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<SEC-DOCUMENT>0000791963-04-000001.txt : 20040312
<SEC-HEADER>0000791963-04-000001.hdr.sgml : 20040312
<ACCEPTANCE-DATETIME>20040311183927
ACCESSION NUMBER:		0000791963-04-000001
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		8
CONFORMED PERIOD OF REPORT:	20031231
FILED AS OF DATE:		20040312

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			OPPENHEIMER HOLDINGS INC
		CENTRAL INDEX KEY:			0000791963
		STANDARD INDUSTRIAL CLASSIFICATION:	SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211]
		IRS NUMBER:				980080034
		STATE OF INCORPORATION:			A6
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-12043
		FILM NUMBER:		04663908

	BUSINESS ADDRESS:	
		STREET 1:		SUITE 1110, P.O. BOX 2015
		STREET 2:		20 EGLINTON AVE. WEST
		CITY:			TORONTO
		STATE:			A6
		ZIP:			M4R 1K8
		BUSINESS PHONE:		(416)322-1515

	MAIL ADDRESS:	
		STREET 1:		PO BOX 2015 SUITE 1110
		STREET 2:		20 EGLINTON AVENUE WEST
		CITY:			TORONTO
		STATE:			A6
		ZIP:			M4R 1K8

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FAHNESTOCK VINER HOLDINGS INC
		DATE OF NAME CHANGE:	19950725

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VINER E A HOLDINGS LTD
		DATE OF NAME CHANGE:	19880622

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	GOLDALE INVESTMENTS LTD
		DATE OF NAME CHANGE:	19861030
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>sec10k.htm
<TEXT>
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<html>


<body bgcolor="#FFFFFF" link="#0000FF" vlink="#7F007F">

<p align="center"><font size="2" face="Arial"><b>________________________________________________________________________________</b></font></p>

<p align="center"><font size="2" face="Arial">UNITED STATES</font></p>

<p align="center"><font size="2" face="Arial">SECURITIES AND
EXCHANGE COMMISSION</font></p>

<p align="center"><font size="2" face="Arial">Washington, D. C.
20549</font></p>

<p align="center"><font size="2" face="Arial"><b>FORM 10-K</b></font></p>

<p><font size="2" face="Arial">(Mark One) </font></p>

<p><font size="2" face="Arial">[x] ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For
the fiscal year ended December 31, 2003<b> </b> </font></p>

<p align="center"><font size="2" face="Arial">OR</font></p>

<p><font size="2" face="Arial">[ ] TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For
the transition period from _________ to _________.</font></p>

<p><font size="2" face="Arial">Commission file number 1-12043</font></p>

<p align="center"><font size="2" face="Arial"><b>OPPENHEIMER
HOLDINGS INC.</b></font></p>

<p align="center"><font size="2" face="Arial">(Exact name of
registrant as specified in its charter)</font></p>

<p><font size="2" face="Arial">Ontario, Canada 98-0080034</font></p>

<p><font size="2" face="Arial">(State or other jurisdiction of
(I.R.S. Employer</font></p>

<p><font size="2" face="Arial">incorporation or organization)
Identification No.)</font></p>

<p><font size="2" face="Arial">P.O. Box 2015, Suite 1110</font></p>

<p><font size="2" face="Arial">20 Eglinton Avenue West</font></p>

<p><font size="2" face="Arial">Toronto, Ontario, Canada M4R 1K8</font></p>

<p><font size="2" face="Arial">(Address of principal executive
offices) (Zip Code)</font></p>

<p><font size="2" face="Arial">Registrant&#146;s Telephone
number, including area code: (416) 322-1515</font></p>

<p><font size="2" face="Arial">Securities registered pursuant to
Section 12(b) of the Act:</font></p>

<p><font size="2" face="Arial">Name of each exchange</font></p>

<p><font size="2" face="Arial"><u>Title of each class</u> <u>on
which registered</u> </font></p>

<p><font size="2" face="Arial">Class A non-voting shares New York
Stock Exchange</font></p>

<p><font size="2" face="Arial">Securities registered pursuant to
Section 12(g) of the Act:</font></p>

<p><font size="2" face="Arial"><u>Title of each class</u></font></p>

<pre><font face="Arial">Not Applicable</font></pre>

<p><font size="1" face="Arial">Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [ X
] No [ ]</font></p>

<p><font size="1" face="Arial">Indicate by check mark if
disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant&#146;s knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]</font></p>

<p><font size="1" face="Arial">Indicate by check mark whether the
registrant is an accelerated filer (as defined in Rule 12b-2 of
the Securities Exchange Act of 1934). Yes [ X ] No [ ]</font></p>

<p><font size="1" face="Arial">The aggregate market value of the
voting stock of the Company held by non-affiliates of the Company
cannot be calculated in a meaningful way because there is only
limited trading in the class of voting stock of the Company. The
aggregate market value of the Class A non-voting shares held by
non-affiliates of the Company at June 30, 2003 was $355,695,000
based on the closing price of the Class A non-voting shares on
the New York Stock Exchange as at June 30, 2003 of $27.96.</font></p>

<p><font size="1" face="Arial">The number of shares of the
Company&#146;s Class A non-voting shares and Class B voting
shares (being the only classes of common stock of the Company),
outstanding on March 9, 2004 was 13,322,416 and 99,680 shares,
respectively.</font></p>

<p><font size="2" face="Arial">_______________________________________________________________________</font></p>

<p align="center"><font face="Arial">TABLE OF CONTENTS </font></p>
<div align="center"><center>

<table border="0" cellpadding="7" cellspacing="0" width="576">
    <tr>
        <td valign="top" width="14%"><font face="Arial">Item
        Number</font></td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">Page</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">PART 1</font></td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">1.</font></td>
        <td valign="top" width="77%"><font face="Arial">Business</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">2</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">2.</font></td>
        <td valign="top" width="77%"><font face="Arial">Properties</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">16</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">3.</font></td>
        <td valign="top" width="77%"><font face="Arial">Legal
        Proceedings</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">16</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">4.</font></td>
        <td valign="top" width="77%"><font face="Arial">Submission
        of Matters to a Vote of Security Holders</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">17</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">PART II</font></td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">5.</font></td>
        <td valign="top" width="77%"><font face="Arial">Market
        for the Registrant&#146;s Common Equity and Related
        Stockholder Matters</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">18</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">6.</font></td>
        <td valign="top" width="77%"><font face="Arial">Selected
        Financial Data</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">20</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">7.</font></td>
        <td valign="top" width="77%"><font face="Arial">Management&#146;s
        Discussion and Analysis of Financial Condition and
        Results of Operations</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">22</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">7a.</font></td>
        <td valign="top" width="77%"><font face="Arial">Quantitative
        and Qualitative Disclosures About Market Risk</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">32</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">8.</font></td>
        <td valign="top" width="77%"><font face="Arial">Financial
        Statements and Supplementary Data</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">34</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">9.</font></td>
        <td valign="top" width="77%"><font face="Arial">Changes
        in and Disagreements with Accountants and Financial
        Disclosure</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">34</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">9a.</font></td>
        <td valign="top" width="77%"><font face="Arial">Controls
        and Procedures</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">34</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">PART III</font></td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">10.</font></td>
        <td valign="top" width="77%"><font face="Arial">Directors
        and Executive Officers of the Registrant</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">36</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">11.</font></td>
        <td valign="top" width="77%"><font face="Arial">Executive
        Compensation</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">41</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">12.</font></td>
        <td valign="top" width="77%"><font face="Arial">Security
        Ownership of Certain Beneficial Owners and Management</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">47</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">13.</font></td>
        <td valign="top" width="77%"><font face="Arial">Certain
        Relationships and Related Transactions</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">49</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">14.</font></td>
        <td valign="top" width="77%"><font face="Arial">Principal
        Accounting Fees and Services</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">50</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">PART IV</font></td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font face="Arial">15.</font></td>
        <td valign="top" width="77%"><font face="Arial">Exhibits,
        Financial Statement Schedules, and Reports on Form 8-K</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">51</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%"><font face="Arial">Signatures</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">52</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="77%"><font face="Arial">Certifications</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">53</font></p>
        </td>
    </tr>
</table>
</center></div>

<p align="center"><font face="Arial">PART I</font></p>

<p><font face="Arial"><b>Item 1. BUSINESS</b></font></p>

<p><font face="Arial">Oppenheimer Holdings Inc., formerly called
Fahnestock Viner Holdings Inc., prior to that called E.A. Viner
Holdings Limited and immediately prior to that called Goldale
Investments Limited (the &quot;Company&quot;), maintains its
registered office and principal place of business at 20 Eglinton
Avenue West, Suite 1110, Toronto, Ontario Canada M4R 1K8 and its
telephone number is (416) 322-1515.</font></p>

<p><font face="Arial">The Company was originally incorporated
under the laws of British Columbia. Pursuant to its Certificate
and Articles of Continuation effective October 12, 1977, the
Company's legal existence was continued under the Business
Corporation Act (Ontario) as if it had been incorporated as an
Ontario corporation.</font></p>

<p><font face="Arial">The Company is a holding company and
carries on no active business. It owns, directly or through
intermediate subsidiaries, Oppenheimer &amp; Co. Inc. (formerly
called Fahnestock &amp; Co. Inc. and prior to that called Edward
A. Viner &amp; Co., Inc.), a New York corporation
(&quot;Oppenheimer&quot;); Freedom Investments, Inc., a Delaware
corporation (&quot;Freedom&quot;); Oppenheimer Asset Management
Inc. (formerly called Hudson Capital Advisors Inc.), a New York
corporation (&quot;OAM&quot;); Evanston Financial, Inc., a New
York corporation (&quot;Evanston&quot;); since September 17,
2001, Josephthal &amp; Co. Inc., a New York corporation
(&quot;Josephthal&quot;); and since November 9, 2001, Prime
Charter, Ltd., a Delaware corporation (&quot;Prime&quot;).
Oppenheimer, OAM and Freedom are sometimes collectively referred
to as the &quot;Operating Subsidiaries&quot;. Through the
Operating Subsidiaries, the Company is engaged in the securities
brokerage and trading business and offers investment advisory and
other related financial services. Oppenheimer and OAM are the
principal Operating Subsidiaries. Oppenheimer is engaged in the
securities brokerage business in the United States, operates in
Toronto, Canada as an International Dealer and, through the
agency of local licensed broker-dealers, operates offices in
Buenos Aires, Argentina and Caracas, Venezuela. OAM is engaged in
the investment advisory business in the United States. In
addition, Oppenheimer conducts investment advisory business under
the name Fahnestock Asset Management, a division of Oppenheimer.
The business formerly conducted by Josephthal and Prime is now
conducted by Oppenheimer. The private client business acquired
from CIBC World Markets Inc. in January 2003 is being conducted
by Oppenheimer. The asset management business acquired from CIBC
World Markets in June 2003 is being conducted by OAM. The Company
operates a discount brokerage business through Freedom. </font></p>

<p><font face="Arial">In September 2001, through a wholly-owned
subsidiary, Oppenheimer acquired 91.6% of the outstanding common
stock of Josephthal Group, Inc. (&quot;Josephthal Group&quot;).
In October 2001 substantially all of the remaining outstanding
stock of Josephthal Group was acquired. The purchase price was $1
plus the assumption of liabilities of $23,885,000. Josephthal
Group indirectly owns 100% of Josephthal, formerly a private New
York-based broker-dealer founded in 1910 with approximately 265
financial consultants in 25 offices across the United States at
the time of closing. The acquisition was accounted for by the
purchase method. The accounts of Josephthal were converted to
Oppenheimer&#146;s system in November 2001. Oppenheimer acted as
a clearing agent for Josephthal until December 31, 2001 when the
accounts of Josephthal became accounts of Oppenheimer. Josephthal
made application to withdraw as a broker dealer and such
application was approved. Since January 1, 2002, its business has
been conducted by Oppenheimer.</font></p>

<p><font face="Arial">In November 2001, through a wholly-owned
subsidiary, Oppenheimer acquired 100% of the outstanding common
stock of Grand Charter Group Incorporated (&quot;Grand
Charter&quot;) for a cash consideration of $2,892,000. Grand
Charter owns 100% of Prime, formerly a twelve-year-old full
service securities firm with approximately 110 financial
consultants operating from offices in New York, New York and Boca
Raton, Florida. The acquisition was accounted for by the purchase
method. Effective January 1, 2002, Prime&#146;s accounts became
Oppenheimer accounts. Prime ceased to be a broker-dealer
effective January 22, 2002 and since January 1, 2002 its business
has been conducted by Oppenheimer. The business generated by the
two branches associated with the Prime acquisition was cleared
pursuant to an agreement with Bank of New York until November
2002 when its client accounts were converted to
Oppenheimer&#146;s clearing platform.</font></p>

<p><font face="Arial">In March 2002, through Freedom, the Company
purchased the business of BUYandHOLD Securities Corporation and
affiliates for cash consideration of $2,297,000. BUYandHOLD is an
on-line brokerage business headquartered in Edison, NJ. The
combination of the Freedom and BUYandHOLD technology platforms
provides clients with a comprehensive and diversified suite of
online financial services.<b> </b>BUYandHOLD operates as a
division of Freedom. The acquisition was accounted for by the
purchase method. </font></p>

<p><font face="Arial">In May 2002, Oppenheimer Trust Company
received a charter as a limited purpose bank domiciled in New
Jersey. Oppenheimer Trust Company offers trust services to the
clients of Oppenheimer and OAM.</font></p>

<p><font face="Arial">On January 3, 2003, the Company acquired
the U.S. Private Client Division of CIBC World Markets and on
June 4, 2003 acquired the U.S. Asset Management Division of CIBC
World Markets for a total consideration of approximately $242
million, of which approximately $16 million was paid in cash at
closing from cash on hand and the balance was paid from the
proceeds of the issuance of debt instruments. The private client
business is being operated by Oppenheimer and added approximately
620 account executives in 18 branches located in the major
financial centers of the United States to its business at the
closing date. Client assets of the Private Client Division were
approximately $30 billion at the closing date. Assets under
management in the Asset Management Division were approximately
$8.5 billion. The asset management business is being operated by
OAM. The acquisition is being accounted for by the purchase
method. This transaction more than doubles the Company&#146;s
retail exposure and asset base.</font></p>

<p><font face="Arial">In January 2003, the Company received
monetary damages plus interest in the amount of $21,750,000,
pursuant to an award by a National Association of Securities
Dealers Dispute Resolution panel against another broker-dealer in
a raiding case involving the sales force of First of Michigan
Corporation, a company acquired by Oppenheimer in July 1997.
During the fourth quarter of 1997, approximately 20% of the
&quot;pre-raid&quot; staff of financial consultants were hired
away in a raid. These proceeds, which were received in January
2003, were included in the Company&#146;s results for the first
quarter of 2003.</font></p>

<p><font face="Arial">In January 2004, the Company received
monetary damages plus interest in the amount of approximately
$2.7 million, pursuant to an award by a National Association of
Securities Dealers Dispute Resolution Panel against another
broker dealer in a raiding case involving financial consultants
of Josephthal &amp; Co. Inc., a company acquired by Oppenheimer
in September 2001. These proceeds, which were received in January
2004, will be included in the Company&#146;s results for the
first quarter of 2004.</font></p>

<p><font face="Arial">At December 31, 2003, Oppenheimer employed
1,704 full-time registered representatives and approximately
1,309 other employees in trading, research, investment banking,
investment advisory services, public finance and support
positions in the United States for Oppenheimer, OAM and Freedom,
for a total of approximately 3,013 full-time employees.
Oppenheimer and Freedom are broker-dealers registered with the
Securities and Exchange Commission (the &quot;SEC&quot;) and in
all other jurisdictions where their respective businesses require
registration. Oppenheimer, in addition to its United States
operations, has two additional offices: it conducts business in
Caracas and Buenos Aires through local broker-dealers who are
licensed under the laws of Venezuela and Argentina, respectively.
</font></p>

<p><font face="Arial">The Operating Subsidiaries are collectively
engaged in a broad range of activities in the securities
brokerage business, including retail securities brokerage,
institutional sales, bond trading and investment banking -
offering both corporate and public finance services,
underwriting, research, market making and investment advisory and
asset management services. No material part of the Company's
revenues, taken as a whole, are derived from a single customer or
group of customers.</font></p>

<p><font face="Arial">Oppenheimer is a member of the New York
Stock Exchange, Inc. (&quot;NYSE&quot;), the National Association
of Securities Dealers, Inc. (&quot;NASD&quot;), the American
Stock Exchange, Inc. (&quot;AMEX&quot;), the Chicago Stock
Exchange Incorporated (&quot;CSE&quot;), the Chicago Board
Options Exchange, Inc. (&quot;CBOE&quot;), the New York Futures
Exchange, Inc. (&quot;NYFE&quot;), the National Futures
Association (&quot;NFA&quot;) and the Securities Industry
Association (&quot;SIA&quot;). In addition, Oppenheimer has
satisfied the requirements of the Municipal Securities Rulemaking
Board (&quot;MSRB&quot;) for effecting customer transactions in
municipal securities. Freedom is a member of the NASD. </font></p>

<p><font face="Arial">Oppenheimer, which acts as a clearing
broker for Freedom and carries an omnibus account for the
BUYandHOLD Division of Freedom, which is itself a self-clearing
firm, is also a member of the Securities Investor Protection
Corporation (&quot;SIPC&quot;), which provides, in the event of
the liquidation of a broker-dealer, protection for customers'
accounts (including the customer accounts of other securities
firms when it acts on their behalf as a clearing broker) held by
the firm of up to $500,000 for each customer, subject to a
limitation of $100,000 for claims for cash balances. SIPC is
funded through assessments on registered broker-dealers, which
may not exceed 1% of a broker-dealer's gross revenues (as
defined); SIPC assessments were a flat fee of $150 in 2003, 2002
and 2001. In addition, Oppenheimer has purchased protection from
Lloyds of London of an additional $49,500,000 per customer. In
February 2004, the protection purchased from Lloyds of London was
increased to $74,500,000 per customer.</font></p>

<p><font face="Arial">The Company&#146;s internet address is
www.opco.com. The Company makes available free of charge through
its website its annual report on Form 10-K, quarterly reports on
Form 10-Q, current reports on Form 8-K, and other SEC filings and
all amendments to those reports as soon as reasonably practicable
after such material is electronically filed with or furnished to
the SEC.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><i>The following table sets forth the
amount and percentage of the Company's revenues from each
principal source for each of the following years ended December
31.</i></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="643">
    <tr>
        <td valign="top" width="32%">&nbsp;</td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial"><u>2003</u></font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial"><u>%</u></font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial"><u>2002</u></font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial"><u>%</u></font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial"><u>2001</u></font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial"><u>%</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7"><font face="Arial">(Dollars
        in thousands, except percentages)</font></td>
    </tr>
    <tr>
        <td valign="top" width="32%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="10%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Commissions</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$325,071</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">47%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">$135,747</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">48%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$122,272</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">47%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Principal
        transactions, net</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">136,672</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">20%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">58,227</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">21%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">56,374</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">22%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Interest</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">42,600</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">6%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">27,622</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">10%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">34,309</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">13%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Investment
        banking</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">50,623</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">7%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">22,760</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">8%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">10,955</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">4%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Advisory
        fees</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">80,550</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">12%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">26,365</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">9%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">24,504</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">9%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Other</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">54,477</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">8%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">12,612</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">4%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">12,847</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">5%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="32%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="10%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="32%"><font face="Arial">Total
        revenues</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$689,993</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">100%</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        face="Arial">$283,333</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">100%</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$261,261</font></p>
        </td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">100%</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">The Company derives most of its revenues
from the operations of its principal subsidiaries, Oppenheimer
and OAM. Although maintained as separate entities, the operations
of the Company's brokerage subsidiaries are closely related
because Oppenheimer acts as clearing broker and omnibus in
transactions initiated by Freedom. Except as expressly otherwise
stated, the discussion below pertains to the operations of
Oppenheimer.</font></p>

<p><font face="Arial">COMMISSIONS</font></p>

<p><font face="Arial">A significant portion of Oppenheimer's
revenues is derived from commissions from retail and, to a lesser
extent, institutional customers on brokerage transactions in
exchange-listed and over-the-counter corporate equity and debt
securities. Brokerage commissions are charged on both exchange
and over-the-counter transactions in accordance with a schedule,
which Oppenheimer has formulated. Often, discounts are granted to
customers, generally on large trades or to active customers.
Oppenheimer also provides a range of services in other financial
products to retail and institutional customers, including the
purchase and sale of options on the CBOE, the AMEX and other
stock exchanges as well as futures on indexes listed on various
exchanges.</font></p>

<p><font face="Arial">Commission business relies heavily on the
services of financial consultants with good sales production
records and good reputations. Competition among securities firms
for such personnel is intense. Retail clients' accounts are
serviced by retail financial advisors (excluding the
institutional financial consultants referred to below) in
Oppenheimer's offices. Oppenheimer's institutional clients, which
include mutual funds, banks, insurance companies, and pension and
profit-sharing funds, are serviced by institutional financial
advisors. (For a discussion of regulatory matters, see
&quot;Regulation&quot;.) The institutional department is
supported by the equity research department which provides
coverage of a number of commercial and industrial as well as
emerging growth companies and special situation investments. </font></p>

<p><font face="Arial">Securities Clearance Activities</font></p>

<p><font face="Arial">Oppenheimer provides a full range of
securities clearance services to two non-affiliated securities
firms on a fully-disclosed basis. In addition to commissions and
service charges, Oppenheimer derives substantial interest revenue
from its securities clearing activities. See &quot;Interest -
Securities Borrowed And Loaned.&quot; Oppenheimer provides margin
financing for the clients of the securities firms for which it
clears, with the securities firms guaranteeing the accounts of
their clients. Oppenheimer also extends margin credit directly to
its correspondent firms to the extent that such firms hold
securities positions for their own account. Because Oppenhimer
must rely on the guarantees and general credit of its
correspondent firms, Oppenheimer may be exposed to significant
risks of loss if any of its correspondents or its correspondents'
customers are unable to meet their respective financial
commitments. See &quot;Risk Management.&quot;</font></p>

<p><font face="Arial">Commodities</font></p>

<p><font face="Arial">Oppenheimer is a futures commission
merchant and clears commodities transactions on a number of
commodities exchanges for its clients that trade commodities.
Such client commodity accounts contain significant leverage and
thus have a greater than average likelihood of becoming unsecured
or for clients incurring substantial losses, that ultimately
could result in a loss to the Company.</font></p>

<p><font face="Arial">PRINCIPAL TRANSACTIONS</font></p>

<p><font face="Helvetica">In the regular course of its business,
Oppenheimer takes securities positions as a market maker to
facilitate customer transactions and for investment purposes. In
making markets and when trading for its own account, Oppenheimer
exposes its own capital to the risk of fluctuations in market
value. Trading profits (or losses) depend primarily upon the
skills of the employees engaged in market making and position
taking, the amount of capital allocated to positions in
securities and the general trend of prices in the securities
markets. </font></p>

<p><font face="Helvetica">Oppenheimer monitors its risk by
maintaining its securities positions at or below certain
pre-established levels. These levels reduce certain opportunities
to realize profits in the event that the values of such
securities increase. However, they also reduce the risk of loss
in the event of decreases in such values and result in controlled
interest costs incurred on funds provided to maintain such
positions. Oppenheimer also attempts to minimize risk with
respect to its principal transactions thereby reducing the need
to hold securities inventory positions for even short periods of
time. </font></p>

<p><font face="Arial">Trading profits or losses depend on (i) the
skills of those employees engaged in market-making activities,
(ii) the capital allocated to holding positions in securities and
(iii) the general trend of prices in the securities markets.
Trading as principal requires the commitment of capital and
creates an opportunity for profits or an exposure to risk of loss
due to market fluctuations. Oppenheimer takes both long and short
positions in those securities in which it makes a market.</font></p>

<p><font face="Helvetica"><i>Equities. </i></font><font
face="Arial">Oppenheimer acts as both principal and agent in the
execution of its customers' orders in the over-the-counter
market. Oppenheimer buys, sells and maintains an inventory of a
security in order to &quot;make a market&quot; in that security.
(To &quot;make a market&quot; in a security is to maintain firm
bid and offer prices by standing ready to buy or sell round lots
at publicly quoted prices. In order to make a market, it is
necessary to commit capital to buy, sell and maintain an
inventory of a security.) In executing customer orders for
over-the-counter securities in which it does not make a market,
Oppenheimer generally charges a commission and acts as agent or
will act as principal by marking the security up or down in a
riskless transaction, working with another firm which is a
market-maker acting as principal. However, when the buy or sell
order is in a security in which Oppenheimer makes a market,
Oppenheimer normally acts as principal and purchases from or
sells to its customers at a price which is approximately equal to
the current inter-dealer market price plus or minus a mark-up or
mark-down. The stocks in which Oppenheimer makes a market also
include those of issuers which are followed by Oppenheimer's
research department. Oppenheimer makes markets in approximately
over </font><font face="Helvetica">650 over-the-counter equity
securities, and trades securities for its own account, as well as
to facilitate customer transactions. As a result of the move to
decimal trading in the Nasdaq Stock Market, which began for all
stocks in April 2001, narrowing bid-ask spreads and smaller price
increments are being experienced and are resulting in a decrease
in trading revenue earned from the Company&#146;s market making
operations. Oppenheimer also trades in OTC Bulletin Board and
pink sheet securities. These securities are typically more
illiquid, have smaller capitalizations and may involve more risk
than Nasdaq-traded securities. </font></p>

<p><font face="Helvetica"><i>High Yield. </i>Oppenheimer also
trades non-investment grade public and private debt securities,
as well as distressed securities. Risk of loss upon default by
the borrower is significantly greater with respect to unrated or
less than investment grade corporate debt securities than with
other corporate debt securities. These securities are generally
unsecured and are often subordinated to other creditors of the
issuer. These issuers usually have high levels of indebtedness
and are more sensitive to adverse economic conditions, such as
recession or increasing interest rates, than are investment grade
issuers. There is a limited market for some of these securities
and market quotes are available only from a small number of
dealers. </font></p>

<p><font face="Arial">Other Trading and Investment Activities</font></p>

<p><font face="Arial">Oppenheimer holds positions in its trading
accounts in over-the-counter securities and in exchange-listed
securities in which it does not make a market and may engage from
time to time in other types of principal transactions in
securities. Oppenheimer has several trading departments
including: a convertible bond department, a risk arbitrage
department, a corporate bond dealer department, a municipal bond
department, a government/mortgage backed securities department, a
department that underwrites and trades U.S. government agency
issues, taxable corporate bonds, and UIT&#146;s. These
departments continually purchase and sell securities and make
markets in order to make a profit on the inter-dealer spread.
Although Oppenheimer from time to time holds an inventory of
securities, more typically, it seeks to match customer buy and
sell orders. In addition, Oppenheimer or OAM hold proprietary
positions in equity or fixed income securities in which it may
not act as a dealer. </font></p>

<p><font face="Arial">The size of its securities positions on any
one day may not be representative of Oppenheimer's exposure on
any other day because securities positions vary substantially
based upon economic and market conditions, allocations of
capital, underwriting commitments and trading volume. Also, the
aggregate value of inventories of stocks which Oppenheimer may
carry is limited by the Net Capital Rule. See &quot;Net Capital
Requirements&quot; and Item 7, &quot;Management's Discussion and
Analysis of Financial Condition and Results of Operations -
Liquidity and Capital Resources.&quot;</font></p>

<p><font face="Arial">In the case of OAM, it holds investments as
general partner in a range of investment partnerships
(&quot;hedge funds&quot;), which are offered to its qualified
clients as well as qualified clients of other broker-dealers. </font></p>

<p><font face="Arial">Investment Income</font></p>

<p><font face="Arial">Dividends and interest earned on securities
held in inventory, cash and cash equivalents and cash and
securities held in segregated accounts are treated as investment
income.</font></p>

<p><font face="Arial">Principal transactions with customers as
well as market-making and other trading and investment activities
accounted for approximately 20%, 21% and 22%, respectively, of
the Company&#146;s total revenues for the fiscal years ended
December 31, 2003, 2002 and 2001, respectively.</font></p>

<p><font face="Arial">Risk Management</font></p>

<p><font face="Helvetica"><i>Credit Risk. </i>Credit risk
represents the loss that the Company would incur if a client,
counterparty or issuer of securities or other instruments held by
the Company fails to perform its contractual obligations. The
Company follows industry practice to reduce credit risk related
to various investing and financing activities by obtaining and
maintaining collateral. The Company adjusts margin requirements
if it believes the risk exposure is not appropriate based on
market conditions. </font><font face="Arial">When Oppenheimer
advances funds or securities to a counterparty in a principal
transaction or to a customer in a brokered transaction, it is
subject to the risk that the counterparty or customer will not
repay such advances. If the market price of the securities
purchased or loaned has declined or increased, respectively,
Oppenheimer may be unable to recover some or all of the value of
the amount advanced. A similar risk is also present where a
customer is unable to respond to a margin call and the market
price of the collateral has dropped. In addition, Oppenheimer's
securities positions are subject to fluctuations in market value
and liquidity.</font></p>

<p><font face="Arial">Oppenheimer monitors market risks through
daily profit and loss statements and position reports. Each
trading department adheres to internal position limits determined
by senior management and regularly reviews the age and
composition of its proprietary accounts. Positions and profits
and losses for each trading department are reported to senior
management on a daily basis. Oppenheimer may from time to time
attempt to reduce market risk through the utilization of various
derivative securities as a hedge to market exposure. </font></p>

<p><font face="Arial">In its market-making activities,
Oppenheimer must provide liquidity in the equities for which it
makes markets. As a result of this event, Oppenheimer has risk
containment policies in place, which limit position size and
monitor transactions on a minute-to-minute basis.</font></p>

<p><font face="Arial">In addition to monitoring the
credit-worthiness of its customers, Oppenheimer imposes more
conservative margin requirements than those of the NYSE.
Generally, Oppenheimer limits customer loans to an amount not
greater than 65% of the value of the securities (or 50% if the
securities in the account are concentrated in a limited number of
issues). Particular attention and more restrictive requirements
are placed on more highly volatile securities traded in the
NASDAQ market. In comparison, the NYSE permits loans of up to 75%
of the value of the equity securities in a customer's account.</font></p>

<p><font face="Helvetica"><i>Operational Risk. </i>Operational
risk generally refers to the risk of loss resulting from the
Company&#146;s operations, including, but not limited to,
improper or unauthorized execution and processing of
transactions, deficiencies in its operating systems, business
disruptions and inadequacies or breaches in its internal control
processes. The Company operates in diverse markets and it is
reliant on the ability of its employees and systems to process
high numbers of transactions often within short time frames. In
the event of a breakdown or improper operation of systems, human
error or improper action by employees, the Company could suffer
financial loss, regulatory sanctions or damage to its reputation.
In order to mitigate and control operational risk, the Company
has developed and continues to enhance policies and procedures
that are designed to identify and manage operational risk at
appropriate levels. </font></p>

<p><font face="Helvetica"></font>&nbsp;</p>

<p><font face="Helvetica"><i>Legal Risk. </i>Legal risk includes
the risk of non-compliance with applicable legal and regulatory
requirements. The Company is subject to extensive regulation in
the different jurisdictions in which it conducts its business.
The Company has various procedures addressing issues such as
regulatory capital requirements, sales and trading practices, use
of and safekeeping of customer funds, credit granting, collection
activities, money-laundering and record keeping. </font></p>

<p><font face="Arial">For further discussion of risk management,
see Item 7A, Quantitative and Qualitative Disclosures about
Market Risk.</font></p>

<p><font face="Arial">DISASTER RECOVERY</font></p>

<p><font face="Helvetica">The events of September&nbsp;11, 2001
heightened the need for comprehensive disaster recovery plans.
Disaster recovery plans exist for the Company&#146;s critical
systems, and redundancies are built into the systems as deemed
appropriate. The Company believes that its disaster recovery
program, including off-site back-up technology and operational
facilities, is adequate to handle a reasonable business
disruption. However, there can be no assurances that a disaster
directly affecting the Company&#146;s headquarters or its
operations center would not have a material adverse impact on the
Company. Insurance and other safeguards might only partially
reimburse the Company for its losses. The Company also uses
periodic self-assessments, internal audit reviews and independent
consultants as a further check on operational risk and exposure. </font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">The Company maintains disaster recovery
procedures and a site in Edison New Jersey at which it houses
back-up facilities to its main operations in New York City.
Subsequent to 9/11/01, the Company has substantially upgraded its
investment in such procedures and facilities, but there remains
substantial risk and uncertainty with respect to the efficacy of
such planning due to the complications of moving its personnel
and business to any such facility.</font></p>

<p><font face="Arial">INTEREST</font></p>

<p><font face="Helvetica">Oppenheimer derives a substantial
portion of its interest revenues, and incurs a substantial
portion of its interest expenses, in connection with its
securities borrowed/ securities loaned activity. Oppenheimer also
earns interest on its securities portfolio, on its operating and
segregated balances, on its margin lending activity and on
certain of its investments. Oppenheimer also incurs interest
expense on its long-term debt, bank loans and free credit
balances in the accounts of customers. </font></p>

<p><font face="Helvetica"><i>Securities Borrowed/ Securities
Loaned. </i>In connection with both its trading and brokerage
activities, Oppenheimer borrows securities to cover short sales
and to complete transactions in which customers have failed to
deliver securities by the required settlement date, and lends
securities to other brokers and dealers for similar purposes.
Oppenheimer has an active securities borrowed and lending matched
book business (&quot;Matched Book&quot;), in which Oppenheimer
borrows securities from one party and lends them to another
party. When Oppenheimer borrows securities, Oppenheimer provides
cash to the lender as collateral, which is reflected in the
Company&#146;s financial statements as receivable from brokers
and dealers. OPCO earns interest revenues on this cash
collateral. Similarly, when Oppenheimer lends securities to
another party, that party provides cash to Oppenheimer as
collateral, which is reflected in the Company&#146;s financial
statements as payable to brokers and dealers. Oppenheimer pays
interest expense on the cash collateral received from the party
borrowing the securities.</font></p>

<p><font face="Helvetica"></font>&nbsp;</p>

<p><font face="Helvetica"><i>Margin Lending. </i>Customers&#146;
transactions are executed on either a cash or margin basis. In a
margin transaction, Oppenheimer extends credit to the customer,
collateralized by securities and cash in the customer&#146;s
account, for a portion of the purchase price, and receives income
from interest charged on such extensions of credit. Margin
lending by Oppenheimer is subject to the margin rules of the
Board of Governors of the Federal Reserve System, NYSE margin
requirements and Oppenheimer&#146;s internal policies. </font></p>

<p><font face="Helvetica">The primary source of funds to finance
customers' margin account borrowings are collateralized and
uncollateralized bank borrowings, funds generated by lending
securities on a cash collateral basis in excess of the amount of
securities borrowed and free credit balances in customers'
accounts. Free credit balances in customers' accounts, to the
extent not required to be segregated pursuant to SEC rules, may
be used in the conduct of Oppenheimer&#146;s business, including
the extension of margin credit. Subject to applicable
regulations, interest is paid by Oppenheimer on most, but not
all, of such free credit balances awaiting reinvestment by
customers. The customer is charged for such margin financing at
interest rates derived from the company&#146;s &quot;base&quot;
rate as defined, as well as the brokers&#146; loan rate, and
LIBOR to which is added an additional amount of up to 2%. To the
extent that the use of free credit balances reduces borrowings,
interest expense is reduced.</font></p>

<p><font face="Helvetica">In permitting a customer to purchase
securities on margin, Oppenheimer is subject to the risk that a
market decline could reduce the value of its collateral below the
amount of the customer&#146;s indebtedness and that the customer
might otherwise be unable to repay the indebtedness. </font></p>

<p><font face="Helvetica">&nbsp;&nbsp;&nbsp;&nbsp; </font></p>

<p><font face="Helvetica">In addition to monitoring the
creditworthiness of its customers, Oppenheimer also considers the
trading liquidity and volatility of the securities it accepts as
collateral for its margin loans. Trading liquidity and volatility
may be dependent, in part, upon the market in which the security
is traded, the number of outstanding shares of the issuer, events
affecting the issuer and/or securities markets in general, and
whether or not there are any legal restrictions on the sale of
the securities. Oppenheimer considers all of these factors at the
time it agrees to extend credit to customers and continues to
review its extensions of credit on an ongoing basis. </font></p>

<p><font face="Helvetica">The majority of Oppenheimer&#146;s
margin loans are made to United States citizens or to
corporations which are domiciled in the United States.
Oppenheimer may extend credit to investors or corporations who
are citizens of foreign countries or who may reside outside the
United States. Oppenheimer believes that should such foreign
investors default upon their loans and should the collateral for
those loans be insufficient to satisfy the investors&#146;
obligations, it may be more difficult to collect such
investors&#146; outstanding indebtedness than would be the case
if investors were citizens or residents of the United States. </font></p>

<p><font face="Helvetica">Although Oppenheimer attempts to
minimize the risk associated with the extension of credit in
margin accounts, there is no assurance that the assumptions on
which Oppenheimer bases its decisions will be correct or that it
is in a position to predict factors or events which will have an
adverse impact on any individual customer or issuer, or the
securities markets in general. </font></p>

<p><font face="Arial">INVESTMENT BANKING BUSINESS</font></p>

<p><font face="Helvetica">Oppenheimer offers corporations
(primarily middle-market growth companies) a full range of
financial advisory services as well as debt, equity, and
convertible financing services. Products include acquisition
financing, private placements and public offerings of debt and
equity securities, debt refinancings, restructuring, merger and
acquisition and exclusive sales advice, structured financings and
securitizations. Investment banking activity involves both
economic and regulatory risks. An underwriter may incur losses if
it is unable to sell the securities it is committed to purchase
or if it is forced to liquidate its commitments at less than the
agreed upon purchase price. In addition, under the Securities Act
and other laws and court decisions with respect to
underwriters&#146; liability and limitations on indemnification
of underwriters by issuers, an underwriter is subject to
substantial potential liability for material misstatements or
omissions in prospectuses and other communications with respect
to underwritten offerings. Further, underwriting commitments
constitute a charge against net capital and Oppenheimer&#146;s
underwriting commitments may be limited by the requirement that
it must, at all times, be in compliance with the Uniform Net
Capital Rule&nbsp;15c3-1 of the SEC.</font></p>

<p><font face="Helvetica">Oppenheimer intends to continue to
pursue opportunities for its corporate customers, which may
require it to finance and/or underwrite the issuance of
securities. Under circumstances where Oppenheimer is required to
act as an underwriter or to take a position in the securities of
its customers, Oppenheimer O may assume greater risk than would
normally be assumed in its normal trading activity. Oppenheimer
also participates as an underwriter in the syndication of </font><font
face="Arial">issues managed by other securities firms.</font></p>

<p><font face="Arial">The Company derived 7%, 8% and 4% of its
revenues from underwriting in 2003, 2002 and 2001, respectively.
See &quot;Net Capital Requirements&quot; and Item 7,
&quot;Management's Discussion and Analysis of Financial Condition
and Results of Operations - Liquidity and Capital
Resources.&quot;</font></p>

<p><font face="Arial">INVESTMENT ADVISORY BUSINESS</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
(through its Fahnestock Asset Management division) and OAM
provide investment advisory services for a fee to its clients.
These equity and debt management service fees are based on the
value of the portfolio under management. In addition to the
management fee, transactions executed for such accounts may be
effected at standard rates of commission or at discounts from </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> 's
customary commission schedule.</font></p>

<p><font face="Arial">At December 31, 2003, </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> and OAM
had approximately $9.59 billion under management. The agreements
under which the portfolios are managed on behalf of institutions
and other investors generally provide for termination by either
party at any time.</font></p>

<p><font face="Arial">OAM</font><font face="Helvetica"> is a
broad-based advisory platform that includes: Investment Advisory
Services (IAS), Strategic Asset Review (STAR), and Portfolio
Advisory Services (PAS), collectively the consulting services;
Oppenheimer Investment Advisors (OIA), core internally managed
client accounts; OMEGA, financial advisor discretionary fee-based
advisory accounts; and Alternative Investments Group,
non-traditional investment strategies within SEC-registered
funds.</font></p>

<p><font face="Helvetica">Fahnestock Asset Management and the
OMEGA Group provide customized discretionary investment
management services and products to high net worth individuals
and families, endowments and foundations and institutions. They
seek to provide portfolio management, client service and other
financial services in a disciplined manner that is tailored to
meet its clients&#146; particular needs and objectives.</font></p>

<p><font face="Helvetica"><i>Importance of Investment
Performance. </i></font></p>

<p><font face="Helvetica">The Company believes that investment
performance is one of the most important factors for the growth
of assets under management for a company in the asset management
business. Poor investment performance could impair growth of the
Company&#146;s asset management business because existing clients
might withdraw funds and the Company&#146;s ability to attract
funds from existing and new clients might diminish.</font></p>

<table border="0" cellpadding="7" cellspacing="0">
    <tr>
        <td valign="top" width="84">&nbsp;</td>
        <td valign="top" width="60">&nbsp;</td>
        <td valign="top" width="88">&nbsp;</td>
        <td valign="top" width="64">&nbsp;</td>
        <td valign="top" width="83">&nbsp;</td>
        <td valign="top" width="58">&nbsp;</td>
        <td>&nbsp;</td>
    </tr>
</table>

<p><font face="Helvetica">Investment advisory and administrative
contracts are generally terminable at will or upon relatively
short notice. Institutional and individual clients can terminate
their relationships with an asset manager, reduce the aggregate
amount of assets under management, or shift their funds to other
types of accounts with different rate structures for any number
of reasons, including investment performance, changes in
prevailing interest rates, loss of key investment management
personnel and financial market performance. In a declining stock
market, the withdrawal of assets from accounts could accelerate. </font></p>

<p><font face="Helvetica">Other Business</font></p>

<p><font face="Helvetica">The Company operates a mortgage banking
business through Evanston Financial Corporation.</font></p>

<p><font face="Arial">ADMINISTRATION AND OPERATIONS</font></p>

<p><font face="Arial">Administration and operations personnel are
responsible for the processing of securities transactions; the
receipt, identification and delivery of funds and securities; the
maintenance of internal financial controls; accounting functions;
custody of customers' securities; the handling of margin accounts
for </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> and its correspondents; and general office
services. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> employs approximately</font><font color="#FF00FF"
face="Arial"> </font><font face="Arial">380</font><font
color="#FF00FF" face="Arial"> </font><font face="Arial">persons</font><font
color="#FF00FF" face="Arial"> </font><font face="Arial">in its
administration and operations departments at its head office,
approximately 60 persons in its administration and operations
departments in Detroit and over 100 administrative and operations
persons located in its branch offices.</font></p>

