What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-07-28 compared with 2023-04-28 · 294 added, 179 removed, 1004 unchanged (32% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(Expressed in thousands, except number of shares and per share amounts) March 31, 2023 December 31, 2022

(Expressed in thousands, except number of shares and per share amounts) June 30, 2023 December 31, 2022

Cash and cash equivalents $ 29,145 $ 112,433

38 unchanged sentences

shares issued and outstanding:

10,975,723 and 10,868,556 as of March 31, 2023 and December 31, 2022, respectively

10,884,575 and 10,868,556 as of June 30, 2023 and December 31, 2022, respectively

shares authorized, issued and outstanding:

99,665 as of March 31, 2023 and December 31, 2022

99,665 as of June 30, 2023 and December 31, 2022

Additional paid-in capital 25,576 28,628

10 unchanged sentences

For the Three Months Ended

June 30, For the Six Months Ended

(Expressed in thousands, except number of shares and per share amounts) 2023 2022 2023 2022

14 unchanged sentences

Total expenses 317,888 243,391 620,518 495,206

Pre-tax income 19,049 14,213

Income taxes provision 4,585 4,435

Net income $ 14,464 $ 9,778

Net income (loss) attributable to noncontrolling interest, net of tax ( 153 ) 486

Net income attributable to Oppenheimer Holdings Inc.

Pre-tax income (loss) ( 11,699 ) ( 6,169 ) 7,350 8,044

Income taxes provision (benefit) ( 2,131 ) ( 1,449 ) 2,454 2,986

Net income (loss) $ ( 9,568 ) $ ( 4,720 ) $ 4,896 $ 5,058

Net loss attributable to noncontrolling interest, net of tax ( 168 ) ( 846 ) ( 321 ) ( 360 )

Net income (loss) attributable to Oppenheimer Holdings Inc.

$ ( 9,400 ) $ ( 3,874 ) $ 5,217 $ 5,418

Earnings per share attributable to Oppenheimer Holdings Inc.

Earnings (loss) per share attributable to Oppenheimer Holdings Inc.

Basic $ ( 0.85 ) $ ( 0.32 ) $ 0.47 $ 0.44

8 unchanged sentences

For the Three Months Ended

For the Six Months Ended

(Expressed in thousands) 2023 2022 2023 2022

Net income $ 14,464 $ 9,778

Other comprehensive income, net of tax

Net income (loss) $ ( 9,568 ) $ ( 4,720 ) $ 4,896 $ 5,058

Other comprehensive loss, net of tax

Currency translation adjustment ( 663 ) ( 2,038 ) ( 1,160 ) ( 2,652 )

Comprehensive income $ 13,967 $ 9,164

Less net income (loss) attributable to noncontrolling interests ( 153 ) 486

Comprehensive income attributable to Oppenheimer Holdings Inc.

Comprehensive income (loss) $ ( 10,231 ) $ ( 6,758 ) 3,736 2,406

Less net loss attributable to noncontrolling interests ( 168 ) ( 846 ) ( 321 ) ( 360 )

Comprehensive income (loss) attributable to Oppenheimer Holdings Inc.

$ ( 10,063 ) $ ( 5,912 ) $ 4,057 $ 2,766

3 unchanged sentences

For the Three Months Ended

For the Six Months Ended

(Expressed in thousands, except per share amount) 2023 2022 2023 2022

10 unchanged sentences

Vested employee share plan awards ( 259 ) — ( 11,578 ) ( 4,595 )

Change in redemption value of redeemable non-controlling interests ( 29 ) —

Change in redemption value of redeemable noncontrolling interests ( 72 ) — ( 101 ) —

Balance at end of period 25,576 35,461 25,576 35,461

1 unchanged sentence

Balance at beginning of period 777,121 748,323 764,178 740,926

Net income (2)

Repurchase of Class A non-voting common stock for cancellation ( 3,599 ) — ( 3,599 ) —

Net income (loss) (1)

( 9,400 ) ( 3,874 ) 5,217 5,418

Dividends paid ( 1,651 ) ( 1,835 ) ( 3,325 ) ( 3,730 )

8 unchanged sentences

Balance at beginning of period 433 2,555 722 2,069

Net income (loss) attributable to noncontrolling interest ( 153 ) 486

Change in redemption value of redeemable non-controlling interests ( 136 ) —

Capital distribution to noncontrolling interest 171 — 171 —

Net loss attributable to noncontrolling interest ( 168 ) ( 846 ) ( 321 ) ( 360 )

Change in redemption value of redeemable noncontrolling interests ( 328 ) — ( 464 ) —

Balance at end of period 108 1,709 108 1,709

6 unchanged sentences

Dividends paid per share $ 0.15 $ 0.15 $ 0.30 $ 0.30

(1) Certain prior period reported amounts were reclassified to conform to the current period presentation, See Note 2.

(1) Attributable to Oppenheimer Holdings Inc.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

FOR THE THREE MONTHS ENDED MARCH 31,

FOR THE SIX MONTHS ENDED JUNE 30,

(Expressed in thousands) 2023 2022

39 unchanged sentences

Payments for employee taxes withheld related to vested share-based awards ( 5,907 ) ( 2,251 )

Addition to noncontrolling interests 171 —

Redemption of redeemable noncontrolling interests ( 83 ) —

Repurchase of senior secured notes ( 1,000 ) —

Increase in bank call loans, net 19,300 8,650

Cash provided by/(used in) financing activities 7,033 ( 11,654 )

Increase in bank call loans 94,400 107,800

Cash provided by financing activities 76,971 55,444

Net decrease in cash, cash equivalents and restricted cash ( 83,019 ) ( 177,043 )

27 unchanged sentences

Oppenheimer Investments Asia Limited, based in Hong Kong, China, which provides fixed income and equities brokerage services to institutional investors and is regulated by the Securities and Futures Commission.

and Oppenheimer Israel Ltd., based in Tel Aviv, Israel, which provides investment services in the State of Israel and operates subject to the authority of the Israel Securities Authority.

Oppenheimer owns Freedom Investments, Inc.

("Freedom"), a registered broker dealer in securities, which provides discount brokerage services, and Oppenheimer Israel (OPCO) Ltd., based on Tel Aviv, Israel, which provides investment services in the State of Israel and operates subject to the authority of the Israel Securities Authority.

Summary of significant accounting policies and estimates

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Although these estimates are based on management's knowledge of current events and actions that the Company may undertake in the future, actual results may differ materially from the estimates.

The condensed consolidated results of operations for the three-month period ended March 31, 2023 are not necessarily indicative of the results to be expected for any future interim or annual period.

The condensed consolidated results of operations for the three and six months ended June 30, 2023 are not necessarily indicative of the results to be expected for any future interim or annual period.

Reclassification

11 unchanged sentences

As a result, both OHAA and the Sponsor are recorded in the Company's consolidated financial statements.

Upon IPO completion, funds totaling $ 127.8 million, including proceeds from the OHAA IPO of $ 126.5 million and $ 1.3 million investment from the Sponsor, are held in a trust account until the earlier of (i) the completion of a Business Combination or (ii) ten business days after April 29, 2023, 18 months from the closing of the OHAA IPO (“Combination Period”), pursuant to OHAA's certificate of incorporation.

Upon IPO completion, funds totaling $ 127.8 million, including proceeds from the OHAA IPO of $ 126.5 million and $ 1.3 million investment from the Sponsor, were held in a trust account until the earlier of (i) the completion of a Business Combination or (ii) ten business days after April 29, 2023, 18 months from the closing of the OHAA IPO (“Combination Period”), pursuant to OHAA's certificate of incorporation.

