What changed in this filing

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Item 1. Financial Statements

2023-10-27 compared with 2023-07-28 · 229 added, 206 removed, 1092 unchanged (28% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

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

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

Cash and cash equivalents $ 30,773 $ 112,433

38 unchanged sentences

shares issued and outstanding:

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

10,289,233 and 10,868,556 as of September 30, 2023 and December 31, 2022, respectively

shares authorized, issued and outstanding:

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

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

Additional paid-in capital 28,826 28,628

Retained earnings 750,798 764,178

Accumulated other comprehensive income 256 1,416

Accumulated other comprehensive income (loss) ( 324 ) 1,416

Total Oppenheimer Holdings Inc.

7 unchanged sentences

For the Three Months Ended

June 30, For the Six Months Ended

September 30, For the Nine Months Ended

September 30,

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

14 unchanged sentences

Total expenses 291,080 286,873 911,598 782,079

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.

Pre-tax income 21,587 7,238 28,938 15,282

Income taxes provision 7,808 2,573 10,262 5,559

Net income $ 13,779 $ 4,665 $ 18,676 $ 9,723

Net income (loss) attributable to noncontrolling interest, net of tax ( 82 ) 145 ( 403 ) ( 215 )

Net income attributable to Oppenheimer Holdings Inc.

$ 13,861 $ 4,520 $ 19,079 $ 9,938

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

Earnings per share attributable to Oppenheimer Holdings Inc.

Basic $ 1.32 $ 0.40 $ 1.75 $ 0.84

8 unchanged sentences

For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

(Expressed in thousands) 2023 2022 2023 2022

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

Net income $ 13,779 $ 4,665 $ 18,676 $ 9,723

Other comprehensive loss, net of tax

Currency translation adjustment ( 580 ) ( 410 ) ( 1,740 ) ( 3,062 )

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.

Comprehensive income $ 13,199 $ 4,255 16,936 6,661

Less net income (loss) attributable to noncontrolling interests ( 82 ) 145 ( 403 ) ( 215 )

Comprehensive income attributable to Oppenheimer Holdings Inc.

$ 13,281 $ 4,110 $ 17,339 $ 6,876

3 unchanged sentences

For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

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

15 unchanged sentences

Repurchase of Class A non-voting common stock for cancellation ( 23,956 ) ( 1,781 ) ( 27,555 ) ( 1,781 )

Net income (loss) (1)

Net income (1)

13,861 4,520 19,079 9,938

9 unchanged sentences

Balance at beginning of period 109 1,709 722 2,069

Capital distribution to noncontrolling interest 171 — 171 —

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

Capital addition (distribution) to noncontrolling interest — ( 21 ) 171 ( 21 )

Net income (loss) attributable to noncontrolling interest ( 82 ) 145 ( 403 ) ( 215 )

Change in redemption value of redeemable noncontrolling interests ( 22 ) — ( 485 ) —

11 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

FOR THE SIX MONTHS ENDED JUNE 30,

FOR THE NINE MONTHS ENDED SEPTEMBER 30,

(Expressed in thousands) 2023 2022

8 unchanged sentences

Write-off of debt issuance costs 5 —

Provision for (reversal of) credit losses ( 1 ) 94

Provision for credit losses 17 61

Share-based compensation 9,662 ( 1,152 )

26 unchanged sentences

Cash dividends paid on Class A non-voting and Class B voting common stock ( 4,904 ) ( 5,433 )

Issuance of Class A non-voting common stock 54 65

Repurchase of Class A non-voting common stock for cancellation ( 31,241 ) ( 59,554 )

Payments for employee taxes withheld related to vested share-based awards ( 5,907 ) ( 2,283 )

Addition to noncontrolling interests 171 —

Addition (Distribution) to noncontrolling interests 171 ( 21 )

Redemption of redeemable noncontrolling interests ( 83 ) —

Repurchase of senior secured notes ( 1,000 ) —

Increase in bank call loans 94,400 107,800

Cash provided by financing activities 76,971 55,444

Increase (Decrease) in bank call loans 56,200 ( 15,900 )

Cash provided by (used in) financing activities 13,290 ( 83,126 )