<p><font face="Arial">There is considerable fluctuation during
any year and from year to year in the volume of transactions </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> must
process. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> records transactions and posts its books on a daily
basis. Operations personnel monitor day-to-day operations to
assure compliance with applicable laws, rules and regulations.
Failure to keep current and accurate books and records can render
</font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> liable for disciplinary action by governmental and
self-regulatory organizations.</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
executes its own and certain of its correspondents' securities
transactions on all United States exchanges of which it is a
member and in the over-the-counter market. </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> clears all
of its securities transactions (i.e., it delivers securities that
it has sold, receives securities that it has purchased and
transfers related funds) through its own facilities and through
memberships in various clearing corporations and custodian banks.</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
believes that its internal controls and safeguards are adequate,
although fraud and misconduct by customers and employees and the
possibility of theft of securities are risks inherent in the
securities industry. As required by the NYSE and certain other
authorities, </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> carries a broker's blanket insurance bond covering
loss or theft of securities, forgery of checks and drafts,
embezzlement, fraud and misplacement of securities. This bond
provides coverage of up to an aggregate of $25,000,000 with a
self-insurance retention of $250,000.<b> </b></font></p>

<p><font face="Arial">COMPETITION</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
encounters intense competition in all aspects of the securities
business and competes directly with other securities firms, a
significant number of which have substantially greater resources
and offer a wider range of financial services. In addition, there
has recently been increasing competition from other sources, such
as commercial banks, insurance companies and certain major
corporations that have entered the securities industry through
acquisition, and from other entities. Additionally, foreign-based
securities firms and commercial banks regularly offer their
services in performing a variety of investment banking functions
including: merger and acquisition advice, leveraged buy-out
financing, merchant banking, and bridge financing, all in direct
competition with U.S. broker-dealers. These developments have led
to the creation of a greater number of integrated financial
services firms that may be able to compete more effectively than </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> for
investment funds by offering a greater range of financial
services.</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
believes that the principal factors affecting competition in the
securities industry are the quality and ability of professional
personnel and relative prices of services and products offered. </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> and its
competitors employ advertising and direct solicitation of
potential customers in order to increase business and furnish
investment research publications in an effort to retain existing
and attract potential clients. Many of </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> 's
competitors engage in these programs more extensively than does </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">.</font></p>

<p><font face="Arial">There is substantial commission discounting
by broker-dealers competing for institutional and retail
brokerage business. Recently, full service firms have begun
offering on-line trading services to their clients at substantial
discounts to their regular pricing. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> intends to compete in this area, but it is likely
to reduce profitability per transaction, unless offset by higher
transaction volume. The continuation of such discounting and an
increase in the incidence thereof could adversely affect </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">. However,
an increase in the use of discount brokerages could be beneficial
to Freedom.</font></p>

<p><font face="Arial">REGULATION</font></p>

<p><font face="Arial">The securities industry in the United
States is subject to extensive regulation under both federal and
state laws. The SEC is the federal agency charged with
administration of the federal securities laws. Much of the
regulation of broker-dealers has been delegated to
self-regulatory organizations (&quot;SRO&quot;) such as the NASD
and national securities exchanges such as the NYSE and the
National Futures Association. The NYSE has been designated </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">&#146;s
primary regulator with respect to securities activities and the
National Futures Association has been designated </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">&#146;s
primary regulator with respect to commodities activities. The
CBOE has been designated </font><font face="Helvetica">Oppenheimer&#146;s</font><font
face="Arial"> primary regulator with respect to options trading
activities. The NASD has been designated Freedom&#146;s primary
regulator with respect to securities activities. These
self-regulatory organizations adopt rules (subject to approval by
the SEC or the Commodities Futures Trading Commission
(&quot;CFTC&quot;), as the case may be) governing the industry
and conduct periodic examinations of </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> 's and
Freedom's operations. Securities firms are also subject to
regulation by state securities commissions in the states in which
they do business. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> and Freedom are each registered as a broker-dealer
in the 50 states and Puerto Rico. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> is also registered as an International
Broker-Dealer in Canada. </font></p>

<p><font face="Arial">The regulations to which broker-dealers are
subject cover all aspects of the securities business, including
sales methods, trade practices among broker-dealers, the use and
safekeeping of customers' funds and securities, capital structure
of securities firms, record keeping and the conduct of directors,
officers and employees. The SEC has adopted rules requiring
underwriters to ensure that municipal securities issuers provide
current financial information and imposing limitations on
political contributions to municipal issuers by brokers, dealers
and other municipal finance professionals. Additional
legislation, changes in rules promulgated by the SEC, the CFTC
and by self-regulatory organizations, or changes in the
interpretation or enforcement of existing laws and rules may
directly affect the method of operation and profitability of
broker-dealers. The SEC, self-regulatory organizations (including
the NYSE) and state securities commissions may conduct
administrative proceedings which can result in censure, fine,
issuance of cease and desist orders or suspension or expulsion of
a broker-dealer, its officers, or employees. The principal
purpose of regulating and disciplining broker-dealers is to
protect customers and the securities markets rather than to
protect creditors and shareholders of broker-dealers.</font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
is also subject to regulation by the SEC and under certain state
laws in connection with its business as an investment advisor and
in connection with its research department activities. </font></p>

<p><font face="Arial">Margin lending by </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> is subject
to the margin rules of the Board of Governors of the Federal
Reserve System and the NYSE. Under such rules, </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> is limited
in the amount it may lend in connection with certain purchases of
securities and is also required to impose certain maintenance
requirements on the amount of securities and cash held in margin
accounts. In addition, </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> may (and currently does) impose more restrictive
margin requirements than required by such rules. See
&quot;Customer Lending.&quot;</font></p>

<p><font face="Arial">NET CAPITAL REQUIREMENTS</font></p>

<p><font face="Arial">As registered broker-dealers and member
firms of the NYSE (</font><font face="Helvetica">Oppenheimer</font><font
face="Arial">) or the NASD (Freedom), the Operating Subsidiaries
are subject to certain net capital requirements pursuant to Rule
15c3-1 (the &quot;Net Capital Rule&quot;) promulgated under the
Securities Exchange Act of 1934, as amended (the &quot;Exchange
Act&quot;). The Net Capital Rule, which specifies minimum net
capital requirements for registered brokers and dealers, is
designed to measure the general financial integrity and liquidity
of a broker-dealer and requires that at least a minimum part of
its assets be kept in relatively liquid form.<b> </b></font></p>

<p><font face="Helvetica">Oppenheimer</font><font face="Arial">
elects to compute net capital under an alternative method of
calculation permitted by the Net Capital Rule. (Freedom computes
net capital under the basic formula as provided by the Net
Capital Rule.) Under this alternative method, </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> is
required to maintain a minimum &quot;net capital&quot;, as
defined in the Net Capital Rule, at least equal to 2% of the
amount of its &quot;aggregate debit items&quot; computed in
accordance with the Formula for Determination of Reserve
Requirements for Brokers and Dealers (Exhibit A to Rule 15c3-3
under the Exchange Act) or $250,000, whichever is greater.
&quot;Aggregate debit items&quot; are assets that have as their
source transactions with customers, primarily margin loans.
Failure to maintain the required net capital may subject a firm
to suspension or expulsion by the NYSE, the SEC and other
regulatory bodies and ultimately may require its liquidation. The
Net Capital Rule also prohibits payments of dividends, redemption
of stock and the prepayment of subordinated indebtedness if net
capital thereafter would be less than 5% of aggregate debit items
(or 7% of the funds required to be segregated pursuant to the
Commodity Exchange Act and the regulations thereunder, if
greater) and payments in respect of principal of subordinated
indebtedness if net capital thereafter would be less than 5% of
aggregate debit items (or 6% of the funds required to be
segregated pursuant to the Commodity Exchange Act and the
regulations thereunder, if greater). The Net Capital Rule also
provides that the total outstanding principal amounts of a
broker-dealer's indebtedness under certain subordination
agreements (the proceeds of which are included in its net
capital) may not exceed 70% of the sum of the outstanding
principal amounts of all subordinated indebtedness included in
net capital, par or stated value of capital stock, paid in
capital in excess of par, retained earnings and other capital
accounts for a period in excess of 90 days.</font></p>

<p><font face="Arial">Net capital is essentially defined in the
Net Capital Rule as net worth (assets minus liabilities), plus
qualifying subordinated borrowings minus certain mandatory
deductions that result from excluding assets that are not readily
convertible into cash and deductions for certain operating
charges. The Net Capital Rule values certain other assets, such
as a firm's positions in securities, conservatively. Among these
deductions are adjustments (called &quot;haircuts&quot;) in the
market value of securities to reflect the possibility of a market
decline prior to disposition. </font></p>

<p><font face="Arial">Compliance with the Net Capital Rule could
limit those operations of the brokerage subsidiaries of the
Company that require the intensive use of capital, such as
underwriting and trading activities and the financing of customer
account balances, and also could restrict the Company's ability
to withdraw capital from its brokerage subsidiaries, which in
turn could limit the Company's ability to pay dividends, repay
debt and redeem or purchase shares of its outstanding capital
stock. Under the Net Capital Rule, broker-dealers are required to
maintain certain records and provide the SEC with quarterly
reports with respect to, among other things, significant
movements of capital, including transfers to a holding company
parent or other affiliate. The SEC and/or the SROs may in certain
circumstances restrict the Company's brokerage subsidiaries'
ability to withdraw excess net capital and transfer it to the
Company or to other of the Operating Subsidiaries or to expand
the Company&#146;s business.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 2. PROPERTIES</b></font></p>

<p><font face="Arial">The Company maintains offices at 20
Eglinton Avenue West, Toronto, Ontario, Canada for general
administrative activities. Most day-to-day management functions
are conducted at the executive offices of Oppenheimer at 125
Broad Street, New York, New York. This office also serves as the
base for most of </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> 's research, operations and trading and investment
banking activities, though other offices also have employees who
work in these areas. Investment advisory services are offered
from the Company&#146;s office at 200 Park Avenue, New York, New
York, although other offices also have employees who work in this
area. Generally, the offices outside of 125 Broad Street, New
York serve as bases for sales representatives who process trades
and provide other brokerage services in co-operation with </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> 's New
York office using the data processing facilities located there.
Freedom conducts its business from its offices located in Edison,
N.J., where the Company also maintains its disaster recovery
site. Management believes that its present facilities are
adequate for the purposes for which they are used and have
adequate capacity to provide for presently contemplated future
uses. </font></p>

<p><font face="Arial">The Company and its subsidiaries own no
real property, but at December 31, 2003, occupied office space
totalling approximately 984,000 square feet in 98 locations under
standard commercial terms expiring between 2004 and 2014. If any
leases are not renewed, the Company believes it could obtain
comparable space elsewhere on commercially reasonable rental
terms.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 3. LEGAL PROCEEDINGS </b></font></p>

<p><font face="Arial">The Operating Subsidiaries are involved in
certain litigation arising in the ordinary course of business.
Management believes, based upon discussion with legal counsel,
that the outcome of this litigation will not have a material
effect on the Company&#146;s financial position. The materiality
of legal matters to the Company&#146;s future operating results
depends on the level of future results of operations as well as
the timing and ultimate outcome of such legal matters.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS</b></font></p>

<p><font face="Arial">The Class B voting shares (the &quot;Class
B Shares&quot;), the Company's only class of voting securities,
are not registered under the Exchange Act and are not required to
be registered. The Class B Shares are owned by fewer than 500
shareholders of record. Consequently, the Company is not required
under Section 14 of the Exchange Act to furnish proxy soliciting
material or an information statement to holders of the Class B
Shares. However, the Company is required under applicable
Canadian securities laws to provide proxy soliciting material,
including a management information circular, to the holders of
its Class B Shares.</font></p>

<p><font face="Arial">Pursuant to the Company's Articles of
Incorporation, holders of Class A non-voting shares (the
&quot;Class A Shares&quot;), although not entitled to vote
thereat, are entitled to receive notices of shareholders'
meetings and to receive all informational documents required by
law or otherwise to be provided to holders of Class B Shares. In
addition, holders of Class A Shares are entitled to attend and
speak at all meetings of shareholders, except class</font></p>

<p><font face="Arial">meetings not including the Class A Shares.</font></p>

<p><font face="Arial">In the event of either a &quot;take-over
bid&quot; or an &quot;issuer bid&quot; (as those terms are
defined in the Securities Act (Ontario)) being made for the Class
B Shares and no corresponding offer being made to purchase Class
A Shares, the holders of Class A Shares would have no right under
the Articles of Incorporation of the Company or under any
applicable statute to require that a similar offer be made to
them to purchase their Class A Shares.</font></p>

<p><font face="Arial">No matters were submitted to the Company's
shareholders during the fourth quarter of the Company's 2003
fiscal year.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>PART II</b></font></p>

<p><font face="Arial"><b>Item 5. MARKET FOR THE REGISTRANT'S
COMMON EQUITY AND RELATED</b></font></p>

<p><font face="Arial"><b>STOCKHOLDER MATTERS</b></font></p>

<p><font face="Arial">The Company's Class A Shares are listed and
traded on The New York Stock Exchange (the &quot;NYSE&quot;) and
The Toronto Stock Exchange (the &quot;TSX&quot;) (trading symbol
&quot;OPY&quot;). The Class B Shares are not traded on any stock
exchange in Canada or the United States and, as a consequence,
there is only limited trading in the Class B shares. The Company
does not presently contemplate listing the Class B Shares in the
United States on any national or regional stock exchange or on
NASDAQ.</font></p>

<p><font face="Arial">The following tables set forth the high and
low sales prices of the Class A Shares on The Toronto Stock
Exchange and on The New York Stock Exchange. Prices provided are
in Canadian dollars or U.S. dollars as indicated and are based on
data provided by The Toronto Stock Exchange and The New York
Stock Exchange.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="475">
    <tr>
        <td valign="top" colspan="2" width="34%"><font
        face="Arial">Class A Shares:</font></td>
        <td valign="top" colspan="2" width="30%"><p
        align="center"><font face="Arial">TSX</font></p>
        </td>
        <td valign="top" colspan="2" width="36%"><p
        align="center"><font face="Arial">NYSE</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="15%"><font face="Arial">HIGH</font></td>
        <td valign="top" width="14%"><font face="Arial">LOW</font></td>
        <td valign="top" width="18%"><font face="Arial">HIGH</font></td>
        <td valign="top" width="18%"><font face="Arial">LOW</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" colspan="2" width="30%"><p
        align="center"><font face="Arial">(Cdn. Dollars)</font></p>
        </td>
        <td valign="top" colspan="2" width="36%"><p
        align="center"><font face="Arial">(U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">2003</font></td>
        <td valign="top" width="21%"><font face="Arial">1<sup>st</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$39.20</font></td>
        <td valign="top" width="14%"><font face="Arial">$33.64</font></td>
        <td valign="top" width="18%"><font face="Arial">$25.24</font></td>
        <td valign="top" width="18%"><font face="Arial">$22.06</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">2<sup>nd</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$39.75</font></td>
        <td valign="top" width="14%"><font face="Arial">$32.90</font></td>
        <td valign="top" width="18%"><font face="Arial">$29.85</font></td>
        <td valign="top" width="18%"><font face="Arial">$22.25</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">3<sup>rd</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$40.35</font></td>
        <td valign="top" width="14%"><font face="Arial">$35.65</font></td>
        <td valign="top" width="18%"><font face="Arial">$29.30</font></td>
        <td valign="top" width="18%"><font face="Arial">$25.50</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">4<sup>th</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$46.11</font></td>
        <td valign="top" width="14%"><font face="Arial">$39.00</font></td>
        <td valign="top" width="18%"><font face="Arial">$35.10</font></td>
        <td valign="top" width="18%"><font face="Arial">$29.15</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">2002</font></td>
        <td valign="top" width="21%"><font face="Arial">1<sup>st</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$46.00</font></td>
        <td valign="top" width="14%"><font face="Arial">$39.40</font></td>
        <td valign="top" width="18%"><font face="Arial">$28.88</font></td>
        <td valign="top" width="18%"><font face="Arial">$24.85</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">2<sup>nd</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$40.56</font></td>
        <td valign="top" width="14%"><font face="Arial">$32.65</font></td>
        <td valign="top" width="18%"><font face="Arial">$25.70</font></td>
        <td valign="top" width="18%"><font face="Arial">$21.26</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">3<sup>rd</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$35.00</font></td>
        <td valign="top" width="14%"><font face="Arial">$31.55</font></td>
        <td valign="top" width="18%"><font face="Arial">$23.15</font></td>
        <td valign="top" width="18%"><font face="Arial">$20.00</font></td>
    </tr>
    <tr>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="21%"><font face="Arial">4<sup>th</sup>
        Quarter</font></td>
        <td valign="top" width="15%"><font face="Arial">$43.86</font></td>
        <td valign="top" width="14%"><font face="Arial">$31.45</font></td>
        <td valign="top" width="18%"><font face="Arial">$28.45</font></td>
        <td valign="top" width="18%"><font face="Arial">$19.77</font></td>
    </tr>
</table>

<p><font face="Arial">The following table sets forth information
about the <i>shareholders of the Company</i> as at December 31,
2003 as set forth in the records of the Company's transfer agent
and registrar: </font></p>

<p><font face="Arial"><b>Class A Shares:</b></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="636">
    <tr>
        <td valign="top" width="51%"><font face="Arial"><u>Shareholders
        of record having addresses in:</u></font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial"><u>Number of shares</u></font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial"><u>Percentage</u></font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial"><u>Number of shareholders</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="51%"><font face="Arial">Canada </font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">5,140,988</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">40%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">168</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="51%"><font face="Arial">United
        States</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">7,677,918</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">60%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">180</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="51%"><font face="Arial">Other</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">614</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">6</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="51%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="51%"><font face="Arial">Total
        issued and outstanding</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">12,819,520</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">100%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">354</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Class B Shares</b></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="648">
    <tr>
        <td valign="top" width="50%"><font face="Arial"><u>Shareholders
        of record having addresses in:</u></font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial"><u>Number of shares</u></font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial"><u>Percentage</u></font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        face="Arial"><u>Number of shareholders</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font face="Arial">Canada
        (1)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">97,813</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">98%</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        face="Arial">116</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font face="Arial">United
        States</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">1,739</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">2%</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        face="Arial">67</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font face="Arial">Other</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">128</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        face="Arial">3</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font face="Arial">Total
        issued and outstanding</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">99,680</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">100%</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        face="Arial">186</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">(1) The Company has been informed that
50,975 Class B shares held by Phase II Financial Limited, an
Ontario corporation, are beneficially owned by A.G. Lowenthal,
Chairman, CEO and a Director of the Company, a U.S. citizen and
resident. See Item 12, &quot;Security Ownership of Certain
Beneficial Owners and Management&quot;.</font></p>

<p><font face="Arial"><i>Dividends</i></font></p>

<p><font face="Arial">The following table sets forth the
frequency and amount of any cash dividends declared on the
Company&#146;s Class A and Class B Shares for the fiscal years
ended December 31, 2003 and 2002.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="631">
    <tr>
        <td valign="top" width="13%"><font face="Arial"><u>Type</u></font></td>
        <td valign="top" width="24%"><font face="Arial"><u>Declaration
        date</u></font></td>
        <td valign="top" width="24%"><font face="Arial"><u>Record
        date</u></font></td>
        <td valign="top" width="26%"><font face="Arial"><u>Payment
        date</u></font></td>
        <td valign="top" width="13%"><font face="Arial"><u>Amount
        per share</u></font></td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">January
        24, 2002</font></td>
        <td valign="top" width="24%"><font face="Arial">February
        8, 2002</font></td>
        <td valign="top" width="26%"><font face="Arial">February
        22, 2002</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">April 19,
        2002</font></td>
        <td valign="top" width="24%"><font face="Arial">May 3,
        2002</font></td>
        <td valign="top" width="26%"><font face="Arial">May 17,
        2002</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">July 18,
        2002</font></td>
        <td valign="top" width="24%"><font face="Arial">August 2,
        2002</font></td>
        <td valign="top" width="26%"><font face="Arial">August
        16, 2002</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">October
        18, 2002</font></td>
        <td valign="top" width="24%"><font face="Arial">November
        8, 2002</font></td>
        <td valign="top" width="26%"><font face="Arial">November
        22, 2002</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">January
        24, 2003</font></td>
        <td valign="top" width="24%"><font face="Arial">February
        14, 2003</font></td>
        <td valign="top" width="26%"><font face="Arial">February
        28, 2003</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">April 24,
        2003</font></td>
        <td valign="top" width="24%"><font face="Arial">May 9,
        2003</font></td>
        <td valign="top" width="26%"><font face="Arial">May 23,
        2003</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">July 24,
        2003</font></td>
        <td valign="top" width="24%"><font face="Arial">August 8,
        2003</font></td>
        <td valign="top" width="26%"><font face="Arial">August
        22, 2003</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">October
        24, 2003</font></td>
        <td valign="top" width="24%"><font face="Arial">November
        7, 2003</font></td>
        <td valign="top" width="26%"><font face="Arial">November
        21, 2003</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="13%"><font face="Arial">Quarterly</font></td>
        <td valign="top" width="24%"><font face="Arial">January
        27, 2004</font></td>
        <td valign="top" width="24%"><font face="Arial">February
        13, 2004</font></td>
        <td valign="top" width="26%"><font face="Arial">February
        27, 2004</font></td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$0.09</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">Future dividend policy will depend upon the
earnings and financial condition of the Operating Subsidiaries,
the Company's need for funds and other factors. Dividends may be
paid to holders of Class A Shares and Class B Shares (pari
passu), as and when declared by the Company's Board of Directors,
from funds legally available therefor.</font></p>

<p><font face="Arial">CERTAIN TAX MATTERS</font></p>

<p><font face="Arial">The following paragraphs summarize certain
United States and Canadian federal income tax considerations in
connection with the receipt of dividends paid on the Class A and
Class B Shares of the Company. These tax considerations are
stated in brief and general terms and are based on United States
and Canadian law currently in effect. There are other potentially
significant United States and Canadian federal income tax
considerations and state, provincial or local income tax
considerations with respect to ownership and disposition of the
Class A and Class B Shares which are not discussed herein. The
tax considerations relative to ownership and disposition of the
Class A and Class B Shares may vary from taxpayer to taxpayer
depending on the taxpayer's particular status. Accordingly,
prospective purchasers should consult with their tax advisors
regarding tax considerations, which may apply to the particular
situation.</font></p>

<p><font face="Arial">United States Federal Income Tax
Considerations</font></p>

<p><font face="Arial">Dividends on Class A and Class B Shares
paid to citizens or residents of the U.S. or to U.S. corporations
(including any Canadian federal income tax withheld) will be
subject to U.S. federal income taxation as qualified dividends to
the extent paid out of the Company&#146;s earnings and profits,
determined under U.S. tax principles, subject to tax at 15%. Such
dividends will not be eligible for the deduction for dividends
received by corporations (unless such corporation owns by vote
and value at least 10% of the stock of the Company, in which case
a portion of such dividend may be eligible for such exclusion).</font></p>

<p><font face="Arial">U.S. corporations, U.S. citizens and U.S.
residents will generally be entitled, subject to certain
limitations, to a credit against their U.S. federal income tax
for Canadian federal income taxes withheld from such dividends.
Taxpayers may claim a deduction for such taxes if they do not
elect to claim such tax credit. No deduction for foreign taxes
may be claimed by an individual taxpayer who does not itemize
deductions. Because the application of the foreign tax credit
depends upon the particular circumstances of each shareholder,
shareholders are urged to consult their own tax advisors in this
regard. </font></p>

<p><font face="Arial">Canadian Federal Income Tax Considerations</font></p>

<p><font face="Arial">Dividends paid on Class A and Class B
Shares held by non-residents of Canada will generally be subject
to Canadian withholding tax. This withholding tax is levied at
the basic rate of 25%, although this rate may be reduced by the
terms of any applicable tax treaty. The Canada - U.S. tax treaty
provides that the withholding rate on dividends paid to U.S.
residents on Class A and Class B Shares is generally 15%.</font></p>

<p><font face="Arial">Normal Course Issuer Bid</font></p>

<p><font face="Arial">On July 8, 2003, the Company announced that
during the year commencing July 10, 2003 it intended to purchase
up to 636,000 Class A Shares by way of a Normal Course Issuer Bid
through the facilities of The Toronto Stock Exchange and/or The
New York Stock Exchange, representing approximately 5% of the
outstanding Class A Shares. In fiscal 2003, through a Normal
Course Issuer Bid, which expired July 8, 2003, the Company
purchased 25,700 Class A Shares at an average cost of $22.76 per
share. The Company did not purchase any Class A Shares in 2003
under the current Normal Course Issuer Bid, which expires July 9,
2004. Any shares purchased by the Company pursuant to the Normal
Course Issuer Bid will be cancelled. The Company may, at its
option, apply to extend the program for an additional year.</font></p>

<p><font face="Arial"><b>Item 6. SELECTED FINANCIAL DATA</b></font></p>

<p><font face="Arial">The following table presents selected
financial information derived from the audited consolidated
financial statements of the Company for the five years ended
December 31, 2003. The selected financial information should be
read in conjunction with, and is qualified in its entirety by
reference to, the Consolidated Financial Statements and notes
thereto included elsewhere in this report. In 2003, the Company
purchased the U.S. private client and asset management divisions
of CIBC World Markets. The 2003 amounts include the assets and
liabilities and operating results of the private client division
for the entire year and the assets and liabilities and operating
results of the asset management division as of and subsequent to
June 4, 2003. In 2002, the Company purchased the business of
BUYandHOLD Securities Corporation. The 2002 amounts include the
assets and liabilities and operating results of BUYandHOLD as of
and subsequent to the period after March 12, 2002. In 2001, the
Company purchased Josephthal and Prime. The 2001 amounts include
the assets and liabilities and operating results of Josephthal
and Prime as of and subsequent to the period after September 17,
2001 and November 9, 2001, respectively. See also Item 1,
&quot;Business&quot; and Item 7, &quot;Management&#146;s
Discussion and Analysis of Financial Condition and Results of
Operations&quot;.</font></p>

<table border="0" cellpadding="2" cellspacing="0" width="638"
bordercolor="#000000">
    <tr>
        <td valign="top" colspan="2" width="32%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial"><u>2003</u></font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial"><u>2002</u></font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial"><u>2001</u></font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial"><u>2000</u></font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial"><u>1999</u></font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="8" width="98%" height="16"><p
        align="right"><font size="3" face="Arial">(In thousands
        of U.S. dollars except per share and share amounts)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Revenue</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$689,993</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$283,333</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$261,261</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$316,499</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$279,111</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Net profit</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$29,791</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$9,321</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$19,150</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$40,901</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$27,390</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Net profit per share (1)</font></td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">- basic</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$0.75</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$3.38</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$2.19</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">- diluted</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$1.63</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$0.73</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$1.50</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$3.29</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$2.17</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Total assets</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$1,709,117</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$1,031,226</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$710,275</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$697,482</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$766,528</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Total current liabilities</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$1,193,401</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$783,590</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$468,580</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$475,682</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$579,141</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Subordinated indebtedness,</font></td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">including current portion</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$30</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Total long term liabilities</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$234,785</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Cash dividends per Class A </font></td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Share and Class B share</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$0.36</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$0.36</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$0.36</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$0.31</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$0.28</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Shareholders' equity</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$280,931</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$247,636</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$241,695</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$221,800</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$187,388</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Book value per share (1)</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">$21.75</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">$19.82</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$19.43</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">$18.34</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$15.30</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16"><font size="3"
        face="Arial">Number of shares of capital stock
        outstanding</font></td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="3" face="Arial">12,919,200</font></p>
        </td>
        <td valign="top" colspan="2" width="13%" height="16"><p
        align="right"><font size="3" face="Arial">12,496,687</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">12,436,765</font></p>
        </td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        size="3" face="Arial">12,090,649</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">12,247,249</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="30%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
    </tr>
</table>

<blockquote>
    <blockquote>
        <p><font face="Arial">The Class A Shares and Class B
        Shares are combined because they are of equal rank for
        purposes of dividends and in the event of a distribution
        of assets upon liquidation, dissolution or winding up. </font></p>
        <p><font face="Arial"></font>&nbsp;</p>
        <p><font face="Arial"></font>&nbsp;</p>
    </blockquote>
</blockquote>

<p><font face="Arial"><b>Item 7. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</b></font></p>

<p><font face="Arial">The Company&#146;s financial statements
have been prepared in accordance with accounting principles
generally accepted in the United States of America. The following
discussion should be read in conjunction with the consolidated
financial statements and notes thereto which appear elsewhere in
this annual report. </font></p>

<p><font face="Arial">Critical Accounting Policies<br>
<br>
The Company&#146;s accounting policies are essential to
understanding and interpreting the financial results reported in
the consolidated financial statements. The significant accounting
policies used in the preparation of the Company&#146;s
consolidated financial statements are summarized in note 1 to
those statements. Certain of those policies are considered to be
particularly important to the presentation of the Company&#146;s
financial results because they require management to make
difficult, complex or subjective judgments, often as a result of
matters that are inherently uncertain. The following is a
discussion of these policies.</font></p>

<p><font face="Arial"><br>
Valuation of Securities and Other Assets<br>
<br>
Substantially all&nbsp;financial instruments are reflected in the
consolidated financial statements at fair&nbsp;value or amounts
that approximate fair value. These&nbsp;include cash equivalents;
deposits&nbsp;with&nbsp;clearing organizations; securities owned;
and securities sold but&nbsp;not yet purchased. &nbsp;Where
available, the Company uses prices from independent
sources&nbsp;such as listed market prices, or broker or dealer
price quotations. In addition, even where&nbsp;the&nbsp;value of
a&nbsp;security&nbsp;is&nbsp;derived from an independent market
price or broker or dealer quote, certain assumptions may be
required&nbsp;to&nbsp;determine the&nbsp;fair&nbsp;value.
For&nbsp;instance,&nbsp;the&nbsp;Company generally assumes that
the size of positions in securities that the Company
holds&nbsp;would&nbsp;not be&nbsp;large
enough&nbsp;to&nbsp;affect&nbsp;the&nbsp;quoted price of&nbsp;the
securities if the Company were to sell them, and&nbsp;that any
such sale would happen in an orderly manner. However, these
assumptions may be incorrect and the actual value realized upon
disposition could be different from the current carrying value. </font></p>

<p><font face="Arial"><br>
Intangible Assets and Goodwill<br>
<br>
</font><font face="Helvetica">Goodwill represents the excess cost
of a business acquisition over the fair value of
the&nbsp;net&nbsp;assets acquired. SFAS No.&nbsp;142,
&quot;Goodwill and Other Intangible Assets,&quot;&nbsp;provides
that goodwill is no longer amortized and the value of
identifiable intangible assets must be amortized over their
useful lives, unless the asset is determined to have an
indefinite useful life. Goodwill&nbsp;relates&nbsp;to&nbsp;the
acquisitions of Oppenheimer, First of Michigan Capital
Corporation, Grand Charter Group Incorporated, Josephthal &amp;
Co. Inc. and the Oppenheimer division and has been allocated to
the private client reporting unit pursuant to&nbsp;SFAS No. 142.
The Company obtained an independent valuation of assets acquired
and liabilities assumed with respect to the acquisition of the
Oppenheimer division in 2003. This valuation involved significant
estimates, which were based on historical data, revenue
projections and industry experience. The Company has identified
intangible assets relating to customer relationships, which it is
amortizing over their useful lives, and trademarks and trade
names, which are being evaluated for impairment on at least an
annual basis. The excess cost of the Oppenheimer division is
being allocated to goodwill.<br>
</font></p>

<p><font face="Helvetica">The Company reviews its goodwill
on&nbsp;at least&nbsp;an&nbsp;annual&nbsp;basis in order to
determine whether its value is impaired.
Goodwill&nbsp;is&nbsp;impaired when&nbsp;the carrying amount of
the reporting unit exceeds the implied fair value of the
reporting unit. &nbsp;In estimating&nbsp;the fair value&nbsp;of
the reporting&nbsp;unit, the Company uses valuation techniques
based on multiples of revenues, earnings, book value&nbsp;and
discounted cash&nbsp;flows&nbsp;similar
to&nbsp;models&nbsp;employed&nbsp;in analyzing the purchase
price&nbsp;of an acquisition target. If the value of the goodwill
is impaired, the difference&nbsp;between the value of&nbsp;the
goodwill reflected on the&nbsp;financial statements
and&nbsp;its&nbsp;current fair value&nbsp;is recognized as an
expense in the period in which the impairment occurs.</font></p>

<p><font face="Arial"><br>
Reserves<br>
<br>
The&nbsp;Company records reserves&nbsp;related&nbsp;to
legal&nbsp;proceedings&nbsp;in &nbsp;&quot;other payables and
accrued expenses&quot;. The determination of the amounts
of&nbsp;these reserves requires significant judgment on&nbsp;the
part&nbsp;of&nbsp;management. Management&nbsp;considers many
factors including, but&nbsp;not limited to: the amount of the
claim; the amount of the loss&nbsp;in the&nbsp;client's account;
the&nbsp;basis and&nbsp;validity of the claim; the possibility of
wrong&nbsp;doing on&nbsp;the part of an employee of the Company;
previous results in similar&nbsp;cases; and legal precedents and
case law as well as the timing of the resolution of such matters.
Each legal proceeding is reviewed with counsel in each accounting
period and the reserve is adjusted as deemed appropriate by
management. Any change in the reserve amount is recorded
as&nbsp;a charge to results&nbsp;in that period. The assumptions
of management in determining the estimates of reserves may be
incorrect and the actual disposition of a legal proceeding could
be greater or less than the reserve amount.<br>
<br>
The&nbsp;Company&nbsp;also records&nbsp;reserves&nbsp;or
allowances&nbsp;for doubtful&nbsp;accounts related&nbsp;to
receivables from&nbsp;clients and financial&nbsp;consultants.
&nbsp;Client loans are&nbsp;collateralized by securities;
however,&nbsp;if there is a decline in&nbsp;the value&nbsp;of the
collateral and the Company cannot obtain additional collateral or
collect on the loan, a reserve is established. &nbsp;The Company
also makes loans&nbsp;or pays advances&nbsp;to financial
consultants. Reserves&nbsp;are established on these
receivables&nbsp;if the financial consultant is no longer
associated with the Company and the receivable has not been
promptly repaid or&nbsp;if it is determined that it is probable
the amount will not be collected.</font></p>

<p><font face="Arial">The Company also estimates taxes payable
and records income tax reserves. These reserves are based on
historic experience and may not reflect the ultimate liability.
The Company monitors and adjusts these reserves as necessary.</font></p>

<p><font face="Arial">Asset management operations</font></p>

<p><font face="Arial">Asset management fees are generally
recognized over the period the related service is provided based
on the account value at the valuation date per the respective
asset management agreements. In certain circumstances, the firm
is entitled to receive incentive fees when the return on assets
under management exceeds certain benchmark returns or other
performance targets. Incentive fees are generally based on
investment performance over a 12-month period and are not subject
to adjustment once the measurement period ends. Accordingly,
incentive fees are recognized in the consolidated statements of
earnings when the measurement period ends. Asset management fees
and incentive fees are included in &quot;Advisory fees&quot; in
the consolidated statements of earnings. Assets under management
are not included as assets of the Company.</font></p>

<p><font face="Arial">Business Environment</font></p>

<p><font face="Arial">The Company is a holding company whose
principal subsidiaries are </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> and OAM. </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> provides securities brokerage, investment banking,
trust and asset management services to its clients from 98
offices across the U.S.A. and associated offices in Caracas,
Venezuela and Buenos Aires, Argentina. </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> is
licensed to offer brokerage and other financial services in all
50 States. Client assets entrusted to the Company as at December
31, 2003 totalled approximately $46 billion. The Company provides
investment advisory services through OAM and Fahnestock Asset
Management, operating as a division of </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">. The
Company provides trust services and products through Oppenheimer
Trust Company. At December 31, 2003, client assets under
management by the asset management groups totaled $9.59 billion. </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> also
engages in proprietary trading of securities. In addition, the
Company operates a discount brokerage business based in Edison,
NJ, through Freedom. At December 31, 2003, the Company employed
approximately 3,013 people, of whom 1,704 were financial
consultants.</font></p>

<p><font face="Arial">The securities industry is highly
competitive and sensitive to many factors and is directly
affected by general economic and market conditions, including the
volatility and price level of securities markets; the volume,
size, and timing of securities transactions; the demand for
investment banking services and changes in interest rates, all of
which have an impact on commissions, trading and investment
income as well as on liquidity. In addition, a significant
portion of the Company's expenses are relatively fixed and do not
vary with market activity. Consequently, substantial fluctuations
can occur in the Company's revenues and net income from period to
period due to these and other factors.</font></p>

<p><font face="Arial">In addition, the Company faces competition
from commercial banks and other sources as these institutions
offer more investment banking and financial services
traditionally only provided by securities firms. The effect of
the consolidation of the securities industry of recent years
means that a variety of financial services companies have merged
to offer a broader spectrum of investment products and such
competitors have substantially greater financial resources than
the Company. The Company is also experiencing increasing
regulation in the securities industry, particularly affecting the
over-the-counter markets, making compliance with regulations more
difficult and costly. At present, the Company is unable to
predict the extent of changes, or the effect on the Company's
business.</font></p>

<p><font face="Arial">Outlook</font></p>

<p><font face="Arial">The Company's long-term plan is to continue
to expand existing offices by hiring experienced professionals as
well as through the purchase of operating branch offices from
other broker dealers, thus maximizing the potential of each
office and the development of existing trading, investment
banking, investment advisory and other activities. Equally
important is the search for viable acquisition candidates. As
opportunities are presented, it is the long term intention of the
Company to pursue growth by acquisition where a comfortable match
can be found in terms of corporate goals and personnel and at a
price that would provide the Company's shareholders with
incremental value. In the near term, the Company will not be
seeking additional significant acquisitions, but will focus its
attention on the integration of recent acquisitions, including
the significant acquisition in 2003 of the U.S. private client
and asset management businesses of CIBC World Markets.</font></p>

<p><font face="Arial">Results of Operations</font></p>

<p><font face="Helvetica">The results of the year ended December
31, 2003, compared to the same period of 2002, reflect the
changed face of the Company after the acquisition by the Company
on January 3, 2003 of the U.S. private client business of CIBC
World Markets and the subsequent acquisition on June 4, 2003 of
the U.S. asset management business of CIBC World Markets
(together, the Oppenheimer divisions). This acquisition more than
doubled the Company&#146;s private client presence, adding
approximately 620 financial consultants in 18 offices, at the
date of closing. The aggregate purchase price was approximately
U.S. $242 million. The Company began self-clearing substantially
all of the private client business at the end of May 2003. Until
that time, CIBC provided operational and administrative services
to the Company on a transition basis. That arrangement precluded
the attainment of certain operating efficiencies and cost savings
that became available to the Company post- conversion of the
client accounts to the Company&#146;s clearing platform.</font></p>

<p><font face="Helvetica">The Company closed on its purchase of
OAM on June 4, 2003. OAM currently manages client assets totaling
over U.S. $8.65 billion. The business includes internally managed
funds, alternative investments (including hedge funds) and third
party managed high net worth accounts.</font></p>

<p><font face="Helvetica">The Company&#146;s results were
significantly impacted by the recent integration of its
acquisition of the Oppenheimer private client division and the
closing of the purchase of OAM. In 2003, expenses were impacted
by payments to CIBC through May 2003 for various transition
services, which the Company utilized during the period. The costs
of integration and retention also significantly impacted the 2003
results. On May 27, 2003, Oppenheimer assumed clearing and
execution of the business of the Oppenheimer divisions. There
were client service issues and internal operational difficulties
encountered as a result of the largest conversion of client
accounts in the Company&#146;s history, which were largely
rectified by the end of the second quarter. The Company continues
to monitor its systems requirements and remains committed to make
improvements in service and technology. </font></p>

<p><font face="Helvetica">The assumption of the clearing
functions substantially changed the Company&#146;s balance sheet
through increased client receivables and payables, related
broker-dealer stock loans and borrows and bank loans, as well as
some increase in inventories carried by the Company to
accommodate the increased size of the business. The Company
continues to believe that this recent acquisition will transform
the Company and the Company remains confident that operating
margins will improve over coming quarters as overlapping services
are eliminated, and integration is completed.</font></p>

<p><font face="Arial">The U.S. economy has continued to pick up
momentum as reflected in growth in fourth quarter GNP. New job
creation continues to lag and remains an issue for consumer
confidence. Low interest rates, a record trade deficit and a
record federal budget deficit have been reflected in a weak U.S.
dollar, which is trading at record lows compared to other major
currencies. These factors are likely to continue to lead to
favorable U.S. corporate earnings comparisons and continuing
strength in the stock market. Savings rates and favorable
demographics in the United States also provide for strong
investment flows and favorable conditions for the securities
industry.</font></p>

<p><font face="Arial">The following table and discussion
summarizes the changes in the major revenue and expense
categories for the past two years (in thousands of dollars).</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" colspan="4" width="65%"><p
        align="center"><font face="Arial">Period to Period Change</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" colspan="4" width="65%"><p
        align="center"><font face="Arial">Increase (Decrease)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" colspan="2" width="32%"><p
        align="center"><font face="Arial">2003 versus 2002</font></p>
        </td>
        <td valign="top" colspan="2" width="33%"><p
        align="center"><font face="Arial">2002 versus 2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" width="17%"><p align="center"><font
        face="Arial">Amount</font></p>
        </td>
        <td valign="top" width="15%"><p align="center"><font
        face="Arial">Percentage</font></p>
        </td>
        <td valign="top" width="17%"><p align="center"><font
        face="Arial">Amount</font></p>
        </td>
        <td valign="top" width="16%"><p align="center"><font
        face="Arial">Percentage</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Revenues
        -</font></td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Commissions</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">189,324</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+139%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$13,475</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+11%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Principal
        transactions, net</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">78,445</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+135%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">1,853</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+3%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Interest</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">14,978</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+54%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(6,687)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-19%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Underwriting
        fees</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">27,863</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+122%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">11,805</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+108%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Advisory
        fees</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">54,185</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+206%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">1,861</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+8%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Other</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">41,865</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+332%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(235)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-2%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Total
        revenues</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">406,660</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+144%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">22,072</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+8%</font></p>
        </td>
    </tr>
</table>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="35%"><font face="Arial">Expenses
        -</font></td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Compensation</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">265,250</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+156%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">20,972</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+14%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Clearing
        and exchanges fees</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">11,127</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+116%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">3,595</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+60%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Communications</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">22,460</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+70%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">8,446</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+36%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Occupancy
        costs</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">25,832</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+93%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">8,539</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+44%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Interest</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">5,943</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+71%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(5,692)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-40%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Other</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">38,362</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+168%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">4,907</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+27%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Total
        expenses</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">368,974</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+136%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">40,767</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">+18%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Profit
        before taxes</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">37,686</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+292%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(18,695)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-59%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Income
        taxes</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">15,442</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+288%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(7,092)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-57%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="35%"><font face="Arial">Net
        profit</font></td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">22,244</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">+295%</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">(11,603)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-61%</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">Fiscal 2003 compared to Fiscal 2002</font></p>