The cash held in the trust account is recorded in “Restricted Cash” on the consolidated balance sheet.

3 unchanged sentences

Of the 12,650,000 shares of Class A common stock that were outstanding, a total of 10,170,490 shares exercised their redemption rights.

As of March 31, 2023, $ 25.6 million remained in the trust account that is recorded within “Restricted Cash” on the condensed consolidated balance sheet.

“Redeemable noncontrolling interests” of $ 25.6 million associated with the publicly held OHAA Class A ordinary shares are recorded on the Company’s condensed consolidated balance sheet as of March 31, 2023 at redemption value and classified as temporary equity in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity”.

As of June 30, 2023, $ 25.8 million remained in the trust account that is recorded within “Restricted Cash” on the condensed consolidated balance sheet.

“Redeemable noncontrolling interests” of $ 25.9 million associated with the publicly-held OHAA Class A ordinary shares are recorded on the Company’s condensed consolidated balance sheet as of June 30, 2023 at redemption value and classified as temporary equity in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity”.

Changes in redemption value are recognized immediately as they occur and will adjust the carrying value of redeemable noncontrolling interests to equal the redemption value at the end of each reporting period.

7 unchanged sentences

Employees who become members of a Series receive a "profit interest", as that term is used in Internal Revenue Service (“IRS”) regulations, and receive an allocation of capital appreciation of the investment held by the particular Series that exceeds a threshold amount established for each Series.

Participating employees are also subject to vesting and forfeiture requirements for each Series investment.

Vested profit interests are accounted for as compensation expense under FASB Topic ASC 710.

Additionally, the

Participating employees are also subject to vesting and forfeiture requirements for each Series

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Company’s policy is to consolidate those entities where it owns the majority voting interests.

Vested profit interests are accounted for as compensation expense under FASB Topic ASC 710.

Additionally, the Company’s policy is to consolidate those entities where it owns the majority voting interests.

The Company owns the majority voting interest of OPI through Oppenheimer Alternative Investment Management (“OAIM”), the managing member of OPI and a subsidiary of OAM.

3 unchanged sentences

Noncontrolling interests also include publicly-held warrants to purchase OHAA Class A ordinary shares.

For the three months ended March 31, 2023 and March 31, 2022, the net income (loss) attributed to noncontrolling interests was (net of taxes) $ 153,000 and ($ 486,000 ), respectively.

For the six months ended June 30, 2023 and June 30, 2022, the net loss (net of taxes) attributed to noncontrolling interests was $ 321,000 and $ 360,000 , respectively.

Restricted Cash

5 unchanged sentences

See note 9 for details.

As of March 31, 2023, the Company had $ 63.6 million of notes receivable ($ 57.5 million as of December 31, 2022).

As of June 30, 2023, the Company had $ 60.9 million of notes receivable ($ 57.5 million as of December 31, 2022).

Notes receivable represent recruiting and retention payments generally in the form of upfront loans to financial advisors and key revenue producers as part of the Company's overall growth strategy.

8 unchanged sentences

The expected loss rate is adjusted for changes in market conditions such as changes in unemployment rates, changes in interest rates and other relevant factors.

For the three months ended March 31, 2023, no adjustments were made to the expected loss rates.

For the three and six months ended June 30, 2023, no adjustments were made to the expected loss rates.

The Company will continuously monitor the effect of these factors on the expected loss rate and adjust it as necessary.

The allowance is measured on a pool basis as the Company has determined that the entire defaulted portion of notes receivable has similar risk characteristics.

As of March 31, 2023, the uncollected balance of defaulted notes was $ 6.1 million and the allowance for uncollectibles was $ 4.1 million.

As of June 30, 2023, the uncollected balance of defaulted notes was $ 6.2 million and the allowance for uncollectibles was $ 3.8 million.

The allowance for uncollectibles consisted of $ 2.2 million related to defaulted notes balances (five years and older) and $ 1.6 million related to defaulted notes balances (under five years).

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (unaudited)

The following table presents the disaggregation of defaulted notes by year of default as of March 31, 2023:

The following table presents the disaggregation of defaulted notes by year of default as of June 30, 2023:

(Expressed in thousands)

As of March 31, 2023

As of June 30, 2023

2018 and prior 2,176

Total $ 6,236

The following table presents activity in the allowance for uncollectibles of defaulted notes for the three months ended

March 31, 2023 and 2022:

The following table presents activity in the allowance for uncollectibles of defaulted notes for the three and six months ended June 30, 2023 and 2022:

(Expressed in thousands)

For the Three Months Ended

For the Six Months Ended

2023 2022 2023 2022

Beginning balance $ 4,051 $ 5,247 $ 4,327 $ 4,923

13 unchanged sentences

The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As of June 30, 2023, the Company had right-of-use operating lease assets of $ 154.8 million (net of accumulated amortization of $ 90.1 million) which are comprised of real estate leases of $ 152.0 million (net of accumulated amortization of $ 87.7 million) and equipment leases of $ 2.8 million (net of accumulated amortization of $ 2.4 million).

As of June 30, 2023, the Company had

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

As of March 31, 2023, the Company had right-of-use operating lease assets of $ 152.8 million (net of accumulated amortization of $ 86.9 million) which are comprised of real estate leases of $ 149.7 million (net of accumulated amortization of $ 84.6 million) and equipment leases of $ 3.1 million (net of accumulated amortization of $ 2.3 million).

As of March 31, 2023, the Company had operating lease liabilities of $ 193.4 million which are comprised of real estate lease liabilities of $ 190.3 million and equipment lease liabilities of $ 3.1 million.

The Company had no finance leases as of March 31, 2023.

operating lease liabilities of $ 196.9 million which are comprised of real estate lease liabilities of $ 194.1 million and equipment lease liabilities of $ 2.8 million.

The Company had no finance leases as of June 30, 2023.

As most of the Company's leases do not provide an implicit rate, the Company uses the incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

1 unchanged sentence

The Company used the incremental borrowing rate as of the lease commencement date for the operating leases that commenced subsequent to January 1, 2019.

The following table presents the weighted average lease term and weighted average discount rate for the Company's operating leases as of March 31, 2023 and December 31, 2022, respectively:

March 31, 2023 December 31, 2022

The following table presents the weighted average lease term and weighted average discount rate for the Company's operating leases as of June 30, 2023 and December 31, 2022, respectively:

June 30, 2023 December 31, 2022

Weighted average remaining lease term (in years) 6.86 6.82

Weighted average discount rate 7.05 % 6.66 %

The following table presents operating lease costs recognized for the three months ended March 31, 2023 and March 31, 2022, respectively, which are included in occupancy and equipment costs on the condensed consolidated income statements:

The following table presents operating lease costs recognized for the three and six months ended June 30, 2023 and June 30, 2022, respectively, which are included in occupancy and equipment costs on the condensed consolidated income statements:

(Expressed in thousands)

For the Three Months Ended

June 30, For the Six Months Ended

2023 2022 2023 2022

Operating lease costs:

3 unchanged sentences

Equipment leases - Interest expense 47 35 93 67

The maturities of lease liabilities as of March 31, 2023 and December 31, 2022 are as follows:

The maturities of lease liabilities as of June 30, 2023 and December 31, 2022 are as follows:

(Expressed in thousands)

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

2023 $ 22,196 $ 42,343

7 unchanged sentences

Present value of lease liabilities $ 196,934 $ 182,570

As of March 31, 2023, the Company had $ 20.3 million of additional real estate operating leases that have not yet commenced ($ 40.2 million as of December 31, 2022).