Net decrease in cash, cash equivalents and restricted cash ( 81,245 ) ( 176,666 )

24 unchanged sentences

Oppenheimer Trust Company of Delaware ("Oppenheimer Trust"), a limited purpose trust company that provides fiduciary services such as trust and estate administration and investment management;

OPY Credit Corp., which from time to time may offer syndication as well as trading of issued corporate loans;

Oppenheimer Europe Ltd., based in the United Kingdom, with offices in the Isle of Jersey, Portugal, Germany, and Switzerland, which provides institutional equities and fixed income brokerage and corporate finance and is regulated by the Financial Conduct Authority;

OPY Credit Corp., which conducts secondary trading activities related to the purchase and sale of loans, primarily on a riskless principal basis;

Oppenheimer Europe Ltd., based in the United Kingdom, with offices in the Isle of Jersey, Portugal, and Switzerland, which provides institutional equities and fixed income brokerage and corporate finance and is regulated by the Financial Conduct Authority;

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.

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.

("Freedom"), a registered broker dealer in securities, which provides discount brokerage services, and Oppenheimer Israel (OPCO) 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.

Summary of significant accounting policies and estimates

9 unchanged sentences

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 and six months ended June 30, 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 nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for any future interim or annual period.

Reclassification

17 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 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”.

As of September 30, 2023, $ 25.9 million remained in the trust account that is recorded within “Restricted Cash” on the condensed consolidated balance sheet.

“Redeemable noncontrolling interests” of $ 26.0 million associated with the publicly-held OHAA Class A ordinary shares are recorded on the Company’s condensed consolidated balance sheet as of September 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.

17 unchanged sentences

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

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.

For the nine months ended September 30, 2023 and September 30, 2022, the net loss (net of taxes) attributed to noncontrolling interests was $ 403,000 and $ 215,000 , respectively.

Restricted Cash

5 unchanged sentences

See note 9 for details.

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

As of September 30, 2023, the Company had $ 61.3 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.

2 unchanged sentences

The unforgiven portion of the notes becomes due on demand in the event the employee departs during the service period.

At this point, any uncollected portion of the notes is reclassified into a defaulted notes category.

At that point, any uncollected portion of the notes is reclassified into a defaulted notes category.

The allowance for uncollectibles is a valuation account that is deducted from the amortized cost basis of the defaulted notes balance to present the net amount expected to be collected.

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

For the three and nine months ended September 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 June 30, 2023, the uncollected balance of defaulted notes was $ 6.2 million and the allowance for uncollectibles was $ 3.8 million.

As of September 30, 2023, the uncollected balance of defaulted notes was $ 6.6 million and the allowance for uncollectibles was $ 3.9 million.

The allowance for uncollectibles consisted of $ 2.1 million related to defaulted notes balances (five years and older) and $ 1.8 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 June 30, 2023:

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

(Expressed in thousands)

As of June 30, 2023

As of September 30, 2023

2018 and prior 2,172

Total $ 6,576

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:

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

(Expressed in thousands)

For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

2023 2022 2023 2022

14 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

As of September 30, 2023, the Company had right-of-use operating lease assets of $ 151.2 million (net of accumulated amortization of $ 89.4 million) which are comprised of real estate leases of $ 148.6 million (net of accumulated amortization of $ 86.8 million) and equipment leases of $ 2.6 million (net of accumulated amortization of $ 2.6 million).

As of September 30,

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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.

2023, the Company had operating lease liabilities of $ 194.0 million which are comprised of real estate lease liabilities of $ 191.4 million and equipment lease liabilities of $ 2.6 million.

The Company had no finance leases as of September 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 June 30, 2023 and December 31, 2022, respectively:

June 30, 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 September 30, 2023 and December 31, 2022, respectively:

September 30, 2023

December 31, 2022

Weighted average remaining lease term (in years) 6.72 6.82

Weighted average discount rate 7.06 % 6.66 %

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:

The following table presents operating lease costs recognized for the three and nine months ended September 30, 2023 and September 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

September 30,

For the Nine Months Ended

September 30,

2023 2022 2023 2022

4 unchanged sentences

Equipment leases - Interest expense 45 41 138 108

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

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

(Expressed in thousands)

June 30, 2023 December 31, 2022

September 30, 2023

December 31, 2022

2023 $ 11,101 $ 42,343

7 unchanged sentences

Present value of lease liabilities $ 193,954 $ 182,570

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).