<p><font face="Arial">Results for 2003 reflected both the changed
face of the Company following its acquisition activity in 2003
and improving economic growth in the U.S., which led to a
resurgence of investor participation in the markets. Following
its acquisition on January 3, 2003 of the U.S. Private Client
business of CIBC World Markets, the Company significantly
increased its private client business in terms of financial
consultants and client assets. The number of financial
consultants increased to 1,704 at December 31, 2003 compared to
1,102 at December 31, 2002. Client assets entrusted to the
Company were approximately $46 billion at December 31, 2003
compared to approximately $17.8 billion at December 31, 2002. The
acquisition on June 4, 2003 of the U.S. Asset Management business
of CIBC World Markets added new business lines and increased
managed assets from approximately $869 million at December 31,
2002 to approximately $9.59 billion at December 31, 2003.</font></p>

<p><font face="Arial">Total revenues for 2003 were $689,993,000
an increase of 144% over $283,333,000 in 2002. Commission income
(income realized in securities transactions for which </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> acts as
agent) increased 139% to $325,071,000 from $135,747,000 in 2002.
This increase was primarily the result of the additional business
generated by the acquired Oppenheimer branches, as well as
improved market conditions. Revenues from principal transactions
(revenues from transactions in which </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> acts as
principal in the secondary market trading of over-the-counter
equities and municipal, corporate and government bonds) increased
by 135% to $136,672,000 from $58,227,000 in 2002 due to the
business generated by the acquired divisions and stronger
activity in the trading of fixed income securities as a result of
lower interest rates and higher bond prices in 2003 compared to
2002. Investment banking revenues increased by 122% to
$50,623,000 from $22,760,000 in 2002, related to increased
participation in the issuance of closed-end funds and debt
securities, particularly as a result of the impact of the
acquired Oppenheimer divisions. Advisory fees increased by 206%
to $80,550,000 from $26,365,000 in 2002 primarily as a result of
the acquisition of the U.S. Asset Management business of CIBC
World Markets in June 2003. In January 2003, the Company was
awarded $21,750,000 in an arbitration award in connection with a
raiding case involving the sales force of First of Michigan
Corporation, a company acquired by the Company in 1997.</font></p>

<p><font face="Arial">Interest income in 2003 was $42,600,000, an
increase of 54% from $27,622,000 in 2002. Interest expense was
$14,322,000, an increase of 71% from $8,379,000 in 2002. This
represents an increase of 47% in net interest revenue (interest
revenue less interest expense) in 2003 compared to 2002, which
can be attributed to an increase in average customer margin
balances due to the conversion of the customer accounts of the
acquired Oppenheimer branches in May 2003 and lower interest
rates in 2003 compared to 2002. </font></p>

<p><font face="Arial">Expenses in 2003 totalled $639,390,000, an
increase of 136% compared to $270,416,000 in 2002. The increase
in expenses can be attributed to the acquisitions of the
Oppenheimer divisions in 2003 as well as continuing unfavorable
legal settlement costs associated with Josephthal &amp; Co. Inc.
client accounts, which were acquired in 2001. Compensation and
related expenses in 2003 were $435,160,000, an increase of 156%
from $169,810,000 in 2002. Compensation expense has
volume-related components and increases with increases in
commission business conducted in 2003 compared to 2002, as well
as increased retention and severance costs and a general increase
in staff levels in both acquired branch offices and in head
office departments which were required to handle the business
volume of the larger entity. Clearing and exchange fees in 2003
were $20,734,000, an increase of 116% from $9,607,000 in 2002.
These expenses increased in 2003 compared with 2002 with
increased volume and with the increased size of the sales force.
In addition, until May, 2003, the business generated from the
acquired Oppenheimer branches was being cleared by a third party.
The cost of third party clearing is higher than the cost of
clearing trades in-house. Communications expenses in 2003 were
$54,526,000, an increase of 70% over $32,066,000 in 2002
reflecting additional costs of a larger branch system, after the
acquisition of the Oppenheimer divisions. Occupancy costs in 2003
were $53,604,000, an increase of 93% compared to $27,772,000 in
2002 as a result of the increased size of the organization with
the acquisition of the Oppenheimer divisions. The increase in
communications, technology and occupancy expenses reflects the
additional costs associated with connecting and housing
approximately 55% more financial consultants in 16 more branch
offices in 2003 compared to December 31, 2002, before the
acquisitions of the Oppenheimer divisions. During 2003, the
Company was able to utilize previously underutilized space and
was able to reassign employees to maximize the usage of space.
Other expenses were $61,144,000, an increase of 168% over
$22,782,000 in 2002. The increase relates primarily to increased
levels of general and administrative expense due to the larger
organization size, as well as increased bad debt expense and
costs of litigation. The Company may face additional unfavorable
judgments in future periods. The Company has used its best
estimate to provide adequate reserves to cover litigation losses.</font></p>

<p><font face="Arial">Fiscal 2002 compared to Fiscal 2001</font></p>

<p><font face="Arial">Results for fiscal 2002 reflected continued
difficult conditions in the investment environment. The combined
impact of rising unemployment levels, adverse import/export flows
and slowing business conditions has overcome the normal impact of
record low interest rates and the prospect of lower tax rates to
produce low market volumes and overall declining prices.</font></p>

<p><font face="Arial">Revenues in fiscal 2002 increased compared
to fiscal 2001 by 8% as a result of the acquisitions of
Josephthal and Prime Charter in the latter part of 2001 and
BUYandHOLD in March 2002. Net profit declined by 61% in fiscal
2002 compared to fiscal 2001 as a result of poor market
conditions and substantial expenses associated with these recent
acquisitions, including integration costs of combining
facilities, severance payments associated with combining
personnel and most significantly, costs of litigation for claims
which preceded the Company&#146;s acquisitions of these entities.</font></p>

<p><font face="Arial">Total revenues for 2002 were $283,333,000
an increase of 8% over $261,261,000 in 2001. Commission income
(income realized in securities transactions for which the Company
acts as agent) increased 11% to $135,747,000 in 2002 from
$122,272,000 in 2001. This increase was the result of the
additional business generated by Josephthal, Prime Charter and
BUYandHOLD, which more than offset generally lower commission
levels in the weaker markets of 2002 compared to 2001. Revenues
from principal transactions (revenues from transactions in which
the Company acts as principal in the secondary market trading of
over-the-counter equities and municipal, corporate and government
bonds) increased by 3% to $58,227,000 in 2002 from $56,374,000 in
2001 due to stronger activity in the trading of fixed income
securities as a result of lower interest rates and higher bond
prices in 2002 compared to 2001. The Company has reduced the
number of securities in which it makes markets. It may increase
or decrease this number as conditions warrant. Underwriting fees
increased by 108% to $22,760,000 in 2002 from $10,955,000 in 2001
related to increased participation in the issuance of closed-end
funds and debt securities. Demand for these products increased in
2002 as investors sought new investment vehicles. Advisory fees
increased by 8% to $26,365,000 in 2002 from $24,504,000 in 2001
primarily as a result of the acquisition of the business of
BUYandHOLD in March 2002. BUYandHOLD provides a fee-based
investing approach to retail investors.</font></p>

<p><font face="Arial">Interest income in 2002 was $27,622,000, a
decrease of 19% from $34,309,000 in 2001. Interest expense was
$8,379,000, a decrease of 40% from $14,071,000 in 2001. This
represents a decrease of 5% in net interest revenue (interest
revenue less interest expense) in 2002 compared to 2001, which
can be attributed to a decrease in average customer margin
balances and lower interest rates in 2002 compared to 2001. </font></p>

<p><font face="Arial">Expenses in 2002 totalled $270,416,000, an
increase of 18% compared to $229,649,000 in 2001. The increase in
expenses can be attributed to the acquisitions of Josephthal and
Prime Charter in the latter part of 2001 and the business of
BUYandHOLD in March 2002. Compensation and related expenses in
2002 were $169,810,000, an increase of 14% from $148,838,000 in
2001. Compensation expense has volume-related components and
increases with increases in commission business conducted in 2002
compared to 2001, as well as increased retention and severance
costs and a general increase in staff levels in both acquired
branch offices and in head office departments which were required
to handle the business volume of the larger entity. Clearing and
exchange fees in 2002 were $9,607,000, an increase of 60% from
$6,012,000 in 2001. These expenses increased in 2002 compared
with 2001 with increased volume and with the increased size of
the sales force. In addition, until November, 2002, the business
generated from the former Prime Charter branches was being
cleared by a third party as was the business of BUYandHOLD until
June, 2002. The cost of third party clearing is higher than the
cost of clearing trades in-house. Communications expenses in 2002
were $32,066,000, an increase of 36% over $23,620,000 in 2001
reflecting additional costs of a larger branch system, after the
acquisition of Josephthal and Prime Charter. Occupancy costs in
2002 were $27,772,000, an increase of 44% compared to $19,233,000
in 2001 as a result of increasing the size of the organization
with the acquisition of Josephthal and Prime Charter in 2001. The
increase in communications, technology and occupancy expenses
reflects the additional costs associated with connecting and
housing 51% more financial consultants in 15 more branch offices
in 2002 compared to September 16, 2001, before the acquisitions
of Josephthal and Prime Charter. Occupancy costs were also
significantly impacted by costs associated with underutilized
space that will be utilized in 2003 and future years by post
year-end acquisitions. Other expenses were $22,782,000, an
increase of 27% over $17,875,000 in 2001. The increase relates
primarily to increased bad debt expense and costs of litigation.</font></p>

<p><font face="Arial">Liquidity and Capital Resources</font></p>

<p><font face="Helvetica">Total assets at December 31, 2003
increased by approximately 66% from December 31, 2002 due
primarily to the acquisition of the Oppenheimer divisions and the
conversion of the Oppenheimer private client division client
accounts to the Oppenheimer clearing platform on May 27, 2003.
Liquid assets at December 31, 2003 accounted for 88% of total
assets, compared to 98% at December 31, 2002. The acquisitions of
the Oppenheimer divisions resulted in the addition of fixed
assets, intangibles and goodwill, all considered long-term in
nature. Current assets at December 31, 2003 increased by 50%
compared to the previous year-end because of increases in all
aspects of the Company&#146;s business with the self-clearing of
the Oppenheimer divisions business. The new business impacted
broker and customer receivables, stock borrow/stock loan
balances, deposits with clearing organizations, restricted cash
and notes receivable. The Company satisfies its need for funds
from its own cash resources, internally generated funds,
collateralized and uncollateralized borrowings, consisting
primarily of bank loans, and uncommitted lines of credit. The
amount of Oppenheimer 's bank borrowings fluctuates in response
to changes in the level of the Company's securities inventories
and customer margin debt, changes in stock loan balances and
changes in notes receivable from employees. Oppenheimer has
arrangements with banks for borrowings on an unsecured and on a
fully collateralized basis. At December 31, 2003, $101,619,000 of
such borrowings were outstanding, an increase of over 527%
compared to outstanding borrowings at December 31, 2002. At
December 31, 2003, the Company had available collateralized and
uncollateralized letters of credit of $143,934,000.</font></p>

<p><font face="Helvetica">In connection with the acquisition of
the Oppenheimer divisions, the Company issued debentures in the
amount of approximately $161 million and a zero coupon promissory
note in the amount of approximately $66 million. The notes to the
financial statements contain a description of these instruments.
The interest due on the debentures is payable semi-annually and
is being financed from internally-generated funds. The principal
payments on the zero coupon promissory note is also being
financed from internally-generated funds. The Company believes
that the necessary internally-generated funds will be available
to service these obligations from funds generated by normal
operations, including funds generated by the acquired business. </font></p>

<p><font face="Helvetica">In connection with the acquisition of
the Oppenheimer divisions, the Company has arranged a credit
facility in the amount of $50 million with CIBC. In January 2003,
the Company borrowed $25 million under this facility and borrowed
the balance in July 2003. The borrowings were used to finance
broker notes and are repayable, together with interest at the
CIBC U.S. base rate plus 2%, over five years or earlier if any
broker notes become due earlier. The interest and principal
repayments are being made out of internally-generated funds and
the Company believes that the cash flow from funds generated by
normal operations, including funds generated by the acquired
business, will be adequate to enable the Company to meet its
obligations. In accordance with the credit arrangement, the
Company has provided certain covenants to CIBC with respect to
the maintenance of minimum debt/equity ratios and net capital of
Oppenheimer. In the Company&#146;s view, the most restrictive of
the covenants requires that Oppenheimer maintain minimum excess
net capital of $100 million. As at December 31, 2003, the Company
was in compliance with the covenants. The Company does not
foresee any difficulties in complying with the covenants.</font></p>

<p><font face="Helvetica">Management believes that funds from
operations, combined with the Company's capital base and
available credit facilities, are sufficient for the Company's
liquidity needs in the foreseeable future.</font></p>

<p><font face="Arial">The Company paid cash dividends to its
shareholders totalling $4,616,000, during 2003, from
internally-generated cash.</font></p>

<p><font face="Arial">During 2003, the Company purchased a total
of 25,700 of its Class A non-voting shares at an average cost of
$22.76 per share through the facilities of the New York Stock
Exchange by way of a Normal Course Issuer Bid, using internally
generated cash. The Company has expressed an intention to
purchase up to an additional 636,000 of its shares from time to
time until July 9, 2004 from internally generated funds.</font></p>

<p><font face="Arial">Because of the Company's strong financial
condition, size and earnings history, management believes
adequate sources of credit would be available to finance higher
trading volumes, branch expansion, and major capital
expenditures, as needed. See factors affecting
&quot;forward-looking statements&quot;.</font></p>

<p><font face="Arial">The book value of the Company&#146;s Class
A and Class B Shares was $21.75 at December 31, 2003, an increase
of approximately 10% compared to $19.82 at December 31, 2002,
based on total outstanding shares of 12,919,200 and 12,496,687,
respectively.</font></p>

<p><font face="Arial">Contractual and Contingent Obligations</font></p>

<p><font face="Arial">The Company has contractual obligations to
make future payments in connection with non-cancelable lease
obligations, certain retirement plans and debt assumed upon the
acquisition of Josephthal. Additional disclosure relating the
Company&#146;s commitments appears in note 12 to the consolidated
financial statements.</font></p>

<p><font face="Arial">The following table sets forth these
contractual and contingent commitments as at December 31, 2003. </font></p>

<p><font face="Arial">Contractual Obligations</font></p>

<p><font face="Arial">(In millions of dollars)</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="613">
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">2004</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">2005</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">2006</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">2007</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">Thereafter</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">Total</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Minimum
        rentals</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">$23</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">$21</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">$19</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">$17</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$68</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$148</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Supplemental
        Executive Retirement Plan</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">1</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">1</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Assumed
        Josephthal notes</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">4</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">1</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">5</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Bank
        loans</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">10</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">10</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">10</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">10</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">40</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Debentures</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">161</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">161</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Zero
        coupon notes</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">15</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">15</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">15</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">6</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">51</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="10%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font face="Arial">Total</font></td>
        <td valign="top" width="9%"><p align="right"><font
        face="Arial">$53</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">$47</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">$44</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">$33</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$229</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$406</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">Inflation</font></p>

<p><font face="Arial">Because the assets of the Company's
brokerage subsidiaries are highly liquid, and because securities
inventories are carried at current market values, the impact of
inflation generally is reflected in the financial statements.
However, the rate of inflation affects the Company's costs
relating to employee compensation, rent, communications and
certain other operating costs, and such costs may not be
recoverable in the level of commissions charged. To the extent
inflation results in rising interest rates and has other adverse
effects upon the securities markets, it may adversely affect the
Company's financial position and results of operations.</font></p>

<p><font face="Arial">Newly Issued Accounting Standards</font></p>

<p><font face="Arial">The Financial Accounting Standards Board
issued SFAS No. 146, &quot;Accounting for Costs Associated with
Exit or Disposal Activities&quot;, FIN No. 45,
&quot;Guarantor&#146;s Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of
Others&quot;, FIN No. 46, &quot;Consolidation of Variable
Interest Entities&quot;,SFAS No. 149, &quot;Amendment of
Statement 133 on Derivative Instruments and Hedging
Activities&quot;, and SFAS No. 150, &quot;Accounting for Certain
Financial Instruments with Characteristics of both Liabilities
and Equity&quot;. The Company has adopted these statements and
interpretations and their adoption has not had a material impact
on its financial results. </font></p>

<p><font face="Arial">The Company has reviewed SFAS No. 148,
&quot;Accounting for Stock-Based Compensation &#150; Transition
and Disclosure&quot; and has adopted the disclosure provisions,
but does not intend to adopt other provisions of this standard at
this time.</font></p>

<p><font face="Arial">Factors Affecting &quot;Forward-Looking
Statements&quot;</font></p>

<p><font face="Arial">From time to time, the Company may publish
&quot;Forward-looking statements&quot; within the meaning of
Section 27A of the Securities Act of 1933, as amended ( the
&quot;Act&quot;), and Section 21E of the Exchange Act or make
oral statements that constitute forward-looking statements. These
forward-looking statements may relate to such matters as
anticipated financial performance, future revenues or earnings,
business prospects, projected ventures, new products, anticipated
market performance, and similar matters. The Private Securities
Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements. In order to comply with the terms of
the safe harbor, the Company cautions readers that a variety of
factors could cause the Company&#146;s actual results to differ
materially from the anticipated results or other expectations
expressed in the Company&#146;s forward-looking statements. These
risks and uncertainties, many of which are beyond the
Company&#146;s control, include, but are not limited to: (i)
transaction volume in the securities markets, (ii) the volatility
of the securities markets, (iii) fluctuations in interest rates,
(iv) changes in regulatory requirements which could affect the
cost of doing business, (v) fluctuations in currency rates, (vi)
general economic conditions, both domestic and international,
(vii) changes in the rate of inflation and the related impact on
the securities markets, (viii) competition from existing
financial institutions and other new participants in the
securities markets, (ix) legal developments affecting the
litigation experience of the securities industry, (x) changes in
federal and state tax laws which could affect the popularity of
products sold by the Company, and (xi) domestic and world events.
The Company does not undertake any obligation to publicly update
or revise any forward-looking statements.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK</b></font></p>

<p><font face="Arial">Risk Management</font></p>

<p><font face="Arial">The Company&#146;s principal business
activities by their nature involve significant market, credit and
other risks. The Company&#146;s effectiveness in managing these
risks is critical to its success and stability. </font></p>

<p><font face="Arial">As part of its normal business operations,
the Company engages in the trading of both fixed income and
equity securities in both a proprietary and market-making
capacity. The Company makes markets in over-the-counter equities
in order to facilitate order flow and accommodate its
institutional and retail customers. The Company also makes
markets in municipal bonds, mortgage-backed securities,
government bonds and high yield bonds.</font></p>

<p><font face="Arial">Market Risk</font></p>

<p><font face="Arial">Market risk generally means the risk of
loss that may result from the potential change in the value of a
financial instrument as a result of fluctuations in interest and
currency exchange rates and in equity and commodity prices.
Market risk is inherent in all types of financial instruments,
including both derivatives and non-derivatives. The
Company&#146;s exposure to market risk arises from its role as a
financial intermediary for its customers&#146; transactions and
from its proprietary trading and arbitrage activities. (See
additional discussion under Risk Management in Item 1).</font></p>

<p><font face="Arial">Operational Risk</font></p>

<p><font face="Arial">Operational risk generally means the risk
of loss resulting from improper processing of transactions or
deficiencies in the Company&#146;s operating systems or internal
controls. With respect to its trading activities, the Company has
procedures designed to ensure that all transactions are
accurately recorded and properly reflected on the Company&#146;s
books on a timely basis. With respect to client activities, the
Company operates a system of internal controls designed to ensure
that transactions and other account activity (new account
solicitation, transaction authorization, transaction processing,
billing and collection) are properly approved, processed,
recorded and reconciled. The Company has procedures designed to
assess and monitor counterparty risk. For a discussion of funding
risk, see &#145;Liquidity and Capital Resources&#146;, above.</font></p>

<p><font face="Arial">Credit Risk</font></p>

<p><font face="Arial">Credit risk arises from non-performance by
trading counterparties, customers and issuers of debt securities
held in the Company&#146;s inventory. The Company manages this
risk by imposing and monitoring position limits, regularly
reviewing trading counterparties, monitoring and limiting
securities concentrations, marking positions to market on a daily
basis to evaluate and establish the adequacy of collateral, and,
with respect to trading counterparties, conducting business
through clearing corporations which guarantee performance.
Further discussion of credit risk appears in the Notes to the
Consolidated Financial Statements, in Item 8.</font></p>

<p><font face="Arial">Legal and Regulatory Risk</font></p>

<p><font face="Arial">Legal and regulatory risk includes the risk
of non-compliance with applicable legal and regulatory
requirements. The Company is subject to extensive regulation in
the different jurisdictions in which it conducts its activities.
The Company has comprehensive procedures for addressing issues
such as regulatory capital requirements, sales and trading
practices, use of and safekeeping of customer funds and
securities, granting of credit, collection activities, money
laundering, and record keeping.</font></p>

<p><font face="Arial">Value-at-Risk </font></p>

<p><font face="Arial">Value-at-risk is a statistical measure of
the potential loss in the fair value of a portfolio due to
adverse movements in underlying risk factors. In response to the
Securities and Exchange Commission&#146;s market risk disclosure
requirements, the Company has performed a value-at-risk analysis
of its trading financial instruments and derivatives. The
value-at-risk calculation uses standard statistical techniques to
measure the potential loss in fair value based upon a one-day
holding period and a 95% confidence level. The calculation is
based upon a variance-covariance methodology, which assumes a
normal distribution of changes in portfolio value. The forecasts
of variances and co-variances used to construct the model, for
the market factors relevant to the portfolio, were generated from
historical data. Although value-at-risk models are sophisticated
tools, their use can be limited as historical data is not always
an accurate predictor of future conditions. The Company attempts
to manage its market exposure using other methods, including
trading authorization limits and concentration limits.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><i>At December 31, 2003 and 2002, the
Company&#146;s value-at-risk for each component of market risk
was as follows (in thousands of U.S. dollars):</i></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="595">
    <tr>
        <td valign="top" width="29%">&nbsp;</td>
        <td valign="top" colspan="3" width="43%"><p
        align="center"><font face="Arial">Fiscal 2003</font></p>
        </td>
        <td valign="top" colspan="2" width="27%"><p
        align="center"><font face="Arial">As at December 31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="29%">&nbsp;</td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial"><u>High</u></font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial"><u>Low</u></font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial"><u>Average</u></font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial"><u>2003</u></font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial"><u>2002</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="29%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="29%"><font face="Arial">Interest
        rate risk</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$174</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">132</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$150</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">168</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">$150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="29%"><font face="Arial">Equity
        price risk</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">387</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">369</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">369</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">412</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">336</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="29%"><font face="Arial">Diversification
        benefit</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">(86)</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">(133)</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">(110)</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">(169)</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">(18)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="29%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="29%"><font face="Arial">Total</font></td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$475</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        face="Arial">$368</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$409</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        face="Arial">$411</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">$468</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">The potential future loss presented by the
total value-at-risk generally falls within predetermined levels
of loss that should not be material to the Company&#146;s results
of operations, financial condition or cash flows. The changes in
the value-at-risk amounts reported in 2003 from those reported in
2002 reflect changes in the size and composition of the
Company&#146;s trading portfolio at December 31, 2003 compared to
December 31, 2002, which include a larger position in equities.
The Company&#146;s portfolio as at December 31, 2003 includes
approximately $15,781,000 in corporate equities, which are
co-related to deferred compensation liabilities and which do not
bear any value-at-risk to the Company. Further discussion of risk
management appears in Item 7, Management&#146;s Discussion and
Analysis of the Results of Operations and Item 1, Risk
Management.</font></p>

<p><font face="Arial">The value-at-risk estimate has limitations
that should be considered in evaluating the Company&#146;s
potential future losses based on the year-end portfolio
positions. Recent market conditions including increased
volatility, may result in statistical relationships that result
in higher value-at-risk than would be estimated from the same
portfolio under different market conditions. Likewise, the
converse may be true. Critical risk management strategy involves
the active management of portfolio levels to reduce market risk.
The Company&#146;s market risk exposure is continuously monitored
as the portfolio risks and market conditions change.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 8. FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA</b></font></p>

<p><font face="Arial">The information required to be furnished in
response to this Item is submitted hereinafter following the
signature pages hereto.</font></p>

<p><font face="Arial"><b>Item 9. CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE</b></font></p>

<p><font face="Arial">None.</font></p>

<p><font face="Arial"><b>Item 9A. CONTROLS AND PROCEDURES</b></font></p>

<p><font face="Arial">As of the end of the reporting period, an
evaluation was carried out under the supervision and with the
participation of the Company&#146;s management, including its
Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of the Company&#146;s
disclosure controls and procedures (as defined in
Rule&nbsp;13a-15(e) under the Exchange Act). Based upon that
evaluation, the Chief Executive Officer and Chief Financial
Officer concluded that the design and operation of the
Company&#146;s disclosure controls and procedures were effective.
No significant changes were made in the Company&#146;s internal
over financial reporting during the quarter ended December 31,
2003 that have materially affected, or are reasonably likely to
materially affect, the Company&#146;s internal control over
financial reporting. </font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>PART III</b></font></p>

<p><font face="Arial"><b>Item 10. DIRECTORS AND EXECUTIVE
OFFICERS OF THE REGISTRANT</b></font></p>

<p><font face="Arial">General</font></p>

<p><font face="Arial">Directors of the Company are elected
annually by the holders of the Class B Shares to serve until the
next annual meeting of shareholders or until their successors are
appointed. Executive officers are appointed annually by the
directors or until their successors are appointed. Certain
information concerning the executive officers and directors of
the Company as at March 8, 2004 is set forth below.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="33%"><font face="Arial"><u>Name</u></font></td>
        <td valign="top" width="9%"><font face="Arial"><u>Age</u></font></td>
        <td valign="top" width="58%"><p align="center"><font
        face="Arial"><u>Positions held</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">John L.
        Bitove</font></td>
        <td valign="top" width="9%"><font face="Arial">76</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since February 1980; Retired
        executive.</font><p><font face="Arial">- Member of the
        Audit, Compensation and Stock Option and
        Nominating/Corporate Governance Committees</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Richard
        Crystal</font></td>
        <td valign="top" width="9%"><font face="Arial">63</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 1992; Partner Brown Raysman
        Millstein Felder &amp; Steiner LLP (law firm) since July
        2002, U.S. counsel to the Company; Partner, Winston &amp;
        Strawn (law firm) and predecessor firms from 1985 to July
        2002.</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Albert G.
        Lowenthal</font></td>
        <td valign="top" width="9%"><font face="Arial">58</font></td>
        <td valign="top" width="58%"><font face="Arial">Chairman
        of the Board, Chief Executive Officer and Director of the
        Company since 1985; Chairman of the Board, Chief
        Executive Officer and Director of </font><font
        face="Helvetica">Oppenheimer</font><font face="Arial">
        since 1985; prior to 1985, Mr. Lowenthal was President of
        Cowen Securities Inc., a New York stock brokerage firm
        and a general partner of Cowen &amp; Co., a New York
        stock brokerage firm.</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Kenneth
        W. McArthur</font></td>
        <td valign="top" width="9%"><font face="Arial">68</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 1996; President and C.E.O.
        of Shurway Capital Corporation ( a private corporation),
        since July1993; Senior Vice-President of Bank of Montreal
        Investment Counsel between January 1992 and July 1993;
        Senior Vice-President of Nesbitt Thomson Inc. between
        July 1989 and January 1993.</font><p><font face="Arial">-
        Member of the Audit and Nominating/Corporate Governance
        Committees</font></p>
        </td>
    </tr>
</table>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="638">

    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Antonio
        Molestina</font></td>
        <td valign="top" width="9%"><font face="Arial">40</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 2003; Deputy General
        Counsel, Canadian Imperial Bank of Commerce (chartered
        bank)</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">A. Winn
        Oughtred</font></td>
        <td valign="top" width="9%"><font face="Arial">61</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 1979; a Director of </font><font
        face="Helvetica">Oppenheimer</font><font face="Arial">
        since 1983; Secretary of the Company since June, 1992 and
        prior to June, 1991; Partner, Borden Ladner Gervais LLP
        (law firm), Canadian counsel to the Company since 1979.</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Elaine K.
        Roberts</font></td>
        <td valign="top" width="9%"><font face="Arial">52</font></td>
        <td valign="top" width="58%"><font face="Arial">President,
        Treasurer and a Director of the Company since 1977;
        Treasurer and a Director of </font><font face="Helvetica">Oppenheimer</font><font
        face="Arial"> since 1983.</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Richard
        Venn</font></td>
        <td valign="top" width="9%"><font face="Arial">52</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 2003; Senior Executive
        Vice-President, Corporate Development, Canadian Imperial
        Bank of Commerce (chartered bank)</font><p><font
        face="Arial">-Member of the Nominating/Corporate
        Governance Committee</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="58%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">Burton
        Winberg</font></td>
        <td valign="top" width="9%"><font face="Arial">79</font></td>
        <td valign="top" width="58%"><font face="Arial">A
        Director of the Company since 1979; President of Rockport
        Holdings Limited (a real estate development company)
        since 1959. </font><p><font face="Arial">- Member of the
        Audit, Compensation and Stock Option and
        Nominating/Corporate Governance Committees.</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">Section 16(a) Beneficial Ownership
Reporting Compliance</font></p>

<p><font face="Arial">Section 16(a) of the Exchange Act requires
the Company's directors and executive officers, and persons who
own more than ten percent of a registered class of the Company's
equity securities, to file by specific dates with the SEC initial
reports of ownership and reports of changes in ownership of
equity securities of the Company. Officers, directors and greater
than ten percent stockholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms that
they file. The Company is required to report in this annual
report on Form 10-K any failure of its directors and executive
officers and greater than ten percent stockholders to file by the
relevant due date any of these reports during the preceding
fiscal year (or, to the extent not previously disclosed, any
prior fiscal year).</font></p>

<p><font face="Arial">To the Company's knowledge, based solely on
review of copies of such reports furnished to the Company during
the fiscal year ended December 31, 2003 and representations made
to the Company by such persons, all Section 16(a) filing
requirements applicable to the Company's officers, directors and
greater than ten percent stockholders were complied with. </font></p>

<p><font face="Arial"><b></b></font>&nbsp;</p>

<p><font face="Arial">DIRECTORS COMPENSATION</font></p>

<p><font face="Arial">From January 1, 2003 to June 30, 2003, the
Company paid its directors an annual retainer fee of $10,000,
plus $1,000 for each board or committee meeting attended in
person and $500 for each board or committee meeting attended by
telephone. Commencing July 1, 2003, directors&#146; fees were
increased as follows:</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="475">
    <tr>
        <td valign="top" width="77%"><font face="Arial">Fees:</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">Effective </font></p>
        <p align="right"><font face="Arial">July 1, 2003</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Annual
        retainer for directors</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$15,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Fee per
        meeting attended in person </font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$1,500</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Fee per
        meeting attended by telephone</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$500</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Annual
        retainer for committee chairmen</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$5,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Annual
        retainer for lead director</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$5,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="77%"><font face="Arial">Annual
        retainer for members of the Audit Committee, other than
        the chairman</font></td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$2,500</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">In 2003 the Directors were paid fees for
both board and committee attendance of $195,500 in aggregate.
Directors are reimbursed for travel and related expenses incurred
in attending board and committee meetings. Directors who are not
employees of the Company and its subsidiaries are also entitled
to the automatic grant of stock options under the Company&#146;s
1996 Equity Incentive Plan, as amended (the &quot;Plan&quot;),
pursuant to a formula set out in the Plan. </font></p>

<p><font face="Arial">DIRECTORS AND OFFICERS INSURANCE</font></p>

<p><font face="Arial">The Company carries liability insurance for
its directors and officers. On November 30, 2003, the Company
renewed its directors and officers liability insurance for one
year ending November 30, 2004 at an annual premium rate of
$325,750. No part of the insurance premiums were or are to be
paid by the officers and directors. The aggregate insurance
coverage under both policies is limited to $10 million with
retention of $2.5 million for the policy years ended November 30,
2003 and 2004. </font></p>

<p><font face="Arial">Under the by-laws of the Company, the
Company is obligated to indemnify the directors and officers of
the Company and its subsidiaries to the maximum extent permitted
by the Business Corporations Act (Ontario). The Company has
entered into indemnity agreements with each of its directors
providing for such indemnities.</font></p>

<p><font face="Arial"><b></b></font>&nbsp;</p>

<p><font face="Arial">RESOURCES FOR THE BOARD COMMITTEES</font></p>

<p><font face="Arial">The Board and each of its committees have,
under the Company&#146;s Corporate Governance Guidelines, the
authority to retain independent legal, financial or other
advisors at the expense of the Company.</font></p>

<p><font face="Arial">BOARD COMPOSITION</font></p>

<p><font face="Arial">Pursuant to a Stakeholders Agreement dated
December 9, 2002 between the Company, CIBC and others, CIBC has
the right to have two of its designees nominated for election to
the Company&#146;s board. CIBC exercised this right in 2003 and
its designees, Mr. A. Molestina and Mr. R. Venn, were elected as
directors of the Company at the May 12, 2003 annual and special
meeting of shareholders and will serve as directors of the
Company until the termination of the May 17, 2004 annual and
special meeting of shareholders. CIBC has informed the Company
that it does not wish to exercise this right for the May 17, 2004
annual and special meeting of shareholders.</font></p>

<p><font face="Arial">BOARD COMMITTEES</font></p>

<p><font face="Arial">The Board has an Audit Committee, a
Compensation and Stock Option Committee and a
Nominating/Corporate Governance Committee. The following is a
brief summary of the responsibilities of these Committees,</font></p>

<p><font face="Arial"><b><i>Audit Committee </i></b></font></p>

<p><font face="Arial"><i>(Messrs. Bitove, McArthur and Winberg
(Chair))</i></font></p>

<p><font face="Arial">The Board has adopted a written charter for
the Audit Committee, a copy of which is attached to this
Management Information Circular as Schedule C. The Audit
Committee:</font></p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <p><font face="Arial">reviews annual, quarterly
                and all legally required public disclosure
                documents containing financial information that
                are submitted to the Board;</font></p>
                <p><font face="Arial">reviews the nature, scope
                and timing of the annual audit carried out by the
                external auditors and reports to the Board;</font></p>
                <p><font face="Arial">evaluates the external
                auditors' performance for the preceding fiscal
                year; reviews their fees and makes
                recommendations to the Board;</font></p>
                <p><font face="Arial">reviews internal financial
                control policies, procedures and risk management
                and reports to the Board;</font></p>
                <p><font face="Arial">meets with the external
                auditors quarterly to review quarterly and annual
                financial statements and reports and to consider
                material matters which, in the opinion of the
                external auditors, should be brought to the
                attention of the Board and the shareholders; </font></p>
                <p><font face="Arial">reviews internal audit
                activities, meets regularly with internal audit
                personnel and reports to the Board;</font></p>
                <p><font face="Arial">reviews accounting
                principles and practices; </font></p>
                <p><font face="Arial">reviews management reports
                with respect to litigation, capital expenditures,
                tax matters and corporate administration charges
                and reports to the Board;</font></p>
                <p><font face="Arial">reviews related party
                transactions; </font></p>
                <p><font face="Arial">reviews and approves
                changes or waivers to the Company's Code of
                Conduct and Business Ethics for Directors,
                Officers and Employees; and </font></p>
                <p><font face="Arial">annually reviews this
                Charter and recommends and make changes thereto
                as required.</font></p>
                <p><font face="Arial">All members of the Audit
                Committee are independent.</font></p>
                <p><font face="Arial">During 2003, the Audit
                Committee met 5 times.</font></p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p><font face="Arial"><b><i>Compensation and Stock Option
Committee </i></b></font></p>

<p><font face="Arial"><i>(Messrs. Bitove and Winberg (Chair))</i></font></p>

<p><font face="Arial">The Board has adopted a Compensation and
Stock Option Committee Charter. The Compensation and Stock Option
Committee:</font></p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <p><font face="Arial">makes recommendations to
                the Board with respect to compensation policy for
                the Company and its subsidiaries;</font></p>
                <p><font face="Arial">makes recommendations to
                the Board with respect to salary, bonus and
                benefits paid and provided to senior management
                of the Company;</font></p>
                <p><font face="Arial">in accordance with the
                provisions of the Company's 1996 Equity Incentive
                Plan, authorizes grants of stock options and
                recommends modifications to the Plan;</font></p>
                <p><font face="Arial">grants certain compensation
                awards to senior management of the Company based
                on criteria linked to the performance of the
                individual and/or the Company;</font></p>
                <p><font face="Arial">administers the
                Performance-Based Compensation Agreement between
                the Company and Mr. A.G. Lowenthal; </font></p>
                <p><font face="Arial">certifies compliance with
                the criteria performance-based awards or grants
                and </font></p>
                <p><font face="Arial">administers and makes
                awards under the Company's Stock Appreciation
                Rights Plan.</font></p>
                <p><font face="Arial">During 2003 the Committee
                met 4 times.</font></p>
                <p><font face="Arial">(see also &quot;Report of
                the Compensation and Stock Option
                Committee&quot;)</font></p>
                <p><font face="Arial"></font>&nbsp;</p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p><font face="Arial"><b><i>Nominating/Corporate Governance
Committee </i></b></font></p>

<p><font face="Arial"><i>(Messrs. Bitove, McArthur (Chair), Venn
and Winberg)</i></font></p>

<p><font face="Arial">The Board has adopted a
Nominating/Corporate Governance Committee Charter.</font></p>

<p><font face="Arial">The Nominating/Corporate Governance
Committee:</font></p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <p><font face="Arial">makes recommendations to
                the Board with respect to corporate governance;</font></p>
                <p><font face="Arial">when necessary, oversees
                the recruitment of new Directors for the Company;</font></p>
                <p><font face="Arial">recommends nominees for
                election or appointment to the Board;</font></p>
                <p><font face="Arial">maintains an orientation
                program for new directors and oversees the
                continuing education needs of Directors;</font></p>
                <p><font face="Arial">evaluates Director
                performance;</font></p>
                <p><font face="Arial">reviews and makes
                recommendations with respect to the Company's
                Corporate Governance Guidelines;</font></p>
                <p><font face="Arial">reviews and approves
                governance reports for publication in the
                Company's Management Information Circular and
                Annual Report on Form 10-K.</font></p>
                <p><font face="Arial">Although the Committee was
                formed in 2003, it did not have any formal
                meetings in 2003. The members of the Committee,
                as members of the Board, participated during the
                year in discussions and decisions on corporate
                governance, the effectiveness of the Board and
                related matters. The Committee did meet on
                February 25, 2004 and has established a schedule
                for regular meetings for the balance of 2004.</font></p>
                <p><font face="Arial"></font>&nbsp;</p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p><font face="Arial">CODE OF ETHICS</font></p>

<p><font face="Arial">The Company has adopted a Code of Conduct
and Business Ethics for Directors, Officers and Employees, which
can be found on its website at </font>
<font face="Arial">www.opco.com</font><font
face="Arial">. A paper copy of the Code of Conduct and Business
Ethics for Directors, Officers and Employees can be requested by
writing to the Company at its head office or by making an email
request to </font><font
face="Arial">investorelations@opy.ca</font><font face="Arial">.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 11. EXECUTIVE COMPENSATION</b></font></p>

<p><font face="Arial">With respect to the year ended December 31,
2003, the Compensation and Stock Option Committee of the Board of
Directors (the &quot;Committee&quot;) was responsible for making
recommendations for approval by the Board of Directors with
respect to the compensation of the Company&#146;s executive
officers. The members of this Committee are John L. Bitove and
Burton Winberg, each of whom are outside directors of the Company
and have no interlocking relationship with the Company or its
subsidiaries.</font></p>

<p><font face="Arial">Summary Compensation Table</font></p>

<p><font face="Arial"><i>The following table sets forth total
annual compensation paid or accrued by the Company to or for the
account of the Company's chief executive officer and each of the
four most highly paid executive officers of the Company and </i></font><font
face="Helvetica"><i>Oppenheimer</i></font><font face="Arial"><i>,
the Company&#146;s principal operating subsidiary, other than the
chief executive officer, whose total cash compensation for the
fiscal year ended December 31, 2003 exceeded $100,000 (the
&quot;Named Executives&quot;). </i></font></p>

<table border="0" cellpadding="2" cellspacing="0" width="606"
bordercolor="#000000">
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" colspan="4" width="39%" height="16"><p
        align="center"><font size="2" face="Arial">Annual
        Compensation</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">Long-term</font></p>
        <p align="right"><font size="2" face="Arial">Compensation</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Name and</font><p><font size="2"
        face="Arial">Principal</font></p>
        </td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p
        align="center"><font size="2" face="Arial">Other</font></p>
        <p align="center"><font size="2" face="Arial">Annual</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">Class A Shares</font></p>
        <p align="right"><font size="2" face="Arial">Underlying</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">All Other</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Occupation</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">Year</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">Salary</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="2" face="Arial">Bonus</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p
        align="center"><font size="2" face="Arial">Compensation</font></p>
        <p align="center"><font size="2" face="Arial">(1)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">Options</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">Compensation</font></p>
        <p align="center"><font size="2" face="Arial">(2)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">A.G. Lowenthal,</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2003</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$500,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$3,360,323</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$22,000</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">150,000</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$3,050</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Chairman, CEO,</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2002</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$480,340</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$22,500</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$2,475</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">and Director of</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2001</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$480,350</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$497,500</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$18,000</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$5,725</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">the Company;</font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Chairman and CEO, and director</font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">of </font><font size="2" face="Helvetica">Oppenheimer</font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Thomas Robiinson (4),</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2003</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$150,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$1,000,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">10,000</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$2,820</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">President of OAM</font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Eric J. Shames,</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2003</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$290,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$700,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">7,500</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$3,050</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Secretary and </font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2002</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$290,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$75,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$2,475</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">General Counsel of </font><font size="2"
        face="Helvetica">Oppenheimer</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2001</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$290,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$100,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">$5,725</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">E.K. Roberts,</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2003</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$200,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$300,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$22,500</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">10,000</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">President, </font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2002</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$183,300</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$60,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$22,500</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Treasurer and Director of the</font></td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2001</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$158,000</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$85,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">$18,000</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Company, </font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Treasurer and a </font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">director of </font><font size="2"
        face="Helvetica">Oppenheimer</font></td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="5%" height="16">&nbsp;</td>
        <td valign="top" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="6%" height="16">&nbsp;</td>
        <td valign="top" width="10%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="15%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font size="2"
        face="Arial">Robert Okin (3)</font><p><font size="2"
        face="Arial">Executive Vice President of </font><font
        size="2" face="Helvetica">Oppenheimer</font></p>
        </td>
        <td valign="top" width="6%" height="16"><font size="2"
        face="Arial">2003</font></td>
        <td valign="top" width="10%" height="16"><p align="right"><font
        size="2" face="Arial">$190,256</font></p>
        </td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="2" face="Arial">$1,000,000</font></p>
        </td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="16%" height="16"><p align="right"><font
        size="2" face="Arial">50,000</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="15%" height="16"><p
        align="right"><font size="2" face="Arial">$3,050</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<blockquote>
    <blockquote>
        <p><font face="Arial">(1) Includes Directors&#146; Fees.
        See the table in Item 10, above, for the applicable
        rates.</font></p>
        <p><font face="Arial">(2) This amount represents Company
        contributions to the Oppenheimer 401(k) Plan.</font></p>
        <p><font face="Arial">(3) Mr. Okin joined Oppenheimer on
        January 3, 2003. In addition to the above compensation,
        on March 17, 2003 Mr. Okin was awarded 22,222 Class A
        Shares, which will be issued on January 3, 2006 and
        priced at $22.50, provided that Mr. Okin remains
        continuously employed by the Company. The issuance of
        these conditionally-issued Class A Shares was confirmed
        by shareholders on May 12, 2003.</font></p>
    </blockquote>
    <p><font face="Arial">(4) Mr. Robinson joined the OAM on June
    4, 2003.</font></p>
    <p><font face="Arial"></font>&nbsp;</p>
</blockquote>