As of June 30, 2023, the Company had $ 9.3 million of additional real estate operating leases that have not yet commenced ($ 40.2 million as of December 31, 2022).

OPPENHEIMER HOLDINGS INC.

27 unchanged sentences

Performance fees are recognized when the return on client AUM exceeds a specified benchmark return or as other performance targets over a 12-month measurement period are met.

Performance fees are considered variable and they are recognized at a point in time as they are subject to fluctuation and/or are contingent on a future event over the measurement

Performance fees are considered variable and they are recognized at a point in time as they are subject to fluctuation and/or are contingent on a future event over the measurement period and are not subject to adjustment once the measurement period ends.

Such fees are computed as of the fund's year-end

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

period and are not subject to adjustment once the measurement period ends.

Such fees are computed as of the fund's year-end when the measurement period ends and generally are recorded as earned in the fourth quarter of the Company's fiscal year.

when the measurement period ends and generally are recorded as earned in the fourth quarter of the Company's fiscal year.

Both management and performance fees are generally received within 90 days.

14 unchanged sentences

Disaggregation of Revenue

The following presents the Company's revenue from contracts with customers disaggregated by major business activity and other sources of revenue for the three months ended March 31, 2023 and 2022:

(Expressed in thousands) For the Three Months Ended March 31, 2023

The following presents the Company's revenue from contracts with customers disaggregated by major business activity and other sources of revenue for the three and six months ended June 30, 2023 and 2022:

(Expressed in thousands) For the Three Months Ended June 30, 2023

Reportable Segments

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Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands) For the Three Months Ended March 31, 2022

(Expressed in thousands) For the Three Months Ended June 30, 2022

Reportable Segments

15 unchanged sentences

Total revenue $ 144,471 $ 24,315 $ 71,274 $ ( 2,838 ) $ 237,222

(Expressed in thousands) For the Six Months Ended June 30, 2023

Reportable Segments

Private Client Asset Management Capital Markets Corporate/Other Total

Revenue from contracts with customers:

Commissions from sales and trading $ 76,590 $ — 83,201 14 $ 159,805

Mutual fund and insurance income 15,423 — 5 8 15,436

Advisory fees 155,394 46,150 — 15 201,559

Investment banking - capital markets 3,475 — 15,586 — 19,061

Investment banking - advisory — — 38,882 — 38,882

Bank deposit sweep income 92,969 — — — 92,969

Other 7,277 — 1,100 118 8,495

Total revenue from contracts with customers 351,128 46,150 138,774 155 536,207

Other sources of revenue:

Interest 42,982 — 7,138 2,141 52,261

Principal transactions, net 2,121 — 23,814 3,808 29,743

Other 8,435 7 138 1,077 9,657

Total other sources of revenue 53,538 7 31,090 7,026 91,661

Total revenue $ 404,666 $ 46,157 $ 169,864 $ 7,181 $ 627,868

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands) For the Six Months Ended June 30, 2022

Reportable Segments

Private Client Asset Management Capital Markets Corporate/Other Total

Revenue from contracts with customers:

Commissions from sales and trading $ 81,463 $ — 95,061 17 $ 176,541

Mutual fund and insurance income 16,130 — 6 22 16,158

Advisory fees 171,613 51,424 117 17 223,171

Investment banking - capital markets 5,665 — 19,234 — 24,899

Investment banking - advisory 35 — 30,189 — 30,224

Bank deposit sweep income 19,199 — — — 19,199

Other 7,642 — 797 188 8,627

Total revenue from contracts with customers 301,747 51,424 145,404 244 498,819

Other sources of revenue:

Interest 18,517 — 2,685 104 21,306

Principal transactions, net ( 4,166 ) — 8,080 ( 292 ) 3,622

Other ( 20,780 ) 8 156 119 ( 20,497 )

Total other sources of revenue ( 6,429 ) 8 10,921 ( 69 ) 4,431

Total revenue $ 295,318 $ 51,432 $ 156,325 $ 175 $ 503,250

Contract Assets and Liabilities

2 unchanged sentences

Alternatively, when payment precedes the provision of the related services, the Company records deferred revenue until the performance obligations are satisfied.

The Company had receivables related to revenue from contracts with customers of $ 28.6 million and $ 32.8 million at March 31, 2023 and December 31, 2022, respectively.

The Company had no significant impairments related to these receivables during the three months ended March 31, 2023.

The Company had receivables related to revenue from contracts with customers of $ 34.3 million and $ 32.8 million at June 30, 2023 and December 31, 2022, respectively.

The Company had no significant impairments related to these receivables during the three months ended June 30, 2023.

Deferred revenue relates to IRA fees received annually in advance on customers' IRA accounts managed by the Company and retainer fees and other fees earned from certain advisory transactions where the performance obligations have not yet been satisfied.

Total deferred revenue was $ 1,701,000 and $ 900,000 at March 31, 2023 and December 31, 2022, respectively.

Total deferred revenue was $ 2.86 million and $ 900,000 at June 30, 2023 and December 31, 2022, respectively.

The following presents the Company's contract assets and deferred revenue balances from contracts with customers, which are included in other assets and other liabilities, respectively, on the condensed consolidated balance sheet:

2 unchanged sentences

(Expressed in thousands) As of

March 31, 2023

June 30, 2023

December 31, 2022

10 unchanged sentences

Investment banking fees (6)

$ 1,507 $ 900

Total deferred revenue $ 2,860 $ 900

4 unchanged sentences

(5) Underwriting revenue and advisory fees earned but not yet received, including certain receivables.

(6) Retainer fees and fees received from certain advisory transactions where the performance

obligations have not yet been satisfied.

(6) Retainer fees and fees received from certain advisory transactions where the performance obligations have not yet been satisfied.

(7) Fee received in advance on an annual basis.

5 unchanged sentences

For the Three Months Ended

For the Six Months Ended

2023 2022 2023 2022

Basic weighted average number of shares outstanding 11,016,430 11,980,115 11,054,306 12,222,527

2 unchanged sentences

Diluted weighted average number of shares outstanding 11,016,430 11,980,115 11,911,379 13,141,538

Net income attributable to Oppenheimer Holdings Inc.

Net income (loss) attributable to Oppenheimer Holdings Inc.

$ ( 9,400 ) $ ( 3,874 ) $ 5,217 $ 5,418

Earnings per share attributable to Oppenheimer Holdings Inc.

Earnings (Loss) per share attributable to Oppenheimer Holdings Inc.

Basic $ ( 0.85 ) $ ( 0.32 ) $ 0.47 $ 0.44

Diluted $ ( 0.85 ) $ ( 0.32 ) $ 0.44 $ 0.41

(1) For the three months ended March 31, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 282,360 shares of Class A Stock granted under share-based compensation arrangements.

For the three months ended March 31, 2022, there was no Class A Stock granted under share-based compensation arrangements that was anti-dilutive.

(1) For the three months ended June 30, 2023, the diluted net loss per share computation did not include the anti-dilutive effect of 1,138,992 shares of Class A Stock granted under share-based compensation arrangements.

For the six months ended June 30, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 281,810 shares of Class A Stock granted under share-based compensation arrangements.

For the three months ended June 30, 2022, the diluted net loss per share computation did not include the anti-dilutive effect of 1,267,733 shares of Class A Stock granted under share-based

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

compensation arrangements.

For the six months ended June 30, 2022, the diluted net income per share computation did not include the anti-dilutive effect of 4,100 shares of Class A Stock granted under share-based compensation arrangements.