As of September 30, 2023, the Company had $ 9.9 million of additional real estate operating leases that have not yet commenced ($ 40.2 million as of December 31, 2022).

OPPENHEIMER HOLDINGS INC.

48 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 and six months ended June 30, 2023 and 2022:

(Expressed in thousands) For the Three Months Ended June 30, 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 nine months ended September 30, 2023 and 2022:

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

Reportable Segments

17 unchanged sentences

Notes to Condensed Consolidated Financial Statements (unaudited)

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

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

Reportable Segments

15 unchanged sentences

Total revenue $ 178,614 $ 24,870 $ 90,947 $ ( 320 ) $ 294,111

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

(Expressed in thousands) For the Nine Months Ended September 30, 2023

Reportable Segments

17 unchanged sentences

Notes to Condensed Consolidated Financial Statements (unaudited)

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

(Expressed in thousands) For the Nine Months Ended September 30, 2022

Reportable Segments

19 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 $ 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.

The Company had receivables related to revenue from contracts with customers of $ 34.7 million and $ 32.8 million at September 30, 2023 and December 31, 2022, respectively.

The Company had no significant impairments related to these receivables during the three months ended September 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 $ 2.86 million and $ 900,000 at June 30, 2023 and December 31, 2022, respectively.

Total deferred revenue was $ 1.80 million and $ 900,000 at September 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:

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands) As of

June 30, 2023

September 30, 2023

December 31, 2022

12 unchanged sentences

Total deferred revenue $ 1,803 $ 900

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(1) Commission recorded on trade date but not yet settled.

11 unchanged sentences

For the Three Months Ended

For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

2023 2022 2023 2022

3 unchanged sentences

Diluted weighted average number of shares outstanding 11,440,229 12,190,425 11,746,337 12,809,000

Net income (loss) attributable to Oppenheimer Holdings Inc.

Net income attributable to Oppenheimer Holdings Inc.

$ 13,861 $ 4,520 $ 19,079 $ 9,938

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

Earnings per share attributable to Oppenheimer Holdings Inc.

Basic $ 1.32 $ 0.40 $ 1.75 $ 0.84

Diluted $ 1.21 $ 0.37 $ 1.62 $ 0.78

(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

(1) For the three months ended September 30, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 286,185 shares of Class A Stock granted under share-based compensation arrangements.

For the nine months ended September 30, 2023, the diluted net income per share computation did not include the anti-dilutive effect of 277,435 shares of Class A Stock granted under share-based compensation arrangements.

For the three months ended September 30, 2022, the diluted net income per share computation did not include the anti-dilutive effect of 398,198 shares of Class A Stock granted under share-based compensation arrangements.

For the nine months ended September 30, 2022, the diluted net income per share computation did not include the anti-dilutive effect of 22,250 shares of Class A Stock granted under share-based compensation arrangements.

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)

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

Receivable from brokers, dealers and clearing organizations consisting of:

27 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.

9 unchanged sentences

Auction Rate Securities ("ARS")

In February 2010, Oppenheimer finalized settlements with each of the New York Attorney General's office and the Massachusetts Securities Division (collectively, the "Regulators") concluding proceedings by the Regulators concerning Oppenheimer's marketing and sale of ARS.

Pursuant to the settlements with the Regulators, Oppenheimer agreed to extend offers to repurchase ARS from certain of its clients.

As of September 30, 2021, the Company had completed its ARS purchase obligations related to the settlements with the Regulators.

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 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.

The Company’s ARS owned referred to above have, for the most part, been subject to issuer tender offers.

As of September 30, 2023, the Company owned $ 2.7 million of ARS.

This amount represents the unredeemed or unsold amount that the Company holds as a result of ARS buybacks in previous years.

The Company has valued the ARS securities owned at the tender offer price and categorized them in Level 3 of the fair value hierarchy due to the illiquid nature of the securities and the period of time since the last tender offer.