<p><font face="Arial">OPTION GRANTS FOR THE YEAR ENDED DECEMBER
31, 2003</font></p>

<p><font face="Arial"><i>The following table sets forth details
of options granted to the Named Executives during the year ended
December 31, 2003.</i></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">Number of Securities Underlying Options/SARs
        Granted</font></p>
        </td>
        <td valign="top" width="18%"><font face="Arial">% of
        Total Options/SARs Granted to Employees in Fiscal Year</font></td>
        <td valign="top" width="16%"><font face="Arial">Exercise
        price per share</font></td>
        <td valign="top" width="11%"><font face="Arial">Expiry
        date</font></td>
        <td valign="top" width="17%"><font face="Arial">Grant
        Date Value</font></td>
    </tr>
    <tr>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">A.G.Lowenthal</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">150,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">39.8%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$24.31</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">1/22/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$788,700</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">E.K.
        Roberts</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">10,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">2.7%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$24.31</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">1/22/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$52,600</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">T.
        Robinson</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">10,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">2.7%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$26.34</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">7/23/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$55,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">E.J.
        Shames</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">7,500</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">2%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$24.31</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">1/22/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$39,400</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">R. Okin</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">25,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">6.6%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$22.75</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">4/22/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$133,300</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%"><font face="Arial">R. Okin</font></td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">25,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        face="Arial">6.6%</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">$26.34</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        face="Arial">7/22/08</font></p>
        </td>
        <td valign="top" width="17%"><p align="right"><font
        face="Arial">$137,500</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">AGGREGATED OPTION EXERCISES AND YEAR-END
VALUE TABLE</font></p>

<p><font face="Arial"><i>The following table sets forth
information with respect to options exercised during the year
ended December 31, 2003 by the Named Executives and as to
unexercised options held by them at December 31, 2003:</i></font></p>

<table border="0" cellpadding="2" cellspacing="0" width="638"
bordercolor="#000000">
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">Shares</font></p>
        </td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">Number of securities Underlying unexercised
        Options/SARs at fiscal year end</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">Value of unexercised in-the-money Options/
        SARs at fiscal year end</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">Acquired </font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">Value</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">exercisable/</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">exercisable/</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font
        face="Arial">Name</font></td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">on exercise</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">Realized</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">unexercisable</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">unexercisable</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font
        face="Arial">A.G. Lowenthal</font></td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">150,000</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">$978,750</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">150,000/150,000</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">$3,000,750/$1,435,500</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font
        face="Arial">T. Robinson</font></td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">0/10,000</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">$0/75,400</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font
        face="Arial">E. J. Shames</font></td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">15,000</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">$95,475</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">15,000/7,500</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">$300,075/$71,775</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="21"><font
        face="Arial">E.K. Roberts</font></td>
        <td valign="top" width="3%" height="21">&nbsp;</td>
        <td valign="top" width="14%" height="21"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="13%" height="21"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="21">&nbsp;</td>
        <td valign="top" width="20%" height="21"><p align="right"><font
        face="Arial">75,000/10,000</font></p>
        </td>
        <td valign="top" width="1%" height="21">&nbsp;</td>
        <td valign="top" width="28%" height="21"><p align="right"><font
        face="Arial">$1,500,375/$95,700</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="19%" height="16"><font
        face="Arial">R. Okin</font></td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="14%" height="16"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        face="Arial">0</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="20%" height="16"><p align="right"><font
        face="Arial">0/50,000</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="28%" height="16"><p align="right"><font
        face="Arial">$0/$466,750</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"><b>REPORT OF THE
COMPENSATION AND STOCK OPTION COMMITTEE</b></font></p>

<p><font face="Arial">The following report of the Committee
discusses generally the Committee's executive compensation
objectives and policies and their relationship to corporate
performance in 2003. In addition, the report specifically
discusses the Committee's bases for compensation in 2003 of the
Company's Chief Executive Officer, as well as the other senior
executive officers of the Company and </font><font
face="Helvetica">Oppenheimer</font><font face="Arial">.</font></p>

<p><font face="Arial"><b><i>Objectives and Policies</i></b></font></p>

<p><font face="Arial">The Committee's objective is to provide a
competitive compensation program with appropriate incentives for
superior performance, thereby providing a strong and direct link
between corporate performance and compensation. Performance is
defined in several ways, as more fully discussed below, each of
which has relevance to the Company's success in the short-term,
long-term or both.</font></p>

<p><font face="Arial">The Company's compensation program for
senior executive officers consists of the following key elements:
a base salary, an annual bonus, grants of stock options and, in
the case of the Chief Executive Officer, the Performance-Based
Compensation Agreement referred to below.</font></p>

<p><font face="Arial">In arriving at its recommendations
concerning the specific components of the Company's compensation
program, the Committee considers certain public information about
the compensation paid by a group of comparable public Canadian
and U.S. broker-dealers and the relative performance of the
Company as measured by net income levels and earnings per share,
among other factors.</font></p>

<p><font face="Arial">The Committee believes that this approach
best serves the interests of shareholders by enabling the Company
to structure compensation in a way that meets the requirements of
the highly competitive environment in which the Company operates,
while ensuring that senior executive officers are compensated in
a manner that advances both the short and long-term interests of
shareholders.</font></p>

<p><font face="Arial">Compensation for the Company's senior
executive officers involves a significant component of
remuneration which is contingent on the performance of both the
Company and the senior executive officer: the variable annual
bonus (which permits individual performance to be recognized on
an annual basis, and which is based, in significant part, on an
evaluation of the contribution made by the officer to corporate
performance) and stock options (which directly relate a portion
of compensation to stock price appreciation realized by the
Company&#146;s shareholders).</font></p>

<p><font face="Arial"><i>Base Salary. </i>Salaries paid to senior
executive officers (other than the Chief Executive Officer) are
reviewed annually by the Committee considering recommendations
made by the Chief Executive Officer to the Committee, based upon
the Chief Executive Officer's assessment of the nature of the
position, and the skills, experience and performance of each
senior executive officer, as well as salaries paid by comparable
companies in the Company&#146;s industry. The Committee then
makes recommendations to the Board with respect to base salaries.</font></p>

<p><font face="Arial"><i>Annual Bonus. </i>Bonuses paid to senior
executive officers (other than the Chief Executive Officer) are
reviewed annually by the Committee considering recommendations
made by the Chief Executive Officer to the Committee, based upon
the Chief Executive Officer's assessment of the performance of
the Company and his assessment of the contribution of each senior
executive to that performance. The Committee then makes
recommendations to the Board with respect to bonuses.</font></p>

<p><font face="Arial">Senior executive officers, including the
Chief Executive Officer, of Oppenheimer have the right to elect
to defer a portion of their annual bonus and performance-based
compensation under Oppenheimer's Executive Deferred Compensation
Plan, a non-qualified unfunded plan. </font></p>

<p><font face="Arial"><i>Stock Option Grants. </i>Under the Plan,
as amended, senior executive officers and employees of the
Company and its subsidiaries (other than the Chief Executive
Officer) are granted stock options by the Committee based upon
the recommendations of the Chief Executive Officer and based upon
a variety of considerations, including the date of the last grant
made to the officer or employee, as well as considerations
relating to the contribution and performance of the specific
optionee.</font></p>

<p><font face="Arial"><b><i>Chief Executive Officer Compensation</i></b></font></p>

<p><font face="Arial">Mr. A.G. Lowenthal, the Chairman of the
Board and the Chief Executive Officer of the Company and
Oppenheimer, is paid a base salary set by the Committee, plus
performance-based compensation under the Performance-Based
Compensation Agreement referred to below and, at the discretion
of the Committee, is eligible for bonuses and grants of stock
options.</font></p>

<p><font face="Arial">On January 1, 2001, the Company entered
into a Performance-Based Compensation Agreement (the &quot;2001
Comp Agreement&quot;) with Mr. Lowenthal, which expires on
December 31, 2005. The 2001 Comp Agreement was approved by the
Class B Shareholders in 2001. The purpose of the 2001 Comp
Agreement is to set the terms under which Mr. Lowenthal's
performance-based compensation is to be calculated during the
term thereof.</font></p>

<p><font face="Arial">In March of 2003, the Committee established
performance goals under the 2001 Comp Agreement entitling Mr.
Lowenthal to a Performance Award under the 2001 Comp Agreement
for the year 2003 of an aggregate of $3,360,323 determined by the
application of a formula based on the following components: the
amount by which the closing price of one Class A Share at January
1, 2003, exceeded the closing price of one Class A Share as at
December 31, 2003 multiplied by 200,000 shares; 3% of the amount
by which the Company's consolidated profit before income taxes
for the year ended December&nbsp;31,&nbsp;2003 exceeded 15% of
and is less than 25% of the Company's consolidated shareholders'
equity as at December&nbsp;31, 2002; 3.0% percent of the amount
by which the Company&#146;s consolidated net profit for the year
ended December 31, 2003 was greater than $0 and less than
$11,500,000; 4.0% of the amount by which the Company&#146;s
consolidated net profit for the year ended December 31, 2003 was
greater than $11,500,000 and less than $23,000,000; and 4.5% of
the amount by which the Company&#146;s consolidated net profit
for the year ended December 31, 2003 was greater than
U.S.$23,000,000 and less than $34,000,000. In March of 2003, the
Committee set Mr. Lowenthal&#146;s base salary for 2003 at
$500,000.</font></p>

<p><font face="Arial"><b><i>U.S. Internal Revenue Code Section
162(m) </i></b></font></p>

<p><font face="Arial">The Company is a Canadian taxpayer.
However, because Oppenheimer is a U.S. taxpayer, most
compensation issues are affected by the U.S. Internal Revenue
Code of 1986, as amended (the &quot;U.S. Tax Code&quot;).</font></p>

<p><font face="Arial">Section 162(m) of the U.S. Tax Code
generally disallows a tax deduction to public Companys for annual
compensation of over $1,000,000 paid to any of the company's
chief executive officer and four other most highly paid executive
officers (determined as of the end of each fiscal year) unless
such compensation constitutes qualified performance-based
compensation or otherwise qualifies for an exception.</font></p>

<p><font face="Arial">In order to qualify for exemptions under
Section 162(m) in 2001, the 2001 Comp Agreement was adopted and
approved by the Class B Shareholders.</font></p>

<p><font face="Arial">To the extent consistent with the Company's
general compensation objectives, the Committee considers the
potential effect of Section 162(m) on compensation paid to the
executive officers of the Company and its subsidiaries. However,
the Committee reserves the right to award and recommend the
awarding of nondeductible compensation in any circumstances it
deems appropriate. Further, because of ambiguities and
uncertainties as to the application and interpretation of Section
162(m) and the regulations issued thereunder, no assurance can be
given, notwithstanding the Company's efforts to qualify, that the
compensation paid by the Company to its executive officers will
in fact satisfy the requirements for the exemption from the
Section 162(m) deduction limit.</font></p>

<p><font face="Arial"><b><i>Members of the Compensation and Stock
Option Committee</i></b></font></p>

<p><font face="Arial">Burton Winberg &#151; Chairman</font></p>

<p><font face="Arial">John L. Bitove</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">SHARE PERFORMANCE GRAPH </font></p>

<p><font face="Arial">The following graph shows changes over the
past five year period of U.S.$100 invested in (1) the
Companys&#146; Class A Shares, (2) the Standard &amp; Poors 500
Index, and (3) the Standard &amp; Poors / Toronto Stock Exchange
Composite Index.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p>[PERFORMANCE GRAPH]</p>

<table border="0" cellspacing="1" width="564">
    <tr>
        <td valign="bottom" width="42%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="bottom" width="42%" height="17">&nbsp;</td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>1998</b></font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>1999</b></font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>2000</b></font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>2001</b></font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>2002</b></font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial"><b>2003</b></font></p>
        </td>
    </tr>
    <tr>
        <td valign="bottom" width="42%" height="17"><font
        size="2" face="Arial">Oppenheimer</font></td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">100 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">87 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">163 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">119 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">90 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">136 </font></p>
        </td>
    </tr>
    <tr>
        <td valign="bottom" width="42%" height="17"><font
        size="2" face="Arial">S&amp;P 500</font></td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">100 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">118 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">90 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">87 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">77 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">126 </font></p>
        </td>
    </tr>
    <tr>
        <td valign="bottom" width="42%" height="17"><font
        size="2" face="Arial">S&amp;P / TSX Composite</font></td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">100 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">130 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">106 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">86 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">86 </font></p>
        </td>
        <td valign="bottom" width="10%" height="17"><p
        align="right"><font size="2" face="Arial">124 </font></p>
        </td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b></b></font>&nbsp;</p>

<p><font color="#FF00FF" face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b></b></font>&nbsp;</p>

<p><font face="Arial"><b>Item 12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT </b></font></p>

<p><font face="Arial">As at December 31, 2003, the authorized
capital of the Company includes an unlimited number of Class A
Shares of which 12,819,520 Class A Shares were issued and
outstanding and 99,680 Class B Shares, all of which were issued
and outstanding.</font></p>

<p><font face="Arial">The following table sets forth certain
information regarding the beneficial ownership of, or the
exercise of control or discretion over, each class of shares of
the Company as at March 9, 2004, with respect to (i) each person
known by the Company to beneficially own or exercise control or
discretion over more than 5% of any class of the Company&#146;s
shares, (ii) each of the Company&#146;s directors, (iii) each of
the Company&#146;s executive officers named in the Summary
Compensation Table and (iv) the directors and officers as a
group.</font></p>

<p><font face="Arial">For purposes of the table, beneficial
ownership is determined pursuant to Rule 13d-3 of the U.S.
Securities Exchange Act of 1934, as amended, pursuant to which a
person or group of persons is deemed to have &quot;beneficial
ownership&quot; of a class of outstanding shares which such
person or group has the right to acquire within 60 days after
March 9, 2004. The percentage of shares deemed outstanding is
based on 13,322,416 Class A Shares and 99,680 Class B Shares
outstanding as of March 9, 2004. In addition, for purposes of
computing the percentage of Class A Shares owned by each person,
the percentage includes all Class A Shares issuable upon exercise
of outstanding options held by such persons within 60 days after
March 9, 2004.</font></p>

<p><font face="Arial">There are no outstanding rights to acquire
beneficial ownership of any Class B Shares.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="589">
    <tr>
        <td valign="top" width="46%">&nbsp;</td>
        <td valign="top" colspan="2" width="29%"><p
        align="center"><font face="Arial"><u>Class A Shares</u></font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" colspan="2" width="22%"><p
        align="center"><font face="Arial"><u>Class B Shares</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial"><u>Name
        and Address of Beneficial Owner</u></font></td>
        <td valign="top" width="16%"><p align="center"><font
        face="Arial"><u>Shares</u></font></p>
        </td>
        <td valign="top" width="12%"><p align="center"><font
        face="Arial"><u>%</u></font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="center"><font
        face="Arial"><u>Shares</u></font></p>
        </td>
        <td valign="top" width="10%"><p align="center"><font
        face="Arial"><u>%</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">Private
        Capital Management, L.P.</font><p><font face="Arial">8889
        Pelican Bay Boulevard</font></p>
        <p><font face="Arial">Suite 500</font></p>
        <p><font face="Arial">Naples, FL 34108</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">4,132,534</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">31.0%</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">AIC
        Limited</font><p><font face="Arial">1375 Kerns Road</font></p>
        <p><font face="Arial">Burlington, Canada L7R 4X8</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">1,837,800</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">13.8%</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">Olga
        Roberts (2)</font><p><font face="Arial">20 Eglinton Ave.
        W.</font></p>
        <p><font face="Arial">Suite 1110</font></p>
        <p><font face="Arial">Toronto, Canada M4R 1K8</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">324,955</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">2.4%</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">44,309</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">44.4%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%" height="4"><font
        face="Arial">Albert G. Lowenthal (1)</font><p><font
        face="Arial">125 Broad St</font></p>
        <p><font face="Arial">New York, NY 10004</font></p>
        </td>
        <td valign="top" width="16%" height="4"><p align="right"><font
        face="Arial">2,751,143</font></p>
        </td>
        <td valign="top" width="12%" height="4"><p align="right"><font
        face="Arial">20.6%</font></p>
        </td>
        <td valign="top" width="3%" height="4">&nbsp;</td>
        <td valign="top" width="12%" height="4"><p align="right"><font
        face="Arial">50,975</font></p>
        </td>
        <td valign="top" width="10%" height="4"><p align="right"><font
        face="Arial">51%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">J.L.
        Bitove</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">56,830</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">20</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">R.
        Crystal (7)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">13,950</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">K.W.
        McArthur (4)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">56,250</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">A.
        Molestina</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">R. Okin
        (9)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">103</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">A.W.
        Oughtred</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">9,750</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">E.K.
        Roberts (3)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">178,594</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">1.3%</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">116</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">E.J.
        Shames (6)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">47,450</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">R. Venn</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">B.
        Winberg (8)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">10,650</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">*</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="46%"><font face="Arial">Executive
        Officers and Directors as a group (10 persons)</font></td>
        <td valign="top" width="16%"><p align="right"><font
        face="Arial">3,134,779</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">23.5%</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        face="Arial">51,011</font></p>
        </td>
        <td valign="top" width="10%"><p align="right"><font
        face="Arial">51%</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">________________________________________</font></p>

<p><font face="Arial">* less than 1%</font></p>

<p><font face="Arial">(1) With respect to the Class A Shares, Mr.
Lowenthal is the sole general partner of Phase II Financial L.
P., a New York limited partnership (&quot;Phase II L.P.&quot;),
which is the record holder of 2,738,430 Class A Shares. Mr.
Lowenthal holds 11,347 Class A Shares through the Company's
401(k) plan, and 1,366 Class A Shares directly. With respect to
the Class B Shares, Phase II, an Ontario Company wholly-owned by
Mr. Lowenthal, is the holder of record of all such shares.</font></p>

<p><font face="Arial">(2) With respect to the Class B Shares,
Mrs. Roberts, who is the mother of Elaine Roberts, President of
the Company, owns 100 Class B Shares directly and 44,209 Class B
Shares indirectly through Elka Estates Limited, an Ontario
Company (&quot;Elka&quot;), which is wholly-owned by Mrs.
Roberts. With respect to the Class A Shares, Mrs. Roberts owns
41,900 Class A Shares directly and 283,055 Class A Shares through
Elka Estates Limited.</font></p>

<p><font face="Arial">(3) 182,294 Class A Shares are held
directly. </font></p>

<p><font face="Arial">(4) 50,000 Class A Shares are held directly
and 6,250 Class A Shares are beneficially owned in respect of
Class A Shares issuable upon exercise of options issued under the
Plan.</font></p>

<p><font face="Arial">(6) 45,000 Class A Shares are held
directly, 2,450 Class A Shares are held through the
Company&#146;s 401(k) Plan. </font></p>

<p><font face="Arial">(7) 2,700 Class A Shares are held directly
and 11,250 Class A Shares are beneficially owned in respect of
Class A Shares issuable upon exercise of options issued under the
Plan.</font></p>

<p><font face="Arial">(8) Includes 6,250 Class A Shares which are
beneficially owned in respect of Class A Shares issuable upon
exercise of options issued under the Plan.</font></p>

<p><font face="Arial">(9) 103 Class A Shares are held through the
Company&#146;s 401(k) Plan.</font></p>

<p><font face="Arial">(c) There are no arrangements, known to the
Company, the operation of which may at a subsequent date result
in a change of control of the Company. </font></p>

<p><font face="Arial">(d) Class A Shares authorized for issuance
under the Company&#146;s 1996 Equity Incentive Plan (the
&quot;Plan&quot;), as amended as at December 31, 2003 are as
follows: All Class A Shares authorized under the Plan have been
approved by shareholders of the Company.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="498">
    <tr>
        <td valign="top" width="36%"><font face="Arial">Number of
        securities to be issued upon exercise of outstanding
        options</font></td>
        <td valign="top" width="30%"><font face="Arial">Weighted
        average exercise price of outstanding options</font></td>
        <td valign="top" width="34%"><font face="Arial">Number of
        securities remaining available for future issuance under
        the Plan.</font></td>
    </tr>
    <tr>
        <td valign="top" width="36%">&nbsp;</td>
        <td valign="top" width="30%">&nbsp;</td>
        <td valign="top" width="34%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="36%"><font face="Arial">1,884,983</font></td>
        <td valign="top" width="30%"><font face="Arial">$21.81</font></td>
        <td valign="top" width="34%"><font face="Arial">135,948</font></td>
    </tr>
    <tr>
        <td valign="top" width="36%">&nbsp;</td>
        <td valign="top" width="30%">&nbsp;</td>
        <td valign="top" width="34%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial">A description of the Plan appears in Note 8
of the Company&#146;s financial statements for the year ended
December 31, 2003. The Company does not have any warrants or
rights outstanding as at December 31, 2003.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 13. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS</b></font></p>

<p><font face="Arial">During the year 2003 certain of the
directors, executive officers and senior officers of the Company
and </font><font face="Helvetica">Oppenheimer</font><font
face="Arial"> maintained margin accounts with </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> in
connection with the purchase of securities (including securities
of the Company) which margin accounts are substantially on the
same terms, including interest rates and collateral, as those
prevailing from time to time for comparable transactions with
non-affiliated persons and do not involve more than the normal
risk of collectability. The details of their indebtedness to </font><font
face="Helvetica">Oppenheimer</font><font face="Arial"> on their
margin accounts is as follows:</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="34%"><font face="Arial">Name and
        Principal Position</font></td>
        <td valign="top" width="21%"><p align="center"><font
        face="Arial">Largest Amount Outstanding During 2003</font></p>
        </td>
        <td valign="top" width="23%"><p align="center"><font
        face="Arial">Amount Outstanding as at December 31, 2003</font></p>
        </td>
        <td valign="top" width="22%"><font face="Arial">Security
        for Indebtedness</font></td>
    </tr>
    <tr>
        <td valign="top" width="34%"><font face="Arial">Albert G.
        Lowenthal,</font><p><font face="Arial">Chairman and CEO
        of the Company and O</font><font face="Helvetica">ppenheimer</font></p>
        </td>
        <td valign="top" width="21%"><p align="center"><font
        face="Arial">$89,330</font></p>
        </td>
        <td valign="top" width="23%"><p align="center"><font
        face="Arial">nil</font></p>
        </td>
        <td valign="top" width="22%"><font face="Arial">Margined
        securities</font></td>
    </tr>
    <tr>
        <td valign="top" width="34%"><font face="Arial">Robert
        Okin, Senior V.P., Operations of </font><font
        face="Helvetica">Oppenheimer</font></td>
        <td valign="top" width="21%"><p align="center"><font
        face="Arial">$231,132</font></p>
        </td>
        <td valign="top" width="23%"><p align="center"><font
        face="Arial">$231,132</font></p>
        </td>
        <td valign="top" width="22%"><font face="Arial">Margined
        securities</font></td>
    </tr>
    <tr>
        <td valign="top" width="34%"><font face="Arial">Eric
        Shames,</font><p><font face="Arial">Secretary and Chief
        Legal Officer of </font><font face="Helvetica">Oppenheimer</font></p>
        </td>
        <td valign="top" width="21%"><p align="center"><font
        face="Arial">$301,488</font></p>
        </td>
        <td valign="top" width="23%"><p align="center"><font
        face="Arial">$293,285</font></p>
        </td>
        <td valign="top" width="22%"><font face="Arial">Margined
        securities</font></td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"><b>Item 14. Principal Accounting Fees and
Services</b></font></p>

<p><font face="Arial">The Company&#146;s principal accountant is
PricewaterhouseCoopers LLP. Audit fees include fees for the audit
of the Company&#146;s annual consolidated financial statements
and the review of its quarterly financial statements. Audit fees
also include fees for the audits of the Company&#146;s broker
dealer subsidiaries in compliance with statutory and regulatory
filings. Other audit-related fees include fees for the audit of
the Company&#146;s 401(k) plan. In 2002, the Company engaged
Ernst &amp; Young to provide tax related services.</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="553">
    <tr>
        <td valign="top" width="56%">&nbsp;</td>
        <td valign="top" colspan="2" width="44%"><p
        align="center"><font face="Arial">Year ended December 31,</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%">&nbsp;</td>
        <td valign="top" width="21%"><p align="center"><font
        face="Arial">2003</font></p>
        </td>
        <td valign="top" width="23%"><p align="center"><font
        face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%"><font face="Arial">Audit
        fees</font></td>
        <td valign="top" width="21%"><p align="right"><font
        face="Arial">$827,500</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$546,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%"><font face="Arial">Audit-related
        fees</font></td>
        <td valign="top" width="21%"><p align="right"><font
        face="Arial">50,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">34,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%"><font face="Arial">Tax fees</font></td>
        <td valign="top" width="21%"><p align="right"><font
        face="Arial">nil</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">Nil</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%"><font face="Arial">All other
        fees</font></td>
        <td valign="top" width="21%"><p align="right"><font
        face="Arial">nil</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">nil</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%">&nbsp;</td>
        <td valign="top" width="21%"><p align="right"><font
        face="Arial">$877,500</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        face="Arial">$580,000</font></p>
        </td>
    </tr>
</table>

<p><font face="Arial">The Audit Committee has the sole authority
and responsibility to nominate independent auditors for election
by shareholders, and to recommend to shareholders that
independent auditors be removed. The Audit Committee approves all
audit engagement fees and terms as well as approves all non-audit
engagements and engagement fees provided by independent auditors.
The process begins prior to the commencement of the audit. The
fees described above were 100% pre-approved.</font></p>

<p align="center"><font face="Arial"><b>PART IV</b></font></p>

<p><font face="Arial"><b>Item 15. EXHIBITS, FINANCIAL STATEMENT
SCHEDULES AND REPORTS ON</b></font></p>

<p><font face="Arial"><b>FORM 8-K</b></font></p>

<table border="0" cellpadding="7" cellspacing="0" width="619">
    <tr>
        <td valign="top" width="7%"><font face="Arial">(a)</font></td>
        <td valign="top" width="7%"><font face="Arial">(i)</font></td>
        <td valign="top" width="86%"><font face="Arial">Financial
        Statements</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">The
        response to this portion of Item 15 is submitted as a
        separate section of this report. See pages F-1 to F-20</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%"><font face="Arial">(ii)</font></td>
        <td valign="top" width="86%"><font face="Arial">Financial
        Statement Schedules</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">Not
        Applicable.</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%"><font face="Arial">(iii)</font></td>
        <td valign="top" width="86%"><font face="Arial">Listing
        of Exhibits</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">The
        exhibits which are filed with this Form 10-K or are
        incorporated herein by reference are set forth in the
        Exhibit Index which immediately precedes the exhibits to
        this report.</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="7%"><font face="Arial">(b)</font></td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">Reports
        on Form 8-K</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">None</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="7%"><font face="Arial">(c)</font></td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">Exhibits</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">See the
        Exhibit Index included hereinafter.</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="7%"><font face="Arial">(d)</font></td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">Financial
        Statement Schedules excluded from the annual report to
        shareholders</font></td>
    </tr>
    <tr>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="7%">&nbsp;</td>
        <td valign="top" width="86%"><font face="Arial">None</font></td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"><b>SIGNATURES</b></font></p>

<p><font face="Arial">Pursuant to the requirements of Section 13
or 15(d) of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York,
State of New York, on the 9th day of March, 2004.</font></p>

<p><font face="Arial">OPPENHEIMER HOLDINGS INC.</font></p>

<p><font face="Arial">BY: &quot;E.K. Roberts&quot;</font></p>

<p><font face="Arial">E.K. Roberts, President</font></p>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial">Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed by
the following persons in the capacities and on the dates
indicated.</font></p>

<table border="0" cellpadding="7" cellspacing="1" width="638">
    <tr>
        <td valign="top" width="33%"><font face="Arial"><u>Signature</u></font></td>
        <td valign="top" width="33%"><font face="Arial"><u>Title</u></font></td>
        <td valign="top" width="33%"><font face="Arial"><u>Date</u></font></td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;J.L.
        Bitove&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">J.L.
        Bitove</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;R.
        Crystal&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">R.
        Crystal</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;A.G.
        Lowenthal&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Chairman,
        Chief Executive </font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">A.G.
        Lowenthal</font></td>
        <td valign="top" width="33%"><font face="Arial">Officer,
        Director</font></td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;K.W.
        McArthur&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">K.W.
        McArthur</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;A.
        Molestina&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">A.
        Molestina</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;A.W.
        Oughtred&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Secretary,
        Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">A.W.
        Oughtred</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;E.K.
        Roberts&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">President
        &amp; Treasurer, </font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">E.K.
        Roberts</font></td>
        <td valign="top" width="33%"><font face="Arial">(Principal
        Financial and Accounting Officer), Director</font></td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;R.
        Venn&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">R.
        Venn</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">&quot;B.
        Winberg&quot;</font></td>
        <td valign="top" width="33%"><font face="Arial">Director</font></td>
        <td valign="top" width="33%"><font face="Arial">March 9,
        2004</font></td>
    </tr>
    <tr>
        <td valign="top" width="33%"><font face="Arial">B.
        Winberg</font></td>
        <td valign="top" width="33%">&nbsp;</td>
        <td valign="top" width="33%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p align="center"><font color="#FF0000" size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font color="#FF0000" size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="4" face="Arial">OPPENHEIMER
HOLDINGS INC.</font></p>

<p align="center"><font size="4" face="Arial">CONSOLIDATED
FINANCIAL STATEMENTS</font></p>

<p align="center"><font size="4" face="Arial">FOR THE YEAR ENDED
DECEMBER 31, 2003</font></p>

<p align="center"><font size="4" face="Arial">FOR INCLUSION IN
THE COMPANY&#146;S FORM 10-K</font></p>

<p align="right"><font color="#FF0000" size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial">INDEX TO
CONSOLIDATED FINANCIAL STATEMENTS</font></p>

<p align="center"><font size="3" face="Arial">OPPENHEIMER
HOLDINGS INC.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Management&#146;s
        Responsibility for Consolidated Financial Statements</font></td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Report
        of Independent Auditors</font></td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">56</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Consolidated
        Balance Sheets as at December 31, 2003 and 2002</font></td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">57</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Consolidated
        Statements of Operations for the three years ended</font><p><font
        size="3" face="Arial">December 31, 2003, 2002 and 2001</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">59</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Consolidated
        Statements of Changes in Shareholders&#146; Equity for
        the three years ended December 31, 2003, 2002 and 2001</font></td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">60</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Consolidated
        Statements of Cash Flows for the three years ended</font><p><font
        size="3" face="Arial">December 31, 2003, 2002 and 2001</font></p>
        </td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">61</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="89%">&nbsp;</td>
        <td valign="top" width="11%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="89%"><font size="3" face="Arial">Notes
        to Consolidated Financial Statements </font></td>
        <td valign="top" width="11%"><p align="right"><font
        size="3" face="Arial">63</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial">MANAGEMENT'S RESPONSIBILITY FOR
CONSOLIDATED FINANCIAL STATEMENTS</font></p>

<p><font size="3" face="Arial">The accompanying consolidated
financial statements of Oppenheimer Holdings Inc. were prepared
by management in accordance with accounting principles generally
accepted in the United States of America, which conform in all
material respects with accounting principles generally accepted
in Canada. The significant accounting policies of the Company are
described in Note 1 to the consolidated financial statements.</font></p>

<p><font size="3" face="Arial">Management is responsible for the
integrity and objectivity of the information contained in the
consolidated financial statements. In order to present fairly the
financial position of the Company and the results of its
operations and its cash flows, estimates which are necessary are
based on careful judgments and have been properly reflected in
the consolidated financial statements. Management has established
systems of internal control which are designed to provide
reasonable assurance that assets are safeguarded from loss or
unauthorized use and to produce reliable accounting records for
the preparation of financial information.</font></p>

<p><font size="3" face="Arial">PricewaterhouseCoopers LLP, the
Company's independent accountants, conduct an audit of the
consolidated financial statements in accordance with auditing
standards generally accepted in the United States of America.
Their audit includes a review and evaluation of the Company's
systems of internal control, and such tests and procedures as
they consider necessary in order to form an opinion as to whether
the consolidated financial statements are presented fairly in
accordance with accounting principles generally accepted in the
United States of America.</font></p>

<p><font size="3" face="Arial">The Board of Directors is
responsible for ensuring that management fulfills its
responsibilities for financial reporting and internal control.
The Board of Directors is assisted in this responsibility by its
Audit Committee, whose members are not officers of the Company.
The Audit Committee meets with management as well as with the
independent auditors to review the internal controls,
consolidated financial statements, and the auditors&#146; report.
The Audit Committee reports its findings to the Board of
Directors for its consideration in approving the consolidated
financial statements for issuance to the shareholders.</font></p>

<p><font size="3" face="Arial">Management recognizes its
responsibility for conducting the Company's affairs in compliance
with established financial standards, and applicable laws and
regulations, and for maintaining proper standards of conduct for
its activities. </font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial">A.G. Lowenthal, E.K. Roberts,</font></p>

<p><font size="3" face="Arial">Chairman of the Board President
and Treasurer</font></p>

<p><font size="3" face="Arial">and Chief Executive Officer</font></p>

<p><font size="3" face="Arial">February 25, 2004 </font></p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial">REPORT OF
INDEPENDENT AUDITORS</font></p>

<p><font size="3" face="Arial">TO THE SHAREHOLDERS OF OPPENHEIMER
HOLDINGS INC.</font></p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial">In our opinion, the accompanying
consolidated balance sheets and the related consolidated
statements of operations, changes in shareholders&#146; equity
and cash flows present fairly, in all material respects, the
financial position of Oppenheimer Holdings Inc. (the
&quot;Company&quot;) and its subsidiaries at December 31, 2003
and 2002, and the results of their operations and their cash
flows for each of the three years in the period ended December
31, 2003 in conformity with accounting principles generally
accepted in the United States of America. These financial
statements are the responsibility of the Company&#146;s
management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits
of these statements in accordance with auditing standards
generally accepted in the United States of America, which require
that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.</font></p>

<p><font size="3" face="Arial">As discussed in note 2, in 2002
the Company adopted the goodwill provisions of Statement of
Accounting Standards No. 142, &quot;Goodwill and Other
Intangibles&quot;.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial">&quot;PricewaterhouseCoopers
LLP&quot;</font></p>

<p><font size="3" face="Arial">New York, New York</font></p>

<p><font size="3" face="Arial">February 25, 2004</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<table border="1" cellpadding="2" cellspacing="3" width="650"
bordercolor="#000000">
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">OPPENHEIMER
        HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">CONSOLIDATED
        BALANCE SHEETS</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">AS AT DECEMBER
        31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="73%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%" height="17">&nbsp;</td>
        <td valign="top" colspan="6" width="43%" height="17"><p
        align="center"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">ASSETS</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Current assets</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Cash and cash equivalents</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$34,478</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$16,115</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Restricted deposits (note 3)</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">14,466</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">7,440</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Deposits with clearing
        organizations</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">17,858</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">3,606</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Receivable from brokers and
        clearing organizations </font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">278,521</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">492,094</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Receivable from customers</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">906,487</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">392,929</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Securities owned, including amounts
        pledged, at market value (note 4)</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">95,223</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">50,173</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Notes receivable (note 15)</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">97,919</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">17,012</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Other</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">63,610</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">28,418</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">1,508,562</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">1,007,787</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Other assets</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Stock exchange seats (approximate
        market value</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">$4,968; $6,716 in 2002)</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">2,994</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">2,994</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Property, plant and equipment (note
        5)</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">23,807</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">8,488</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Intangible assets, net of
        amortization</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">35,865</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16"><font
        size="3" face="Arial">Goodwill</font></td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">137,889</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">11,957</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="16">&nbsp;</td>
        <td valign="top" colspan="2" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">200,555</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">23,439</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="17">&nbsp;</td>
        <td valign="top" colspan="2" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$1,709,117</font></p>
        </td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$1,031,226</font></p>
        </td>
    </tr>
</table>

<p><font face="Courier"></font>&nbsp;</p>

<table border="1" cellpadding="2" cellspacing="3" width="650"
bordercolor="#000000">
    <tr>
        <td valign="top" colspan="6" height="16"><p
        align="center"><font size="3" face="Arial">OPPENHEIMER
        HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="6" height="16"><p
        align="center"><font size="3" face="Arial">CONSOLIDATED
        BALANCE SHEETS</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="6" height="16"><p
        align="center"><font size="3" face="Arial">AS AT DECEMBER
        31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="73%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="43%" height="17"><p
        align="center"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
</table>

<table border="1" cellpadding="2" cellspacing="1" width="650"
bordercolor="#000000">
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">LIABILITIES AND SHAREHOLDERS' EQUITY</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="17"><font size="3"
        face="Arial">Current liabilities</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="17"><font size="3"
        face="Arial">Drafts payable</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$68,148</font></p>
        </td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$21,653</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Bank call loans (note 6)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">91,500</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">16,200</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Payable to brokers and clearing
        organizations </font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">467,966</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">520,743</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Payable to customers</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">406,137</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">162,343</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Securities sold, but not yet purchased, at
        market value (note 5)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">10,687</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">9,606</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Accrued compensation</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">88,999</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">27,194</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Accounts payable and other liabilities</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">33,857</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">23,551</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Income taxes payable</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">67</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">2,057</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Current portion of bank loans</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">10,119</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Current portion of long term debt</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">15,921</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">1,193,401</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">783,347</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Long term liabilities</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Bank loans (note 7)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">29,536</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Long term debt (note 7)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">34,954</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Exchangeable debentures (note 7)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">160,822</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Deferred income tax</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">9,473</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">243</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">234,785</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">243</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Commitments and contingencies (note 12)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Shareholders' equity</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Share capital (note 9)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">12,819,520 Class A non-voting shares issued </font><p><font
        size="3" face="Arial">(2002-12,397,007 shares issued)</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">41,520</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">34,338</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">99,680 Class B voting shares issued</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">133</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">133</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">41,653</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">34,471</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Contributed capital (note 10)</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">5,966</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">5,028</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16"><font size="3"
        face="Arial">Retained earnings</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">233,312</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">208,137</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">280,931</font></p>
        </td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">247,636</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="73%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$1,709,117</font></p>
        </td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$1,031,226</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="5" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5" height="17"><p
        align="center"><font size="3" face="Arial">The
        accompanying notes are an integral part of these
        consolidated financial statements.</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<table border="1" cellpadding="2" cellspacing="3" width="662"
bordercolor="#000000">
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">OPPENHEIMER
        HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">CONSOLIDATED
        STATEMENTS OF OPERATIONS</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="17"><p
        align="center"><font size="3" face="Arial">FOR THE YEAR
        ENDED DECEMBER 31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17">&nbsp;</td>
        <td valign="top" colspan="6" width="47%" height="17"><p
        align="center"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars, except per share amounts)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">REVENUE:</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Commissions</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$325,071</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$135,747</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$122,272</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Principal transactions, net</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">136,672</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">58,227</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">56,374</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Interest</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">42,600</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">27,622</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">34,309</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Underwriting fees</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">50,623</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">22,760</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">10,955</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Advisory fees</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">80,550</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">26,365</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">24,504</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Arbitration award</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">21,750</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Other</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">32,727</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">12,612</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">12,847</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">689,993</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">283,333</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">261,261</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">EXPENSES:</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Compensation and related expenses</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">435,160</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">169,810</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">148,838</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Clearing and exchange fees</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">20,734</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">9,607</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">6,012</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Communications</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">54,526</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">32,066</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">23,620</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Occupancy and equipment costs</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">53,604</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">27,772</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">19,233</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Interest</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">14,322</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">8,379</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">14,071</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Other</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">61,044</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">22,782</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">17,875</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">639,390</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">270,416</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">229,649</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Profit before income taxes </font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">50,603</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">12,917</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">31,612</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Income tax provision (note 10)</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">20,812</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">5,370</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">12,462</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17"><font size="3"
        face="Arial">Profit before cumulative effect of a change
        in accounting principle</font></td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">29,791</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">7,547</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17"><font size="3"
        face="Arial">Cumulative effect of a change in accounting
        principle (note 2)</font></td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">1,774</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17"><font size="3"
        face="Arial">NET PROFIT FOR YEAR</font></td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$29,791</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$9,321</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17"><font size="3"
        face="Arial">Earnings per share (notes 2 and 11)</font></td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="17"><font size="3"
        face="Arial">Basic earnings per share </font></td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$0.75</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">- Before the effect of a change in
        accounting </font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">principle</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$0.61</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">- Cumulative effect of a change in
        accounting </font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">principle</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16"><font size="3"
        face="Arial">Diluted earnings per share</font></td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$1.63</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$0.73</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$1.50</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">The
        accompanying notes are an integral part of these
        consolidated financial statements.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="53%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16">&nbsp;</td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<table border="1" cellpadding="2" cellspacing="3" width="662"
bordercolor="#000000">
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">OPPENHEIMER
        HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="16"><p
        align="center"><font size="3" face="Arial">CONSOLIDATED
        STATEMENTS OF CHANGES IN SHAREHOLDERS&#146; EQUITY</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="7" height="17"><p
        align="center"><font size="3" face="Arial">FOR THE YEAR
        ENDED DECEMBER 31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p
        align="center"><font size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" colspan="6" width="44%" height="17"><p
        align="center"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">SHARE CAPITAL</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Balance at beginning of year</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$34,471</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$34,257</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$29,683</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Issue of Class A Shares</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">7,767</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">3,503</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">4,723</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Repurchase of Class A Shares for
        cancellation</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(585)</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(3,289)</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">(149)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17"><font size="3"
        face="Arial">Balance at end of year</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$41,653</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$34,471</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$34,257</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">CONTRIBUTED CAPITAL</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Balance at beginning of year</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$5,028</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$4,113</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$3,499</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Tax benefit from employee stock options
        exercised</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">938</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">915</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">614</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17"><font size="3"
        face="Arial">Balance at end of year</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$5,966</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$5,028</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$4,113</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16">&nbsp;</td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">RETAINED EARNINGS</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Balance at beginning of year</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$208,137</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">$203,325</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">$188,618</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Net profit for year</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">29,791</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">9,321</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="16"><font size="3"
        face="Arial">Dividends paid</font></td>
        <td valign="top" width="1%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(4,616)</font></p>
        </td>
        <td valign="top" width="3%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(4,509)</font></p>
        </td>
        <td valign="top" width="4%" height="16">&nbsp;</td>
        <td valign="top" width="13%" height="16"><p align="right"><font
        size="3" face="Arial">(4,443)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17"><font size="3"
        face="Arial">Balance at end of year</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$233,312</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$208,137</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$203,325</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17">&nbsp;</td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="56%" height="17"><font size="3"
        face="Arial">Total Shareholders&#146; Equity</font></td>
        <td valign="top" width="1%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$280,931</font></p>
        </td>
        <td valign="top" width="3%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$247,636</font></p>
        </td>
        <td valign="top" width="4%" height="17">&nbsp;</td>
        <td valign="top" width="13%" height="17"><p align="right"><font
        size="3" face="Arial">$241,695</font></p>
        </td>
    </tr>
</table>