Receivable from and payable to brokers, dealers and clearing organizations

(Expressed in thousands)

March 31, 2023 December 31, 2022

June 30, 2023 December 31, 2022

Receivable from brokers, dealers and clearing organizations consisting of:

11 unchanged sentences

Total $ 421,403 $ 550,006

(1) The balances are primarily related to a trade/settlement date adjustment for U.S.

Government Securities.

(1) The balances are primarily related to trade date / settlement date adjustments for positions in inventory.

Fair value measurements

13 unchanged sentences

The fair value of corporate bonds is estimated using recent transactions, broker quotations and bond spread information.

Mortgage and Other Asset-Backed Securities

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Mortgage and Other Asset-Backed Securities

The Company values non-agency securities collateralized by home equity and various other types of collateral based on external pricing and spread data provided by independent pricing services.

13 unchanged sentences

In addition to the settlements with the Regulators, Oppenheimer had also reached settlements of and received adverse awards in legal proceedings with various clients where the Company was obligated to purchase ARS.

As of March 31, 2023, the Company no longer had any obligations to purchase ARS from such legal settlements or adverse awards.

As of March 31, 2023, the Company owned $ 31.8 million of ARS.

As of June 30, 2023, the Company no longer had any obligations to purchase ARS from such legal settlements or adverse awards.

As of June 30, 2023, the Company owned $ 31.7 million of ARS.

This amount represents the unredeemed or unsold amount that the Company holds as a result of ARS buybacks pursuant to the settlements with the Regulators and legal settlements and awards referred to above.

4 unchanged sentences

In such cases, other valuation techniques might be necessary.

As of March 31, 2023, the Company had a valuation allowance totaling $ 5.2 million relating to ARS owned (which is included as a reduction to securities owned on the condensed consolidated balance sheet).

As of June 30, 2023, the Company had a valuation allowance totaling $ 5.2 million relating to ARS owned (which is included as a reduction to securities owned on the condensed consolidated balance sheet).

In its role as general partner in certain hedge funds and private equity funds, the Company, through its subsidiaries, holds direct investments in such funds.

The Company uses the net asset value of the underlying fund as a basis for estimating the fair value of its investment.

The following table provides information about the Company's investments in Company-sponsored funds as of June 30, 2023:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

The following table provides information about the Company's investments in Company-sponsored funds as of March 31, 2023:

(Expressed in thousands)

9 unchanged sentences

(1) Includes investments in hedge funds and hedge fund of funds that pursue long/short, event-driven, and activist strategies

(2) Includes private equity funds and private equity fund of funds with diversified portfolios focusing on but not limited to

technology companies, venture capital and global natural resources

(2) Includes private equity funds and private equity fund of funds with diversified portfolios focusing on but not limited to technology companies, venture capital and global natural resources

The following table provides information about the Company's investments in Company-sponsored funds as of December 31, 2022:

11 unchanged sentences

(2) Includes private equity funds and private equity fund of funds with diversified portfolios focusing on but not limited to technology companies, venture capital and global natural resources.

During 2020, the Company made an investment in a financial technologies firm.

The Company owns an investment in a financial technologies firm.

The Company elected the fair value option for this investment and it is included in other assets on the condensed consolidated balance sheet.

The Company determined the fair value of the investment based on an implied market-multiple approach and observable market data, including comparable company transactions.

As of March 31, 2023, the fair value of the investment was $ 6.0 million and was categorized in Level 2 of the fair value hierarchy.

As of June 30, 2023, the fair value of the investment was $ 6.2 million and was categorized in Level 2 of the fair value hierarchy.

Assets and Liabilities Measured at Fair Value

The Company's assets and liabilities, recorded at fair value on a recurring basis as of March 31, 2023, and December 31, 2022, have been categorized based upon the above fair value hierarchy as follows:

The Company's assets and liabilities, recorded at fair value on a recurring basis as of June 30, 2023, and December 31, 2022, have been categorized based upon the above fair value hierarchy as follows:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2023 :

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2023 :

(Expressed in thousands)

Fair Value Measurements as of March 31, 2023

Fair Value Measurements as of June 30, 2023

Level 1 Level 2 Level 3 Total

13 unchanged sentences

5,454 11,713 — 17,167

Derivative contracts:

TBAs — 4,734 — 4,734

41 unchanged sentences

Agency securities — 3 — 3

Sovereign obligations — 9,048 — 9,048

Corporate debt and other obligations — 2,905 — 2,905

10 unchanged sentences

Notes to Condensed Consolidated Financial Statements (unaudited)

The following tables present changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the three months ended March 31, 2023 and 2022:

The following tables present changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the three and six months ended June 30, 2023 and 2022:

(Expressed in thousands)

Level 3 Assets and Liabilities

For the Three Months Ended March 31, 2023

For the Three Months Ended June 30, 2023

Total Realized

4 unchanged sentences

$ 31,776 $ 6 $ — $ ( 100 ) $ — $ 31,682

ARS Purchase Commitments (2)

(1) Represents auction rate securities that failed in the auction rate market.

(2) Represents the difference in principal and fair value for auction rate securities purchase commitments outstanding at the end of the period.

(Expressed in thousands)

Level 3 Assets and Liabilities

For the Three Months Ended March 31, 2022

For the Three Months Ended June 30, 2022

Total Realized

Beginning and Unrealized Purchases Sales and Transfers Ending

Balance Losses

and Issuances Settlements In (Out) Balance

Auction rate securities (1)

31,804 ( 27 ) 200 — — 31,977

(1) Represents auction rate securities that failed in the auction rate market.

(Expressed in thousands)

Level 3 Assets and Liabilities

For the Six Months Ended June 30, 2023

Total Realized

Beginning and Unrealized Purchases Sales and Transfers Ending

Balance Losses

and Issuances Settlements In (Out) Balance

Auction rate securities (1)

31,776 6 — ( 100 ) — 31,682

(1) Represents auction rate securities that failed in the auction rate market.

(Expressed in thousands)

Level 3 Assets and Liabilities

For the Six Months Ended June 30, 2022

Total Realized

Beginning and Unrealized Purchases Sales and Transfers Ending

Balance Losses and Issuances Settlements In (Out) Balance

1 unchanged sentence

31,804 ( 27 ) 200 — — 31,977

ARS Purchase Commitments (2)

(1) Represents auction rate securities that failed in the auction rate market.

(2) Represents the difference in principal and fair value for auction rate securities purchase commitments outstanding at the end of the period.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Financial Instruments Not Measured at Fair Value

3 unchanged sentences

The fair value of the Company's senior secured notes, categorized in Level 2 of the fair value hierarchy, is based on quoted prices from the market in which the notes trade.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Assets and liabilities not measured at fair value as of March 31, 2023:

Assets and liabilities not measured at fair value as of June 30, 2023:

(Expressed in thousands) Fair Value Measurement:

13 unchanged sentences

87,826 — 87,826 — 87,826

(1) Included in other assets on the condensed consolidated balance sheet.

(1) The cash surrender value of Company-owned life insurance policies, which fluctuates based on changes in fair value of the policies’ underlying investments, comprises approximately $ 86 million of this balance.

This balance is included within other assets on the condensed consolidated balance sheet.

(Expressed in thousands) Fair Value Measurement:

11 unchanged sentences

Senior secured notes 113,050 — 107,702 — 107,702

Assets and liabilities not measured at fair value as of December 31, 2022:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Assets and liabilities not measured at fair value as of December 31, 2022:

(Expressed in thousands) Fair Value Measurement:

8 unchanged sentences

Clearing organizations 20,035 — 20,035 — 20,035

Other — — — — —

206,076 — 206,076 — 206,076

4 unchanged sentences

79,322 — 79,322 — 79,322

(1) Included in other assets on the condensed consolidated balance sheet.

