on the consolidated financial statements.

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***13.* Shareholder Designated Contribution Plan**

The Company has established a Shareholder Designated Charitable Contribution program. Under the program, from time to time each shareholder is eligible to designate a charity to which the Company would make a donation at a rate per share, approved by the Board of Directors, based upon the actual number of shares registered in the shareholder's name. The Company recorded an expense of $3.1 million and $4.8 million related to this program for the years ended *December 31, 2022* and *2021*, respectively, which is included in shareholder-designated contribution in the consolidated statements of income. As of *December 31, 2022* and *2021*, the Company has reflected a liability in the amount of $1.0 million and $1.5 million, respectively, in connection with this program, which is included in accrued expenses and other liabilities on the consolidated statement of financial condition.

***14.* Subsequent Events**

From *January 1, 2023* to *March 15, 2023,* the Company repurchased 41,442 shares at $37.24 per share.

On *January 3, 2023,* our consolidated VOE commenced its *second* scheduled tender offer. On *February 10, 2023,* our consolidated VOE announced approximately $3.2 million of redeemable noncontrolling interests had tendered their interests in the fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; *49*

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| | |
|:---|:---|
| **ITEM 9:** | **CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE** |

---

None.

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| | |
|:---|:---|
| **ITEM 9A.** | **CONTROLS AND PROCEDURES** |

---

**Evaluation of Disclosure Controls and Procedures**

The Company maintains a system of disclosure controls and procedures that is designed to provide reasonable assurance that information, which is required to be timely disclosed, is recorded, processed, summarized, and reported to management within the time periods specified in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company's Chief Executive Officer and Co-Chief Financial Officers, after evaluating the effectiveness of the Company's disclosure controls and procedures (as defined in the Exchange Act) as of the end of the period covered by this report, have concluded that the Company's disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by the Company in the reports that it files or reasonable assurance that such information is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms. Our current management, including our CEO and co-CFOs, have evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of December 31, 2022.

**Management**'**s Report on Internal Control Over Financial Reporting**

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act and based upon the criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the "COSO framework")). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our financial statements for external purposes in accordance with GAAP. An effective internal control system, no matter how well designed, has inherent limitations, including the possibility of human error or overriding of controls, and therefore can provide only reasonable assurance with respect to reliable financial reporting. Because of its inherent limitations, our internal control over financial reporting may not prevent or detect all misstatements, including the possibility of human error, the circumvention or overriding of controls, or fraud. Effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements.

Based on its evaluation, management concluded that, as of December 31, 2022, the Company maintained effective internal control over financial reporting.

**Changes in Internal Control Over Financial Reporting**

There has been no change in our internal control over financial reporting during the quarter ended December 31, 2022, that has materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 50

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| | |
|:---|:---|
| **ITEM 9B:** | **OTHER INFORMATION** |

---

None.

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| | |
|:---|:---|
| **ITEM 9C:**  | **DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS** |

---

Not applicable.

**PART III**

---

| | |
|:---|:---|
| **ITEM 10:** | **DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE** |

---

Information regarding the Directors and Executive Officers of AC and compliance with Section 16(a) of the Securities Exchange Act of 1934 is incorporated herein by reference to the Company's Proxy Statement for the 2023 Annual Meeting of Stockholders (the "Proxy Statement").

AC has adopted a Code of Business Conduct that applies to all of our officers, directors, full-time and part-time employees and a Code of Conduct that sets forth additional requirements for our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (together, the "Codes of Conduct"). The Codes of Conduct are posted on our website (<u>www.associated-capital-group.com</u>) and are available in print free of charge to anyone who requests a copy. Interested parties may address a written request for a printed copy of the Codes of Conduct to: Secretary, Associated Capital Group, Inc., 191 Mason Street, Greenwich, Connecticut 06830. We intend to satisfy the disclosure requirement regarding any amendment to, or a waiver of, a provision of the Codes of Conduct by posting such information on our website.

In addition to the certifications attached as Exhibits to this Form 10-K, following its 2023 Annual Meeting, AC will also submit to the New York Stock Exchange ("NYSE") a certification by our Chief Executive Officer that he is not aware of any violations by AC of the NYSE corporate governance listing standards as of the date of the certification.