<table border="0" cellpadding="2" cellspacing="0" width="668">
    <tr>
        <td valign="top" height="16"><p align="center"><font
        size="3" face="Arial">The accompanying notes are an
        integral part of these consolidated financial statements.</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

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<table border="1" cellpadding="7" cellspacing="3" width="648">
    <tr>
        <td valign="top" colspan="16"><p align="center"><font
        size="3" face="Arial">OPPENHEIMER HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="16"><p align="center"><font
        size="3" face="Arial">CONSOLIDATED STATEMENTS OF CASH
        FLOWS</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="16"><p align="center"><font
        size="3" face="Arial">FOR THE YEAR ENDED DECEMBER 31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="16" height="16"><p
        align="right"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Cash flows from operating
        activities:</font></td>
        <td valign="top" colspan="5" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="17"><font
        size="3" face="Arial">Net profit for year</font></td>
        <td valign="top" colspan="5" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">$29,791</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">$9,321</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="17"><font
        size="3" face="Arial">Adjustments to reconcile net profit
        to net cash provided</font></td>
        <td valign="top" colspan="5" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="17">&nbsp;</td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">by (used in) operating activities:</font></td>
        <td valign="top" colspan="5" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Non-cash items included in net
        profit:</font></td>
        <td valign="top" colspan="5" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Depreciation and amortization</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">9,518</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">4,864</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">3,974</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Loss on disposal of fixed assets</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">443</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Write off of negative goodwill
        (note 2)</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(1,774)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Deferred tax liability</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">9,230</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">57</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Tax benefit from employee stock
        options exercised</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">938</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">915</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">614</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="59%" height="16"><font
        size="3" face="Arial">Decrease (increase) in operating
        assets, net of the effect of acquisitions:</font></td>
        <td valign="top" colspan="4" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="14%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Restricted deposits</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(7,026)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(5,047)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">319</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Securities purchased under
        agreement to resell</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">23,500</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Deposits with clearing
        organizations</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(14,252)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">4,080</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(1,769)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Receivable from brokers and
        clearing organizations</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">213,573</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(391,400)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">37,463</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Receivable from customers</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(513,558)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">71,057</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(35,404)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Securities owned</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(32,267)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">699</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">1,524</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Notes receivable</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(15,395)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(4,522)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(7,763)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Other assets</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(21,740)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(3,377)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">1,647</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="59%" height="16"><font
        size="3" face="Arial">Increase (decrease) in operating
        liabilities, net of the effect of acquisitions:</font></td>
        <td valign="top" colspan="4" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="14%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Drafts payable</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">46,495</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">1,031</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(5,842)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Securities sold under agreement to
        repurchase</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(23,500)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Payable to brokers and clearing
        organizations</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(52,777)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">341,531</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(42,938)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Payable to customers</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">243,794</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(26,044)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">63,853</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Securities sold, but not yet
        purchased</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">1,081</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">685</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">498</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Accrued compensation</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">47,678</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">1,558</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">1,773</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Accounts payable and other
        liabilities</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">214</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(7,439)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(11,684)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Income taxes payable</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(1,990)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">565</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(3,487)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="55%" height="17"><font size="3"
        face="Arial">Cash (used in) provided by operating
        activities</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">(56,693)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">(3,240)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="19%" height="17"><p
        align="right"><font size="3" face="Arial">22,341</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="17"><font
        size="3" face="Arial">Cash flows from investing
        activities:</font></td>
        <td valign="top" colspan="5" width="12%" height="17">&nbsp;</td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="17">&nbsp;</td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Purchase of the Oppenheimer
        divisions</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(15,611)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Purchase of Josephthal Group, Inc.,
        net of cash acquired</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">3,139</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Purchase of Grand Charter Group,
        net of cash acquired</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(1,789)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="17"><font
        size="3" face="Arial">Purchase of the business of
        BUYandHOLD</font></td>
        <td valign="top" colspan="5" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">(2,297)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Proceeds from sale of exchange seat</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">24</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="61%" height="16"><font
        size="3" face="Arial">Purchase of property, plant and
        equipment</font></td>
        <td valign="top" colspan="5" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(12,215)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(1,360)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(1,009)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="55%" height="16"><font size="3"
        face="Arial">Cash (used in) provided by investing
        activities</font></td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(27,826)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(3,633)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="5" width="19%" height="16"><p
        align="right"><font size="3" face="Arial">341</font></p>
        </td>
    </tr>
</table>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<table border="1" cellpadding="7" cellspacing="3" width="648">
    <tr>
        <td valign="top" colspan="11"><p align="center"><font
        size="3" face="Arial">OPPENHEIMER HOLDINGS INC.</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="11"><p align="center"><font
        size="3" face="Arial">CONSOLIDATED STATEMENTS OF CASH
        FLOWS (continued)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="11"><p align="center"><font
        size="3" face="Arial">FOR THE YEAR ENDED DECEMBER 31, </font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="11" height="16"><p
        align="right"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Cash flows from financing
        activities:</font></td>
        <td valign="top" colspan="3" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Cash dividends paid on Class A and</font></td>
        <td valign="top" colspan="3" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Class B Shares</font></td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">(4,616)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(4,509)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">(4,443)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Issuance of Class A Shares</font></td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">7,767</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">3,503</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">4,723</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Repurchase of Class Shares for </font></td>
        <td valign="top" colspan="3" width="12%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16">&nbsp;</td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">cancellation</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">(585)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">(3,289)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">(149)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">Zero coupon promissory note
        repayments</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">(14,639)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">Proceeds from issuance of bank
        loans</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">50,000</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">Bank loan repayments</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">(10,345)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p
        align="center"><font size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">Increase (decrease) in bank call
        loans</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">75,300</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">3,066</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">(13,265)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="55%" height="17"><font size="3"
        face="Arial">Cash provided by (used in) financing
        activities</font></td>
        <td valign="top" colspan="2" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">102,882</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">(1,229)</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="19%" height="17"><p
        align="right"><font size="3" face="Arial">(13,134)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Net (decrease) increase in cash and
        cash equivalents</font></td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">18,363</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">(8,102)</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">9,548</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="16"><font
        size="3" face="Arial">Cash and cash equivalents,
        beginning of year</font></td>
        <td valign="top" colspan="3" width="12%" height="16"><p
        align="right"><font size="3" face="Arial">16,115</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="16"><p
        align="right"><font size="3" face="Arial">24,217</font></p>
        </td>
        <td valign="top" width="2%" height="16">&nbsp;</td>
        <td valign="top" width="12%" height="16"><p align="right"><font
        size="3" face="Arial">14,669</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="2" width="61%" height="17"><font
        size="3" face="Arial">Cash and cash equivalents, end of
        year</font></td>
        <td valign="top" colspan="3" width="12%" height="17"><p
        align="right"><font size="3" face="Arial">$34,478</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" colspan="3" width="11%" height="17"><p
        align="right"><font size="3" face="Arial">$16,115</font></p>
        </td>
        <td valign="top" width="2%" height="17">&nbsp;</td>
        <td valign="top" width="12%" height="17"><p align="right"><font
        size="3" face="Arial">$24,217</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="11" height="17"><font size="3"
        face="Arial"><b>Supplemental Cash Flow Disclosure:</b></font><p><font
        size="3" face="Arial">Non-cash acquisition activity (see
        Note 14)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="11" height="17"><p
        align="center"><font size="3" face="Arial">The
        accompanying notes are an integral part of these
        financial statements</font></p>
        </td>
    </tr>
</table>

<p align="center"><font size="3" face="Arial">OPPENHEIMER
HOLDINGS INC.</font></p>

<p align="center"><font size="3" face="Arial">Notes to
Consolidated Financial Statements</font></p>

<p align="center"><font size="3" face="Arial">(Expressed in U.S.
dollars)</font></p>

<p align="center"><font size="3" face="Arial">December 31, 2003</font></p>

<p><font size="3" face="Arial">GENERAL</font></p>

<p><font size="3" face="Arial">Oppenheimer Holdings Inc.
(formerly Fahnestock Viner Holdings Inc.) (&quot;OPY&quot;) is
incorporated under the laws of Ontario. On September 2, 2003 the
names of OPY and certain of its subsidiaries were changed. The
consolidated financial statements include the accounts of OPY and
its subsidiaries (together, the &quot;Company&quot;). The
principal subsidiaries of OPY are Oppenheimer &amp; Co. Inc.
(formerly Fahnestock &amp; Co. Inc.) (&quot;Oppenheimer&quot;), a
registered broker dealer in securities, and Oppenheimer Asset
Management Inc.(formerly Hudson Capital Advisors, Inc.)
(&quot;OAM&quot;), a registered investment advisor under the
Investment Advisors Act of 1940. Oppenheimer operates as
Fahnestock &amp; Co. Inc. in South America. Oppenheimer owns
Freedom Investments, Inc. (&quot;Freedom&quot;), a registered
broker dealer in securities, which also operates as the
BUYandHOLD division of Freedom, offering on-line discount
brokerage and dollar-based investing services. Oppenheimer is a
member of the New York Stock Exchange, the American Stock
Exchange and several other regional exchanges in the United
States. The Company engages in a broad range of activities in the
securities industry, including retail securities brokerage,
institutional sales and trading, investment banking (both
corporate and public finance), research, market-making, trust
services, and investment advisory and asset management services.</font></p>

<p><font size="3" face="Arial"><b>1. Summary of significant
accounting policies</b></font></p>

<p><font size="3" face="Arial">These consolidated financial
statements have been prepared in conformity with accounting
principles generally accepted in the United States of America for
purpose of inclusion in the Company&#146;s annual report on Form
10-K. In all material respects, they conform with accounting
principles generally accepted in Canada, which have been used to
prepare the consolidated financial statements for purposes of
inclusion in the Company&#146;s annual report to shareholders.</font></p>

<p><font size="3" face="Arial">The preparation of financial
statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the dates of
the financial statements and the reported amounts of revenues and
expenses during the reporting periods. The most significant
estimates are related to income taxes and contingencies. Actual
results could be materially different from these estimates.</font></p>

<p><font size="3" face="Arial">Since operations are predominantly
based in the United States of America, these consolidated
financial statements are presented in U.S. dollars.</font></p>

<p><font size="3" face="Arial">Certain prior period amounts have
been reclassified to conform to the current presentation.</font></p>

<p><font size="3" face="Arial">The following is a summary of
significant accounting policies followed in the preparation of
these consolidated financial statements:</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><i>(a) Basis of consolidation</i></font></p>

<p><font size="3" face="Arial">The consolidated financial
statements include the accounts of the Company and all
subsidiaries. The major subsidiaries, wholly-owned and operated
in the United States of America, are as follows:</font></p>

<blockquote>
    <blockquote>
        <p><font size="3" face="Arial">Oppenheimer &amp; Co. Inc.
        -broker/dealer in securities</font></p>
        <p><font size="3" face="Arial">Oppenheimer Asset
        Management Inc. -investment advisory services</font></p>
        <p><font size="3" face="Arial">Freedom Investments, Inc.
        -discount broker in securities</font></p>
    </blockquote>
</blockquote>

<p><font size="3" face="Arial">Significant intercompany balances
and transactions have been eliminated in the preparation of the
consolidated financial statements.</font></p>

<p><font size="3" face="Helvetica"><i>(b) Brokerage operations</i></font></p>

<p><font size="3" face="Helvetica">Transactions in proprietary
securities and related revenues and expenses are recorded on a
trade date basis. Customers&#146; securities and commodities
transactions are reported on a settlement date basis, which is
generally three business days after trade date. Related
commission income and expense is recorded on a trade date basis.
Securities owned and securities sold, but not yet purchased, are
reported at market value generally based upon quoted prices.
Realized and unrealized changes in market value are recognized in
net trading revenues in the period in which the change occurs.
Other financial instruments are carried at fair value or amounts
that approximate fair value.</font></p>

<p><font size="3" face="Helvetica"><i>(c) Asset management
operations</i></font></p>

<p><font size="3" face="Helvetica">Asset management fees are
generally recognized over the period the related service is
provided based on the account value at the valuation date per the
respective asset management agreements. In certain circumstances,
OAM is entitled to receive incentive fees when the return on
assets under management exceeds certain benchmark returns or
other performance targets. Incentive fees are generally based on
investment performance over a 12-month period and are not subject
to adjustment once the measurement period ends. Accordingly,
incentive fees are recognized in the consolidated statements of
operations when the measurement period ends. Asset management
fees and incentive fees are included in &quot;Advisory fees&quot;
in the consolidated statements of earnings. Assets under
management are not included as assets of the Company.</font></p>

<p><font size="3" face="Helvetica"><i>(d) Cash and cash
equivalents</i></font></p>

<p><font size="3" face="Helvetica">The Company defines cash
equivalents as highly liquid investments with original maturities
of less than 90 days that are not held for sale in the ordinary
course of business.</font></p>

<p><font size="3" face="Helvetica"><i>(e) Drafts payable</i></font></p>

<p><font size="3" face="Helvetica">Drafts payable represent
amounts drawn by the Company against a bank.</font></p>

<p><font size="3" face="Helvetica"><i>(f) Goodwill </i></font></p>

<p><font size="3" face="Helvetica">Goodwill arose upon the
acquisitions of Oppenheimer, First of Michigan Capital
Corporation, Josephthal &amp; Co. Inc., Grand Charter Group
Incorporated and the Oppenheimer divisions. Goodwill is subject
to an annual test for impairment to determine if the fair value
of goodwill of a reporting unit is less than its carrying amount.
Goodwill recorded as at December 31, 2003 has been tested for
impairment and no such impairment was recorded.</font></p>

<p><font size="3" face="Helvetica">(g) <i>Intangible Assets</i> </font></p>

<p><font size="3" face="Helvetica">Intangible assets arose upon
the acquisition of the Oppenheimer divisions and are comprised of
customer relationships and trademarks and trade names . Customer
relationships, carried at $4,165,000 net of accumulated
amortization of $735,000, are being amortized on a straight-line
basis over 80 months commencing in January 2003. Trademarks and
trade names, carried at $31,700,000, which are not amortized, are
subject to an annual test for impairment to determine if the fair
value is less than its carrying amount.</font></p>

<p><font size="3" face="Helvetica"><i>(h) Property, plant and
equipment</i></font></p>

<p><font size="3" face="Helvetica">Furniture, fixtures, equipment
and leasehold improvements and stock exchange seats are stated at
cost. Depreciation of furniture,fixtures and equipment is
provided on a straight-line basis generally over three to seven
years. Leasehold improvements are amortized on a straight-line
basis over the shorter of the life of the improvement or the
remaining term of the lease. </font></p>

<p><font size="3" face="Helvetica"><i>(i) Foreign currency
translations</i></font></p>

<p><font size="3" face="Helvetica">Canadian currency balances
have been translated into U.S. dollars as follows: monetary
assets and liabilities at exchange rates prevailing at period
end; revenue and expenses at average rates for the period; and
non-monetary assets and share capital at historical rates.</font></p>

<p><font size="3" face="Helvetica"><i>(j) Income taxes</i></font></p>

<p><font size="3" face="Helvetica">The Company accounts for
income taxes in accordance with Statement of Financial Accounting
Standards No. 109, &quot;Accounting for Income Taxes&quot;.
Deferred income tax assets and liabilities arise from
&quot;temporary differences&quot; between the tax basis of an
asset or liability and its reported amount in the consolidated
financial statements. Deferred tax balances are determined by
applying the enacted tax rates.</font></p>

<p><font size="3" face="Helvetica"><i>(k)Securities lending
activities</i></font></p>

<p><font size="3" face="Helvetica">Securities borrowed and
securities loaned are carried at the amounts of cash collateral
advanced or received.</font></p>

<p><font size="3" face="Helvetica">Securities borrowed
transactions require the Company to deposit cash or other
collateral with the lender. The Company receives cash or
collateral in an amount generally in excess of the market value
of securities loaned.</font></p>

<p><font size="3" face="Helvetica">The Company monitors the
market value of securities borrowed and loaned on a daily basis
and may require counterparties to deposit additional collateral
or return collateral pledged, when appropriate.</font></p>

<p><font size="3" face="Helvetica">Included in receivable from
brokers and clearing organizations are deposits paid for
securities borrowed of $237,329,000 (as at December 31, 2002 -
$480,938,000). Included in payable to brokers and clearing
organizations are deposits received for securities loaned of
$444,977,000 (as at December 31, 2002 - $514,213,000).</font></p>

<p><font size="3" face="Helvetica"><i>(l) Resale and repurchase
agreements</i></font></p>

<p><font size="3" face="Helvetica">Transactions involving
purchases of securities under agreements to resell (&quot;reverse
repurchase agreements&quot;) or sales of securities under
agreements to repurchase (&quot;repurchase agreements&quot;) are
treated as collateralized financing transactions and recorded at
their contractual resale or repurchase amounts plus accrued
interest.</font></p>

<p><font size="3" face="Helvetica">The Company obtains possession
of collateral with a market value equal to or in excess of the
principal amount loaned under reverse repurchase agreements.
Collateral is valued daily and adjusted when appropriate.</font></p>

<p><font size="3" face="Helvetica"><i>(m) Investment banking
revenues</i></font></p>

<p><font size="3" face="Helvetica">Investment banking fees are
recorded on offering date, sales concessions on settlement date
and underwriting fees at the time the transaction is
substantially completed and income is reasonably determinable. </font></p>

<p><font size="3" face="Helvetica"><i>(n) Interest expense</i></font></p>

<p><font size="3" face="Helvetica">Included in interest expense
is interest on bank loans, debt, payments in lieu of interest on
securities loaned and interest paid with respect to repurchase
agreements.</font></p>

<p><font size="3" face="Helvetica"><i>(o)</i> <i>Stock-based
compensation plans</i></font></p>

<p><font size="3" face="Helvetica">The Company has a stock-based
compensation plan. The Company accounts for stock based
compensation in accordance with </font><font size="3"
face="Arial">Accounting Principles Board Opinion No. 25,
&quot;Accounting for Stock Issued to Employees&quot;</font><font
size="3" face="Helvetica">. No compensation expense is recognized
for this plan when stock options are issued to employees as the
options are exercisable at the fair value at the date of grant.
Any consideration paid by employees on the exercise of stock
options or purchase of stock is credited to share capital.</font></p>

<p><font size="3" face="Arial"><b>2. Recently Issued Accounting
Standards</b></font></p>

<p><font size="3" face="Arial"><i>Goodwill and other intangible
assets</i></font></p>

<p><font size="3" face="Arial">The Company adopted Financial
Accounting Standards Board issued Statement of Accounting
Standards No.142, &quot;Goodwill and Other Intangibles</font><font
face="Helvetica">&quot; </font><font size="3" face="Arial">effective
January 1, 2002 without restatement of prior periods. In
connection with the adoption of the standard, the Company&#146;s
recorded amount of goodwill is no longer subject to amortization
but is being periodically measured for impairment. Such
impairment test was performed as at December 31, 2003 and no
impairment was recorded.</font></p>

<p><font size="3" face="Arial">In addition, on January 1, 2002,
the Company wrote off unamortized &quot;negative goodwill&quot;
in the amount of $1,774,000, as required by the standard.
Negative goodwill represents the excess fair value of net assets
acquired above the cost of acquisition. The write-off was
recognized in the statement of operations for the year ended
December 31, 2002 as a gain from the cumulative effect of a
change in accounting principle. </font></p>

<p><font size="3">The following table reflects the effect of the
amortization of goodwill on the results of operations as though
FAS 142 had been adopted on January 1, 2001.</font></p>

<p><font size="3"></font>&nbsp;</p>
<div align="center"><center>

<table border="1" cellpadding="7" width="523">
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" colspan="3" width="41%"><p
        align="center"><font size="3">December 31,</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">2003</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">2002</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Profit before
        cumulative effect of a change in accounting principle as
        reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$29,791</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$7,547</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Amortization
        of goodwill as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">432</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Profit before
        cumulative effect of a change in accounting principle as
        adjusted </font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">29,791</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">7,547</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">19,582</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Cumulative
        effect of a change in accounting principle as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">1,774</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Net profit as
        adjusted</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$29,791</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$9,321</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$19,582</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Basic
        earnings per share as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$2.35</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.75</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">- Before
        cumulative effect of a change in accounting principle</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$2.35</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.61</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">-Cumulative
        effect of a change in accounting principle</font></td>
        <td valign="top" width="14%"><p align="center"><font
        size="3">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.14</font></p>
        </td>
        <td valign="top" width="14%"><p align="center"><font
        size="3">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Diluted
        earnings per share as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.63</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.73</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.50</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Basic
        earnings per share as adjusted</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$2.35</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.75</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.59</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="59%"><font size="3">Diluted
        earnings per share as adjusted</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.63</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$0.73</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3">$1.53</font></p>
        </td>
    </tr>
</table>
</center></div>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><i>Other recently issued
accounting standards</i></font></p>

<p><font size="3" face="Helvetica">The Financial Accounting
Standards Board issued SFAS No. 146, &quot;Accounting for Costs
Associated with Exit or Disposal Activities&quot;, FIN No. 45,
&quot;Guarantor&#146;s Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Indebtedness of
Others&quot;, FIN No. 46, &quot;Consolidation of Variable
Interest Entities&quot;, SFAS No. 149, &quot;Amendment of
Statement 133 on Derivative Instruments and Hedging
Activities&quot;, and SFAS No. 150, &quot;Accounting for Certain
Financial Instruments with Characteristics of both Liabilities
and Equity&quot;. The Company has adopted these statements and
interpretations and their adoption did not have a material impact
on its financial results. </font></p>

<p><font size="3" face="Helvetica">The Company has reviewed SFAS
No. 148, &quot;Accounting for Stock-Based Compensation &#150;
Transition and Disclosure&quot; and has adopted the disclosure
provisions, but does not intend to adopt the other provisions of
this standard at this time.</font></p>

<p><font size="3" face="Arial"><b>3. Restricted deposits</b></font></p>

<p><font size="3" face="Arial">Deposits of $14,466,000 (2002 -
$7,440,000) were held at year-end in a special reserve bank
accounts for the exclusive benefit of customers in accordance
with regulatory requirements. To the extent permitted, these
deposits are invested in interest bearing accounts collateralized
by qualified securities.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>4. Securities owned and
Securities sold, but not yet purchased (at fair market value)</b></font></p>

<table border="1" cellpadding="7" cellspacing="1" width="534">
    <tr>
        <td valign="top" width="57%">&nbsp;</td>
        <td valign="top" width="20%"><p align="center"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Securities
        owned consist of:</font></td>
        <td valign="top" width="20%">&nbsp;</td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Corporate
        equities</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">$34,877,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$11,467,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Corporate
        and sovereign debt</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">24,962,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">16,522,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">U.S.
        government and agency and state and municipal government
        obligations</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">32,070,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">22,103,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Money
        market funds </font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">3,288,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Options
        and other</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">26,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">81,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%">&nbsp;</td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">$95,223,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$50,173,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%">&nbsp;</td>
        <td valign="top" width="20%">&nbsp;</td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Securities
        sold, but not yet purchased consist of:</font></td>
        <td valign="top" width="20%">&nbsp;</td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Corporate
        equities</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">$3,128,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$5,049,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">Corporate
        debt </font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">5,115,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">3,935,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%"><font size="3" face="Arial">U.S.
        government and agency and state and municipal government
        obligations and other</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">2,444,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">622,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="57%">&nbsp;</td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Arial">$10,687,000</font></p>
        </td>
        <td valign="top" width="5%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$9,606,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">Securities owned and Securities
sold, but not yet purchased, consist of trading and investment
securities at fair market values. Included in securities owned at
December 31, 2003 are corporate equities with fair market values
of approximately $15,781,000, which are correlated to deferred
compensation liabilities to certain employees. At December 31,
2003, the Company has pledged securities owned of approximately
$1,427,000 ($1,078,000 in 2002) as collateral to counterparties
for securities loan transactions, which can be sold or repledged.
</font></p>

<p><font size="3" face="Arial"><b>5. Property, plant and
equipment</b></font></p>

<table border="1" cellpadding="7" cellspacing="1" width="613">
    <tr>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" colspan="4" width="79%"><p
        align="center"><font size="3" face="Arial">(Expressed in
        thousands of U.S. dollars)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">Cost</font></p>
        </td>
        <td valign="top" width="21%"><p align="center"><font
        size="3" face="Arial">Accumulated depreciation/</font></p>
        <p align="center"><font size="3" face="Arial">amortization</font></p>
        </td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">Net book value</font></p>
        </td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">Net book value</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="21%"><font size="3" face="Arial">Furniture,
        fixtures and equipment</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$40,415</font></p>
        </td>
        <td valign="top" width="21%"><p align="right"><font
        size="3" face="Arial">$25,744</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$14,671</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$7,395</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="21%"><font size="3" face="Arial">Leasehold
        improvements</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">15,542</font></p>
        </td>
        <td valign="top" width="21%"><p align="right"><font
        size="3" face="Arial">6,406</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">9,136</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">1,093</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="21%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$55,957</font></p>
        </td>
        <td valign="top" width="21%"><p align="right"><font
        size="3" face="Arial">$32,150</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$23,807</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$8,488</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">Depreciation and amortization
expense, included in occupancy and equipment costs, was
$8,783,000, $4,864,000 and $3,542,000 in the years ended December
31, 2003, 2002 and 2001, respectively.</font></p>

<p><font size="3" face="Arial"><b>6. Bank call loans</b></font></p>

<p><font size="3" face="Arial">Bank call loans, primarily payable
on demand, bear interest at various rates but not exceeding the
broker call rate, which was 2.75% at December 31, 2003. These
loans, collateralized by firm and customer securities with market
values of approximately $35,674,000 and $139,478,000,
respectively, at December 31, 2003 are primarily with two U.S.
money center banks. Details of the bank call loans are as
follows:</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>
<div align="center"><center>

<table border="0" cellpadding="7" cellspacing="0" width="570">
    <tr>
        <td valign="top" width="44%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Year-end
        balance</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$91,500,000</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$16,200,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$13,134,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Weighted
        interest rate (at end of year)</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">1.41%</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">1.38%</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2.07%</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Maximum
        balance (at any month end)</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$170,100,000</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$49,281,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$37,666,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Average
        amount outstanding (during the year) (1)</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$86,026,000</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$19,760,000</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$12,836,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Weighted
        average interest rate (during the year) (2)</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2.96%</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2.10%</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">4.80%</font></p>
        </td>
    </tr>
</table>
</center></div>

<p><font size="3" face="Arial">(1) The average amount outstanding
during the year was computed by adding amounts outstanding at the
end of each month and dividing by twelve.</font></p>

<p><font size="3" face="Arial"><br>
(2) The weighted average interest rate during the year was
computed by dividing the actual interest expense by the average
bank call loans outstanding at the end of each month.</font></p>

<p><font size="3" face="Arial">Aggregate interest paid on bank
call loans by the Company on a cash basis during the years ended
December 31, 2003, 2002, and 2001 was $6,523,000, $6,473,000 and
$9,709,000, respectively.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Helvetica"><b>7. Long term liabilities</b></font></p>

<table border="1" cellpadding="7" cellspacing="1" width="591">
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">Issued</font></td>
        <td valign="top" width="17%"><p align="center"><font
        size="3" face="Helvetica">Maturity Date</font></p>
        </td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Helvetica">Interest Rate</font></p>
        </td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Helvetica">December 31, 2003</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">Bank loans <b>(a)</b></font></td>
        <td valign="top" width="17%"><p align="center"><font
        size="3" face="Helvetica">1/2/2008</font></p>
        </td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Helvetica">6.5%</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">$39,655,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">Less current portion</font></td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">10,119,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">Long term portion of bank loans</font></td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">$29,536,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%">&nbsp;</td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5"><font size="3"
        face="Helvetica">Zero Coupon Promissory Note, </font></td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">issued January 2, 2003 <b>(b)</b></font></td>
        <td valign="top" width="17%"><p align="right"><font
        size="3" face="Helvetica">-</font></p>
        </td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Helvetica">0%</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">$50,875,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="3" width="76%"><font size="3"
        face="Helvetica">Less current portion</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">15,921,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">Long term portion of long-term debt</font></td>
        <td valign="top" width="17%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">$34,954,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="41%"><font size="3"
        face="Helvetica">First and Second Variable Rate
        Exchangeable </font><p><font size="3" face="Helvetica">Debentures<b>,
        </b>issued<b> </b></font></p>
        <p><font size="3" face="Helvetica">January 6, 2003 and
        May 12, 2003, respectively <b>(c)</b></font></p>
        </td>
        <td valign="top" width="17%"><font size="3"
        face="Helvetica">1/2/2013</font></td>
        <td valign="top" width="18%"><p align="center"><font
        size="3" face="Helvetica">3%</font></p>
        </td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Helvetica">$160,822,000</font></p>
        </td>
        <td valign="top" width="6%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" colspan="5">&nbsp;</td>
    </tr>
</table>

<p><font size="3" face="Helvetica">(a) Bank loans are subject to
a credit arrangement with Canadian Imperial Bank of Commerce
(&quot;CIBC&quot;) dated January 2, 2003 in the aggregate amount
of $50 million dollars, and bear interest at the U.S. base rate
plus 2% per annum. The minimum annual principle repayment under
the agreement is approximately $10,119,000. The principle
repayments are tied to certain employee notes receivable issued
during 2003 and repayments above the minimum level are triggered
by the termination of employment of these employees. In
accordance with the credit arrangement, the Company has provided
certain covenants to CIBC with respect to the maintenance of
minimum debt/equity ratios and net capital of Oppenheimer. In the
Company&#146;s view, the most restrictive of the covenants
requires that Oppenheimer maintain minimum excess net capital of
$100 million. As at December 31, 2003, the Company was in
compliance with the covenants. Interest expense on bank loans was
$2,021,000 in 2003, of which $1,802,000 was paid on a cash basis.</font></p>

<p><font size="3" face="Helvetica">(b)The Zero Coupon Promissory
Note is repayable as related employee notes receivable, which are
assigned to Oppenheimer, become due and are forgiven. Such
payments are to be made notwithstanding whether any of the
employees&#146; loans default.</font></p>

<p><font size="3" face="Helvetica">(c)The First and Second
Variable Rate Exchangeable Debentures are exchangeable for
approximately 6.9 million Class A Shares of the Company at the
rate of $23.20 per share. The annual interest rate is 3% in 2003,
4% in 2004 - 2006, and 5% in 2007 through maturity. The First and
Second Variable Rate Exchangeable Debentures, which mature on
January 2, 2013, contain a retraction clause, which may be
activated by the holder for a period of 120 days at the end of
year seven. Interest is payable semi-annually in June and
December. Interest expense on the First and Second Variable Rate
Exchangeable Debentures was $4,811,000 in 2003.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>8. Share capital</b></font></p>

<p><font size="3" face="Arial">The Company's authorized share
capital, all of which is without par value, consists of (a) an
unlimited number of first preference shares issuable in series;
(b) an unlimited number of Class A non-voting shares (&quot;Class
A Shares&quot;); and (c) 99,680 Class B voting shares
(&quot;Class B Shares&quot;).</font></p>

<p><font size="3" face="Arial">The Class A and the Class B Shares
are equal in all respects except that the Class A Shares are
non-voting.</font></p>

<p><font size="3" face="Arial">The Company's issued and
outstanding share capital is as follows (no first preference
shares have been issued):</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="547">
    <tr>
        <td valign="top" width="37%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="37%"><font size="3" face="Arial">12,819,520
        (12,397,007 in 2002 and 12,337,085 in 2001) Class A
        Shares</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$41,520,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$34,338,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$34,124,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="37%"><font size="3" face="Arial">99,680
        Class B Shares</font></td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">133,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">133,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">133,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="37%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="37%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$41,653,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$34,471,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$34,257,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"><i>Equity Incentive Plan </i></font></p>

<p><font size="3" face="Arial">Under the Company&#146;s 1996
Equity Incentive Plan as amended February 28, 2002
(&quot;EIP&quot;), the compensation and stock option committee of
the board of directors of the Company may grant options to
purchase Class A Shares to officers and key employees of the
Company and its subsidiaries. Grants of options are made to the
Company&#146;s independent directors on a formula basis. Options
are generally granted for a five-year term and generally vest at
the rate of 25% of the amount granted for each year held. The
aggregate number of Class A Shares that are available under the
EIP is 3,815,000.</font></p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<table border="1" cellpadding="7" cellspacing="1" width="607">
    <tr>
        <td valign="top" width="44%">&nbsp;</td>
        <td valign="top" colspan="2" width="29%"><p
        align="center"><font size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" colspan="2" width="28%"><p
        align="center"><font size="3" face="Arial">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%">&nbsp;</td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">Number of shares</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">Weighted average exercise price</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">Number of shares</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">Weighted average exercise price</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        outstanding, beginning of year</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,978,959</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$20.16</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,907,503</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$17.36</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        granted </font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">376,500</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$24.97</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">383,128</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$27.14</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        exercised</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">(425,171)</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$16.83</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">(211,322)</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$16.57</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        forfeited</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">(45,305)</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$22.34</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">(100,350)</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$26.35</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        outstanding, end of year</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,884,983</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$21.81</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,978,959</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$20.16</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="44%"><font size="3" face="Arial">Options
        vested, end of year</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">581,723</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">$16.63</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">462,185</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$16.13</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">The following table summarizes
stock options outstanding and exercisable as at December 31,
2003.</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="590">
    <tr>
        <td valign="top" width="22%"><p align="center"><font
        size="3" face="Arial">Range of exercise prices </font></p>
        </td>
        <td valign="top" width="15%"><p align="center"><font
        size="3" face="Arial">Number outstanding</font></p>
        </td>
        <td valign="top" width="15%"><p align="center"><font
        size="3" face="Arial">Weighted average remaining
        contractual life</font></p>
        </td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Arial">Weighted average exercise price</font></p>
        <p align="center"><font size="3" face="Arial">of
        outstanding</font></p>
        <p align="center"><font size="3" face="Arial">options</font></p>
        </td>
        <td valign="top" width="16%"><p align="center"><font
        size="3" face="Arial">Number exercisable</font></p>
        <p align="center"><font size="3" face="Arial">(vested)</font></p>
        </td>
        <td valign="top" width="13%"><p align="center"><font
        size="3" face="Arial">Weighted average exercise price of</font></p>
        <p align="center"><font size="3" face="Arial">vested</font></p>
        <p align="center"><font size="3" face="Arial">options</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="22%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="15%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="13%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="22%"><font size="3" face="Arial">$13.875-$22.00</font></td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">633,178</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">0.75 years</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$15.35</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">463,723</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        size="3" face="Arial">$14.63</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="22%"><font size="3" face="Arial">$22.00-$34.51</font></td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">1,251,805</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">2.97 years</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$25.08</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">118,000</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        size="3" face="Arial">$24.49</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="22%" height="8">&nbsp;</td>
        <td valign="top" width="15%" height="8">&nbsp;</td>
        <td valign="top" width="15%" height="8">&nbsp;</td>
        <td valign="top" width="19%" height="8">&nbsp;</td>
        <td valign="top" width="16%" height="8">&nbsp;</td>
        <td valign="top" width="13%" height="8">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="22%"><font size="3" face="Arial">$13.875-$34.51</font></td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">1,884,983</font></p>
        </td>
        <td valign="top" width="15%"><p align="right"><font
        size="3" face="Arial">2.22 years</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Arial">$21.81</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">581,723</font></p>
        </td>
        <td valign="top" width="13%"><p align="right"><font
        size="3" face="Arial">$16.63</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">The Company issued 23,042 Class A
Shares from Treasury for a total consideration of $613,000 to the
Company's 401(k) plan in the year ended December 31, 2003 (nil in
2002 and 2001).</font></p>

<p><font size="3" face="Arial"><i>Dividends</i></font></p>

<p><font size="3" face="Arial">In 2003, the Company paid cash
dividends to holders of Class A and Class B Shares as follows
($0.36 in 2002 and 2001):</font></p>

<p><font size="3" face="Arial"><u>Dividend per share Record Date
Payment Date</u></font></p>

<p><font size="3" face="Arial">$0.09 February 14, 2003 February
28, 2003</font></p>

<p><font size="3" face="Arial">$0.09 May 9, 2003 May 23, 2003</font></p>

<p><font size="3" face="Arial">$0.09 August 8, 2003 August 22,
2003</font></p>

<p><font size="3" face="Arial">$0.09 November 7, 2003 November
21, 2003</font></p>

<p><font size="3" face="Arial"><i>Issuer Bid</i></font></p>

<p><font size="3" face="Arial">The Company may purchase up to
636,000 Class A Shares by way of a Normal Course Issuer Bid
through the facilities of The Toronto Stock Exchange and/or the
New York Stock Exchange until July 9, 2004. During the year ended
December 31, 2003, the Company purchased 25,700 Class A Shares
for a total consideration of $585,000, pursuant to a Normal
Course Issuer Bid which expired on July 8, 2003 (151,400 shares
for $3,289,000 in 2002 and 6,100 shares for $149,000 in 2001).</font></p>

<p><font size="3" face="Arial"><b>9. Contributed capital</b></font></p>

<p><font size="3" face="Arial">Contributed capital represents the
tax benefit on the difference between market price and exercise
price on employee stock options exercised.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>10. Income taxes</b></font></p>

<p><font size="3" face="Arial">The income tax provision shown in
the consolidated statement of operations is reconciled to amounts
of tax that would have been payable (recoverable) from the
application of combined federal, state, provincial and local tax
rates to pre-tax profit as follows:</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="595">
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Profit
        before income tax</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial"><u>$50,603,000</u></font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$<u>12,917,000</u></font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$<u>31,612,000</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">U.S.
        federal tax at 35% </font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$18,361,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$4,524,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$11,092,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Canadian
        tax at 44%</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">74,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="center"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Combined
        state and local tax, net of federal benefit</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2,047,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">653,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">1,977,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Income
        taxes before under-noted</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">20,408,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">5,251,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">13,069,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Tax
        effect of non-taxable interest and dividends</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">329,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(148,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(143,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Tax
        effect of differences between accounting and taxable
        income</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">733,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">267,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(464,000<u>)</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Income
        taxes</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$<u>20,812,000</u></font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$<u>5,370,000</u></font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$<u>12,462,000</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Profit
        before income tax provision:</font></td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Canadian
        operations </font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">($1,857,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$(10,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$(78,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">U.S.
        operations</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$52,460,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$12,927,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$31,690,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">Income taxes included in the
consolidated statements of operations represent the following:</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="595">
    <tr>
        <td valign="top" colspan="4">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">Current:</font></td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
        <td valign="top" width="16%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%" height="4"><font size="3"
        face="Arial">Canadian tax</font></td>
        <td valign="top" width="18%" height="4"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="16%" height="4"><p align="right"><font
        size="3" face="Arial">$74,000</font></p>
        </td>
        <td valign="top" width="16%" height="4"><p align="center"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">U.S.
        federal tax</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$18,959,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">5,176,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$9,878,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">State
        and local tax</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">3,530,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">1,226,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">3,157,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$22,489,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">6,476,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">13,035,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%" height="14"><font size="3"
        face="Arial">Deferred:</font></td>
        <td valign="top" width="18%" height="14">&nbsp;</td>
        <td valign="top" width="16%" height="14">&nbsp;</td>
        <td valign="top" width="16%" height="14">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">U.S.
        federal tax</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$(1,342,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$(885,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$(458,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%"><font size="3" face="Arial">State
        and local tax</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">(335,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(221,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(115,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">(1,677,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(1,106,000)</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">(573,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="50%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$20,812,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$5,370,000</font></p>
        </td>
        <td valign="top" width="16%"><p align="right"><font
        size="3" face="Arial">$12,462,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">Goodwill arising from the
acquisitions of Josephthal Group Inc. and the Oppenheimer
divisions is being amortized for tax purposes on a straight-line
basis over 15 years. The difference between book and tax is
recorded as a deferred tax liability.</font></p>

<p><font size="3" face="Arial">Aggregate deferred income tax
assets, which relate primarily to fixed assets and currently
non-deductible expenses, are included in other assets and
amounted to approximately $7,257,000 ($5,966,000 in 2002).</font></p>

<p><font size="3" face="Arial">On a cash basis, the Company paid
income taxes for the years ended December 31, 2003, 2002 and 2001
in the amounts of $13,342,000, $8,411,000 and $14,918,000,
respectively.</font></p>

<p align="center"><font size="3" face="Arial"><b></b></font>&nbsp;</p>

<p align="center"><font size="3" face="Arial"><b></b></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>11. Earnings per share</b></font></p>

<p><font size="3" face="Arial">Basic earnings per share was
computed by dividing net profit by the weighted average number of
Class A and Class B Shares outstanding. Diluted earnings per
share includes the weighted average Class A and Class B Shares
outstanding and the effects of exchangeable debentures using the
if converted method and Class A Share options using the treasury
stock method.</font></p>

<p><font size="3" face="Arial">Earnings per share has been
calculated as follows:</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="535">
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%" height="22"><font size="3"
        face="Arial">Basic weighted average number of shares
        outstanding</font></td>
        <td valign="top" width="18%" height="22"><p align="right"><font
        size="3" face="Arial">12,692,634</font></p>
        </td>
        <td valign="top" width="3%" height="22">&nbsp;</td>
        <td valign="top" width="18%" height="22"><p align="right"><font
        size="3" face="Arial">12,429,264</font></p>
        </td>
        <td valign="top" width="3%" height="22">&nbsp;</td>
        <td valign="top" width="18%" height="22"><p align="right"><font
        size="3" face="Arial">12,348,051</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        effect, if converted method</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">6,932,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        effect, treasury method</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">317,850</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">280,278</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">421,783</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Diluted
        common shares (1)</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">19,942,484</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">12,709,542</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">12,769,834</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        profit, as reported</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$29,791,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$9,321,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$19,150,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Effect
        of dilutive exchangeable debentures</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">2,791,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        profit available to shareholders and assumed conversions</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$32,582,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$9,321,000</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$19,150,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Basic
        earnings per share</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$0.75</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">-Before
        cumulative effect of a change in accounting principle</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$0.61</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">-Cumulative
        effect of a change in accounting principle</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Diluted
        earnings per share</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$1.63</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$0.73</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">$1.50</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">(1)
        The diluted earnings per share computations do not
        include the antidilutive effect of the following options:</font></td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Number
        of antidilutive options, end of period</font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">291,995</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">509,630</font></p>
        </td>
        <td valign="top" width="3%">&nbsp;</td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial">124,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b><i>Stock-based compensation</i></b></font></p>