This balance is included within other assets on the condensed consolidated balance sheet.

(Expressed in thousands) Fair Value Measurement:

14 unchanged sentences

fair value versus carrying value) for certain assets and liabilities.

As of March 31, 2023, the Company had no repurchase agreements and reverse repurchase agreements that do not settle overnight or have an open settlement date.

As of June 30, 2023, the Company had no repurchase agreements and reverse repurchase agreements that do not settle overnight or have an open settlement date.

Derivative Instruments and Hedging Activities

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

The Company transacts, on a limited basis, in exchange traded and over-the-counter derivatives for both asset and liability management as well as for trading and investment purposes.

2 unchanged sentences

Foreign exchange hedges

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

From time to time, the Company also utilizes forward and options contracts to hedge the foreign currency risk associated with compensation obligations to Oppenheimer Israel (OPCO) Ltd.

14 unchanged sentences

Net unrealized gains and losses on TBAs are recorded on the condensed consolidated balance sheet in receivable from brokers, dealers and clearing organizations or payable to brokers, dealers and clearing organizations and in the condensed consolidated income statement as principal transactions revenue, net.

The notional amounts and fair values of the Company's derivatives as of March 31, 2023 and December 31, 2022 by product were as follows:

The notional amounts and fair values of the Company's derivatives as of June 30, 2023 and December 31, 2022 by product were as follows:

(Expressed in thousands)

Fair Value of Derivative Instruments as of March 31, 2023

Fair Value of Derivative Instruments as of June 30, 2023

Description Notional Fair Value

1 unchanged sentence

Other contracts TBAs $ 5,525 $ 4,734

Forward reverse repurchase agreements 15,000 —

$ 5,525 $ 4,734

3 unchanged sentences

Other contracts TBAs 5,525 4,696

Forward repurchase agreements 104,000 —

$ 8,226,525 $ 7,753

18 unchanged sentences

Such derivative instruments are not subject to master netting agreements, thus the related amounts are not offset.

The following table presents the location and fair value amounts of the Company's derivative instruments and their effect in the condensed consolidated income statements for the three months ended March 31, 2023 and 2022:

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Three Months Ended March 31, 2023

For the Three Months Ended June 30, 2023

Recognized in Income on Derivatives

2 unchanged sentences

Other contracts Foreign exchange forward contracts Other revenue ( 7 )

Other contracts TBAs Principal transactions revenue, net 2

TBAs Principal transactions revenue, net 36

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Three Months Ended March 31, 2022

For the Three Months Ended June 30, 2022

Recognized in Income on Derivatives

Types Description Location Net Gain

Types Description Location Net Gain/(Loss)

Commodity contracts Futures Principal transactions revenue, net $ 1,328

Other contracts TBAs Principal transactions revenue, net 63

Other contracts Foreign exchange forward contracts Other revenue ( 20 )

TBAs Principal transactions revenue, net ( 6 )

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Six Months Ended June 30, 2023

Recognized in Income on Derivatives

Types Description Location Net Gain/(Loss)

Commodity contracts Futures Principal transactions revenue, net $ 3,739

Other contracts Foreign exchange forward contracts Other revenue ( 8 )

TBAs Principal transactions revenue, net 38

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Six Months Ended June 30, 2022

Recognized in Income on Derivatives

Types Description Location Net Gain/(Loss)

Commodity contracts Futures Principal transactions revenue, net $ 3,519

Other contracts Foreign exchange forward contracts Other revenue ( 20 )

TBAs Principal transactions revenue, net 56

Collateralized transactions

3 unchanged sentences

Government and Agency securities.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

The Company obtains short-term borrowings primarily through bank call loans.

Bank call loans are generally payable on demand and bear interest at various rates.

As of March 31, 2023, the outstanding balance of bank call loans was $ 19.3 million ( zero as of December 31, 2022).

As of June 30, 2023, the outstanding balance of bank call loans was $ 94.4 million ( zero as of December 31, 2022).

Such loans with commercial banks were collateralized by the Company's securities and customer securities with market values of approximately $ 45.5 million and $ 64.4 million, respectively.

As of March 31, 2023, the Company had approximately $ 1.6 billion of customer securities under customer margin loans that are available to be pledged, of which the Company has re-pledged approximately $ 256.1 million under securities loan agreements.

As of March 31, 2023, the Company had pledged $ 271.5 million of customer securities directly with the Options Clearing Corporation to secure obligations and margin requirements under option contracts written by customers.

As of March 31, 2023, the Company had no outstanding letters of credit.

As of June 30, 2023, the Company had approximately $ 1.6 billion of customer securities under customer margin loans that are available to be pledged, of which the Company has re-pledged approximately $ 229.7 million under securities loan agreements.

As of June 30, 2023, the Company had pledged $ 261.8 million of customer securities directly with the Options Clearing Corporation to secure obligations and margin requirements under option contracts written by customers.

As of June 30, 2023, the Company had no outstanding letters of credit.

The Company enters into reverse repurchase agreements, repurchase agreements, securities borrowed and securities loaned transactions in order to, among other things, acquire securities to cover short positions and settle other securities obligations, so as to accommodate customers' needs and to finance the Company's inventory positions.

2 unchanged sentences

Repurchase agreements and reverse repurchase agreements are presented on a net-by-counterparty basis, when the repurchase agreements and reverse repurchase agreements are executed with the same counterparty, have the same explicit settlement date, are executed in accordance with a master netting arrangement, the securities underlying the repurchase agreements and reverse repurchase agreements exist in "book entry" form and certain other requirements are met.

The following table presents a disaggregation of the gross obligation by the class of collateral pledged and the remaining contractual maturity of the repurchase agreements and securities loaned transactions as of March 31, 2023:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)

1 unchanged sentence

Repurchase agreements:

Government and Agency securities $ 310,490

Government $ 685,436

Securities loaned:

1 unchanged sentence

Gross amount of recognized liabilities for repurchase agreements and securities loaned $ 1,021,949

The following tables present the gross amounts and the offsetting amounts of reverse repurchase agreements, repurchase agreements, securities borrowed and securities loaned transactions as of March 31, 2023 and December 31, 2022:

As of March 31, 2023

As of June 30, 2023

(Expressed in thousands)

11 unchanged sentences

(1) Included in receivable from brokers, dealers and clearing organizations on the condensed consolidated balance sheet.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Gross Amounts Not Offset

24 unchanged sentences

(1) Included in receivable from brokers, dealers and clearing organizations on the condensed consolidated balance sheet.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Gross Amounts Not Offset

12 unchanged sentences

The Company elects the fair value option for those repurchase agreements and reverse repurchase agreements that do not settle overnight or have an open settlement date.

As of March 31, 2023, the Company did not have any repurchase agreements and reverse repurchase agreements that do not settle overnight or have an open settlement date.

As of June 30, 2023, the Company did not have any repurchase agreements and reverse repurchase agreements that do not settle overnight or have an open settlement date.

The Company receives collateral in connection with securities borrowed and reverse repurchase agreement transactions and customer margin loans.

Under many agreements, the Company is permitted to sell or re-pledge the securities received (e.g., use the securities to enter into securities lending transactions, or deliver to counterparties to cover short positions).