2 unchanged sentences

In such cases, other valuation techniques might be necessary.

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).

As of September 30, 2023, the Company had a valuation allowance totaling $ 0.2 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 Company uses the net asset value of the underlying fund as a basis for estimating the fair value of its investment unless another method provides a better indicator of fair value.

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

(Expressed in thousands)

11 unchanged sentences

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

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

(Expressed in thousands)

13 unchanged sentences

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

As of September 30, 2023, the fair value of the investment was $ 7.0 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 June 30, 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 September 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 June 30, 2023 :

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

(Expressed in thousands)

Fair Value Measurements as of June 30, 2023

Fair Value Measurements as of September 30, 2023

Level 1 Level 2 Level 3 Total

3 unchanged sentences

Agency securities — 2 — 2

Sovereign obligations — 261 — 261

Corporate debt and other obligations — 23,079 — 23,079

9 unchanged sentences

Derivative contracts:

Futures 1 — — 1

TBAs — 153 — 153

3 unchanged sentences

Treasury securities $ 12,505 $ — $ — $ 12,505

Agency securities — 2 — 2

Corporate debt and other obligations — 13,799 — 13,799

Mortgage and other asset-backed securities — 143 — 143

Convertible bonds — 8,117 — 8,117

23 unchanged sentences

Corporate equities 24,837 — — 24,837

Money markets — — — —

Auction rate securities — — 31,776 31,776

21 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 and six months ended June 30, 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 nine months ended September 30, 2023 and 2022:

(Expressed in thousands)

Level 3 Assets and Liabilities

For the Three Months Ended June 30, 2023

For the Three Months Ended September 30, 2023

Total Realized

Beginning and Unrealized Purchases Sales and Transfers Ending

Balance Losses

and Issuances Settlements In (Out) Balance

Balance Gain and Issuances Settlements In (Out) Balance

Auction rate securities (1)

3 unchanged sentences

Level 3 Assets and Liabilities

For the Three Months Ended June 30, 2022

For the Three Months Ended September 30, 2022

Total Realized

7 unchanged sentences

Level 3 Assets and Liabilities

For the Six Months Ended June 30, 2023

For the Nine Months Ended September 30, 2023

Total Realized

Beginning and Unrealized Purchases Sales and Transfers Ending

Balance Losses

and Issuances Settlements In (Out) Balance

Balance Gain and Issuances Settlements In (Out) Balance

Auction rate securities (1)

3 unchanged sentences

Level 3 Assets and Liabilities

For the Six Months Ended June 30, 2022

For the Nine Months Ended September 30, 2022

Total Realized

11 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.

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

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

(Expressed in thousands) Fair Value Measurement:

Carrying Value Level 1 Level 2 Level 3 Total

Cash $ 29,145 $ 29,145 $ — $ — $ 29,145

Cash and cash equivalents $ 30,773 $ 30,773 $ — $ — $ 30,773

Restricted cash 25,949 25,949 — — 25,949

Deposits with clearing organization 48,619 48,619 — — 48,619

Deposits with clearing organizations 53,957 53,957 — — 53,957

Receivable from brokers, dealers and clearing organizations:

28 unchanged sentences

Carrying Value Level 1 Level 2 Level 3 Total

Cash $ 112,433 $ 112,433 $ — $ — $ 112,433

Cash and cash equivalents $ 112,433 $ 112,433 $ — $ — $ 112,433

Restricted cash 25,534 25,534 — — 25,534

7 unchanged sentences

Receivable from customers 1,202,764 — 1,202,764 — 1,202,764

Securities purchased under agreements to resell — — — — —

Notes receivable, net 57,495 — 57,495 — 57,495

5 unchanged sentences

Carrying Value Level 1 Level 2 Level 3 Total

Bank call loans $ — $ — $ — $ — $ —

Payables to brokers, dealers and clearing organizations:

11 unchanged sentences

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

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.

As of September 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

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.

Risks managed using derivative instruments include interest rate

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.

Risks managed using derivative instruments include interest rate risk and, to a lesser extent, foreign exchange risk.

risk and, to a lesser extent, foreign exchange risk.