<p><font size="3" face="Arial">Financial Accounting Standards
Board Statement No. 123, &quot;Accounting for Stock-Based
Compensation&quot; (SFAS 123) was issued in 1995 and changed the
method of accounting for stock compensation plans similar to
those of the Company. Adoption of SFAS 123&#146;s fair value
recognition method is optional. The Company has chosen to
continue to apply Accounting Principles Board Opinion No. 25,
&quot;Accounting for Stock Issued to Employees&quot;, and related
interpretations in accounting for its stock compensation plans.
The Company has reviewed SFAS No. 148, &quot;Accounting for
Stock-Based Compensation &#150; Transition and Disclosure&quot;,
which was issued in 2002, and has adopted the disclosure
provisions but does not intend to adopt other provisions of this
standard at this time.</font></p>

<p><font size="3" face="Arial">In accordance with SFAS 123, the
following presents the pro forma income and earnings per share
impact, using a fair value calculation, of the Company&#146;s
stock-based compensation. Amounts are expressed in thousands of
U.S. dollars, except per share amounts.</font></p>

<table border="1" cellpadding="7" cellspacing="1" width="601">
    <tr>
        <td valign="top" width="58%">&nbsp;</td>
        <td valign="top" colspan="3" width="42%"><p
        align="center"><font size="3" face="Arial">Year ended
        December 31,</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%">&nbsp;</td>
        <td valign="top" width="14%"><p align="center"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="14%"><p align="center"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="14%"><p align="center"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Net
        profit as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$29,791</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$9,321</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$19,150</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Stock
        based employee compensation expense included in reported
        net income</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Additional
        compensation expense</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,840</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,906</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">1,843</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Pro
        forma net profit</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$27,951</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$7,415</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$17,307</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Basic
        profit per share as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$0.75</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.55</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Diluted
        profit per share as reported</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.63</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$0.73</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.50</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="14%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Pro
        forma basic profit per share</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$2.20</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$0.60</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.40</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="58%"><font size="3" face="Arial">Pro
        forma diluted profit per share</font></td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.40</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$0.58</font></p>
        </td>
        <td valign="top" width="14%"><p align="right"><font
        size="3" face="Arial">$1.36</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">For purposes of the pro forma
presentation, the Company determined fair value using the
Black-Scholes option pricing model with the following weighted
average assumptions for grants in fiscal 2003, 2002 and 2001,
respectively: expected dividend yields of 1.3%, 1.4% and 1.4%;
risk-free interest rates ranging from 2.87% to 3.4%, 3.75% to
4.55%, and 3.76% to 5.07%; expected volatility ranging from 21%
to 23%, 27% to 28%, and 27% to 29%; and expected life of 5 years.
The weighted average fair value of options granted during 2003,
2002 and 2001, respectively was $1,697,000, $1,946,000 and
$3,741,000. The fair value is being amortized over five years on
an after-tax basis, where applicable for purposes of pro forma
presentation. Stock options generally expire five years after the
date of grant or three months after the date of retirement, if
earlier. Stock options generally vest over a five year period
with 0% in year one, 25% of the shares becoming exercisable on
each of the next three anniversaries of the grant date and the
balance vesting in the last six months of the option life. The
vesting period is at the discretion of the Compensation and Stock
Option Committee and is determined at the time of grant.</font></p>

<p><font size="3" face="Arial">The calculation of fair value in
this pro forma presentation are not indicative of future amounts
because it does not take into consideration future grants, any
difference between actual and assumed forfeitures.</font></p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>12. Commitments and
contingencies</b></font></p>

<blockquote>
    <p><font size="3" face="Arial">The Company and its
    subsidiaries have operating leases for office space and
    capital leases for equipment expiring at various dates
    through 2013. Future minimum rental commitments under such
    office and equipment leases as at December 31, 2003 are as
    follows:</font></p>
</blockquote>
<div align="center"><center>

<table border="1" cellpadding="7" cellspacing="1" width="354">
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">2004</font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">$23,019,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">2005</font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">20,787,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">2006</font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">19,193,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">2007
        </font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">17,483,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">2008
        and thereafter</font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">68,086,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="70%"><font size="3" face="Arial">Total</font></td>
        <td valign="top" width="30%"><p align="right"><font
        size="3" face="Arial">$148,568,000</font></p>
        </td>
    </tr>
</table>
</center></div>

<p><font size="3" face="Arial">Certain of the leases contain
provisions for rent escalation based on increases in costs
incurred by the lessor.</font></p>

<p><font size="3" face="Arial">(b) The Company's rent expense for
the years ended December 31, 2003, 2002 and 2001 was $31,028,000,
$14,108,000 and $10,909,000, respectively.</font></p>

<p><font size="3" face="Arial">(c) The Company, through its
subsidiaries, maintains a defined contribution plan covering
substantially all full-time U.S. employees. The Oppenheimer plan
provides that Oppenheimer may make discretionary contributions.
For certain employees who were formerly employed by First of
Michigan Corporation (&quot;FOM&quot;), contributions are made in
accordance with the terms of the plan document.</font></p>

<p><font size="3" face="Arial">FOM sponsors an unfunded
Supplemental Executive Retirement Program (&quot;SERP&quot;),
which is a non-qualified plan that provides certain former
officers additional retirement benefits. Benefits payable under
the SERP were approximately $970,000 at December 31,2003.</font></p>

<p><font size="3" face="Arial">The Company made contributions to
the plans of $3,491,000, $1,398,000 and $1,525,000 in 2003, 2002
and 2001, respectively.</font></p>

<p><font size="3" face="Arial">(d) On November 30, 2000 the
Company established an Executive Deferred Compensation Plan
(&quot;EDCP&quot;) in order to offer to certain qualified
high-performing financial consultants, a bonus based upon a
formula reflecting years of service, gross commissions and a
valuation of their clients&#146; assets. The bonus amounts
calculated with respect to fiscal 2003 total approximately
$1,254,000 ($966,000 in 2002, $1,270,000 in 2001) and will
normally vest five years from the end of the related fiscal year.
The liability is being recognized on a straight-line basis over
the vesting period. The total amount expensed in 2003 for
deferred compensation was $4,186,000.</font></p>

<p><font size="3" face="Arial">The Company is maintaining a
Deferred Compensation Plan on behalf of certain employees who
were formerly employed by CIBC World Markets. The liability is
being tracked against the value of an investment portfolio held
by the Company for this purpose.</font></p>

<p><font size="3" face="Arial">The Company has granted Stock
Appreciation Rights to certain employees as part of their
compensation package based on a formula reflecting gross
commission and length of service. The value of Stock Appreciation
Rights granted in 2003 total approximately $635,000 and will
normally vest five years from the end of the related fiscal year.
The liability is being recognized over the vesting period. </font></p>

<p><font size="3" face="Arial">In 2003, the Company awarded up to
45,000 Class A Shares to certain employees, which will vest if
the employees are continuously employed by the Company until
January 3, 2006. The value of this award has been estimated at
$211,000. The liability is being recognized over the vesting
period.</font></p>

<p><font size="3" face="Arial">The amount expensed in 2003 for
stock-related awards was $468,000 (nil in 2002 and 2001).</font></p>

<p><font size="3" face="Arial">(e) At December 31, 2003, the
Company has collateralized and uncollateralized letters of credit
for $143,900,000. Collateral for these letters of credit include
marketable customer securities of approximately $181,914,000,
pledged to two financial institutions. </font></p>

<p><font size="3" face="Arial">(f) The Company is involved in
certain litigation arising in the ordinary course of business.
Management believes, based upon discussions with legal counsel,
that the outcome of this litigation will not have a material
effect on the Company's financial position. The materiality of
legal matters to the Company's future operating results depends
on the level of future results of operations as well as the
timing and ultimate outcome of such legal matters.</font></p>

<p><font size="3" face="Arial">(g) The Company's major
subsidiaries, Oppenheimer and Freedom, are subject to the uniform
net capital requirements of the Securities and Exchange
Commission (&quot;SEC&quot;) under Rule 15c3-1 (the
&quot;Rule&quot;). Oppenheimer computes its net capital
requirements under the alternative method provided for in the
Rule which requires that Fahnestock maintain net capital equal to
two percent of aggregate customer related debit items, as defined
in SEC Rule 15c3-3. At December 31, 2003, Oppenheimer had net
capital of $150,709,000, which was $128,243,000 in excess of the
$22,466,000 required to be maintained 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 $250,000 or 6 2/3% of
aggregate indebtedness, as defined. At December 31, 2003, Freedom
had net capital of $5,056,000, which was $4,806,000 in excess of
the $250,000 required to be maintained at that date. </font></p>

<p><font size="3" face="Arial">At December 31, 2003, Oppenheimer
and Freedom had $5,396,000 and $9,070,000, respectively, in cash
and securities segregated under Federal and other regulations.</font></p>

<p><font size="3" face="Arial">Oppenheimer Trust Company is
subject to regulation by the New Jersey Department of Banking.</font></p>

<p><font size="3" face="Arial">(h) In accordance with the
Securities and Exchange Commission&#146;s No Action Letter dated
November 3, 1998, the Company has computed a reserve requirement
for the proprietary accounts of introducing firms as of December
31, 2003. The Company had no deposit requirements as of December
31, 2003.</font></p>

<p><font size="3" face="Arial"><b></b></font>&nbsp;</p>

<blockquote>
    <blockquote>
        <p><font size="3" face="Arial"><b>13. Financial
        instruments with off-balance sheet risk and concentration
        of credit risk</b></font></p>
    </blockquote>
</blockquote>

<p><font size="3" face="Arial">In the normal course of business,
the Company's securities activities involve execution, settlement
and financing of various securities transactions for customers.
These activities may expose the Company to risk in the event
customers, other brokers and dealers, banks, depositories or
clearing organizations are unable to fulfill their contractual
obligations.</font></p>

<p><font size="3" face="Arial">The Company is exposed to
off-balance sheet risk of loss on unsettled transactions in the
event customers and other counterparties are unable to fulfill
their contractual obligations. It is the Company's policy to
periodically review, as necessary, the credit standing of each
counterparty with which it conducts business.</font></p>

<p><font size="3" face="Arial">Securities sold, but not yet
purchased represent obligations of the Company to deliver the
specified security at the contracted price and thereby create a
liability to repurchase the security in the market at prevailing
prices. Accordingly, these transactions result in
off-balance-sheet risk, as the Company's ultimate obligation to
satisfy the sale of securities sold, but not yet purchased may
exceed the amount recognized on the balance sheet. Securities
positions are monitored on a daily basis.</font></p>

<p><font size="3" face="Arial">The Company's customer financing
and securities lending activities require the Company to pledge
customer securities as collateral for various financing sources
such as bank loans and securities lending. At December 31, 2003,
the Company had approximately $1.3 billion</font><font
color="#FF0000" size="3" face="Arial"> </font><font size="3"
face="Arial">of customer securities under customer margin loans
that are available to be pledged of which the Company has
repledged approximately $297,600,000 under securities loan
agreements. In addition, the Company has received collateral of
approximately $229,264,000 under securities borrow agreements of
which the Company has repledged approximately $145,949,000 as
collateral under securities loans agreements. Included in
receivable from brokers and clearing organizations are
receivables from three major U.S. broker-dealers totaling
$108,870,000.</font></p>

<p><font size="3" face="Arial">The Company monitors the market
value of collateral held and the market value of securities
receivable from others. It is the Company's policy to request and
obtain additional collateral when exposure to loss exists. In the
event the counterparty is unable to meet its contractual
obligation to return the securities, the Company may be exposed
to off-balance sheet risk of acquiring securities at prevailing
market prices. </font></p>

<p><font size="3" face="Arial">At December 31, 2003 the Company
had outstanding commitments to buy and sell of $980,000 and
$508,000, respectively, primarily of mortgage-backed securities
on a when issued basis. These commitments have off-balance sheet
risks similar to those described above.</font></p>

<p><font size="3" face="Helvetica">The Company has a clearing
arrangement with Pershing LLC to clear certain transactions in
foreign securities. Accordingly, the Company has credit exposures
with this clearing broker. The clearing broker can rehypothecate
the securities held on behalf of the Company. The clearing broker
has the right to charge the Company for losses that result from a
client's failure to fulfill its contractual obligations. As the
right to charge the Company has no maximum amount and applies to
all trades executed through the clearing broker, the Company
believes there is no maximum amount assignable to this right. At
December 31, 2003, the Company has recorded no liabilities with
regard to this right. The Company's policy is to monitor the
credit standing of this clearing broker, all counterparties and
all clients with which it conducts business.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>14. Acquisitions</b></font></p>

<p><font size="3" face="Helvetica">On January 3, 2003, the
Company acquired the U.S. Private Client Division of CIBC World
Markets Corp. (&quot;World Markets&quot;), a wholly-owned
subsidiary of CIBC, and agreed to complete the acquisition of the
U.S. Asset Management Division of World Markets. The U.S. Private
Client Division, also referred to as the Oppenheimer division, is
part of Oppenheimer and employed approximately 620 brokers in 18
branch offices located across the United States at the time of
acquisition. Client assets at the date of acquisition were
approximately $30 billion. The acquisition more than doubled the
Company&#146;s private client presence in terms of client assets
and provided managerial expertise to the organization. On June 4,
2003, the Company completed the acquisition of the U.S. Asset
Management Division of World Markets, now operating as OAM. OAM
includes Oppenheimer Investment Advisers, three investment
management consulting programs (Investment Advisory Service,
Strategic Asset Review and Portfolio Advisory Service), a
broker-managed wrap program (OMEGA) and Advantage Advisors (which
includes publicly listed closed end funds and alternative
investment offerings). The acquisition was accounted for by the
purchase method. The Company engaged an independent evaluator to
identify and value intangible assets acquired. The fair value of
assets acquired, included in the table below, is based on the
report of the independent evaluator.</font></p>

<blockquote>
    <blockquote>
        <p><font size="3" face="Helvetica">The following table
        summarizes the estimated fair value of assets acquired,
        in thousands of dollars:</font></p>
    </blockquote>
</blockquote>

<table border="1" cellpadding="7" cellspacing="1" width="390">
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Prepaid
                expenses</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">$1,206</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Marketable
                securities</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">12,783</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Seed capital
                investments</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">3,970</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Property,
                plant and equipment</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">11,887</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Notes
                receivable</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">65,513</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Other assets</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">8,276</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Intangible
                assets</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">36,600</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Goodwill</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">125,932</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Less:</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Deferred
                compensation liabilities</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">(12,783)</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Accrued
                expenses and accounts payable</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">(11,437)</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
    <tr>
        <td valign="top" width="71%"><blockquote>
            <blockquote>
                <p><font size="3" face="Helvetica">Purchase price
                paid</font></p>
            </blockquote>
        </blockquote>
        </td>
        <td valign="top" width="29%"><blockquote>
            <blockquote>
                <p align="right"><font size="3" face="Helvetica">$241,947</font></p>
            </blockquote>
        </blockquote>
        </td>
    </tr>
</table>

<p><font size="3" face="Helvetica"></font>&nbsp;</p>

<p><font size="3" face="Helvetica"></font>&nbsp;</p>

<p><font size="3" face="Helvetica">The aggregate purchase price
of approximately $241,947,000 was paid as follows:</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="595">
    <tr>
        <td valign="top" width="17%"><p align="right"><font
        size="3" face="Helvetica">$15,611,000</font></p>
        </td>
        <td valign="top" width="83%"><font size="3"
        face="Helvetica">was paid by the Company in cash from
        cash on hand</font></td>
    </tr>
    <tr>
        <td valign="top" width="17%"><p align="right"><font
        size="3" face="Helvetica">$65,514,000</font></p>
        </td>
        <td valign="top" width="83%"><font size="3"
        face="Helvetica">was paid with the proceeds of the
        issuance by Viner Finance Inc., a wholly-owned subsidiary
        of the Company, to World Markets, of a zero coupon
        promissory note (i)</font></td>
    </tr>
    <tr>
        <td valign="top" width="17%"><p align="right"><font
        size="3" face="Helvetica">$160,822,000 </font></p>
        </td>
        <td valign="top" width="83%"><font size="3"
        face="Helvetica">was paid with the proceeds of debentures
        issued by E.A. Viner International Co., a wholly-owned
        subsidiary of the Company, to CIBC (ii)</font></td>
    </tr>
</table>

<blockquote>
    <blockquote>
        <blockquote>
            <p><font size="3" face="Helvetica">(</font><font
            size="3" face="Courier">i)</font><font size="3"
            face="Helvetica"> The Zero Coupon Promissory Note is
            repayable as related employee notes receivable, which
            are assigned to Oppenheimer, become due and are
            forgiven. Such payments are to be made
            notwithstanding whether any of the employees&#146;
            loans default.</font></p>
            <p><font size="3" face="Helvetica">(</font><font
            size="3" face="Courier">ii)</font><font size="3"
            face="Helvetica"> Two debentures were issued. The
            first and second variable rate exchangeable
            debentures, in the aggregate principal amount of
            $160,822,000, are exchangeable for 6,932,000 Class A
            Shares of the Company at the rate of $23.20 per share
            (approximately 35% of the Class A Shares on a diluted
            basis). The first and second variable rate
            exchangeable debentures mature on January 2, 2013,
            and bear interest at an annual rate of interest of 3%
            in the first year, 4% in years two through four, and
            5% in years five through maturity. A potential
            additional issuance of up to approximately 208,000
            Class A Shares may be required if the debentures are
            exchanged, the holders exercise their rights to have
            the resulting Class A Shares sold and the holders
            realize a price of less than $23.20 per share. </font></p>
        </blockquote>
    </blockquote>
</blockquote>

<p><font size="3" face="Helvetica">In addition, the Company has
arranged a credit facility in the amount of $50 million with
CIBC. In January 2003, the Company borrowed $25 million under
this facility and borrowed the balance in July 2003. The
borrowings are being used to finance broker notes and are
repayable, together with interest at the CIBC U.S. base rate plus
2%, over five years or earlier if any broker notes become due
earlier. </font></p>

<p><font size="3" face="Helvetica">Presented below are pro forma
consolidated results of operations. Amounts presented give effect
to the acquisitions of the U.S. Private Client and Asset
Management Divisions of World Markets as if the transactions were
consummated as at January 1, 2002. The Company&#146;s actual
results for the year ended December 31, 2003 include the results
of the Oppenheimer private client division and OAM from January
3, 2003 and June 4, 2003, respectively.</font></p>

<p><font size="3" face="Helvetica">The pro forma information is
for comparative purposes only and is not indicative either of the
actual results that would have occurred if the acquisition had
been consummated at the beginning of the periods presented, or of
future operations of the combined companies. CIBC has an October
31<sup>st</sup> year end and, therefore, the 2002 financial
information for the acquired divisions relates to the year ended
October 31, 2002. Revenue and expenses included in the pro forma
presentation for the year ended December 31, 2002 include certain
CIBC corporate allocations, reflecting the manner in which this
division was managed within CIBC. Such allocations may distort
the comparability of the years presented below. In the period
ended July 31, 2003, the Company incurred certain transition
costs relating to continued management and clerical support and
clearing services provided by World Markets. The Company realized
cost savings after the conversion of the client accounts of the
acquired division to the Company&#146;s clearing platform. The
conversion took place on May 27, 2003. </font></p>

<p><font size="3" face="Helvetica"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="571">
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Expressed in thousands of dollars,
        except per share amounts</font></td>
        <td valign="top" colspan="2" width="39%"><p
        align="center"><font size="3" face="Helvetica">Year ended</font></p>
        <p align="center"><font size="3" face="Helvetica">December
        31,</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%">&nbsp;</td>
        <td valign="top" width="20%"><p align="center"><font
        size="3" face="Helvetica">2003</font></p>
        </td>
        <td valign="top" width="19%"><p align="center"><font
        size="3" face="Helvetica">2002</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%">&nbsp;</td>
        <td valign="top" width="20%">&nbsp;</td>
        <td valign="top" width="19%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Revenue</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Helvetica">$735,276</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Helvetica">$737,281</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Profit (loss) before tax from operations</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Helvetica">$57,241</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Helvetica">$(70,542)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Net profit (loss)</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Helvetica">$33,200</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Helvetica">$(40,915)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Basic earnings (loss) per share </font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Helvetica">$2.62</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Helvetica">$(1.94)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="61%"><font size="3"
        face="Helvetica">Diluted earnings (loss) per share</font></td>
        <td valign="top" width="20%"><p align="right"><font
        size="3" face="Helvetica">$1.80</font></p>
        </td>
        <td valign="top" width="19%"><p align="right"><font
        size="3" face="Helvetica">$(3.29)</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>15. Related Party Transactions</b></font></p>

<p><font size="3" face="Arial">The Company has notes and accounts
receivable from employees, net, of approximately $97,919,000 at
December 31, 2003, which are recorded at face value net of
accumulated amortization. These amounts will be forgiven over a
service period from the initial date of the loan or based on
productivity levels of employees with respect to certain of these
notes receivable and are contingent on their continued employment
with the Company. The unforgiven portion of the notes become due
on demand in the event the employee departs during the service
period.</font></p>

<p><font size="3" face="Arial">At December 31, 2003, Oppenheimer
had an outstanding guarantee of debt of approximately $3,163,000
that arose as a result of the acquisition of Josephthal Group,
Inc.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>16. Segment Information</b></font></p>

<p><font size="3" face="Arial">The Company has determined its
reportable segments based on the Company&#146;s method of
internal reporting, which disaggregates its retail business by
branch and its proprietary and investment banking businesses by
product. The Company&#146;s segments are: Private Client which
includes all business generated by the Company&#146;s 89
branches, including commission and fee income earned on client
transactions, net interest earnings on client margin loans and
cash balances, stock loan activities and financing activities;
Capital Markets which includes market-making activities in
over-the-counter equities, institutional trading in both fixed
income and equities, structured assets transactions, bond
trading, trading in mortgage-backed securities, corporate
underwriting activities, public finance activities, and syndicate
participation; and Asset Management which includes fees from
money market funds and the investment management services of
Oppenheimer Asset Management Inc and Oppenheimer&#146;s asset
management divisions employing various programs to professionally
manage client assets either in individual accounts or in funds.
The Company evaluates the performance of its segments and
allocates resources to them based upon profitability.</font></p>

<p><font size="3" face="Arial">In connection with the analysis
done in conjunction with the adoption of SFAS No. 142, the
Company has made changes to its reportable segments. Prior year
results have been restated based on the composition of the new
segments.</font></p>

<p><font size="3" face="Arial">The table below presents
information about the reported revenue and operating income
(profit before income taxes) of the Company for the years ended
December 31, 2003, 2002 and 2001. The Company&#146;s business is
predominantly in the U.S. Asset information by reportable segment
is not reported, since the Company does not produce such
information for internal use.</font></p>

<p align="center"><font size="3" face="Arial"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="523">
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" colspan="3" width="69%"><p
        align="center"><font size="3" face="Arial">Year ended
        December 31,</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">2003</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">2002</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">2001</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Revenue:</font></td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Private
        Client </font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$525,785,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$202,312,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$181,292,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Capital
        Markets</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">120,101,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">73,005,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">73,752,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Asset
        Management</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">39,809,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">4,981,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">5,562,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Other</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">4,298,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">3,035,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">655,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Total</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$689,993,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$283,333,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$261,261,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Operating
        Income:</font></td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Private
        Client*</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$17,592,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$(12,488,000)</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$19,627,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Capital
        Markets</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">20,214,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">14,418,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">12,835,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Asset
        Management</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">14,347,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">13,219,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">809,000</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Other</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">(1,550,000)</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">(2,232,000)</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">(1,659,000)</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="31%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="31%"><font size="3" face="Arial">Total</font></td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$50,603,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$12,917,000</font></p>
        </td>
        <td valign="top" width="23%"><p align="right"><font
        size="3" face="Arial">$31,612,000</font></p>
        </td>
    </tr>
</table>

<p><font size="3" face="Arial">* Losses in the Private Client
segment in 2002 were the result of unfavorable market conditions
as well as operating losses and acquisition costs relating to
Josephthal, Prime Charter and BUYandHOLD and included litigation,
settlement costs, retention and severance costs and the costs of
under-utilized facilities.</font></p>

<p><font size="3" face="Arial"><b></b></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>17. Subsequent events</b></font></p>

<p><font size="3" face="Arial">(a) On January 27, 2004, a cash
dividend of U.S.$0.09 per share (totalling $1,200,000) was
declared payable on February 20, 2004 to Class A non-voting and
Class B shareholders of record on February 6, 2004.</font></p>

<p><font size="3" face="Arial">(b) In January 2004, the Company
received monetary damages plus interest in the amount of
approximately $2.7 million, pursuant to an award by a National
Association of Securities Dealers Dispute Resolution Panel
against another broker dealer in a raiding case involving
financial consultants of Josephthal &amp; Co. Inc, a company
acquired by Oppenheimer in September 2001. These proceeds, which
were received in January 2004, will be included in the
Company&#146;s results for the first quarter of 2004.</font></p>

<p><font size="3" face="Arial"></font>&nbsp;</p>

<p><font size="3" face="Arial"><b>18. Quarterly Information
(unaudited)</b></font></p>

<p><font size="3" face="Arial">(Expressed in thousands of
dollars, except per share amounts)</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" colspan="5" width="61%"><p
        align="center"><font size="3" face="Arial"><b>Fiscal
        Quarters</b></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial"><b>Year
        ended December 31, 2003</b></font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial"><b>Fourth</b></font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial"><b>Third</b></font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial"><b>Second</b></font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial"><b>First</b></font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial"><b>Total</b></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Revenue</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$188,341</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$176,404</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$164,397</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$160,851</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$689,993</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Profit
        before taxes</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$12,807</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$11,298</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$13,601</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$12,897</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$50,603</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        profit</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$7,769</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$6,616</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$7,919</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$7,487</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$29,791</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Earnings
        per share:</font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Basic</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.60</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.52</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.62</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.59</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$2.35</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Diluted</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.42</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.36</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.43</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.49</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$1.63</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Dividends
        per share</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.36</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Market
        price of Class A Shares:</font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">High</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$35.10</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$29.30</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$29.85</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$25.24</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$35.10</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Low</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$29.15</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$25.50</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$22.25</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$22.06</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$22.06</font></p>
        </td>
    </tr>
</table>

<p><font face="Courier"></font>&nbsp;</p>

<table border="0" cellpadding="7" cellspacing="0" width="638">
    <tr>
        <td valign="top" width="39%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial"><b>Year
        ended December 31, 2002</b></font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Revenue</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$76,150</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$68,522</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$68,144</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$70,517</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$283,333</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%" height="14"><font size="3"
        face="Arial">Operating profit before taxes</font></td>
        <td valign="top" width="12%" height="14"><p align="right"><font
        size="3" face="Arial">$5,614</font></p>
        </td>
        <td valign="top" width="12%" height="14"><p align="right"><font
        size="3" face="Arial">$2,785</font></p>
        </td>
        <td valign="top" width="12%" height="14"><p align="right"><font
        size="3" face="Arial">$1,912</font></p>
        </td>
        <td valign="top" width="12%" height="14"><p align="right"><font
        size="3" face="Arial">$2,606</font></p>
        </td>
        <td valign="top" width="12%" height="14"><p align="right"><font
        size="3" face="Arial">$12,917</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Cumulative
        effect of a change in accounting principles</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">-</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$1,774</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$1,774</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Net
        profit</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$3,297</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$1,735</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$883</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$3,406</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$9,321</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Earnings
        per share:</font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Basic</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.27</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.07</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.27</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.75</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">-
        Operations</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.27</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.07</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.13</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.61</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">-
        Cumulative effect of a change in </font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">accounting
        principle</font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Diluted</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.26</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.14</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.07</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.26</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.73</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Dividends
        per share</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.09</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$0.36</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Market
        price of Class A Shares:</font></td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
        <td valign="top" width="12%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">High</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$28.45</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$23.15</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$25.70</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$28.88</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$28.88</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="39%"><font size="3" face="Arial">Low</font></td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$19.77</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$20.00</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$21.26</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$24.85</font></p>
        </td>
        <td valign="top" width="12%"><p align="right"><font
        size="3" face="Arial">$19.77</font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" colspan="6"><font size="3" face="Arial">The
        price quotations above were supplied by the New York
        Stock Exchange.</font></td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<p><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial">EXHIBIT INDEX</font></p>

<p><font face="Arial">Unless designated by an asterisk indicating
that such document has been filed herewith, the Exhibits listed
below have been heretofore filed by the Company pursuant to
Section 13 or 15(d) of the Exchange Act and are hereby
incorporated herein by reference to the pertinent prior filing.</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="607">
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial"><u>Number</u></font></td>
        <td valign="top" width="68%"><font size="3" face="Arial"><u>Description</u></font></td>
        <td valign="top" width="18%"><p align="right"><font
        size="3" face="Arial"><u>Page</u></font></p>
        </td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">2.1</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Asset
        Purchase Agreement dated as of December 9, 2002 and
        Amendment No. 1 to the Asset Purchase Agreement dated as
        of January 2, 2003, by and among Fahnestock Viner
        Holdings Inc., Viner Finance Inc., Canadian Imperial Bank
        of Commerce and CIBC World Markets Corp. (previously
        filed as an exhibit to Form 8-K dated January 17, 2003). </font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">2.2</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Asset
        Management Acquisition Agreement dated as of January 2,
        2003, by and among Fahnestock Viner Holdings Inc.,
        Fahnestock &amp; Co. Inc., Canadian Imperial Bank of
        Commerce and CIBC World Markets Corp. (previously filed
        as an exhibit to Form 8-K dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">3
        (a)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Articles
        of Incorporation, as amended, of Fahnestock Viner
        Holdings Inc. (previously filed as exhibits to Form 20-F
        for the fiscal year ended December 31, 1986 and 1988).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">3(b)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">By-Laws,
        as amended, of Fahnestock Viner Holdings Inc. (previously
        filed as an exhibit to Form 20-F for the fiscal year
        ended December 31, 1987).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">4.1</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Stakeholders
        Agreement dated December 9, 2002, by and among Fahnestock
        Viner Holdings Inc., Canadian Imperial Bank of Commerce,
        Albert G. Lowenthal, Phase II Financial L.P., Phase II
        Financial Limited, The Albert G. Lowenthal Foundation,
        Olga Roberts and Elka Estates Limited (previously filed
        as an exhibit to Form 8-K dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">4.2</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Registration
        Rights Agreement dated January 2, 2003, issued by
        Fahnestock Viner Holdings Inc. to Canadian Imperial Bank
        of Commerce (previously filed as an exhibit to Form 8-K
        dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">4.3</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Exchangeable
        Debenture dated January 6, 2003, issued by E. A. Viner
        International Co. to Canadian Imperial Bank of Commerce
        (previously filed as an exhibit to Form 8-K dated January
        17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">4.4</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Interim
        Exchangeable Debenture dated January 6, 2003, issued by
        E. A. Viner International Co. to Canadian Imperial Bank
        of Commerce (previously filed as an exhibit to Form 8-K
        dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">4.5</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Exchangeable
        Debenture dated May 17, 2003, issued by E. A. Viner
        International Co. to Canadian Imperial Bank of Commerce
        (filed herewith). *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(f)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Fahnestock
        Viner Holdings Inc. 1996 Equity Incentive Plan, Amended
        and Restated as at May 17, 1999 (previously filed as an
        exhibit to Form S-8 dated May 15, 2000)</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="68%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
</table>

<p align="center"><font face="Arial">E-1</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="607">
    <tr>
        <td valign="top" width="14%">&nbsp;</td>
        <td valign="top" width="68%">&nbsp;</td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(k)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Performance-Based
        Compensation Agreement between Fahnestock Viner Holdings
        Inc. and Albert G. Lowenthal dated March 25, 1997
        (previously filed as an exhibit filed to Form 10-K for
        the year ended December 31, 1997)</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(l)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Securities
        Purchase Agreement dated June 11, 1997, between 1888
        Limited Partnership and DST Systems Inc. and Purchaser
        (previously filed as an exhibit to Schedule 14D-1 and
        Schedule 13D for First of Michigan Capital Corporation
        dated June 18, 1997)</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(m)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Fahnestock
        Viner Holdings Inc. 1996 Equity Incentive Plan Amendment
        No. 1 dated February 29, 2000 (previously filed as an
        exhibit to Form 10-K for the year ended December 31,
        1999) </font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(n)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Fahnestock
        Viner Holdings Inc. 1996 Equity Incentive Plan Amendment
        No. 2 dated May 19, 2001 (previously filed as an exhibit
        to Form 10-K for the year ended December 31, 2001)</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(o)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Performance-Based
        Compensation Agreement between Fahnestock Viner Holdings
        Inc. and Albert G. Lowenthal dated January 1, 2001
        (previously filed as an exhibit to Form 10-K for the year
        ended December 31, 2001)</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(p)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Credit
        Agreement dated January 2, 2003, by and between
        Fahnestock Viner Holdings Inc. and Canadian Imperial Bank
        of Commerce (previously filed as an exhibit to Form 8-K
        dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(q)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Amended
        and Restated Promissory Note dated January 15, 2003, made
        by Viner Finance Inc. for the benefit of CIBC World
        Markets Corp (previously filed as an exhibit to Form 8-K
        dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(r)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Non-Competition
        Agreement dated January 2, 2003, by and among Canadian
        Imperial Bank of Commerce and CIBC World Markets Corp.,
        Fahnestock &amp; Co. Inc. and Viner Finance Inc.
        (previously filed as an exhibit to Form 8-K dated January
        17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(s)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Non-Solicitation
        Agreement dated January 2, 2003 by and among Fahnestock
        Viner Holdings Inc., Fahnestock &amp; Co. Inc., Canadian
        Imperial Bank of Commerce and CIBC World Markets Corp.
        (previously filed as an exhibit to Form 8-K dated January
        17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(t)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Clearing
        Agreement dated January 2, 2003 between Fahnestock &amp;
        Co. Inc. and CIBC World Markets Corp. (previously filed
        as an exhibit to Form 8-K dated January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
</table>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<p><font face="Courier"></font>&nbsp;</p>

<p align="center"><font face="Arial">E-2</font></p>

<table border="0" cellpadding="7" cellspacing="0" width="607">
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">10(u)</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Shareholders
        Agreement dated December 9, 2002, by and among Fahnestock
        Viner Holdings Inc., Albert G. Lowenthal, Phase II
        Financial L.P., Phase II Financial Limited, The Albert G.
        Lowenthal Foundation, Olga Roberts and Elka Estates
        Limited (previously filed as an exhibit to Form 8-K dated
        January 17, 2003).</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">14</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Code
        of Conduct and Business Ethics for Directors, Officers
        and Employees (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">21</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Subsidiaries
        of the registrant (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">31.1</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Rule
        13a &#150; 14(a) 15d &#150; 14(a) Certification signed by
        A.G. Lowenthal (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">31.2</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Rule
        13a &#150; 14(a) 15d &#150; 14(a) Certification signed by
        E.K. Roberts (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">32.1</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Certification
        pursuant to 18 U.S.C. Section 1350 signed by A.G.
        Lowenthal (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="14%"><font size="3" face="Arial">32.2</font></td>
        <td valign="top" width="68%"><font size="3" face="Arial">Certification
        pursuant to 18 U.S.C. Section 1350 signed by E.K. Roberts
        (filed herewith) *</font></td>
        <td valign="top" width="18%">&nbsp;</td>
    </tr>
</table>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial"></font>&nbsp;</p>

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<p align="center"><font face="Arial"></font>&nbsp;</p>

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<p align="center"><font face="Arial"></font>&nbsp;</p>

<p align="center"><font face="Arial">E-3</font></p>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>2
<FILENAME>ex322.htm
<DESCRIPTION>CFO CERTIFICATION
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
<html>


<body bgcolor="#FFFFFF">

<pre><font face="Arial">EXHIBIT 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350


         The undersigned, Elaine K. Roberts, President and Chief Financial Officer of Oppenheimer Holdings Inc.
(the &quot;Company&quot;),hereby certifies that to her knowledge the Annual Report on Form 10-K for the period ended
December 31, 2002 of the Company filed with the Securities and Exchange Commission on the date hereof
(the &quot;Report&quot;) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act
of 1934 and the information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company for the period specified.

         Signed at the City of Toronto, Ontario, Canada, this 9 day of March, 2004.



                                                       &quot;E.K. Roberts&quot;
                                                       Elaine K. Roberts
			       President and Chief Financial Officer</font></pre>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>3
<FILENAME>ex21.htm
<DESCRIPTION>SUBSIDIARIES OF THE REGISTRANT
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
<html>


<body bgcolor="#FFFFFF">

<p><font face="Arial">EXHIBIT 21</font></p>

<p><font face="Arial">SUBSIDIARIES OF THE REGISTRANT AS AT
DECEMBER 31, 2003 (100% owned)</font></p>

<p><font face="Arial">OPPENHEIMER HOLDINGS INC. (Ontario)</font></p>

<blockquote>
    <p><font face="Arial">E.A. VINER HOLDINGS CO. (Delaware)</font></p>
</blockquote>

<blockquote>
    <blockquote>
        <p><font face="Arial">NEWSON INC. (Pennsylvania)</font></p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p><font face="Arial">OPPENHEIMER ASSET MANAGEMENTINC.
        (New York)</font></p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p><font face="Arial">EVANSTON FINANCIAL INC. (New York)</font></p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p><font face="Arial">OPPENHEIMER TRUST COMPANY (New
        Jersey)</font></p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p><font face="Arial">VINER FINANCE INC. (Delaware)</font></p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <blockquote>
            <p><font face="Arial">OPPENHEIMER &amp; CO. INC. (New
            York)</font></p>
        </blockquote>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <p><font face="Arial">FIRST OF MICHIGAN CAPITAL
                CORPORATION (Delaware)</font></p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <p><font face="Arial">-OLD MICHIGAN
                    CORPORATION (Delaware)</font></p>
                    <p><font face="Arial">-CRANBROOK CAPITAL
                    MANAGEMENT, INC. (Michigan)</font></p>
                    <p><font face="Arial">-FIRST OF MICHIGAN
                    VENTURE CAPITAL ASSOCIATES, INC. (Michigan)</font></p>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <p><font face="Arial">PACE SECURITIES INC. (New
                York)</font></p>
                <p><font face="Arial">FREEDOM INVESTMENTS, INC.
                (Delaware)</font></p>
                <p><font face="Arial">REICH &amp; CO.INC.
                (Alabama)</font></p>
                <p><font face="Arial">GRAND CHARTER GROUP,
                INCORPORATED (Delaware)</font></p>
                <blockquote>
                    <p><font face="Arial">PRIME CHARTER LTD.
                    (Delaware)</font></p>
                </blockquote>
                <p><font face="Arial">JOSEPHTHAL &amp; CO. INC.
                (New York)</font></p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>4
<FILENAME>ex311.htm
<DESCRIPTION>CEO CERTIFICATION
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
<html>


<body bgcolor="#FFFFFF">

<p align="center"><font face="Arial"><b>CERTIFICATION EXHIBIT
31.1</b></font></p>

<p><font face="Arial">I, Albert G. Lowenthal, certify that: </font></p>

<blockquote>
    <blockquote>
        <p><font face="Arial">1. I have reviewed this annual
        report on Form&nbsp;10-K of Oppenheimer Holdings Inc.; </font></p>
        <p><font face="Arial">2. Based on my knowledge, this
        annual report does not contain any untrue statement of a
        material fact or omit to state a material fact necessary
        to make the statements made, in light of the
        circumstances under which such statements were made, not
        misleading with respect to the period covered by this
        annual report; </font></p>
        <p><font face="Arial">3. Based on my knowledge, the
        financial statements, and other financial information
        included in this annual report, fairly present in all
        material respects the financial condition, results of
        operations and cash flows of the registrant as of, and
        for, the periods presented in this annual report; </font></p>
        <p><font face="Arial">4. The registrant&#146;s other
        certifying officers and I are responsible for
        establishing and maintaining disclosure controls and
        procedures (as defined in Exchange Act
        Rules&nbsp;13a-15(e) and 15d-15(e)) for the registrant
        and we have: </font></p>
    </blockquote>
</blockquote>

<table border="0" cellspacing="0" width="613">
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">a)&nbsp;designed
        such disclosure controls and procedures, or caused such
        disclosure controls and procedures to be designed under
        our supervision, to ensure that material information
        relating to the registrant, including its consolidated
        subsidiaries, is made known to us by others within those
        entities, particularly during the period in which this
        annual report is being prepared; </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">b)&nbsp;evaluated
        the effectiveness of the registrant&#146;s disclosure
        controls and procedures; and presented in this annual
        report our conclusions about the effectiveness of the
        disclosure controls and procedures as of the end of the
        period covered by the annual report based on such
        evaluation</font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">c)
        disclosed in this report any change in the
        registrant&#146;s internal control over financial
        reporting that occurred during the registrant&#146;s most
        recent fiscal quarter that has materially affected, or is
        reasonably likely to materially affect, the
        registrant&#146;s internal control over financial
        reporting; and&nbsp; </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<blockquote>
    <blockquote>
        <p><font face="Arial">5. The registrant&#146;s other
        certifying officers and I have disclosed, based on our
        most recent evaluation of internal control over financial
        reporting, to the registrant&#146;s auditors and the
        audit committee of registrant&#146;s board of directors
        (or persons performing the equivalent function): </font></p>
    </blockquote>
</blockquote>

<table border="0" cellspacing="0" width="613">
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">a)&nbsp;all
        significant deficiencies in the design or operation of
        internal control over financial reporting which are
        reasonably likely to adversely affect the
        registrant&#146;s ability to record, process, summarize
        and report financial data; and </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">b)&nbsp;any
        fraud, whether or not material, that involves management
        or other employees who have a significant role in the
        registrant&#146;s internal control over financial
        reporting.</font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<table border="0" cellspacing="0" width="264">
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="68%"><font face="Arial">&quot;A.G.
        Lowenthal&quot;</font></td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" colspan="2" width="91%"><font
        face="Arial">Name: Albert G. Lowenthal </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" colspan="2" width="91%"><font
        face="Arial">Title: Chief Executive Officer </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial">March 9, 2004</font></p>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>5
<FILENAME>ex312.htm
<DESCRIPTION>CFO CERTIFICATION
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
<html>


<body bgcolor="#FFFFFF">

<p align="center"><font face="Arial"><b>CERTIFICATION EXHIBIT
31.2</b></font></p>

<p><font face="Arial">I, Elaine K. Roberts, certify that: </font></p>

<p><font face="Arial">1.I have reviewed this annual report on
Form&nbsp;10-K of Oppenheimer Holdings Inc.; </font></p>

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

<p><font face="Arial">3.Based on my knowledge, the financial
statements, and other financial information included in this
annual report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual
report; </font></p>

<p><font face="Arial">4.The registrant&#146;s other certifying
officers and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act
Rules&nbsp;13a-15(e)) and 15d-15(e)) for the registrant and we
have: </font></p>

<table border="0" cellspacing="0" width="613">
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">a)&nbsp;designed
        such disclosure controls and procedures, or caused such
        disclosure controls and procedures to be designed under
        our supervision, to ensure that material information
        relating to the registrant, including its consolidated
        subsidiaries, is made known to us by others within those
        entities, particularly during the period in which this
        annual report is being prepared; </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">b)&nbsp;evaluated
        the effectiveness of the registrant&#146;s disclosure
        controls and procedures; and presented in this annual
        report our conclusions about the effectiveness of the
        disclosure controls and procedures as of the end of the
        period covered by the annual report based on such
        evaluation</font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">c)
        disclosed in this report any change in the
        registrant&#146;s internal control over financial
        reporting that occurred during the registrant&#146;s most
        recent fiscal quarter that has materially affected, or is
        reasonably likely to materially affect, the
        registrant&#146;s internal control over financial
        reporting; and</font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<blockquote>
    <blockquote>
        <p><font face="Arial">5.The registrant&#146;s other
        certifying officers and I have disclosed, based on our
        most recent evaluation of internal control over financial
        reporting, to the registrant&#146;s auditors and the
        audit committee of registrant&#146;s board of directors
        (or persons performing the equivalent function): </font></p>
    </blockquote>
</blockquote>

<table border="0" cellspacing="0" width="613">
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">a)&nbsp;all
        significant deficiencies in the design or operation of
        internal control over financial reporting which are
        reasonably likely to adversely affect the
        registrant&#146;s ability to record, process, summarize
        and report financial data; and </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="8%">&nbsp;</td>
        <td valign="top" width="92%"><font face="Arial">b)&nbsp;any
        fraud, whether or not material, that involves management
        or other employees who have a significant role in the
        registrant&#146;s internal control over financial
        reporting. </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial"></font>&nbsp;</p>

<table border="0" cellspacing="0" width="264">
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" width="68%"><font face="Arial">&quot;E.K.
        Roberts&quot;</font></td>
        <td valign="top" width="23%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" colspan="2" width="91%"><font
        face="Arial">Name: Elaine K. Roberts </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
    <tr>
        <td valign="top" width="9%">&nbsp;</td>
        <td valign="top" colspan="2" width="91%"><font
        face="Arial">Title: Chief Financial Officer </font></td>
        <td valign="top" width="0%">&nbsp;</td>
    </tr>
</table>

<p><font face="Arial">March 9, 2004</font></p>
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<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>6
<FILENAME>ex321.htm
<DESCRIPTION>CEO CERTIFICATION
<TEXT>
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<body bgcolor="#FFFFFF">

<pre><font face="Arial">EXHIBIT 32.1


CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350

         The undersigned, Albert G. Lowenthal, Chairman and Chief Executive Officer of Oppenheimer Holdings Inc.
(the &quot;Company&quot;), hereby certifies that to his knowledge the Annual Report on Form 10-K for the period ended
December 31, 2002 of the Company filed with the Securities and Exchange Commission on the date hereof
(the &quot;Report&quot;) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act
of 1934 and the information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company for the period specified.