As of March 31, 2023, the fair value of securities received as collateral under securities borrowed transactions and reverse repurchase agreements was $ 255.4 million ($ 124.1 million as of December 31, 2022) and $ 30.1 million ($ 28.0 million as of December 31, 2022), respectively, of which the Company has sold and re-pledged approximately $ 106.3 million ($ 39.4 million as of December 31, 2022) under securities loaned transactions and $ 30.1 million under repurchase agreements ($ 28.0 million as of December 31, 2022).

As of June 30, 2023, the fair value of securities received as collateral under securities borrowed transactions and reverse repurchase agreements was $ 250.7 million ($ 124.1 million as of December 31, 2022) and $ 40.0 million ($ 28.0 million as of December 31, 2022), respectively, of which the Company has sold and re-pledged approximately $ 95.5 million ($ 39.4 million as of December 31, 2022) under securities loaned transactions and $ 40.0 million under repurchase agreements ($ 28.0 million as of December 31, 2022).

The Company pledges certain of its securities owned for securities lending and repurchase agreements and to collateralize bank call loan transactions.

The carrying value of pledged securities owned that can be sold or re-pledged by the counterparty was

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

$ 337.8 million, as presented on the face of the condensed consolidated balance sheet as of March 31, 2023 ($ 175.7 million as of December 31, 2022).

The carrying value of pledged securities owned that can be sold or re-pledged by the counterparty was $ 660.0 million, as presented on the face of the condensed consolidated balance sheet as of June 30, 2023 ($ 175.7 million as of December 31, 2022).

The Company manages credit exposure arising from repurchase and reverse repurchase agreements by, in appropriate circumstances, entering into master netting agreements and collateral arrangements with counterparties that provide the Company, in the event of a customer default, the right to liquidate securities and the right to offset a counterparty's rights and obligations.

6 unchanged sentences

The Company seeks to mitigate these risks by actively monitoring exposures and obtaining collateral as deemed appropriate.

Included in receivable from brokers, dealers and clearing organizations as of March 31, 2023 were receivables from five major U.S.

Included in receivable from brokers, dealers and clearing organizations as of June 30, 2023 were receivables from two major U.S.

broker-dealers totaling approximately $ 125.9 million.

4 unchanged sentences

O'Brien & Associates (commodities transactions), Mortgage-Backed Securities Division (a division of FICC), and others.

With respect to its business in reverse repurchase and repurchase agreements, substantially all open contracts as of March 31, 2023 are with the FICC .

With respect to its business in reverse repurchase and repurchase agreements, substantially all open contracts as of June 30, 2023 are with the FICC .

In addition, the Company clears its non-U.S.

international equities business carried on by Oppenheimer Europe Ltd.

international equities business

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

carried on by Oppenheimer Europe Ltd.

through Global Prime Partners, Ltd, a global clearing financial institution located in United Kingdom.

3 unchanged sentences

As the right to charge the Company has no maximum amount and applies to all trades executed through the clearing brokers, the Company believes there is no maximum amount assignable to this right.

As of March 31, 2023, the Company had recorded no liabilities with regard to this right.

As of June 30, 2023, the Company had recorded no liabilities with regard to this right.

The Company's policy is to monitor the credit standing of the clearing brokers and banks with which it conducts business.

8 unchanged sentences

The subsidiaries' general partnership and limited partnership interests are included in other assets on the condensed consolidated balance sheet.

As of March 31, 2023, the Company did not have any hedge funds and private equity funds that are VIEs.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

As of June 30, 2023, the Company did not have any hedge funds and private equity funds that are VIEs.

The Company serves as general partner of Oppenheimer Acquisition LLC I and Oppenheimer Acquisition LLC II (the "Sponsors").

8 unchanged sentences

Of the 12,650,000 shares of Class A common stock that were outstanding, a total of 10,170,490 shares exercised their redemption rights.

As of March 31, 2023, $ 25.6 million remained in the trust account that is recorded within “Restricted Cash” on the consolidated balance sheet.

As of June 30, 2023, $ 25.8 million remained in the trust account that is recorded within “Restricted Cash” on the consolidated balance sheet.

In addition, OPI was formed in December 2020 and designed to retain and reward talented employees of the Company, primarily in connection with the deployment of Company capital into successful private market investments, and also in connection with the Company's receipt of non-cash compensation from investment banking assignments.

3 unchanged sentences

OPI is a consolidated VIE as the Company is the primary beneficiary.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

The following table sets forth the total assets and liabilities of VIEs consolidated on our condensed consolidated balance sheet:

(Expressed in thousands)

As of March 31,

As of June 30,

Cash and cash equivalents $ 5,487 $ 1,458

6 unchanged sentences

(Expressed in thousands)

Issued Maturity Date March 31, 2023 December 31, 2022

Issued Maturity Date June 30, 2023 December 31, 2022

5.50 % Senior Secured Notes

3 unchanged sentences

5.50 % Senior Secured Notes due 2025 (the "Notes")

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

On September 22, 2020, in a private offering, the Company issued $ 125.0 million aggregate principal amount of 5.50 % Senior Secured Notes due 2025 (the "Unregistered Notes") under an indenture at an issue price of 100 % of the principal amount.

10 unchanged sentences

During the first quarter of 2023, the Company repurchased and cancelled $ 1.0 million aggregate principal amount of its Notes in the open market.

As of March 31, 2023, $ 113.05 million aggregate principal amount of the Notes remain outstanding.

The indenture governing the Notes contains covenants which place restrictions on the incurrence of indebtedness, the payment of dividends, the repurchase of equity, the sale of assets, the issuance of guarantees, mergers and acquisitions and the granting of liens.

As of June 30, 2023, $ 113.05 million aggregate principal amount of the Notes remain outstanding.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

These covenants are subject to a number of important exceptions and qualifications.

9 unchanged sentences

• limitation on asset sales, which generally prohibits the Parent and certain of its subsidiaries from selling assets or certain securities or property of significant subsidiaries.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

The indenture also provides for events of default which, if any of them occurs, would permit or require the principal of and accrued interest on the Notes to become or to be declared due and payable.

As of March 31, 2023, the Parent was in compliance with all of its covenants.

As of June 30, 2023, the Parent was in compliance with all of its covenants.

The Notes are jointly and severally and fully and unconditionally guaranteed on a senior secured basis by the Subsidiary Guarantors and future subsidiaries are required to guarantee the Notes pursuant to the indenture.

The Notes are secured by a first-priority security interest in substantially all of the Parent’s and the Subsidiary Guarantors’ existing and future tangible and intangible assets, subject to certain exceptions and permitted liens.

Interest expense on the Notes for the three months ended March 31, 2023 was $ 1.6 million.

Interest expense on the Notes for the three months ended March 31, 2022 was $ 1.7 million .

The effective income tax rate for the three months ended March 31, 2023 was 24.1 %, compared with 31.2 % for the three months ended March 31, 2022 and reflects the Company's annual estimate of the statutory federal and state tax rates adjusted for certain discrete items.

The effective tax rate for the first quarter of 2023 was positively impacted by favorable permanent items.

Interest expense on the Notes for the three and six months ended June 30, 2023 was $ 1.6 million and $ 3.1 million, respectively.

Interest expense on the Notes for the three and six months ended June 30, 2022 was $ 1.7 million and $ 3.4 million, respectively.

The effective income tax rate for the three and six months ended June 30, 2023 was 18.2 % and 33.4 % respectively, compared with 23.5 % and 37.1 % for the three and six months ended June 30, 2022 and reflects the Company's annual estimate of the statutory federal and state tax rates adjusted for certain discrete items.