All derivative instruments are measured at fair value and are recognized as either assets or liabilities on the condensed consolidated balance sheet.

16 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 June 30, 2023 and December 31, 2022 by product were as follows:

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

(Expressed in thousands)

Fair Value of Derivative Instruments as of June 30, 2023

Fair Value of Derivative Instruments as of September 30, 2023

Description Notional Fair Value

1 unchanged sentence

Other contracts TBAs $ 8,746 $ 153

Futures 5,000 1

$ 13,746 $ 154

3 unchanged sentences

Other contracts TBAs 8,746 146

Forward repurchase agreements 104,000 —

$ 7,633,746 $ 2,020

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 and six months ended June 30, 2023 and 2022:

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Three Months Ended June 30, 2023

For the Three Months Ended September 30, 2023

Recognized in Income on Derivatives

Types Description Location Net Gain/(Loss)

Types Description Location Net Gain

Commodity contracts Futures Principal transactions revenue, net $ 1,078

Other contracts Foreign exchange forward contracts Other revenue ( 7 )

TBAs Principal transactions revenue, net 36

Other contracts TBAs Principal transactions revenue, net 25

(Expressed in thousands)

The Effect of Derivative Instruments in the Income Statement

For the Three Months Ended June 30, 2022

For the Three Months Ended September 30, 2022

Recognized in Income on Derivatives

Types Description Location Net Gain/(Loss)

Types Description Location Net Gain

Commodity contracts Futures Principal transactions revenue, net $ 349

Other contracts Foreign exchange forward contracts Other revenue ( 20 )

TBAs Principal transactions revenue, net ( 6 )

Other contracts TBAs Principal transactions revenue, net 1

OPPENHEIMER HOLDINGS INC.

2 unchanged sentences

The Effect of Derivative Instruments in the Income Statement

For the Six Months Ended June 30, 2023

For the Nine Months Ended September 30, 2023

Recognized in Income on Derivatives

5 unchanged sentences

The Effect of Derivative Instruments in the Income Statement

For the Six Months Ended June 30, 2022

For the Nine Months Ended September 30, 2022

Recognized in Income on Derivatives

10 unchanged sentences

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

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

As of September 30, 2023, the outstanding balance of bank call loans was $ 56.2 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 $ 57.9 million and $ 9.3 million, respectively.

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.

As of September 30, 2023, the Company had approximately $ 1.5 billion of customer securities under customer margin loans that are available to be pledged, of which the Company has re-pledged approximately $ 218.4 million under securities loan agreements.

As of September 30, 2023, the Company had pledged $ 311.3 million of customer securities directly with the Options Clearing Corporation to secure obligations and margin requirements under option contracts written by customers.

As of September 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.

1 unchanged sentence

Government and Agency securities, are carried at amounts at which the securities subsequently will be resold or reacquired as specified in the respective agreements and include accrued interest.

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.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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 June 30, 2023:

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.

(Expressed in thousands)

5 unchanged sentences

Gross amount of recognized liabilities for repurchase agreements and securities loaned $ 978,077

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 June 30, 2023 and December 31, 2022:

As of June 30, 2023

As of September 30, 2023

(Expressed in thousands)

36 unchanged sentences

Total $ 155,829 $ ( 28,012 ) $ 127,817 $ ( 127,365 ) $ — $ 452

(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)

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

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 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.

As of September 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 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).

As of September 30, 2023, the fair value of securities received as collateral under securities borrowed transactions and reverse repurchase agreements was $ 137.9 million ($ 124.1 million as of December 31, 2022) and $ 5.1 million ($ 28.0 million as of December 31, 2022), respectively, of which the Company has sold and re-pledged approximately $ 63.5 million ($ 39.4 million as of December 31, 2022) under securities loaned transactions and $ 5.1 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 $ 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 carrying value of pledged securities owned that can be sold or re-pledged by the counterparty was $ 680.9 million, as presented on the face of the condensed consolidated balance sheet as of September 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 June 30, 2023 were receivables from two major U.S.

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

broker-dealers totaling approximately $ 100.4 million.

2 unchanged sentences

If clients do not fulfill their contractual obligations, the Company may incur losses.