---

| | |
|:---|:---|
| **ITEM 11:** | **EXECUTIVE COMPENSATION** |

---

Information required by Item 11 is included in our Proxy Statement and is incorporated herein by reference.

---

| | |
|:---|:---|
| **ITEM 12:** | **SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS** |

---

Information required by Item 12 is included in our Proxy Statement and is incorporated herein by reference.

---

| | |
|:---|:---|
| **ITEM 13:** | **CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE** |

---

Information required by Item 13 is included in our Proxy Statement and is incorporated herein by reference.

---

| | |
|:---|:---|
| **ITEM 14:** | **PRINCIPAL ACCOUNTANT FEES AND SERVICES** |

---

Information required by Item 14 is included in our Proxy Statement and is incorporated herein by reference.

**PART IV**

---

| | |
|:---|:---|
| **ITEM 15:** | **EXHIBITS, FINANCIAL STATEMENT SCHEDULES** |

---

**(a) List of documents filed as part of this Report:**

(1) Consolidated Financial Statements and Independent Registered Public Accounting Firm's Reports included herein:

See Index on page 19.

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(2) Financial Statement Schedules

Financial statement schedules are omitted as not required or not applicable or because the information is included in the Financial Statements or notes thereto.

(3) List of Exhibits:

The agreements included or incorporated by reference as exhibits to this Annual Report on Form 10-K contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties were made solely for the benefit of the other parties to the applicable agreement and (i) were not intended to be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; (ii) may have been qualified in such agreement by disclosures that were made to the other party in connection with the negotiation of the applicable agreement; (iii) may apply contract standards of "materiality" that are different from "materiality" under the applicable securities laws; and (iv) were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement.

The Company acknowledges that, notwithstanding the inclusion of the foregoing cautionary statements, it is responsible for considering whether additional specific disclosures of material information regarding material contractual provisions are required to make the statements in this report not misleading.

---

| | |
|:---|:---|
| **Exhibit**<br> **Number** | **Description of Exhibit** |
| [<u>2.1</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex2d1.htm) | Separation and Distribution Agreement, dated November 30, 2015, between GAMCO Investors, Inc., a Delaware corporation ("GAMCO"), and Associated Capital Group, Inc., a Delaware corporation (the "Company"). (Incorporated by reference to Exhibit 2.1 to the Company's Form 8-K dated November 30, 2015 filed with the Securities and Exchange Commission on December 4, 2015). |
| [<u>3.1</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915081320/a15-24101_1ex3d1.htm) | Amended and Restated Certificate of Incorporation of the Company. (Incorporated by reference to Exhibit 3.1 to the Company's Form 8-K dated November 19, 2015 filed with the Securities and Exchange Commission on November 25, 2015). |
| [<u>3.2</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915081320/a15-24101_1ex3d2.htm) | Amended and Restated Bylaws of the Company. (Incorporated by reference to Exhibit 3.2 to the Company's Report on Form 8-K dated November 19, 2015 filed with the Securities and Exchange Commission on November 25, 2015). |
| [<u>4.1</u>](http://www.sec.gov/Archives/edgar/data/1642122/000104746915007971/a2226253zex-4_1.htm) | Form of Common Stock Certificate. (Incorporated by reference to Exhibit 4.1 to Amendment No. 4 to the Company's Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015). |
| [<u>4.2</u>](http://www.sec.gov/Archives/edgar/data/1642122/000114036120005911/ex4_2.htm) | Description of The Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. (Incorporated by reference to Exhibit 4.2 of the Company's Report on Form 10-K filed with the Commission on March 16, 2020). |
| [<u>10.1</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex10d1.htm) | Service Mark and Name License Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015). |
| [<u>10.2</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex10d2.htm) | Transitional Administrative and Management Services Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015). |
| [<u>10.3</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex10d3.htm) | Employment Agreement between the Company and Mario J. Gabelli dated November 30, 2015 (Incorporated by reference to Exhibit 10.3 to the Company's Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015). |
| [<u>10.4</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex10d4.htm) | Promissory Note in aggregate principal amount of $250,000,000, dated November 30, 2015, issued by GAMCO in favor of the Company (Incorporated by reference to Exhibit 10.4 to the Company's Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015). |
| [<u>10.5</u>](http://www.sec.gov/Archives/edgar/data/1642122/000110465915083060/a15-24521_1ex10d5.htm) | Tax Indemnity and Sharing Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.5 to the Company's Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015). |
| [<u>10.6</u>](http://www.sec.gov/Archives/edgar/data/1642122/000104746915007971/a2226253zex-10_11.htm) | 2015 Stock Award Incentive Plan (Incorporated by reference to Exhibit 10.11 to Amendment No. 4 to the Company's Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015). |
| [<u>10.7</u>](http://www.sec.gov/Archives/edgar/data/1642122/000104746915007971/a2226253zex-10_7.htm) | Form of Indemnification Agreement by and between the Company and the Indemnitee defined therein (Incorporated by reference to Exhibit 10.7 to Amendment No. 4 to the Company's Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015). |
| [<u>10.8</u>](http://www.sec.gov/Archives/edgar/data/1162283/000114036119019947/ex2_1.htm) | Agreement and Plan of Merger, dated as of October 31, 2019, by and among Morgan Group Holding Co., G.R. acquisition, LLC, G.research, LLC, Institutional Services Holdings, LLC and Associated Capital Group, Inc. (Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of Morgan Group Holding Co. filed with the Securities and Exchange Commission on November 6, 2019). |
| [<u>21.1</u>](ex_449372.htm) | Subsidiaries of the Company. |
| [<u>24.1</u>](#poa) | Powers of Attorney (included on page 54 of this Report). |
| [<u>31.1</u>](ex_448609.htm) | Certification of CEO pursuant to Rule 13a-14(a). |
| [<u>31.2</u>](ex_448610.htm) | Certification of Co-CFO pursuant to Rule 13a-14(a). |
| [31.3](ex_448611.htm) | Certification of Co-CFO pursuant to Rule 13a-14(a). |
| [<u>32.1</u>](ex_448612.htm) | Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| [<u>32.2</u>](ex_448613.htm) | Certification of Co-CFOs pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002. |
| 101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |

---

---

| | |
|:---|:---|
| **ITEM 16:** | **FORM 10-K SUMMARY** |

---

None.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 52

------

[**Table of Contents**](#toc)

**SIGNATURES**

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Greenwich, State of Connecticut, on March 15, 2023.

ASSOCIATED CAPITAL GROUP, INC.

---

| | | | |
|:---|:---|:---|:---|
| By: | /s/ Patrick B. Huvane | By: | /s/ Ian J. McAdams |
| Name: | Patrick B. Huvane | Name: | Ian J. McAdams |
| Title: | Interim Co-Chief Financial Officer | Title: | Interim Co-Chief Financial Officer |
| Date: | March 15, 2023 | Date: | March 15, 2023 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 53

------

[**Table of Contents**](#toc)

**POWER OF ATTORNEY**

Each person whose signature appears below hereby constitutes and appoints Peter D. Goldstein, Patrick B. Huvane, and Ian J. McAdams and each of them, their true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for them in their name, place and stead, in any and all capacities, to sign any and all amendments to this report and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| /s/ Douglas R. Jamieson | President, | March 15, 2023 |
| Douglas R. Jamieson | Chief Executive Officer and Director |  |
|  | (Principal Executive Officer) |  |
| /s/ Patrick B. Huvane | Interim Co-Chief Financial Officer | March 15, 2023 |
| Patrick B. Huvane | (Co-Principal Financial Officer) |  |
| /s/ Ian J. McAdams | Interim Co-Chief Financial Officer | March 15, 2023 |
| Ian J. McAdams | (Co-Principal Financial Officer) |  |
| /s/ Mario J. Gabelli | Executive Chair of the | March 15, 2023 |
| Mario J. Gabelli | Board and Director |  |
| /s/ Marc Gabelli | Director | March 15, 2023 |
| Marc Gabelli |  |  |
| /s/ Daniel R. Lee | Director | March 15, 2023 |
| Daniel R. Lee |  |  |
| /s/ Bruce M. Lisman | Director | March 15, 2023 |
| Bruce M. Lisman |  |  |
| /s/ Richard T. Prins | Director | March 15, 2023 |
| Richard T. Prins |  |  |
| /s/ Frederic V. Salerno | Director | March 15, 2023 |
| Frederic V. Salerno |  |  |
| /s/ Salvatore F. Sodano | Director | March 15, 2023 |
| Salvatore F. Sodano |  |  |
| /s/ Elisa M. Wilson | Director | March 15, 2023 |
| Elisa M. Wilson |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 54