The effective tax rate for the second quarter of 2023 was impacted by permanent items and nondeductible foreign losses.

Stockholders' Equity

6 unchanged sentences

The following table reflects changes in the number of shares of Class A Stock outstanding for the periods indicated:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

For the Three Months Ended

June 30, For the Six Months Ended

2023 2022 2023 2022

Class A Stock outstanding, beginning of period 10,975,723 12,156,174 10,868,556 12,447,036

8 unchanged sentences

On May 24, 2022, the Company announced that its Board of Directors approved a share repurchase program that authorizes the Company to purchase up to 550,000 shares of the Company's Class A Stock, representing approximately 4.6 % of its 11,863,559 then issued and outstanding shares of Class A Stock.

This authorization supplemented the 71,893 shares that remained

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

authorized and available under the Company's previous share repurchase program for a total of 621,893 shares authorized and available for repurchase at May 24, 2022.

This authorization supplemented the 71,893 shares that remained authorized and available under the Company's previous share repurchase program for a total of 621,893 shares authorized and available for repurchase at May 24, 2022.

On July 29, 2022, the Company's Board of Directors approved a share repurchase program that authorizes the Company to purchase up to 536,500 shares of the Company's Class A Stock, representing approximately 4.8 % of its 11,251,930 then issued and outstanding shares of Class A Stock.

2 unchanged sentences

This authorization supplemented the 144,034 shares that remained authorized and available under the Company's previous share repurchase program for a total of 687,034 shares authorized.

During the three months ended March 31, 2023, the Company purchased and canceled an aggregate of 95,055 shares of Class A Stock for a total consideration of $ 3.7 million ($ 38.79 per share) under this program.

During the three months ended March 31, 2022, the Company purchased and canceled an aggregate of 377,313 shares of Class A Stock for a total consideration of $ 16.2 million ($ 42.82 per share) under this program.

As of March 31, 2023, 591,979 shares remained available to be purchased under the share repurchase program.

During the three months ended June 30, 2023, the Company purchased and canceled an aggregate of 96,135 shares of Class A Stock for a total consideration of $ 3.6 million ($ 37.43 per share) under this program.

During the six months ended June 30, 2023, the Company purchased and canceled an aggregate of 191,190 shares of Class A Stock for a total consideration of $ 7.3 million ($ 38.11 per share) under this program.

During the three months ended June 30, 2022, the Company purchased and canceled an aggregate of 885,230 shares of Class A Stock for a total consideration of $ 30.2 million ($ 34.13 per share) under this program.

During the six months ended June 30, 2022, the Company purchased and canceled an aggregate of 1,262,543 shares of Class A Stock for a total consideration of $ 46.4 million ($ 36.73 per share) under this program.

As of June 30, 2023, 495,844 shares remained available to be purchased under the share repurchase program.

The Company repurchases shares from time to time in the open market at the prevailing open market price using cash on hand, in compliance with the applicable rules and regulations of the New York Stock Exchange and federal and state securities laws and the terms of the Company's Notes.

2 unchanged sentences

The timing and amounts of any purchases will be based on market conditions and other factors including price, regulatory requirements and capital availability.

The share repurchase program does not obligate the Company to repurchase any dollar amount or number of shares of Class A Stock.

The share repurchase program does not obligate the Company to

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

repurchase any dollar amount or number of shares of Class A Stock.

Depending on market conditions and other factors, these repurchases may be commenced or suspended from time to time without prior notice.

11 unchanged sentences

Counsel may be required to review, analyze and resolve numerous issues, including through potentially lengthy discovery and determination of important factual matters, and by addressing novel or unsettled legal questions relevant to the proceedings in question, before the Company can reasonably estimate a loss or range of loss or additional loss for the proceeding.

Even after lengthy review

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

and analysis, the Company, in many legal and regulatory proceedings, may not be able to reasonably estimate possible losses or range of losses.

Even after lengthy review and analysis, the Company, in many legal and regulatory proceedings, may not be able to reasonably estimate possible losses or range of losses.

For certain other legal and regulatory proceedings, the Company can estimate possible losses, or range of loss in excess of amounts accrued, but does not believe, based on current knowledge and after consultation with counsel, that such losses individually, or in the aggregate, will have a material adverse effect on the Company's consolidated financial statements as a whole.

4 unchanged sentences

Accordingly, the Company's estimate will change from time to time, and actual losses may be more than the current estimate.

Beginning on or about August 31, 2021, Oppenheimer was named as a respondent in thirty-nine arbitrations, many containing multiple claimants, each filed before FINRA, relating to those claimants’ purported investment in Horizon Private Equity, III, LLC (“Horizon”).

On November 18, 2022, the Company received an information request from the SEC requesting information relating to the use of text messaging and similar forms of electronic communications by employees of the Company and whether those communications were properly retained by the Company as part of its records preservation requirements relating to the broker-dealer or investment adviser business activities of the Company.

Subsequently, the Company received a similar information request from the Commodity Futures Trading Commission (“CFTC”).

The Company has submitted multiple responses to the information request and continues to cooperate with the SEC and CFTC inquiries.

Beginning on or about August 31, 2021, Oppenheimer was named as a respondent in forty-five arbitrations, many containing multiple claimants, each filed before FINRA, relating to those claimants’ purported investment in Horizon Private Equity, III,

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

LLC (“Horizon”).

Horizon is alleged to be a fraudulent scheme involving, among others, a former Oppenheimer employee John Woods.

John Woods left Oppenheimer’s employ in 2016 and Oppenheimer never received a complaint or question from any of the investors prior to the Securities and Exchange Commission (“SEC”) bringing a complaint against Woods and his co-conspirators in 2021.

John Woods left Oppenheimer’s employ in 2016 and Oppenheimer never received a complaint or question from any of the investors prior to the SEC bringing a complaint against Woods and his co-conspirators in 2021.

Each investor who was an Oppenheimer client, signed a document acknowledging that Horizon was not an approved Oppenheimer product.

2 unchanged sentences

Claimants do not allege Oppenheimer received any of the funds invested in Horizon, but rather that Oppenheimer’s purported failure to properly supervise its employees allowed the alleged scheme to occur and continue.

The twenty-two individual arbitrations still pending claim specific monetary damages allege losses of approximately $ 24.0 million in the aggregate while a few others claim unspecified damages.

The fourteen arbitrations still pending that claim specific monetary damages and allege losses of approximately $ 13.9 million in the aggregate while a few others claim unspecified damages.

Oppenheimer believes these claims to be without merit and intends to defend itself vigorously against these claims.

As previously reported Oppenheimer’s motion to vacate the arbitration award in Donald Robinson, Timothy and Sharon Padden, Rhett Rainey, Kelly A.

Rainey Trust, Toucan Holdings LP, Robert Goodman, Robert Daniel Burgner, Individually and as Trustee of the Burgner Family Charitable Remainder Trust, Douglas Kasemeier, Wesley Callaway, and Billy Loveless v.

Oppenheimer has settled, or settled in principle or an award has been rendered in thirty-one of the Horizon-related arbitrations, with approximately one hundred eight individual complainants.

The aggregate payments for those thirty-one arbitrations total approximately $ 78.5 million.

On June 16, 2023, Oppenheimer was served with a complaint in an action entitled John and Cynthia Kearney, John & Tera Sargent, Mike Hall, Individually and as Assignee of 6694 Dawson Blvd, LLC, Thomas and Beverly Crampton, Roy and Shirley

Hill, Billy and Debra Lanter, Larry Lawson, Eugene Lyle, Scott Spence, and Dolores Willoughby v.

Oppenheimer & Co.