         Signed at the New York, New York, this 9 day of March, 2004

                                                       &quot;A.G. Lowenthal&quot;
                                                       Albert G. Lowenthal
			       Chairman and Chief Executive Officer
</font></pre>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4
<SEQUENCE>7
<FILENAME>secondde.htm
<DESCRIPTION>EXHIBIT 4.5 SECOND EXCHANGEABLE DEBENTURE
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
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<body bgcolor="#FFFFFF">

<p><b>THIS SECOND EXCHANGEABLE DEBENTURE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
&quot;SECURITIES ACT&quot;), OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE TRANSFERRED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT OR STATE SECURITIES LAWS OR AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT
REQUIRED AND OTHERWISE SUBJECT TO THE RESTRICTIONS CONTAINED
HEREIN. </b></p>

<p><b>THIS SECOND EXCHANGEABLE DEBENTURE IS SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AND RIGHTS OF REPURCHASE WHICH ARE SET
FORTH IN A STAKEHOLDERS AGREEMENT. A COPY OF SUCH AGREEMENT WILL
BE PROVIDED WITHOUT COST BY THE COMPANY UPON REQUEST TO THE
HOLDER OF THIS SECOND EXCHANGEABLE DEBENTURE.</b></p>

<p><b></b>&nbsp;</p>

<p><b></b>&nbsp;</p>

<p>&nbsp;</p>

<p align="center">E. A. VINER INTERNATIONAL CO.</p>

<p>&nbsp;</p>

<p align="center">SECOND VARIABLE RATE EXCHANGEABLE DEBENTURE DUE
2013</p>

<p>$90,841,572</p>

<p>May 12, 2003</p>

<p>E. A. Viner International Co., a Delaware corporation (the
&quot;Company,&quot; which term includes any successor
corporation or other business entity), for value received, hereby
promises to pay to Canadian Imperial Bank of Commerce (including
its permitted designees or assignees, &quot;Holder&quot;), the
principal sum of NINETY MILLION, EIGHT HUNDRED FORTY ONE
THOUSAND, FIVE HUNDRED SEVENTY TWO U.S. DOLLARS ($90,841,572) on
January 2, 2013 (the &quot;Maturity Date&quot;), together with
interest on the unpaid balance of the principal amount of this
Second Variable Rate Exchangeable Debenture (the &quot;Second
Exchangeable Debenture&quot;) at a variable rate calculated in
accordance with the formula set forth in Section 1 below,
interest to be payable in the manner and at times provided
herein. Certain defined terms are set forth in Section 4 hereof
and elsewhere herein. </p>

<p>1. <u>Interest</u>. The interest rate for the period (i)
commencing on the date of original issuance of this Second
Exchangeable Debenture (the &quot;Issue Date&quot;) and ending on
the one year anniversary of the Issue Date, shall be 3% per
annum; (ii) commencing on the day immediately following the one
year anniversary of the Issue Date and ending on the four year
anniversary of the Issue Date, shall be 4% per annum; and (iii)
commencing on the day immediately following the four year
anniversary of the Issue Date until the Maturity Date, shall be
5% per annum. Accrued but unpaid interest on this Second
Exchangeable Debenture will be payable on the last Business Day
of June 2003 and on the last Business Day of each December and
June thereafter (each an &quot;Interest Payment Date&quot;).
Interest on this Second Exchangeable Debenture will accrue from
the most recent date to which interest has been paid or accrued
as provided in the preceding sentence or, if no interest has been
paid, from the Issue Date. Interest will be computed on the basis
of a 360-day year for the actual days elapsed. In the event that
the Company fails to timely pay interest on an Interest Payment
Date or otherwise during the occurrence and continuance of an
Event of Default, such unpaid interest shall compound
semi-annually until paid by the Company at a rate equal to 2%
above the then applicable interest rate. Nothing herein shall
preclude the Company from withholding any tax amounts imposed on
or with respect to Holder from any payments made hereunder, which
tax amounts are required to be withheld by any law or regulation.</p>

<p>2. <u>Repayment</u>. Unless earlier exchanged, the outstanding
principal of this Second Exchangeable Debenture, together with
accrued but unpaid interest thereon, shall be immediately due and
payable and shall be repaid on the Put Date in whole, or in part,
to the extent this Second Exchangeable Debenture is retracted
pursuant to Section 8(b), or in whole on the Retraction Date, to
the extent this second Exchangeable Debenture is retracted
pursuant to Section 8 (c), or in whole on the Maturity Date. </p>

<p>3. <u>Method of Cash Payment</u>. </p>

<p>The Company will make cash payments of principal and interest
in currency of the United States that at the time of payment is
legal tender for payment of public and private debts. Cash
payments shall be made to Holder by wire transfer of immediately
available funds to an account designated in writing by Holder and
provided to the Company at least ten (10) Business Days before
any Payment Date.</p>

<p>4. <u>Certain Defined Terms</u>. </p>

<blockquote>
    <blockquote>
        <p>The following terms shall have the following meanings:</p>
    </blockquote>
</blockquote>

<p>&quot;<u>Affiliate</u>&quot; means, with respect to a
specified Person, a Person that directly or indirectly, through
one or more intermediaries, controls, or is controlled by or is
under common control with, the Person specified.</p>

<p>&quot;<u>Asset Purchase Agreement</u>&quot; means the Asset
Purchase Agreement, dated as of December 9, 2002, as amended by
and among the Parent, Canadian Imperial Bank of Commerce and
certain of their Affiliates.</p>

<p>&quot;<u>Average Market Value</u>&quot; means, with respect to
Class A Shares, the average of the last reported sale price for
the Class A Shares on the NYSE for the 20 consecutive Business
Days ending five Business Days prior to the Put Date or Maturity
Date, as applicable.</p>

<p>&quot;<u>Bankruptcy Law</u>&quot; means, with respect to the
Company, Title 11, United States Bankruptcy Code, or with respect
to the Parent, the Bankruptcy and Insolvency Act (Canada) and the
Companies&#146; Creditors Arrangement Act (Canada), and in each
case any similar law relating to reorganization or for the
appointment of a receiver, liquidator or trustee in respect of
all or a material portion of the Company&#146;s or Parent&#146;s
property or an assignment for the benefit of creditors, or any
similar law for the relief of debtors. </p>

<p>&quot;<u>Board of Directors</u>&quot; means the Board of
Directors of the Company or Parent, as the case may be, or any
committee thereof duly authorized to act on behalf of such Board.</p>

<p>&quot;<u>Business Day</u>&quot; means any day other than a
Saturday, Sunday or other day on which the NYSE is not open for
trading.</p>

<p>&quot;<u>Class A Shares</u>&quot; means the Class A non-voting
shares of the Parent and any capital stock or other securities
that are issued in respect of, in exchange for, or in
substitution of, any Class A Shares by reason of any
reorganization, recapitalization, reclassification, merger,
consolidation, spin-off, partial or complete liquidation, stock
dividend, split-up, sale of assets, distribution to stockholders
or combination of the Class A Shares or any other change in the
capital structure of the Company.</p>

<p>&nbsp;</p>

<p>&quot;<u>Current Market Price Per Share</u>&quot; has the
meaning set forth in Section 5(h) hereof.</p>

<p>&quot;<u>Custodian</u>&quot; means any receiver, trustee,
assignee, liquidator, custodian or similar official under any
Bankruptcy Law.</p>

<p>&quot;<u>Determination Date</u>&quot; has the meaning set
forth in Section 5(h) hereof.</p>

<p>&quot;<u>GAAP</u>&quot; means generally accepted accounting
principles in the United States.</p>

<p>&quot;<u>Exchange Date</u>&quot; has the meaning set forth in
Section 5(d) hereof.</p>

<p>&quot;<u>Exchange Effective Date</u>&quot; has the meaning set
forth in Section 5(c) hereof.</p>

<p>&quot;<u>Exchange Price</u>&quot; has the meaning set forth in
Section 5(h) hereof.</p>

<p>&quot;<u>Exchangeable Debenture </u>&quot; means the Variable
Rate Exchangeable Debenture Due 2013 issued by the Company in the
initial principal amount of $69,980,828 and any Exchangeable
Debenture issued in replacement thereof, as such Exchangeable
Debenture may be amended from time to time.</p>

<p>&quot;<u>Expiration Time</u>&quot; has the meaning set forth
in Section 5(h) hereof.</p>

<p>&quot;<u>Governmental Entity</u>&quot; means any national,
federal, state, provincial, municipal, local, territorial,
foreign or other governmental entity or any department,
commission, board, bureau, agency, regulatory authority or
instrumentality thereof, or any court, judicial, administrative
or arbitral body or public or private tribunal.</p>

<p>&quot;<u>Guarantee</u>&quot; means any obligation, contingent
or otherwise, of any Person directly or indirectly guaranteeing
any indebtedness of any other Person and any obligation, direct
or indirect, contingent or otherwise, of such Person (1) to
purchase or pay (or advance or supply funds for the purchase or
payment of) such indebtedness or other obligation of such Person
(whether arising by virtue of partnership arrangements, or by
agreements to keepwell, to purchase assets, goods, securities or
services, to take-or-pay or to maintain financial statement
conditions or otherwise) or (2) entered into for the purpose of
assuring in any other manner the obligee of such indebtedness of
the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, however, that
the term &quot;Guarantee&quot; shall not include endorsements for
collection or deposit in the ordinary course of business. The
term &quot;Guarantee&quot; used as a verb has a corresponding
meaning.</p>

<p>&quot;<u>HSR Act</u>&quot; means the United States Hart-Scott
Rodino Antitrust Improvements Act of 1976, as amended.</p>

<p>&quot;<u>Indebtedness</u>&quot; means of any Person at any
date, without duplication, (a) all obligations of such Person for
borrowed money, (b) all obligations of such Person evidenced by
bonds (other than performance bonds), debentures, notes or other
similar instruments, (c) all obligations of such Person to pay
the deferred purchase price of property or services (other than
trade payables incurred in the ordinary course of business), (d)
all obligations of such Person under capital leases, (e) all
contingent or non-contingent obligations of such Person to
reimburse any Person in respect of amounts paid or payable
(currently or in the future, on a contingent or non-contingent
basis) under a letter of credit or similar instrument, (f) all
Indebtedness of any other Person secured by a lien on any asset
of such Person, and (g) all Indebtedness of others Guaranteed by
such Person; provided that Indebtedness shall not include
intercompany Indebtedness, which is expressly subordinate and
junior in right of payment to the Second Exchangeable Debenture.</p>

<p>&quot;<u>Interest Payment Date</u>&quot; has the meaning set
forth in Section 1 hereof.</p>

<p>&quot;<u>Issue Date</u>&quot; has the meaning set forth in
Section 1 hereof.</p>

<p>&quot;<u>NYSE</u>&quot; The New York Stock Exchange, Inc.</p>

<p>&quot;<u>Parent</u>&quot; means Fahnestock Viner Holdings
Inc., an Ontario corporation and its successors.</p>

<p>&quot;<u>Payment Date</u>&quot; means any Interest Payment
Date or Maturity Date, provided that if any Payment Date is not a
Business Day, such Payment Date shall, for all purposes
hereunder, be deemed to be the next succeeding Business Day.</p>

<p>&quot;<u>Person</u>&quot; means any individual, corporation,
partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision
thereof or any other entity. </p>

<p>&quot;<u>Purchased Shares</u>&quot; has the meaning set forth
in Section 5(h) hereof.</p>

<p>&quot;<u>Put Date</u>&quot; means any date from and after the
seven year anniversary of the Issue Date (the &quot;Seven Year
Anniversary Date&quot;) to 120 days after the Seven Year
Anniversary Date.</p>

<p>&quot;<u>Put Event</u>&quot; means the date of death of the
Significant Shareholder I Individual (as defined in the
Stakeholders Agreement).</p>

<p>&quot;<u>Responsible Officer</u>&quot; means any senior
financial officer and any other officer of the Company with
responsibility for the administration of this Second Exchangeable
Debenture.</p>

<p>&quot;<u>Retraction Consideration</u>&quot; means the
aggregate principal amount of the Second Exchangeable Debenture
outstanding plus any accrued but unpaid interest through the
Retraction Date, 25% of which shall be paid in cash, and 75% of
which shall be paid through the issuance of the Second Retraction
Debenture.</p>

<p><u>&quot;Second Exchangeable Debenture </u>&quot; means this
Second Variable Rate Exchangeable Debenture Due 2013 issued by
the Company in the initial principal amount of $90,841,572 and
any Second Exchangeable Debenture issued in replacement thereof,
as such Second Exchangeable Debenture may be amended from time to
time.</p>

<p>&quot;<u>Second Retraction Debenture</u>&quot; means the 9.75%
Debenture of the Company which may become issuable upon payment
of the Retraction Consideration, the form of which is set forth
as Exhibit B hereto.</p>

<p>&quot;<u>Significant Subsidiary</u>&quot; means any Subsidiary
that would be a &quot;Significant Subsidiary&quot; of the Company
within the meaning of Rule 1-02 under Regulation S-X promulgated
by the SEC.</p>

<p>&quot;<u>Stakeholders Agreement</u>&quot; means the agreement
dated as of December 9, 2002, by and among Parent, Canadian
Imperial Bank of Commerce and certain other parties named
therein.</p>

<p>&quot;<u>Subsidiary</u>&quot; means, in respect of any Person,
any corporation, association, partnership or other business
entity of which more than 50% of the total voting power of shares
of Capital Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or
indirectly, by (1) such Person, (2) such Person and one or more
Subsidiaries of such Person or (3) one or more Subsidiaries of
such Person.</p>

<p>&quot;<u>TSX</u>&quot; means The Toronto Stock Exchange.</p>

<p>&quot;<u>Triggering Distribution</u>&quot; has the meaning set
forth in Section 5(h) hereof.</p>

<p>&quot;<u>Variable Rate Convertible Debentures</u>&quot; means
the Convertible Debentures Due 2006 issued by the Company in the
initial principal amount of $90,841,572 and any Convertible
Debentures issued in replacement thereof, as such Convertible
Debentures may be amended from time to time.</p>

<p>5. <u>Exchange</u>.</p>

<p>(a) <u>Conditions and Number of Class A Shares</u>. At any
time prior to (i) the close of business on July 2, 2012 (ii) the
delivery to the Company of a Retraction Notice, or (iii) the
delivery to the Holder of a Regulatory Call Notice (as defined in
the Stakeholders Agreement), the Holder may, at the Holder's
option, exchange the principal amount of this Second Exchangeable
Debenture (or any portion thereof equal to $1,000 or any integral
multiple of $1,000 in excess thereof) for Class A Shares at the
Exchange Price then in effect. The number of Class A Shares
issuable upon exchange of the Second Exchangeable Debenture shall
be determined by dividing the principal amount of the Second
Exchangeable Debenture or portion thereof, including any accrued
but unpaid interest thereon, surrendered for exchange by the
Exchange Price in effect on the Exchange Date. The initial
Exchange Price is $23.20 per Class A Share subject to adjustment
as provided in this Section 5.</p>

<p>(b) <u>Additional Class A Shares</u>. If, on either the Put
Date or the Maturity Date, the Holder has surrendered all or any
portion of his Second Exchangeable Debenture for exchange and has
sold the Class A Shares received upon exchange pursuant to an
underwritten public offering within 120 days of such surrender
(&quot;Secondary Sale&quot;) and receives aggregate gross
proceeds (after giving effect to underwriting discounts and
commissions which shall be paid by the Company and shall not
reduce the number of Class A Shares to be received by the Holder)
less than the amount determined by multiplying the number of
shares sold by the Average Market Value of the shares, then
Parent shall, as soon as reasonably practicable following receipt
of a notice (the &quot;Additional Share Notice&quot;) stating the
exercise of the Holder's rights pursuant to this Section 5(b),
issue an additional number of Class A Shares to the Holder. The
payment of the fees and expenses associated with such Secondary
Sale (other than with respect to underwriting discounts and
commissions) shall be as set forth in the Registration Rights
Agreement. It shall be a condition of such issuance that the
Additional Share Notice shall include a representation and
warranty of the Holder that it is an accredited investor within
the meaning of the Securities Act (Ontario) and is acquiring such
additional Class A Shares as principal. The number of such shares
to be issued shall equal the amount of such difference divided by
the last reported sales price of the of the Class A Shares on the
NYSE on the closing date of the Secondary Sale, provided,
however, that the number of shares to be so issued pursuant to
this Section 5(b) shall not exceed an amount equal to 3% of the
number of Class A Shares issuable upon exchange of all
Exchangeable Debentures and Second Exchangeable Debentures then
outstanding times a fraction, the numerator of which is the
number of Class A Shares sold in the underwritten offering and
the denominator of which is the number of Class A Shares issuable
upon exchange of the entire principal amount of all Exchangeable
Debentures and Second Exchangeable Debentures. The Company
acknowledges that the Holder may surrender the Second
Exchangeable Debenture at the closing of the Secondary Sale and
may withdraw its obligation to surrender the Second Exchangeable
Debenture in the event that the Secondary Sale does not close. In
the event that the Holder surrenders the Second Exchangeable
Debenture, interest will no longer accrue on such Second
Exchangeable Debenture from and after the date of surrender,
unless the Holder subsequently withdraws such surrender if the
Secondary Sale does not close, in which case interest will be
reinstated for the period of such surrender. In no event will
interest accrue after the Maturity Date.</p>

<p>(c) <u>45 Day Waiting Period</u>. The Holder is not entitled
to any rights of a holder of Class A Shares until 45 days after
the Holder has exchanged its Second Exchangeable Debentures for
Class A Shares (the &quot;Exchange Effective Date&quot;), and
only to the extent the Second Exchangeable Debenture has been
deemed to have been exchanged for Class A Shares pursuant to this
Section 5. The person in whose name the Class A Share certificate
is registered following exchange shall be deemed to be a
stockholder of record on the Exchange Effective Date. </p>

<p>(d) <u>Exchange Procedure</u>. To exchange the Second
Exchangeable Debenture, the Holder must (i) complete and manually
sign the exchange notice on the back of this Second Exchangeable
Debenture and deliver such notice to the Company, with a copy to
Parent, and (ii) surrender the Second Exchangeable Debenture to
the Company. The date on which the Holder satisfies all those
requirements is the &quot;Exchange Date.&quot; As soon as
practicable after the Exchange Effective Date, Parent shall
deliver to the Holder, either directly or through the Company, a
certificate for the number of whole Class A Shares issuable upon
the exchange and cash in lieu of any fractional shares. Any cash
paid in lieu of fractional shares shall be based upon the Closing
Price of the Class A Shares on the Business Day immediately prior
to the Exchange Date. If this Debenture is exchanged in part
only, the Company shall execute and deliver to the Holder, a new
Second Exchangeable Debenture equal in principal amount to the
unconverted portion of the Second Exchangeable Debenture
surrendered.</p>

<p>(e) <u>Taxes on Exchange</u>. If the Holder exchanges this
Second Exchangeable Debenture, the Company shall pay any
documentary, stamp or similar issue or transfer tax due on the
issue of Class A Shares upon such exchange. However, the Holder
shall pay any such tax which is due because the Holder requests
the shares to be issued in a name other than the Holder's name.
Nothing herein shall preclude any tax withholding imposed on or
with respect to Holder required by law or regulation.</p>

<p>(f) <u>Parent To Provide Stock</u>. Parent shall, prior to
issuance of any Class A Shares hereunder, and from time to time
as may be necessary, reserve, out of its authorized but unissued
Class A Shares, a sufficient number of Class A Shares to permit
the exchange of the Second Exchangeable Debenture into Class A
Shares. All Class A Shares delivered upon exchange of the
Exchangeable Debenture shall be newly issued shares, shall be
duly authorized, validly issued, fully paid and nonassessable and
shall be free from preemptive rights and free of any lien or
adverse claim.</p>

<p>(g) <u>Compliance With Securities Laws; Listing</u>. Parent
will endeavor promptly to comply with all applicable federal,
state and provincial securities laws regulating the offer and
delivery of Class A Shares upon exchange of Second Exchangeable
Debenture, if any, and will list or cause to have quoted such
Class A Shares on each national securities exchange, the TSX or
on The Nasdaq National Market or other over-the-counter market or
such other market on which the Class A Shares are then listed or
quoted; provided, however, that if rules of such automated
quotation system or exchange permit the Company to defer the
listing of such Class A Shares until the first exchange of the
Second Exchangeable Debenture into Class A Shares in accordance
with the provisions hereof, Parent covenants to list such Class A
Shares issuable upon exchange of the Second Exchangeable
Debenture in accordance with the requirements of such automated
quotation system or exchange on or prior to the first Exchange
Effective Date.</p>

<p>(h) <u>Adjustment of Exchange Price</u>. The initial exchange
price as stated in Section 5(a) hereof shall be adjusted from
time to time (as so adjusted, the &quot;Exchange Price&quot;) as
follows: </p>

<p>(i) In case Parent shall (1) pay a dividend on its Class A
Shares in Class A Shares, (2) make a distribution on its Class A
Shares in Class A Shares, (3) subdivide its outstanding Class A
Shares into a greater number of shares, or (4) combine its
outstanding Class A Shares into a smaller number of shares, the
Exchange Price in effect immediately prior thereto shall be
adjusted so that the Holder upon exchange of the Second
Exchangeable Debenture shall thereafter be entitled to receive
that number of Class A Shares which it would have owned had the
Second Exchangeable Debenture been exchanged immediately prior to
the happening of such event. An adjustment made pursuant to this
subsection (i) shall become effective immediately after the
record date in the case of a dividend or distribution and shall
become effective immediately after the effective date in the case
of subdivision or combination.</p>

<p>(ii) In case Parent shall, by dividend or otherwise, at any
time distribute (a &quot;Triggering Distribution&quot;) to all or
substantially all holders of its Class A Shares, cash in an
aggregate amount that, together with the aggregate amount of (A)
any cash and the fair market value (as reasonably determined in
good faith by the Board of Directors of Parent, whose
determination shall be conclusive evidence thereof) of any other
consideration payable to holders of Class A Shares in respect of
any offer by Parent or a Subsidiary of Parent to purchase Class A
Shares from Parent's Class A stockholders on a pro rata basis and
such offer is consummated within the 12 months preceding the date
of payment of the Triggering Distribution and in respect of which
no Exchange Price adjustment pursuant to this Section 5 has been
made and (B) all other cash distributions to all or substantially
all holders of its Class A Shares made within the 12 months
preceding the date of payment of the Triggering Distribution and
in respect of which no Exchange Price adjustment pursuant to this
Section 5 has been made, exceeds an amount equal to 5% of the
product of the Current Market Price Per Class A Share on the
Business Day (the &quot;Determination Date&quot;) immediately
preceding the day on which such Triggering Distribution is
declared by Parent multiplied by the number of Class A Shares
outstanding on the Determination Date (excluding shares held in
the treasury of Parent), the Exchange Price shall be reduced so
that the same shall equal the price determined by multiplying
such Exchange Price in effect immediately prior to the
Determination Date by a fraction of which the numerator shall be
the Current Market Price Per Class A Share on the Determination
Date less the sum of the aggregate amount of cash and the
aggregate fair market value (as reasonably determined in good
faith by the Board of Directors of Parent, whose determination
shall be conclusive evidence of such fair market value) of any
such other consideration so distributed, paid or payable within
such 12 months (including, without limitation, the Triggering
Distribution) applicable to one Class A Share (determined on the
basis of the number of Class A Shares outstanding on the
Determination Date) and the denominator shall be such Current
Market Price Per Class A Share on the Determination Date, such
reduction to become effective immediately prior to the opening of
business on the day following the date on which the Triggering
Distribution is paid.</p>

<p>(1) In case any offer, by Parent or any of its Subsidiaries to
purchase Class A Shares from Parent's Class A stockholders on a
pro rata basis shall expire and such offer (as amended upon the
expiration thereof) shall involve the payment of aggregate
consideration in an amount (determined as the sum of the
aggregate amount of cash consideration and the aggregate fair
market value (as reasonably determined in good faith by the Board
of Directors of Parent), whose determination shall be conclusive
evidence thereof of any other consideration) that, together with
the aggregate amount of (A) any cash and the fair market value
(as reasonably determined in good faith by the Board of Directors
of Parent, whose determination shall be conclusive evidence
thereof) of any other consideration payable in respect of any
other offers by Parent or any Subsidiary of Parent to purchase
Class A Shares from Parent's Class A stockholders on a pro rata
basis consummated within the 12 months preceding the date of the
Expiration Date (as defined below) and in respect of which no
Exchange Price adjustment pursuant to this Section 5 has been
made and (B) all cash distributions to all or substantially all
holders of its Class A Shares made within the 12 months preceding
the Expiration Date and in respect of which no Exchange Price
adjustment pursuant to this Section 5 has been made, exceeds an
amount equal to 5% of the product of the Current Market Price Per
Class A Share as of the last date (the &quot;Expiration
Date&quot;) tenders, repurchases or redemptions could have been
made pursuant to such offer (as it may be amended) (the last time
at which such purchases could have been made on the Expiration
Date is hereinafter sometimes called the &quot;Expiration
Time&quot;) multiplied by the number of Class A Shares
outstanding (including tendered shares but excluding any shares
held in the treasury of Parent) at the Expiration Time, then,
immediately prior to the opening of business on the day after the
Expiration Date, the Exchange Price shall be reduced so that the
same shall equal the price determined by multiplying the Exchange
Price in effect immediately prior to the close of business on the
Expiration Date by a fraction of which the numerator shall be the
product of the number of Class A Shares outstanding (including
tendered, repurchased or redeemed shares but excluding any shares
held in the treasury of Parent) at the Expiration Time multiplied
by the Current Market Price Per Class A Share on the Trading Day
next succeeding the Expiration Date and the denominator shall be
the sum of (x) the aggregate consideration (determined as
aforesaid) payable to Class A stockholders based on the
acceptance (up to any maximum specified in the terms of the
offer) of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the &quot;Purchased Shares&quot;)
and (y) the product of the number of Class A Shares outstanding
(less any Purchased Shares and excluding any shares held in the
treasury of Parent) at the Expiration Time and the Current Market
Price Per Class A Share on the Trading Day next succeeding the
Expiration Date, such reduction to become effective immediately
prior to the opening of business on the day following the
Expiration Date. In the event that Parent or its Subsidiary, as
the case may be, is obligated to purchase shares pursuant to any
offer to purchase Class A Shares from Parent's Class A
stockholders on a pro rata basis, but Parent or its Subsidiary,
as the case may be, is permanently prevented by applicable law
from effecting any or all such purchases or any or all such
purchases are rescinded, the Exchange Price shall again be
adjusted to be the Exchange Price which would have been in effect
based upon the number of shares actually purchased. If the
application of this Section 5(h) would result in an increase in
the Exchange Price, no adjustment shall be made under this
Section 5(h).</p>

<p>(2) For the purpose of any computation under subsections (i)
and (ii) of this Section 5(h), the current market price per Class
A Share (the &quot;Current Market Price Per Share&quot;) on any
date shall be deemed to be the average of the daily Closing
Prices for the 30 consecutive Trading Days commencing 45 Business
Days before (i) the Determination Date or the Expiration Date, as
the case may be, with respect to distributions or offers under
subsection (ii) of this Section 5(h) or (ii) the record date with
respect to distributions, issuances or other events requiring
such computation under subsection (i) of this Section 5(h). The
Closing Price for each day (the &quot;Closing Price&quot;) shall
be the last reported sales price or, in case no such reported
sale takes place on such date, the average of the reported
closing bid and asked prices in case on the NYSE. If the Class A
Shares are not then quoted or listed or admitted to trading on
the NYSE, the last reported sale price referenced above shall be
determined based on the last reported sale price on the TSX (and
converted to U.S. dollars at the exchange rate quoted by the Bank
of Canada at such time) or, if the Class A Shares are not then
quoted or listed or admitted to trading on the NYSE or TSX, any
national securities exchange or quotation system on which sales
of Class A Shares takes place, or, in case no reported sale takes
place, the Market Price shall be the fair value of a Class A
Shares as reasonably determined in good faith by the Board of
Directors of the Company. </p>

<p>(3) In any case in which this Section 5(h) shall require that
an adjustment be made following a record date or a Determination
Date or Expiration Date, as the case may be, established for
purposes of this Section 5(h), Parent may elect to defer issuing
to the Holder until after such record date or Determination Date
or Expiration Date the Class A Shares and other capital stock of
Parent issuable upon such exchange over and above the Class A
Shares and other capital stock of Parent issuable upon such
exchange only on the basis of the Exchange Price prior to
adjustment; and, in lieu of the shares the issuance of which is
so deferred, Parent shall issue or cause its transfer agent to
issue due bills or other appropriate evidence prepared by Parent
of the right to receive such shares. If any distribution in
respect of which an adjustment to the Exchange Price is required
to be made as of the record date or Determination Date or
Expiration Date therefor is not thereafter made or paid by the
Company for any reason, the Exchange Price shall be readjusted to
the Exchange Price which would then be in effect if such record
date had not been fixed or such effective date or Determination
Date or Expiration Date had not occurred.</p>

<p>(iii) If any event occurs as to which the foregoing provisions
of this Section 5(h) are not strictly applicable or, if <u>strictly</u>
applicable, would not, in the good faith judgment of the Company,
fairly and adequately protect the rights of the Holder in
accordance with the essential intent and principles of such
provisions, then the Company shall make such adjustments in the
application of such provisions, in accordance with such essential
intent and principles, as shall be reasonably necessary, in the
good faith opinion of the Company, to protect such rights as
aforesaid, but in no event shall any such adjustment have the
effect of increasing the Exchange Price or decreasing the number
of Class A Shares issuable upon exchange of this Second
Exchangeable Debenture.</p>

<p>(iv) <u>Adjustment for Tax Purposes</u>. Parent shall be
entitled to make such reductions in the Exchange Price, in
addition to those required by this Section 5(h), as it in its
discretion shall determine to be advisable in order that any
stock dividends, subdivisions of shares, distributions of rights
to purchase stock or Second Exchangeable Debenture or
distributions of Second Exchangeable Debenture convertible into
or exchangeable for stock hereafter made by Parent to its
stockholders shall not be taxable.</p>

<p>(v) <u>Notice of Adjustment</u>. Whenever the Exchange Price
or exchange privilege is adjusted, Parent or Company shall
promptly mail to the Holder a notice of the adjustment.</p>

<p>(vi) <u>Notice of Certain Transactions</u>. In the event that:
</p>

<p>(1) Parent or the Company consolidates or merges with or into,
or transfers all or substantially all of its property and assets
to, another corporation or another corporation merges into Parent
or the Company and;</p>

<p>(2) a record date has been established by Parent for any
distributions to holders of Class A Shares, other than a
distribution comprised solely of ordinary dividends; or </p>

<p>(3) there is a dissolution or liquidation of Parent or the
Company, </p>

<p>Parent shall mail to Holders a notice stating the proposed
record or effective date, as the case may be. Parent shall mail
the notice at least twenty days in advance of the applicable
record date for such action. Failure to mail such notice or any
defect therein shall not affect the validity of any transaction
referred to in clause (1), (2), or (3) of this Section 5(h)(vi).</p>

<p>In the event that a Put Event has occurred, the Company shall
give notice to Holders as soon as practicable thereafter, but in
any event, not more than 30 days after the occurrence thereof. </p>

<p>6. <u>Representations and Warranties of the Company</u>. </p>

<p>The Company represents and warrants to the Holder as follows:</p>

<p>(a) <u>Organization; Authority</u>. The Company is a
corporation duly organized and validly subsisting under the laws
of the State of Delaware, and has all requisite corporate power
and authority to enter into this Second Exchangeable Debenture
and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Second Exchangeable
Debenture and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Company. This Second Exchangeable
Debenture has been duly executed and delivered by the Company and
constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms
except that (i) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights, and (ii)
the remedy of specific performance and injunctive and other forms
of equitable relief may be subject to equitable defenses and to
the discretion of the court before which any proceeding therefor
may be brought.</p>

<p>(b) <u>No Violation; Consents and Approvals</u>. The execution
and delivery of this Second Exchangeable Debenture do not, and
the consummation of the transactions contemplated hereby and
compliance with the terms hereof will not, conflict with, or
result in any violation of or default under, (i) any provision of
the articles or by-laws of the Company, (ii) any judgment, order
or decree, or material statute, law, ordinance, rule or
regulation applicable to the Company or the property or assets of
the Company or (iii) any note, bond, mortgage, indenture,
license, agreement, lease or other instrument or obligation to
which the Company is a party or by which the Company may be bound
or affected or to which any of its respective assets may be
subject. Except for the requirements of the HSR Act, no consent,
approval, order or authorization of, or registration, declaration
or filing with, any Governmental Entity or any third party is
required to be obtained or made by or with respect to the Company
in connection with the execution and delivery of this Second
Exchangeable Debenture or the consummation by the Company of the
transactions contemplated hereby.</p>

<p>(c) <u>Capitalization</u>. As of the date of this Second
Exchangeable Debenture, Parent&#146;s authorized capital stock
consists of (i) an unlimited number of authorized Class A
Non-Voting Shares, no par value, of which 12,691,643 shares are
issued and outstanding, (ii) 99,680 authorized Class B Voting
Shares, no par value, all of which are issued and outstanding and
(iii) an unlimited number of First Preference Shares issuable in
series, of which no shares are issued or outstanding. All such
issued and outstanding shares are duly authorized and validly
issued, fully paid and nonassessable. The Class A Shares
initially issuable upon exchange of this Second Exchangeable
Debenture and pursuant to Section 5(b) represent in aggregate
32.24% of the total issued and outstanding Class A and Class B
Shares as of the date hereof. </p>

<p>7. <u>Effect of Reclassification, Consolidation, Merger
Amalgamation or Sale on Exchange Privilege</u>. </p>

<p>If any of the following shall occur, namely: (a) any
reclassification or change of Class A Shares issuable upon
exchange of the Second Exchangeable Debenture (other than as a
result of a subdivision or combination, or any other change for
which an adjustment is provided in Section 5; (b) any
consolidation or merger or amalgamation or combination to which
Parent or the Company is a party other than a merger or
amalgamation in which Parent or the Company is the continuing
corporation and which does not result in any reclassification of,
or change (other than as a result of a subdivision or
combination) in, outstanding Class A Shares; or (c) any sale or
conveyance as an entirety or substantially as an entirety of the
property and assets of Parent or the Company, directly or
indirectly, to any person, then Company and Parent shall take all
actions necessary to ensure that, as a condition precedent to
such reclassification, change, combination, consolidation,
merger, sale or conveyance, the Holder shall have the right to
either (i) convert the Second Exchangeable Debenture into the
kind and amount of shares of stock and other securities and
property (including cash) receivable upon such reclassification,
change, combination, consolidation, merger, amalgamation, sale or
conveyance by a holder of the number of Class A Shares
deliverable upon exchange of the Second Exchangeable Debenture
immediately prior to such reclassification, change, combination,
consolidation, merger, sale or conveyance or (ii) continue to
hold debentures of such successor purchasing or transferee
corporation, as the case may be, which shall be as nearly
equivalent as may be practicable to the Second Exchangeable
Debentures. If, in the case of any such consolidation, merger,
amalgamation, combination, sale or conveyance, the stock or other
securities and property (including cash) receivable thereupon by
a holder of Class A Shares include shares of stock or other
securities and property of a person other than the successor,
purchasing or transferee corporation, as the case may be, in such
consolidation, merger, amalgamation, combination, sale or
conveyance, then such replacement debentures shall also be
executed by such other person and shall contain such additional
provisions to protect the interests of the Holder as the Board of
Directors of the Company shall reasonably consider necessary by
reason of the foregoing. The provisions of this Section 7 shall
similarly apply to successive reclassifications, changes,
combinations, consolidations, mergers, amalgamation, sales or
conveyances. </p>

<p>8. <u>Regulatory Call; Retraction</u>.</p>

<p><u>(a)</u> <u>Regulatory Call</u>. In the event of a
Regulatory Event (as defined in the Stakeholders Agreement), but
only to the extent necessary to cure such Regulatory Event, this
Second Exchangeable Debenture may be purchased by Parent (or its
designee, which may include the Company, in which case the
Company shall be entitled to purchase this Second Exchangeable
Debenture for cancellation) in the manner and subject to the
terms and conditions set forth in Section 4.6 of the Stakeholders
Agreement. The Company is hereby authorized by the Holder to take
all actions reasonably necessary to ensure that Section 4.6 of
the Stakeholders Agreement is complied with and, for purposes of
a purchase for cancellation of this Second Exchangeable
Debenture, the terms of Section 4.6 of the Stakeholders Agreement
are hereby incorporated herein by reference.</p>

<p>(b) <u>Retraction at Year Seven</u>. Not less than 30 nor more
than 90 days prior to a Put Date, the Holder may, at its
election, notify the Company and the Parent in writing (a
&quot;Retraction Notice&quot;) of its intention to require the
Company to redeem the Second Exchangeable Debenture in whole or
in part, on the Put Date set forth in the Retraction Notice,
without premium or penalty at a retraction price (the
&quot;Retraction Payment&quot;) equal to the then outstanding
principal amount, plus any accrued but unpaid interest up to, but
not including the Put Date. On the Put Date, the Holder shall
deliver the certificate evidencing this Second Exchangeable
Debenture to the Company for redemption and upon payment of the
Retraction Payment in cash by or on behalf of the Company, all
rights of the Holder hereunder shall cease.</p>

<p>(c) <u>Retraction on Put Event</u>. Not more than 120 days
after a Put Event, the Holder may, at its election, notify the
Company and the Parent in writing (a &quot;Retraction
Notice&quot;) of its irrevocable intention to require the Company
to redeem the Exchangeable Debenture in whole on the retraction
date set forth in the Retraction Notice (the &quot;Retraction
Date&quot;), which may not be less than 180 days from the Put
Event nor more than 210 days from the Put Event. Retraction will
be effected without premium or penalty at a redemption price
equal to the Retraction Consideration. On the Retraction Date,
the Holder shall deliver the certificate evidencing this Second
Exchangeable Debenture to the Company for redemption and a
certificate containing a representation and warranty of the
Holder that it is an accredited investor within the meaning of
the Securities Act (Ontario) and is acquiring the Second
Retraction Debenture as principal. Upon payment of the Retraction
Consideration by or on behalf of the Company, all rights of the
Holder hereunder shall cease. Notwithstanding the foregoing, no
retraction hereunder shall be effective unless any outstanding
Variable Rate Convertible Debentures and Second Exchangeable
Debentures, if any, shall also be retracted concurrently.</p>