The Company has clearing/participating arrangements with the National Securities Clearing Corporation, the Fixed Income Clearing Corporation ("FICC"), R.J.

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 June 30, 2023 are with the FICC .

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

international equities business

The Company has clearing/participating arrangements with the National Securities Clearing Corporation, the Fixed Income Clearing

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

carried on by Oppenheimer Europe Ltd.

Corporation ("FICC"), R.J.

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 September 30, 2023 are with the FICC .

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

international equities business 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 June 30, 2023, the Company had recorded no liabilities with regard to this right.

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

As of September 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").

1 unchanged sentence

II (the "SPACs”), that are seeking to effect a transaction which could be in the form of a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

The Sponsors and the SPACs are consolidated VIE's as the Company is the primary beneficiary.

The Sponsors and the SPACs are consolidated VIEs as the Company is the primary beneficiary.

On October 26, 2021, OHAA consummated its $ 126.5 million IPO.

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

As of September 30, 2023, $ 25.9 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.

OPI is designed to promote alignment of Company, client and employee interests as they relate to profitable investment opportunities.

This program acts as an incentive for senior employees to identify attractive private investments for the Company and its clients, and as a retention tool for key employees of the Company.

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

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

This program acts as an incentive for senior employees to identify attractive private investments for the Company and its clients, and

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

as a retention tool for key employees of the Company.

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

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

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

(Expressed in thousands)

As of June 30,

As of September 30,

Cash and cash equivalents $ 5,348 $ 1,369

6 unchanged sentences

(Expressed in thousands)

Issued Maturity Date June 30, 2023 December 31, 2022

Issued Maturity Date September 30, 2023 December 31, 2022

5.50 % Senior Secured Notes

5 unchanged sentences

Interest on the Unregistered Notes is payable semi-annually on April 1st and October 1st.

The Company used the net proceeds from the offering of the Unregistered Notes, along with cash on hand, to redeem in full our 6.75 % Senior Secured Notes due July 1, 2022 (the "Old Notes") in the principal amount of $ 150.0 million (the Company held $ 1.4 million in treasury for a net outstanding amount of $ 148.6 million), and pay all related fees and expenses in relation thereto.

On November 23, 2020, we completed an exchange offer in which we exchanged 99.8 % of the Unregistered Notes for a like principal amount of Notes with identical terms, except that such new Notes have been registered under the Securities Act of 1933, as amended (the "Securities Act").

1 unchanged sentence

The Notes will mature on October 1, 2025 and bear interest at a rate of 5.50 % per annum, payable semiannually on April 1st and October 1st, respectively, of each year.

The Parent used the net proceeds from the offering of the Notes, along with cash on hand, to redeem in full its Old Notes, in the principal amount of $ 150.0 million (the Parent held $ 1.4 million in treasury for a net outstanding amount of $ 148.6 million), and pay all related fees and expenses in relation thereto.

The cost to issue the Notes was $ 3.1 million, of which $ 1.9 million was paid to its subsidiary, Oppenheimer, who served as the initial purchaser of the offering, and was eliminated in consolidation.

3 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 June 30, 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

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

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

These exceptions and

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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

These exceptions and qualifications include, among other things, a variety of provisions that are intended to allow the Company to continue to conduct its brokerage operations in the ordinary course of business.

qualifications include, among other things, a variety of provisions that are intended to allow the Company to continue to conduct its brokerage operations in the ordinary course of business.

In addition, certain of the covenants will be suspended upon the Parent attaining an investment grade debt rating for the Notes from both S&P Global Ratings and Moody’s Investors Service, Inc.

3 unchanged sentences

• limitation on dividends and other payment restrictions affecting restricted subsidiaries or Regulated Subsidiaries, which generally limits the ability of certain of the Parent’s subsidiaries to pay dividends or make other transfers;

• limitation on future Subsidiary Guarantors (as hereinafter defined), which prohibits certain of the Parent’s subsidiaries from guaranteeing its indebtedness or indebtedness of any restricted subsidiary unless the Notes are comparably guaranteed;

• limitation on future Subsidiary Guarantors (as defined), which prohibits certain of the Parent’s subsidiaries from guaranteeing its indebtedness or indebtedness of any restricted subsidiary unless the Notes are comparably guaranteed;

• limitation on transactions with shareholders and affiliates, which generally requires transactions among the Parent’s affiliated entities to be conducted on an arm’s-length basis;

2 unchanged sentences

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

As of September 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 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.