## Exhibit 21.1

**Exhibit 21.1**

**Subsidiaries of Associated Capital Group, Inc.**

The following table lists the direct and indirect subsidiaries of Associated Capital Group, Inc. (the "Company"), except those subsidiaries when considered in the aggregate would not constitute a "significant subsidiary" as defined in the rules promulgated under the Securities Act. In accordance with Item 601 (21) of Regulation S-K, the omitted subsidiaries considered in the aggregate as a single subsidiary would not constitute a "significant subsidiary" as defined under Rule 1-02(w) of Regulation S-X.

---

| | |
|:---|:---|
| **Name** | **Jurisdiction of Incorporation or Organization** |
| Gabelli & Company Investment Advisers, Inc. | Delaware |
| &nbsp;&nbsp;&nbsp; (100%-owned by the Company) |  |
| Gabelli & Partners, LLC | Delaware |
| &nbsp;&nbsp;&nbsp; (100%-owned by Gabelli & Company Investment Advisers, Inc.) |  |

---

## Exhibit 31.1

**Exhibit 31.1**

**Certifications**

I, Douglas R. Jamieson, certify that:

1. I have reviewed this annual report on Form 10-K of Associated Capital Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of income and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures as of the end of the period covered by this report; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| By: | /s/ Douglas R. Jamieson |
| Name: | Douglas R. Jamieson |
| Title: | Chief Executive Officer |
| Date: | March 15, 2023 |

---

## Exhibit 31.2

**Exhibit 31.2**

**Certifications**

I, Patrick B. Huvane, certify that:

1. I have reviewed this annual report on Form 10-K of Associated Capital Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of income and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures as of the end of the period covered by this report; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| By: | /s/ Patrick B. Huvane |
| Name: | Patrick B. Huvane |
| Title: | Interim Co-Chief Financial Officer |
| Date: | March 15, 2023 |

---

## Exhibit 31.3

**Exhibit 31.3**

**Certifications**

I, Ian J. McAdams, certify that:

1. I have reviewed this annual report on Form 10-K of Associated Capital Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of income and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures as of the end of the period covered by this report; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| By: | /s/ Ian J. McAdams |
| Name: | Ian J. McAdams |
| Title: | Interim Co-Chief Financial Officer |
| Date: | March 15, 2023 |

---

## Exhibit 32.1

**Exhibit 32.1**

**Certification of CEO Pursuant to**

**18 U.S.C. Section 1350, as Adopted Pursuant to**

**Section 906 of the Sarbanes-Oxley Act of 2002**

In connection with the Annual Report on Form 10-K of Associated Capital Group, Inc. (the "Company") for the year ended December 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Douglas R. Jamieson, as Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of income of the Company.

---

| | |
|:---|:---|
| By: | /s/ Douglas R. Jamieson |
| Name: | Douglas R. Jamieson |
| Title: | Chief Executive Officer |
| Date: | March 15, 2023 |

---

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

## Exhibit 32.2

**Exhibit 32.2**

**Certification of Co-CFOs Pursuant to**

**18 U.S.C. Section 1350, as Adopted Pursuant to**

**Section 906 of the Sarbanes-Oxley Act of 2002**

In connection with the Annual Report on Form 10-K of Associated Capital Group, Inc. (the "Company") for the year ended December 31, 2022 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Patrick B. Huvane and Ian J. McAdams, as Interim Co-Chief Financial Officers of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of their knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of income of the Company.

---

| | | | |
|:---|:---|:---|:---|
| By: | /s/ Patrick B. Huvane | By: | /s/ Ian J. McAdams |
| Name: | Patrick B. Huvane | Name: | Ian J. McAdams |
| Title: | Interim Co-Chief Financial Officer | Title: | Interim Co-Chief Financial Officer |
| Date: | March 15, 2023 | Date: | March 15, 2023 |

---

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.