(the “Robinson Arbitration”) was denied on January 30, 2023.

However, on March 27, 2023, the Court entered a consent judgment vacating the award in Robinson Arbitration pursuant to the parties’ request in connection with their settlement of the matter.

Oppenheimer has settled, or settled in principle or an award has been rendered in seventeen of the Horizon related arbitrations, including the Robinson Arbitration,with approximately fifty-seven individual complainants.

The aggregate settlement payments for those total approximately $ 58.0 million.

Inc., Anne Greene and Gordon Morse, filed in Georgia State Court, Fulton County.

Plaintiffs allege that they were all investors in Horizon.

However, all of the Plaintiffs allege that they invested in Horizon after John Woods left Oppenheimer’s employ in 2016 and virtually all of the plaintiffs were not Oppenheimer customers.

Plaintiffs further allege that Oppenheimer, through its inaction and/or misconduct, is responsible for their alleged losses and are seeking unspecified damages sounding in violations of the Georgia RICO statute and negligence per se.

Oppenheimer believes these claims to be without merit and intends to defend itself vigorously against these claims.

Also, on July 17, 2023, Oppenheimer was served with a complaint in an action entitled Mark Del Pico, Elizabeth Del Pico and Surrey Lane Partners GP LLC, as general Partner of Surrey Lane Partners, Ltd.

Oppenheimer & Co.

Inc., and Michael Mooney , filed in Florida State Court, Sarasota County.

Plaintiffs allege that they were all investors in Horizon;

however, none of the Plaintiffs were Oppenheimer customers.

All of the Plaintiffs allege that they invested in Horizon years after John Woods left Oppenheimer’s employ in 2016.

Plaintiffs further allege that Oppenheimer, through its inaction and/or misconduct, is responsible for their alleged losses and are seeking unspecified damages from Oppenheimer sounding in negligence per se, aiding and abetting breach of fiduciary duty, and aiding and abetting fraud.

On June 30, 2022, the Company received a "Wells Notice" from the SEC requesting that Oppenheimer make a written submission to the SEC to explain why Oppenheimer should not be charged with violations of Section 15c2-12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Rule 15c2-12 thereunder as well as Municipal Securities Rulemaking Board Rules G-17 and G-27 in relation to its sales of municipal notes pursuant to an exemption from continuing disclosure contained in Rule 15c2-12.

2 unchanged sentences

The Company believes such claim to be without merit and intends to vigorously defend itself against such claim.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Regulatory requirements

2 unchanged sentences

Oppenheimer computes its net capital requirements under the alternative method provided for in the Rule which requires that Oppenheimer maintain net capital equal to two percent of aggregate customer-related debit items, as defined in SEC Rule 15c3-3.

As of March 31, 2023, the net capital of Oppenheimer as calculated under the Rule was $ 440.0 million or 39.98 % of Oppenheimer's aggregate debit items.

As of June 30, 2023, the net capital of Oppenheimer as calculated under the Rule was $ 417.5 million or 36.66 % of Oppenheimer's aggregate debit items.

This was $ 394.7 million in excess of the minimum required net capital at that date.

Freedom computes its net capital requirement under the basic method provided for in the Rule, which requires that Freedom maintain net capital equal to the greater of $ 100,000 or 6-2/3% of aggregate indebtedness, as defined.

As of March 31, 2023, Freedom had net capital of $ 4.3 million, which was $ 4.2 million in excess of the $ 100,000 required to be maintained at that date.

As of March 31, 2023, the capital required and held under the FCA’s Investment Firms’ Prudential Regime (“IFPR”) for Oppenheimer Europe Ltd.

Freedom computes its net capital requirement under

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

the basic method provided for in the Rule, which requires that Freedom maintain net capital equal to the greater of $ 100,000 or 6-2/3% of aggregate indebtedness, as defined.

As of June 30, 2023, Freedom had net capital of $ 4.2 million, which was $ 4.1 million in excess of the $ 100,000 required to be maintained at that date.

As of June 30, 2023, the capital required and held under the FCA’s Investment Firms’ Prudential Regime (“IFPR”) for Oppenheimer Europe Ltd.

was as follows:

4 unchanged sentences

Capital ratios are now expressed differently, but are effectively unchanged when comparing performance to required regulatory minimums.

As of March 31, 2023, Oppenheimer Europe Ltd.

As of June 30, 2023, Oppenheimer Europe Ltd.

was in compliance with its regulatory requirements.

As of March 31, 2023, the regulatory capital of Oppenheimer Investments Asia Limited was $ 4.9 million, which was $ 4.5 million in excess of the $ 382,172 required to be maintained on that date.

As of June 30, 2023, the regulatory capital of Oppenheimer Investments Asia Limited was $ 4.4 million, which was $ 4.0 million in excess of the $ 382,854 required to be maintained on that date.

Oppenheimer Investments Asia Limited computes its regulatory capital pursuant to the requirements of the Securities and Futures Commission of Hong Kong.

As of March 31, 2023, Oppenheimer Investment Asia Limited was in compliance with its regulatory requirements.

As of June 30, 2023, Oppenheimer Investment Asia Limited was in compliance with its regulatory requirements.

Segment information

8 unchanged sentences

These areas include, but are not limited to, legal, compliance, operations, accounting, and internal audit.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Costs associated with these groups are separately reported in a Corporate/Other category and primarily include compensation and benefits.

The table below presents information about the reported revenue and pre-tax income (loss) of the Company for the three months ended March 31, 2023 and 2022.

The table below presents information about the reported revenue and pre-tax income (loss) of the Company for the three months ended June 30, 2023 and 2022.

Asset information by reportable segment is not reported since the Company does not produce such information for internal use by the chief operating decision maker.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)

For the Three Months Ended

June 30, For the Six Months Ended

2023 2022 2023 2022

Private client (1)

9 unchanged sentences

Asset management (1)

6,533 8,120 13,014 17,594

Capital markets ( 14,051 ) ( 17,935 ) ( 29,528 ) ( 16,769 )

3 unchanged sentences

Advisory fees are allocated 10.0 % to the Asset Management and 90.0 % to the Private Client segments.

Revenue, classified by the major geographic areas in which it was earned, for the three months ended March 31, 2023 and 2022 was:

Revenue, classified by the major geographic areas in which it was earned, for the three and six months ended June 30, 2023 and 2022 was:

(Expressed in thousands)

For the Three Months Ended

June 30, For the Six Months Ended

2023 2022 2023 2022

Americas $ 295,496 $ 225,500 $ 605,285 $ 477,410

3 unchanged sentences

Subsequent events

On April 28, 2023, the Company announced a quarterly dividend in the amount of $ 0.15 per share, payable on May 26, 2023 to holders of Class A Stock and Class B Stock of record on May 12, 2023.

On July 28, 2023, the Company announced a quarterly dividend in the amount of $ 0.15 per share, payable on August 25, 2023 to holders of Class A Stock and Class B Stock of record on August 11, 2023.

On May 31, 2023, the Company announced the commencement of a modified “Dutch Auction” tender offer to purchase up to $ 30.0 million of its Class A non-voting common stock at a price not less than $ 34.00 per share or more than $ 40.00 per share.

The Company completed its repurchases pursuant to the tender offer on July 6, 2023, when it successfully repurchased and cancelled 437,183 shares of Class A non-voting common stock at $ 40.00 per share for an aggregate purchase price of $ 17.49 million.

As a result, the Company had 10,447,392 shares outstanding on July 6, 2023 after the purchase.

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

What changed 10-Q

Item 1. Financial Statements