Interest expense on the Notes for the three and nine months ended September 30, 2023 was $ 1.6 million and $ 4.7 million, respectively.

Interest expense on the Notes for the three and nine months ended September 30, 2022 was $ 1.7 million and $ 5.2 million, respectively.

The effective income tax rate for the three and nine months ended September 30, 2023 was 36.2 % and 35.5 % respectively, compared with 35.5 % and 36.4 % for the three and nine months ended September 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 third quarter of 2023 was impacted by permanent items and non-deductible losses in non-U.S.

Stockholders' Equity

9 unchanged sentences

For the Three Months Ended

June 30, For the Six Months Ended

September 30, For the Nine Months Ended

September 30,

2023 2022 2023 2022

1 unchanged sentence

Issued pursuant to share-based compensation plans 10,745 17,098 217,954 103,549

Repurchased and canceled pursuant to the stock buy-back ( 96,135 ) ( 885,230 ) ( 191,190 ) ( 1,262,543 )

Repurchased and cancelled ( 606,087 ) ( 413,052 ) ( 797,277 ) ( 1,675,595 )

Class A Stock outstanding, end of period 10,289,233 10,874,990 10,289,233 10,874,990

Stock buy-back

On May 15, 2020, the Company announced that its Board of Directors approved a share repurchase program that authorizes the Company to purchase up to 530,000 shares of the Company's Class A Stock, representing approximately 4.2 % of its 12,636,523 then issued and outstanding shares of Class A Stock.

This authorization supplemented the 98,625 shares that remained authorized and available under the Company's previous share repurchase program for a total of 628,625 shares authorized and available for repurchase at May 15, 2020.

On February 28, 2022, the Company announced that its Board of Directors approved a share repurchase program that authorizes the Company to purchase up to 518,000 shares of the Company's Class A Stock, representing approximately 4.2 % of its 12,322,073 then issued and outstanding shares of Class A Stock.

3 unchanged sentences

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.

This authorization supplemented the 4,278 shares that remained authorized and available under the Company's previous share repurchase program for a total of 540,778 shares authorized.

This authorization supplemented the 4,278 shares that remained authorized and available under the Company's previous share repurchase program for a total of 540,778 shares authorized and available for repurchase at July 29, 2022.

On December 13, 2022, the Company's Board of Directors approved a share repurchase program that authorizes the Company to purchase up to 543,000 shares of the Company's Class A Stock, representing approximately 5.0 % of its 10,867,660 then issued and outstanding shares of Class A Stock.

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 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.

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 and available for repurchase at December 13, 2022.

During the three months ended September 30, 2023, the Company purchased and canceled an aggregate of 168,904 shares of Class A Stock for a total consideration of $ 6.5 million ($ 38.30 per share) under this program.

During the nine months ended September 30, 2023, the Company purchased and canceled an aggregate of 360,094 shares of Class A Stock for a total consideration of $ 13.8 million ($ 38.20 per share) under this program.

During the three months ended September 30, 2022, the Company purchased and canceled an aggregate of 413,052 shares of Class A Stock for a total consideration of $ 14.0 million ($ 33.86 per share) under this program.

During the nine months ended September 30, 2022, the Company purchased and canceled an aggregate of 1,675,595 shares of Class A Stock for a total consideration of $ 60.4 million ($ 36.02 per share) under this program.

As of September 30, 2023, 326,940 shares remained available to be purchased under the share repurchase program.

The Company’s existing policies and procedures require all Directors and Officers to pre-clear any transaction (including purchases and sales) in the Company’s Class A Stock or Notes during a repurchase plan with Legal and Compliance prior to execution.

During the three and nine months ended September 30, 2023, the Company did not adopt, modify or terminate any Rule 10b5-1 trading arrangements.

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 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 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.

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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.

1 unchanged sentence

The share repurchase program is expected to continue indefinitely.

None of the foregoing authorizations is subject to expiration.

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

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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

The share repurchase program does not obligate the Company to 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.

18 unchanged sentences

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

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”).

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-seven arbitrations, many containing multiple claimants, each filed before FINRA, relating to those claimants’ purported investment in Horizon Private Equity, III, LLC (“Horizon”).

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

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

The aggregate payments for those thirty-six arbitrations total approximately $ 82.4 million.

The eleven arbitrations still pending claim specific monetary damages and allege losses of approximately $ 1.1 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.

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

5 unchanged sentences

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.

On September 5, 2023, Oppenheimer filed a motion to dismiss the complaint, which is pending before the court.

That same day, Oppenheimer also filed a motion to transfer the case to the Metro Atlanta Business Case Division, which motion was granted on September 25, 2023.

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

6 unchanged sentences

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 August 28, 2023, Oppenheimer filed a motion to dismiss the complaint, which is pending before the court.

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

Finally, on August 25, 2023, Oppenheimer was served with a complaint in an action entitled Lisa Wright, Billy Ray Boaz, Sylvia Boyles, Donald and Gina Bryant, Alton Graviette, Gilbert and Felicia Hawks, Michael and Brenda Craig, Barbara and Russell Danley, Carolyn and Ronald Edwards, Pamela Goins, Amy Gordon, Susan Gregory, Timothy Hall, Ronald Jones, Douglas Lineberry, Marcia Martin, Bobby and Jo Simpson, Karen Stephens, Caroline Moser, Rebecca Tapp, Paul Vaughan, Brenda and Varner Vogler, and Peggie Thomas v.

Oppenheimer & Co.

Inc., Ann 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.

On September 15, 2023, Oppenheimer filed a motion to transfer the case to the Metro Atlanta Business Case Division, which motion was granted on September 25, 2023.

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

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

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.

6 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 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.

As of September 30, 2023, the net capital of Oppenheimer as calculated under the Rule was $ 437.1 million or 40.26 % of Oppenheimer's aggregate debit items.

This was $ 415.4 million in excess of the minimum required net capital at that date.

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.

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 September 30, 2023, Freedom had net capital of $ 4.1 million, which was $ 4.0 million in excess of the $ 100,000 required to be maintained at that date.

As of September 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 June 30, 2023, Oppenheimer Europe Ltd.

As of September 30, 2023, Oppenheimer Europe Ltd.

was in compliance with its regulatory requirements.

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.

As of September 30, 2023, the regulatory capital of Oppenheimer Investments Asia Limited was $ 4.2 million, which was $ 3.9 million in excess of the $ 383,083 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 June 30, 2023, Oppenheimer Investment Asia Limited was in compliance with its regulatory requirements.

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

Segment information

3 unchanged sentences

Private Client — includes commissions and a proportionate amount of fee income earned on assets under management ("AUM"), net interest earnings on client margin loans and cash balances, fees from money market funds, custodian fees, net contributions from stock loan activities and financing activities, and direct expenses associated with this segment;

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Asset Management — includes a proportionate amount of fee income earned on AUM from investment management services of Oppenheimer Asset Management Inc.

4 unchanged sentences

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 June 30, 2023 and 2022.

The table below presents information about the reported revenue and pre-tax income (loss) of the Company for the three and nine months ended September 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

September 30,

For the Nine Months Ended

September 30,

2023 2022 2023 2022

16 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 and six months ended June 30, 2023 and 2022 was:

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

(Expressed in thousands)

For the Three Months Ended

June 30, For the Six Months Ended

September 30,

For the Nine Months Ended

September 30,

2023 2022 2023 2022

3 unchanged sentences

Total $ 312,667 $ 294,111 $ 940,536 $ 797,361

OPPENHEIMER HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (unaudited)

Subsequent events

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.

On October 26, 2023, OHAA’s stockholders approved an amendment to its certificate of incorporation to extend the deadline by which it must complete its initial business combination from October 30, 2023 to June 30, 2024.

On October 27, 2023, the Company announced a quarterly dividend in the amount of $ 0.15 per share, payable on November 24, 2023 to holders of Class A Stock and Class B Stock of record on November 10, 2023.

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