<p>9. <u>Events&nbsp;of&nbsp;Default</u>. </p>

<p>(a) An &quot;Event of Default&quot; occurs if:</p>

<blockquote>
    <p>(1) <a name="_Ref26360383">the Company defaults in any
    payment of interest on this Second Exchangeable Debenture
    when the same becomes due and payable, and such default
    continues for a period of 3 Business Days;</a></p>
    <p>(2) <a name="_Ref26360409">the Company defaults in the
    payment of a principal payment when the same becomes due and
    payable;</a></p>
    <p>(3) the Company fails to comply with any of its agreements
    under this Second Exchangeable Debenture (other than those
    referred to in clauses (1) and (2) above) and such failure
    continues for 30 days;</p>
    <p>(4) A default occurs under any mortgage, indenture or
    agreement or instrument under which there may be issued or by
    which there may be secured or evidenced any indebtedness for
    money borrowed by the Company or any of its Significant
    Subsidiaries (or payment of which is Guaranteed by the
    Company or any of its Significant Subsidiaries), whether such
    indebtedness for money borrowed or Guarantee now exists, or
    is created after the Issue Date (which default, (i)
    constitutes a failure to pay at final maturity (after giving
    effect to any applicable grace periods and any extensions
    thereof) the principal amount of such indebtedness for money
    borrowed or (ii) shall have resulted in such indebtedness for
    money borrowed being accelerated or otherwise become or being
    declared due and payable prior to its stated maturity), and
    the principal amount of all such indebtedness for money
    borrowed as to which a default described in this clause (4)
    has occurred aggregates $5,000,000 or more;</p>
    <p>(5) A final judgment or judgments for the payment of money
    aggregating in excess of $5,000,000 are rendered against one
    or more of the Company and its Significant Subsidiaries and
    which judgments are not, within 60 days after entry thereof,
    bonded, discharged or stayed pending appeal, or are not
    discharged within 60 days after the expiration of such stay;</p>
    <p>(6) <a name="_Ref26359996">the Company or any Significant
    Subsidiary pursuant to or within the meaning of any
    Bankruptcy Law:</a></p>
    <blockquote>
        <blockquote>
            <blockquote>
                <p>(A) commences a voluntary case;</p>
                <p>(B) consents to the entry of an order for
                relief against it in an involuntary case;</p>
                <p>(C) consents to the appointment of a Custodian
                of it or for any substantial part of its
                property; or</p>
                <p>(D) makes a general assignment for the benefit
                of its creditors; or</p>
            </blockquote>
        </blockquote>
    </blockquote>
    <p>(7) <a name="_Ref26360033">a court of competent
    jurisdiction enters an order or decree under any Bankruptcy
    Law that:</a></p>
    <blockquote>
        <blockquote>
            <blockquote>
                <p>(A) is for relief against the Company or any
                Significant Subsidiary in an involuntary case;</p>
                <p>(B) appoints a Custodian of the Company or any
                Significant Subsidiary or for any substantial
                part of its property; or</p>
                <p>(C) orders the winding up or liquidation of
                the Company or any Significant Subsidiary; or any
                similar relief is granted under any foreign laws
                and the order or decree remains unstayed and in
                effect for 60 days.</p>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary
or involuntary or is effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body.</p>

<p>(b) <u>Acceleration</u>. If an Event of Default (other than an
Event of Default specified in clauses (a)(6) or (a)(7) of Section
9) occurs and is continuing, the Holder by written notice to the
Company (an &quot;Acceleration Notice&quot;), may declare the
unpaid principal of and accrued interest on this Second
Exchangeable Debenture to be immediately due and payable. Upon
such a declaration, the unpaid principal of and accrued interest
on this Second Exchangeable Debenture shall be due and payable
immediately without presentment, demand or notice of any kind,
which are hereby expressly waived by the Company. If an Event of
Default specified in clauses (a)(6) or (a) (7) of Section 9
occurs, all principal of and interest on the Second Exchangeable
Debenture shall <u>ipso</u> <u>facto</u> become and be
immediately due and payable without any declaration or other act
on the part of the Holder. The Holder by written notice to the
Company may rescind an acceleration and its consequences if (i)
all existing Events of Default, other than the nonpayment of
principal of or interest on this Second Exchangeable Debenture
which has become due solely because of the acceleration, have
been cured or waived and (ii) the rescission would not conflict
with any judgment or decree of a court of competent jurisdiction.
</p>

<p>(c) <u>Remedies Cumulative</u>. A delay or omission by the
Holder in exercising any right or remedy accruing upon an Event
of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All remedies are cumulative to the
extent permitted by law.</p>

<p>10. <u>Covenants</u>.</p>

<p>(a) <u>Corporate Existence, Etc</u>. The Company will at all
times preserve and keep in full force and effect its corporate
existence and that of its Significant Subsidiaries and all rights
and franchises of the Company and its Significant Subsidiaries
unless, in the good faith judgment of the Company, the
termination of or failure to preserve and keep in full force and
effect such corporate existence, right or franchise would not,
individually or in the aggregate, have a materially adverse
effect on the business, operations, affairs, financial condition,
properties or assets of the Company and its Subsidiaries taken as
a whole. </p>

<p>(b) <u>Payment of Taxes</u>. The Company will file all income
tax or similar tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due
and payable on such returns and all other taxes, assessments,
governmental charges, or levies payable by any of them, to the
extent such taxes and assessments have become due and payable and
before they have become delinquent, provided that the Company
need not pay any such tax or assessment if (i) the amount,
applicability or validity thereof is contested by the Company on
a timely basis in good faith and in appropriate proceedings, and
the Company has established adequate reserves therefor in
accordance with GAAP on the books of the Company or (ii) the
nonpayment of all such taxes and assessments in the aggregate
would not reasonably be expected to have a materially adverse
effect on the business, operations, affairs, financial condition,
properties or assets of the Company and its Subsidiaries taken as
a whole. </p>

<p>(c) <u>Maintenance of Properties</u>. The Company and its
Significant Subsidiaries will maintain and keep, or cause to be
maintained and kept, their respective properties in good repair,
working order and condition (other than ordinary wear and tear),
so that the business carried on in connection therewith may be
properly conducted at all times, provided that this Section 10(c)
shall not prevent the Company from discontinuing the operation
and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and
the Company has concluded that such discontinuance would not,
individually or in the aggregate, have a materially adverse
effect on the business, operations, affairs, financial condition,
properties or assets of the Company and its Subsidiaries taken as
a whole. </p>

<p>(d) <u>Insurance</u>. The Company and its Significant
Subsidiaries will maintain, with financially sound and reputable
insurers, insurance with respect their respective properties and
businesses against such casualties and contingencies, of such
types, on such terms and in such amounts (including deductibles,
co-insurance and self-insurance, if adequate reserves are
maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a
similar business and similarly situated. </p>

<p>(e) <u>Compliance with Law</u>. The Company and its
Significant Subsidiaries will comply with all laws, ordinances or
governmental rules or regulations to which each of them is
subject, and will obtain and maintain in effect all licenses,
certificates, permits, franchises and other governmental
authorizations necessary to the ownership of their respective
properties or to the conduct of its business, in each case to the
extent necessary to ensure that non-compliance with such laws,
ordinances or governmental rules or regulations or failures to
obtain or maintain in effect such licenses, certificates,
permits, franchises and other governmental authorizations would
not reasonably be expected, individually or in the aggregate, to
have a materially adverse effect on the business, operations,
affairs, financial condition, properties or assets of the Company
and its Subsidiaries taken as a whole. </p>

<p>(f) <u>Company Financial Statements</u>. The Company shall
deliver to the Holder: </p>

<p>(i) Quarterly Statements -- within 45 days after the end of
each quarterly fiscal period in each fiscal year of the Company
(other than the last quarterly fiscal period of each such fiscal
year), copies of,</p>

<p>(1) a consolidated balance sheet of the Company and its
Subsidiaries as at the end of such quarter, and</p>

<p>(2) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such quarter and (in the case of the second and
third quarters) for the portion of the fiscal year ending with
such quarter, setting forth in each case in comparative form the
figures for the corresponding periods in the previous fiscal
year, all in reasonable detail, prepared in accordance with GAAP
applicable to quarterly financial statements generally, and
certified by a senior financial officer as fairly presenting, in
all material respects, the financial position of the companies
being reported on and their results of operations and cash flows,
subject to changes resulting from year-end adjustments;</p>

<p>(ii) Annual Statements -- within 90 days after the end of each
fiscal year of the Company, copies of,</p>

<p>(1) an audited consolidated balance sheet of the Company and
its Subsidiaries, as at the end of such year, and</p>

<p>(2) an audited consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its
Subsidiaries, for such year,</p>

<p>setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP.</p>

<p>(g) <u>Notice of Default or Event of Default</u>. Promptly,
and in any event within five days after a Responsible Officer
becoming aware of the existence of any Default or Event of
Default, a written notice specifying the nature and period of
existence thereof and what action the Company is taking or
proposes to take with respect thereto.</p>

<p>(h) <u>Further Instruments and Acts</u>. Upon request of a
Holder, the Company shall execute and deliver such further
instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of
this Second Exchangeable Debenture. In addition, the Company is
expressly authorized to take such actions as are reasonably
necessary to effectuate the respective rights and obligations of
the parties under the Stakeholders Agreement, to the extent such
rights and obligations relate to this Second Exchangeable
Debenture.</p>

<p>(i) <u>Indebtedness</u>. The Company shall not create, incur,
assume or permit to be outstanding any Indebtedness other than
Indebtedness incurred pursuant to this Second Exchangeable
Debenture and the transactions contemplated by the Asset Purchase
Agreement, unless the proceeds of such Indebtedness are used to
pay all or a portion of the Indebtedness represented by the
Convertible Debenture. </p>

<p>11. <u>Amendment&nbsp;and&nbsp;Waiver</u>.<u> </u></p>

<p>(a) <u>Consent Required</u>. Any term, covenant, agreement or
condition of this Second Exchangeable Debenture may, with the
consent of the Company, be amended or compliance therewith may be
waived (either generally or in a particular instance and either
retroactively or prospectively), if the Company shall have
obtained the consent in writing of the Holder, provided, however,
that any term covenant agreement or condition which relates to
the obligations of Parent pursuant to Sections 5, 6, 7 and 8(a)
hereof will also require the consent of Parent.</p>

<p>(b) <u>Effect of Amendment or Waiver</u>. Any amendment or
waiver shall be binding upon each future holder of this Second
Exchangeable Debenture and upon the Company (and Parent, as
applicable), whether or not such Second Exchangeable Debenture
shall have been marked to indicate such amendment or waiver. No
such amendment or waiver shall extend to or affect any obligation
not expressly amended or waived or impair any right consequent
thereon.</p>

<p>12. <u>Replacement&nbsp;Second Exchangeable Debenture</u>.</p>

<p>If this Second Exchangeable Debenture becomes mutilated and is
surrendered to the Company or if the Holder of this Second
Exchangeable Debenture presents evidence to the reasonable
satisfaction of the Company that this Second Exchangeable
Debenture has been lost, destroyed or wrongfully taken, the
Company shall issue a replacement Second Exchangeable Debenture
of like tenor if the requirements of the Company for such
transactions are met. An indemnity agreement may be required that
is sufficient in the reasonable judgment of the Company to
protect the Company from any loss which it may suffer. The
Company may charge for its out-of-pocket expenses incurred in
replacing this Second Exchangeable Debenture.</p>

<p>13. <u>No&nbsp;Recourse&nbsp;Against&nbsp;Others</u>.<u> </u></p>

<p>No director, officer, employee or stockholder, as such, of the
Company shall have any liability for any obligations of the
Company under this Second Exchangeable Debenture or for any claim
based on, in respect or by reason of, such obligations or their
creation. The Holder by accepting this Second Exchangeable
Debenture waives and releases all such liability. This waiver and
release are part of the consideration for the issue of this
Second Exchangeable Debenture.</p>

<p>14. <u>Notices</u>.<u> </u></p>

<p>All notices, requests, demands, waivers and other
communications required or permitted to be given under this
Second Exchangeable Debenture shall be in writing and shall be
deemed to have been duly given if delivered personally, by mail
(certified or registered mail, return receipt requested), by
recognized overnight courier or by facsimile transmission
(receipt of which is confirmed):</p>

<blockquote>
    <blockquote>
        <p>(i) if to the Company, to: </p>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <p>E.A. Viner International Co.<br>
                                125 Broad Street<br>
                                New York, NY 10004<br>
                                Fax: (212) 943-8728<br>
                                Attention: A.G. Lowenthal</p>
                                <p><br>
                                with a copy to:<br>
                                </p>
                                <p>Borden Ladner Gervais LLP<br>
                                Scotia Plaza, Suite 4400<br>
                                40 King Street West<br>
                                Toronto, Ontario M5H 3Y4<br>
                                CANADA<br>
                                Attention: A. Winn Oughtred, Esq.<br>
                                Telephone: (416) 367-6247<br>
                                Facsimile: (416) 361-7076<br>
                                Email: woughtred@blgcanada.com</p>
                            </blockquote>
                        </blockquote>
                    </blockquote>
                </blockquote>
                <p>and</p>
            </blockquote>
        </blockquote>
        <p>Skadden, Arps, Slate, Meagher &amp; Flom LLP</p>
        <p>Four Times Square</p>
        <p>New York, NY 10036</p>
        <p>Attention: Vincent J. Pisano, Esq.</p>
        <p>Telephone: (212) 735-2718</p>
        <p>Facsimile: (917) 777-2718</p>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <p>Email: vpisano@skadden.com</p>
                            </blockquote>
                        </blockquote>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
        <p>(ii) if to the Holder, to:</p>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <p>Canadian Imperial Bank of
                                Commerce<br>
                                Commerce Court West<br>
                                Toronto, Ontario M5L 1A2<br>
                                CANADA<br>
                                Attention: Gerry McCaughey<br>
                                Telephone: (416) 980-2211<br>
                                Facsimile: (416) 332-4316<br>
                                Email: gerry.mccaughey@cibc.com</p>
                                <p>with a copy to:<br>
                                <br>
                                Mayer, Brown, Rowe &amp; Maw<br>
                                1675 Broadway<br>
                                New York, NY 10019-5820 <br>
                                Attention: James B. Carlson, Esq.<br>
                                Telephone: (212) 506-2515<br>
                                Facsimile: (212) 849-5515<br>
                                Email:
                                jcarlson@mayerbrownrowe.com</p>
                            </blockquote>
                        </blockquote>
                        <p>and</p>
                        <p>Canadian Imperial Bank of Commerce</p>
                        <p>Legal and Compliance</p>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
        <p>245 Park Avenue</p>
        <p>42nd Floor </p>
        <p>New York, NY 10167</p>
        <p>Attention: Michael Capatides, Esq.</p>
        <p>Telephone: (917) 332-4108</p>
        <p>Facsimile: (917) 332-4320</p>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <p>Email:
                                michael.capatides@us.cibc.com</p>
                            </blockquote>
                        </blockquote>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>or to such other person or address as any party shall specify
by notice in writing to the other party. All such notices,
requests, demands, waivers and communications shall be deemed to
have been received on the date on which so hand-delivered, on the
third Business Day following the date on which so mailed, on the
Business Day following the date on which delivered to the
overnight courier service and on the date on which faxed and
confirmed, except for a notice of change of address, which shall
be effective only upon receipt thereof.</p>

<p>15. <u>Waiver of Stay, Usury or Extension Laws</u>. </p>

<p>The Company (to the extent it may lawfully do so) shall not at
any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, usury or extension
law wherever enacted, now or at any time hereafter in force,
which may affect the covenants or the performance of this
Exchangeable Debenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or
advantage of any such law. </p>

<p>16. <u>Governing&nbsp;Law; Jurisdiction</u>.<u> </u></p>

<p>This Second Exchangeable Debenture shall be construed,
performed and enforced in accordance with, and governed by, the
laws of the State of New York, without giving effect to the
principles of conflicts of laws thereof. Each party irrevocably
submits to the exclusive jurisdiction of (i) the Supreme Court of
the State of New York, New York County, and (ii) the United
States District Court for the Southern District of New York, for
the purposes of any suit, action or other proceeding arising out
of this Second Exchangeable Debenture. Each party agrees to
commence any action, suit or proceeding relating hereto either in
the United States District Court for the Southern District of New
York or if such suit, action or other proceeding may not be
brought in such court for reasons of subject matter jurisdiction,
in the Supreme Court of the State of New York, New York County.
Each party irrevocably and unconditionally waives any objection
to the laying of venue of any action, suit or proceeding arising
out of this Second Exchangeable Debenture in (A) the Supreme
Court of the State of New York, New York County, or (B) the
United Sates District Court for the Southern District of New
York, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such
action, suit or proceeding brought in any such court has been
brought in an inconvenient forum. Each party irrevocably and
unconditionally waives the right to trial by jury in any legal or
equitable action, suit or proceeding arising out of or relating
to this Second Exchangeable Debenture, the notes or any other
operative agreement or any transaction contemplated hereby or
thereby or the subject matter of any of the foregoing.</p>

<p>17. <u>Successors, etc.; Entire Agreement; Assignment</u>. </p>

<p>This Second Exchangeable Debenture shall be binding upon and
shall inure to the benefit of the Holder and the Company (and
Parent with respect to its rights and obligations pursuant to
Sections 5, 6, 7 and 8(a) hereof) and their respective successors
and permitted assigns. This Second Exchangeable Debenture
constitutes the entire agreement between the parties, superseding
all prior understandings and writings, with respect to the
indebtedness represented hereby. Provided, however, that in the
event any provision of the Second Exchangeable Debenture is in
conflict with any provision of the Stakeholders Agreement, the
provisions of the Stakeholders Agreement shall control and take
precedence over any provision herein. Holder may not assign or
transfer this Second Exchangeable Debenture without complying
with the terms and conditions of the Stakeholders Agreement
applicable to the transfer of the Second Exchangeable Debenture,
and such transfer shall be subject to regulatory approval,
including but not limited to, the rules and regulations of NYSE.
In the event that the Holder wishes to assign or transfer this
Second Exchangeable Debenture, the Holder shall deliver written
notice of such intention to the Company specifying the name and
address for notices of the transferee and the proposed date of
transfer (which date shall be not fewer than ten (10) Business
Days following the Holder&#146;s delivery to the Company of such
notice). In the event that the Company objects to such proposed
date of transfer, the Company and the Holder shall work together
in good faith to determine a mutually agreeable date of transfer,
provided, however, that such date shall not be later than 30 days
following the Holder&#146;s delivery to the Company of written
notice of its intention to assign or transfer this Second
Exchangeable Debenture. On the date of transfer, the Holder shall
surrender this Second Exchangeable Debenture to the Company for
cancellation, and the Company shall issue a Second Exchangeable
Debenture to such transferee, which Second Exchangeable Debenture
is identical in all respects to this Second Exchangeable
Debenture except for the name of the Holder and the name and
address of the Holder specified in Section 14. The Holder may not
assign or transfer this Second Exchangeable Debenture except
pursuant to the foregoing procedure. </p>

<p>18. <u>Headings</u>.<u> </u></p>

<p>The section headings of this Second Exchangeable Debenture are
for convenience only and shall not affect the meaning or
interpretation of this Second Exchangeable Debenture or any
provision hereof.</p>

<p>IN WITNESS WHEREOF, the Company has caused this Second
Exchangeable Debenture to be executed by its duly authorized
officer.</p>

<p>Dated: May 12, 2003</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <blockquote>
                                    <blockquote>
                                        <blockquote>
                                        <blockquote>
                                        <p>E.A. VINER
                                        INTERNATIONAL CO.</p>
                                        <p>&nbsp;</p>
                                        <p>&nbsp;</p>
                                        <p>By:<u> </u></p>
                                        <p>Name:</p>
                                        <p>Title:</p>
                                        <p>&nbsp;</p>
                                        </blockquote>
                                        </blockquote>
                                    </blockquote>
                                </blockquote>
                            </blockquote>
                        </blockquote>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p>IN WITNESS WHEREOF, solely with respect to the rights and
obligations of Parent pursuant to Sections 5, 6, 7 and 8(a)
hereof, Parent has caused this Second Exchangeable Debenture to
be executed by its duly authorized officer.</p>

<p>Dated: May 12, 2003</p>

<p>&nbsp;</p>

<p>&nbsp;</p>

<blockquote>
    <blockquote>
        <blockquote>
            <blockquote>
                <blockquote>
                    <blockquote>
                        <blockquote>
                            <blockquote>
                                <blockquote>
                                    <blockquote>
                                        <blockquote>
                                        <blockquote>
                                        <p>FAHNESTOCK VINER
                                        HOLDINGS INC.</p>
                                        <p>&nbsp;</p>
                                        <p>&nbsp;</p>
                                        <p>By:<u> </u></p>
                                        <p>Name:</p>
                                        <p>Title:</p>
                                        </blockquote>
                                        </blockquote>
                                    </blockquote>
                                </blockquote>
                            </blockquote>
                        </blockquote>
                    </blockquote>
                </blockquote>
            </blockquote>
        </blockquote>
    </blockquote>
</blockquote>

<p align="right"><u>Exhibit A</u></p>

<p align="center">EXCHANGE NOTICE</p>

<p>By execution and delivery to the Company of this Exchange
Notice, the undersigned represents and warrants that it is an
accredited investor within the meaning of the Securities Act
(Ontario) and is acquiring the Class A Shares as principal.</p>

<p>To exchange this Second Exchangeable Debenture for Class A
Shares of Fahnestock Viner Holdings Inc.</p>

<p>check the box: [ ]</p>

<p>To exchange only part of this Second Exchangeable Debenture,
state the principal amount to be exchanged (must be $1,000 or a
multiple of $1,000): $______________. </p>

<p>If you want the stock certificate made out in another person's
name, fill in the form below:</p>

<p>_________________________________________________________________
</p>

<p>(Insert assignee's soc. sec. or tax I.D. no.) </p>

<p>_________________________________________________________________
</p>

<p>__________________________________________________________________</p>

<p>__________________________________________________________________</p>

<p>__________________________________________________________________
</p>

<p>(Print or type assignee's name, address and zip code) </p>

<p>Your Signature:</p>

<p>&nbsp;</p>

<p>Date: ______________ ______________________________________ </p>

<p>(Sign exactly as your name appears on the other side of this
Second Exchangeable Debenture)</p>
</body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-14
<SEQUENCE>8
<FILENAME>codeofco.htm
<DESCRIPTION>CODE OF ETHICS
<TEXT>
<!DOCTYPE HTML PUBLIC "-//IETF//DTD HTML//EN">
<html>


<body bgcolor="#FFFFFF" link="#0000FF">
<p align="right"><b>EXHIBIT 14</b></p>

<p align="right"><b>March 2004</b></p>

<p align="center"><b>Oppenheimer Holdings Inc. <br>
<br>
Oppenheimer &amp; Co. Inc.<br>
<br>
Code of Conduct and Business Ethics for Directors, Officers and
Employees <br>
<br>
1. Introduction</b></p>

<p>This Code of Conduct and Business Ethics (the
&quot;Code&quot;) applies to all directors, officers and
employees of Oppenheimer Holdings Inc., Oppenheimer &amp; Co.
Inc. and all other subsidiaries of Oppenheimer Holdings Inc.
(collectively &quot;Oppenheimer&quot;). Some subsidiaries,
departments and specialized areas have specific codes of conduct
or ethics or the like in place that cover conduct or regulatory
issues that only apply to that area or field. If you work for one
of these subsidiaries or specialized areas such specific codes of
conduct of ethics apply to you in addition to the Code.</p>

<p align="center"><b>2. Purpose of the Code</b></p>

<p>The purpose of the Code is to promote and foster the honest
and ethical conduct of the directors, officers and employees of
Oppenheimer.</p>

<p>Our Basic Principles are:</p>

<blockquote>
    <blockquote>
        <p>adhere to the law wherever Oppenheimer does business;</p>
        <p>avoid putting yourself or Oppenheimer in a conflict of
        interest;</p>
        <p>conduct yourself honestly and with integrity; </p>
        <p>keep Oppenheimer transactions, communications and
        information, accurate, confidential and secure, and
        Oppenheimer assets safe; and </p>
        <p>treat everyone fairly and equitably &#150; whether
        customers, suppliers, employees or others who deal with
        Oppenheimer.</p>
    </blockquote>
</blockquote>

<p align="center"><b>3. Compliance with Law </b></p>

<p>You must know, respect and comply with all laws, rules, and
regulations applicable to the conduct of Oppenheimer's businesses
in the areas in which you work. Oppenheimer actively promotes
compliance with the laws, rules, and regulations that govern
Oppenheimer's business. Obeying both the letter and spirit of the
law is one of the foundations of Oppenheimer&#146;s ethical
standards. You must follow and obey the laws of all the states
and countries where we operate. While you are not expected to be
an expert on every detail of all the laws that govern our
business in every jurisdiction, you are expected to understand
the laws and regulations applicable to your duties at Oppenheimer
and to understand the regulatory environment within which the
firm operates well enough to know when to seek advice from your
Manager, a Senior Officer or from the Senior Vice President and
Corporate Counsel.</p>

<blockquote>
    <blockquote>
        <p><b>A. Brokerage Accounts</b></p>
    </blockquote>
</blockquote>

<p>In accordance with industry regulations, Oppenheimer employees
and officers and their immediate families must maintain their
brokerage accounts at Oppenheimer. Exceptions to this policy are
rarely granted and must be approved by your Manager, the Director
of Compliance or the Senior Vice President and Corporate Counsel.</p>

<blockquote>
    <blockquote>
        <p><b>B. Insider Trading</b></p>
    </blockquote>
</blockquote>

<p>Securities laws and Oppenheimer policy prohibit you from
acting upon material non-public information to benefit yourself
or others. Information is &quot;material&quot; if there is a
substantial likelihood that a reasonable investor would consider
it important in making an investment decision, or it could
reasonably be expected to affect the price of an issuer's
securities. At times, our policies may limit the ability of some
employees to enter into transactions. Anyone with ongoing
possession of non-public information may be unable to trade
personally in the securities of the companies about which he or
she has information. Those having access to confidential or
non-public information must not use or share that information
except in connection with the legitimate conduct of Oppenheimer
business. Oppenheimer strives to prevent the misuse of material
non-public information by, among other things, limiting access to
confidential information and limiting and monitoring
communications between various Oppenheimer departments including,
without limitation, the investment banking, asset management,
sales, research, and trading departments. In addition to civil
and criminal proceedings and penalties, misuse of confidential
information or engaging in insider trading will result in
disciplinary action, up to and including termination.</p>

<blockquote>
    <blockquote>
        <p><b>C. Money Laundering and Antiterrorism Laws</b></p>
    </blockquote>
</blockquote>

<p>Oppenheimer complies with federal, state,. and international
laws prohibiting money laundering and with the safeguards against
terrorist activity contained in the USA Patriot Act. Under no
circumstances should you participate in any money laundering
activity. In addition to severe criminal penalties, money
laundering by Oppenheimer employees and violations of the USA
Patriot Act will result in disciplinary action, up to and
including termination. Any suspicious deposits, or any other
client activity that raises questions about the source of the
client's funds, should be reported immediately to your Manager,
the firm&#146;s Anti-Money Laundering Officer (currently Mr.
James Gianni at (212) 668-5024, or the Office of the General
Counsel.</p>

<blockquote>
    <blockquote>
        <p><b>D. Proper Record-Keeping and Disclosure
        Requirements</b></p>
    </blockquote>
</blockquote>

<p>Oppenheimer requires honest and accurate accounting and
recording of financial and other information in order to make
responsible business decisions and provide an accurate account of
Oppenheimer's performance to stakeholders and regulators. It is a
violation of law and Oppenheimer policy for any employee to
attempt to improperly influence or mislead any person engaged in
auditing or reviewing our financial accounts and statements.
Oppenheimer is committed to full compliance with all requirements
applicable to its regulatory and public disclosures. Oppenheimer
requires that its financial and other reporting fairly present
the financial condition, results of operations, and cash flow of
Oppenheimer and that it comply in all respects with applicable
law, governmental rules, and regulations, including generally
accepted accounting principles (GAAP) in the United States and
Canada and applicable rules of the U.S. Securities and Exchange
Commission, the New York Stock Exchange, Canadian securities
regulators, the Toronto Stock Exchange and other securities
regulators. Oppenheimer has implemented disclosure controls and
procedures to ensure that its public disclosures are timely,
compliant, and otherwise full, fair, accurate, and
understandable. All employees and officers responsible for the
preparation of Oppenheimer's public disclosures, or who provide
information as part of that process, have a responsibility to
ensure that such disclosures and information are complete,
accurate, and in compliance with Oppenheimer's disclosure
controls and procedures.</p>

<blockquote>
    <blockquote>
        <p><b>E. Document Retention and Destruction</b></p>
    </blockquote>
</blockquote>

<p>Without exception, all officers and employees must fully
comply with Oppenheimer's document retention and destruction
policy. It is a criminal offense to destroy documents that are
subject to a subpoena or other legal process. Once a legal
proceeding has begun, or even when one is threatened or
reasonably likely, federal and state obstruction-of-justice
statutes require Oppenheimer to preserve documents relevant to
the issues in that proceeding even before specific documents are
requested. Any Oppenheimer employee who fails to comply with this
policy, as well as industry regulations and state and federal
laws, is subject to termination and may also face criminal or
civil prosecution, with possible fines and prison terms.</p>

<blockquote>
    <blockquote>
        <p><b>F. Cooperation with Investigations and Law
        Enforcement</b></p>
    </blockquote>
</blockquote>

<p>It is Oppenheimer's policy to cooperate with government
investigators and law enforcement officials. Every Oppenheimer
employee must also cooperate with investigations by
non-governmental regulators with oversight of our business, such
as securities exchanges, as well as with internal Oppenheimer
investigations. All inquiries or requests or demands for
information from external investigators must be immediately
referred to the Office of the General Counsel. The Office of the
General Counsel must coordinate all responses to external
investigators' questions. Failure to cooperate with legitimate
investigations will result in disciplinary action, up to and
including termination.</p>

<blockquote>
    <blockquote>
        <p><b>G. Privacy</b></p>
    </blockquote>
</blockquote>

<p>All Oppenheimer personnel must comply with all applicable
privacy laws in their handling of client matters and client and
Oppenheimer records. Any questions about the applicability of
privacy laws should be referred to the Office of the General
Counsel.</p>

<p align="center"><b>4. Conflicts of Interest</b></p>

<p>A conflict of interest occurs when your private interests
interfere, or appear to interfere, in any way, with the interests
of Oppenheimer. Conflicts of interest can arise when you take
action or have interests that may make it difficult for you to
perform your duties to Oppenheimer effectively. Conflicts of
interest also arise when you, or a member of your family,
receives improper personal benefits as a result of your position
with Oppenheimer. Loans to, or guarantees of obligations of, any
employees, officers, directors or any of their family members are
likely to pose conflicts of interest, as are transactions of any
kind between Oppenheimer and any other organization in which you
or any member of your family have an interest.</p>

<p>Engaging in any conduct that represents a conflict of interest
is prohibited. If you have any doubt whether or not conduct would
be considered a conflict of interest, please consult your
Manager, a Senior Officer or the Senior Vice President and
Corporate Counsel. You must also disclose any material
transaction or relationship that could reasonably be expected to
give rise to such a conflict to the Senior Vice President and
Corporate Counsel. If a conflict of interest cannot be avoided,
it must be managed in an ethical, responsible manner, so as not
to create the perception of impropriety.</p>

<p>As a Director, Senior Executive, or Financial Officer or
employee of Oppenheimer, it is imperative that you avoid any
investment, interest or association that interferes, might
interfere, or might be perceived to interfere, with your
independent exercise of judgment in Oppenheimer's best interest.</p>

<blockquote>
    <blockquote>
        <p><b>A. Ownership of Securities and Outside Business
        Activities</b></p>
    </blockquote>
</blockquote>

<p>As a Senior Executive or employee of Oppenheimer, you must
report all outside business activities, including ownership of
privately held stock and limited partnership interests, to your
Manager and to the appropriate Oppenheimer Compliance Officer so
that a review for potential conflicts of interest can be
conducted. Outside business activities and interests include
serving as a partner or a stockholder in another business, as an
officer in a family-owned corporation, or as an outside director
of another company. The appropriateness of you engaging in these
and other types of outside business activities, interest, or
investment opportunities depends on many factors, including the
nature and extent of the outside interest, the potential for
conflicts of interest, the relationship between Oppenheimer and
the outside entities, and the duties involved. You must receive
prior written approval for any outside business activity and
private investment from the Director of Compliance. You have an
obligation to keep Oppenheimer apprised of these activities and
provide updated information about the outside interests. Service
by you as a director, officer, or employee of any other
corporation or business must be authorized in writing by the
Director of Compliance. Unless approved in writing by the
Director of Compliance or the Senior Vice President and Corporate
Counsel, you may not serve as a director of a publicly traded
company. </p>

<p>Directors of Oppenheimer should inform the Chairman and Chief
Executive Officer of Oppenheimer Holdings Inc. prior to accepting
appointments to the boards of directors or advisory boards of any
public or privately held company. The disclosure requirements and
other possible conflict-of-interest issues involved must be
analyzed and discussed.</p>

<blockquote>
    <blockquote>
        <p><b>B. Public Office</b></p>
    </blockquote>
</blockquote>

<p>You are required to notify and receive the approval of the
Director of Compliance or the Senior Vice President and Corporate
Counsel before committing to a candidacy for elective office or a
formal position on a company committee and before accepting an
appointment to a public or civic office. Oppenheimer must take
steps to ensure that conflicts of interest are not raised by such
campaign or public service. In general, you may run for and serve
in local, elective, or appointed civic offices, provided the
activity, including campaigning:</p>

<blockquote>
    <blockquote>
        <p>occurs outside work hours;</p>
        <p>involves no use of Oppenheimer's name, facilities,
        client lists, other corporate assets, or corporate
        funding;</p>
        <p>is confined solely to you in your capacity as a
        private citizen and not as a representative of
        Oppenheimer; and </p>
        <p>does not present an actual or perceived conflict of
        interest for Oppenheimer, as determined in the sole
        judgment of Oppenheimer.</p>
    </blockquote>
</blockquote>

<p align="center"><b>5. Corporate Opportunities</b></p>

<p>You may not advance your personal interests at the expense of
Oppenheimer. You owe a duty to Oppenheimer to advance
Oppenheimer's legitimate interests to the best of your abilities
whenever the opportunity arises. You must not take for yourself
personally opportunities you discover through your employment
with Oppenheimer or the use of Oppenheimer property, information,
or position, which is in violation of Oppenheimer's policies. In
addition, Oppenheimer property, information, or position must not
be used for personal gain. You may not compete with Oppenheimer
while employed by Oppenheimer.</p>

<p align="center"><b>6. Confidentiality Obligations</b></p>

<blockquote>
    <blockquote>
        <p><b>A. Non-Public Information </b></p>
    </blockquote>
</blockquote>

<p>You must maintain the confidentiality of information entrusted
to you by Oppenheimer and provided by our clients, suppliers and
service providers. In the conduct of its business, Oppenheimer
receives a great deal of non-public information. Much of this
information may be sensitive, with the potential to affect market
conditions, negotiations, strategic positioning, and
relationships with clients, competitors, suppliers or service
providers. You must exercise care not to misuse non-public
information obtained during your employment, including client
lists, information about Oppenheimer personnel and clients, and
business plans and ideas. The obligation to maintain the
confidentiality of information may be subject to legal or
regulatory requirements to disclose that information. In such
cases, the Office of the General Counsel will help determine what
disclosure is required and how it is to be made.</p>

<blockquote>
    <blockquote>
        <p><b>B. Media, Publishing, and Public Appearances </b></p>
    </blockquote>
</blockquote>

<p>You may not provide non-public corporate information to
persons outside Oppenheimer, including the media. Any inquiries
or questions relative to the media should be referred to the
Chief Executive Officer or the President of Oppenheimer Holdings
Inc. </p>

<blockquote>
    <blockquote>
        <p><b>C. Client Information Privacy </b></p>
    </blockquote>
</blockquote>

<p>Oppenheimer protects the confidentiality and security of
client information [Oppenheimer's Privacy Policy for client
information provides that:</p>

<blockquote>
    <blockquote>
        <p>Oppenheimer does not
        sell or rent clients' personal information;</p>
        <p>you may not discuss the
        business affairs of any client with any other person,
        except on a strict need-to-know basis;</p>
        <p>Oppenheimer does not
        release client information to third parties, except upon
        a client's authorization or when permitted or required by
        law; and </p>
        <p>third-party service
        providers and suppliers with access to client information
        are required to keep client information confidential and
        use it only to provide services to or for Oppenheimer.</p>
    </blockquote>
</blockquote>

<p align="center"><b>7. Fair Dealing </b></p>

<p>You must deal fairly with Oppenheimer's clients, suppliers,
service providers, competitors, and employees. Competitive
advantage must result from superior performance, not unethical or
illegal business dealings. While Oppenheimer seeks to outperform
our competitors, it must be done honestly and fairly.</p>

<blockquote>
    <blockquote>
        <p><b>A. Unethical Behavior, Relationships with
        Competitors </b></p>
    </blockquote>
</blockquote>

<p>You may not take unfair advantage of anyone through unethical
or illegal measures, such as manipulation, concealment, abuse of
privileged information, misrepresentation of material facts, or
any other unfair dealing practices. It is improper, and may be
illegal, to hire competitors' employees for the purpose of
obtaining clients or trade secrets or other proprietary
information. It is also against Oppenheimer's policy to seek
increased revenues by disparaging our competitors. Our goal is to
increase business by offering superior and innovative financial
products and services. Oppenheimer advertising must be truthful,
not deceptive, and in compliance with applicable laws,
regulations, and corporate policies. All advertising and
marketing materials must be approved using the established
approval procedures. You must guard against unfair competitive
practices and exercise extreme caution to avoid conduct that
might violate antitrust laws or other rules prohibiting
anti-competitive activities. Violations may result in criminal or
civil proceedings and penalties. If a competitor or third-party
proposes to discuss unfair collusion, price-fixing, or other
anti-competitive activities, your responsibility is to object,
terminate the conversation, or leave the meeting and report the
incident promptly to your manager, a Senior Officer or the Senior
Vice President and Corporate Counsel. You must avoid any
discussion with competitors of proprietary or confidential
information, business plans, or topics such as pricing or sales
policies &#150; the discussion of which could be viewed as an
attempt to make joint rather than independent business decisions.</p>

<blockquote>
    <blockquote>
        <p><b>B. Gifts, Gratuities, Political Contributions, and
        Other Payments Related to Oppenheimer Business </b></p>
    </blockquote>
</blockquote>

<p>You, your associates or members of your family may not,
directly or indirectly, accept or receive bonuses, fees, gifts,
frequent or excessive entertainment, or any similar form of
consideration that is of more than nominal value from any person
or entity with which Oppenheimer does, or seeks to do, business.
It also is generally against corporate policy to give gifts or
gratuities, other than within accepted guidelines, without
receiving specific approval by the Director of Compliance or the
Senior Vice President and Corporate Counsel. You may not give
gifts of any value to government officials without specific
approval by the Director of Compliance or the Senior Vice
President and Corporate Counsel. Oppenheimer policy forbids
bribes, payoffs, contributions, or payments of any kind by any
Oppenheimer employee, officer or director to any person,
government official, or entity for the purpose of improperly
obtaining or retaining business or influencing consideration of
any business activity. This policy covers all types of payments
that may or may not be considered legal under the circumstances.
Special rules may apply to payments or gifts (including
entertainment) to officers, directors, employees, or other
affiliates of government owned or controlled entities and certain
highly regulated entities (such as banks or insurance companies),
as well as entities located in certain jurisdictions.</p>

<p align="center"><b>8. Respect for the Individual</b></p>

<blockquote>
    <blockquote>
        <p><b>A. Conduct Business Activities in an Atmosphere of
        Good Faith and Respect </b></p>
    </blockquote>
</blockquote>

<p>It is Oppenheimer's policy, to treat each individual with
dignity, consideration, and respect. All Oppenheimer employees
should be honest and fair with others, share the credit when
credit is due, avoid public criticism of one another, and
encourage an atmosphere in which openness, cooperation, and
consultation are the norms. Internal relationships with fellow
employees should be based on the same high standards of integrity
and ethical responsibility that are observed with Oppenheimer
clients, shareholders, and the public.</p>

<p>Oppenheimer is committed to promoting diversity within its
workforce; achieving it is an important competitive advantage in
the global marketplace. Oppenheimer has a strict policy of equal
opportunity in hiring, developing, promoting, and compensating
employees. We seek to attract, retain, and reward employees who
perform their work to the highest standards, basing promotions on
qualification and merit. Discrimination is not tolerated on the
grounds of race, national origin, religion, gender, age,
disability, sexual orientation, or veteran status. Just as we do
not tolerate illegal discrimination in any form, we also do not
tolerate illegal sexual or any other form of harassment at any
level of Oppenheimer. Employees who experience or observe
work-related discrimination, harassment, or similar problems have
an obligation to report it to their Manager, the Director of
Human Resources, or the Senior Vice President and Corporate
Counsel.</p>

<p>Indebtedness between employees is best avoided and must not
reach a level that may compromise the objectivity essential in
manager employee relationships or in the discharge of job-related
responsibilities. Any indebtedness between employees and their
direct or indirect supervisors (regardless of which one is
borrower or lender) must be limited to nominal amounts.</p>

<p align="center"><b>9. Protecting Oppenheimer Information,
Assets, and Property</b></p>

<blockquote>
    <blockquote>
        <p><b>A. Business Use</b></p>
    </blockquote>
</blockquote>

<p>You must protect Oppenheimer's assets and ensure their
efficient use. You may only use Oppenheimer property for
legitimate business purposes. Any suspected fraud or theft of
Oppenheimer property must be reported for investigation
immediately. Oppenheimer's assets include our capital,
facilities, equipment, proprietary information, technology,
business plans, ideas for new products and services, trade
secrets, inventions, copyrightable materials, and client lists.
Information owned by Oppenheimer must be treated with the same
care as any other asset, and every Oppenheimer employee has a
role in protecting its confidentiality and integrity.</p>

<blockquote>
    <blockquote>
        <p><b>B. Proprietary Information and Intellectual
        Property</b></p>
    </blockquote>
</blockquote>

<p>Your obligation to protect Oppenheimer's assets applies to our
proprietary information. Proprietary information includes
business, marketing, and service plans; unpublished financial
data and reports; databases; customer information; and salary and
bonus information, as well as intellectual property such as trade
secrets, patents, trademarks, and copyrights. Unauthorized use or
distribution of this material is a violation of Oppenheimer's
policy, and it may also be illegal and result in civil and
criminal proceedings and penalties. Intellectual property refers
to a company's intangible assets, such as the company's business
methods, inventions, trademarks, and publications. All inventions
and copyrightable material conceived by an employee within the
scope of his or her employment are the exclusive property of
Oppenheimer, and as a condition of continued employment, the
employee must do whatever is necessary to transfer to Oppenheimer
the technical ownership of such inventions or materials. It is
the responsibility of every employee to protect Oppenheimer's
intellectual property. In addition, Oppenheimer also respects the
intellectual property of other parities. The unauthorized use of
another party's patented, trademarked, or copyrighted
(electronic, audio, video, text) materials is strictly
prohibited, regardless of their source. In addition, Oppenheimer
does not permit the use of software or other devices whose
primary purpose is the circumvention or violation of another's
intellectual property rights. Please contact the Senior Vice
President and Corporate Counsel with questions about the proposed
use of another party's intellectual property and for appropriate
contracts.</p>

<blockquote>
    <blockquote>
        <p><b>C. Compliance with Internal Controls </b></p>
    </blockquote>
</blockquote>

<p>Oppenheimer maintains and enforces a strong, effective system
of internal controls to safeguard and preserve its information
and assets, its clients, and its shareholders. These controls are
designed to ensure that business transactions are properly
authorized and carried out, and that all reporting is truthful
and accurate. These administrative and accounting control systems
are the responsibility of each group in the Oppenheimer
organization. All business transactions require authorization at
an appropriate management level. Any employee who is responsible
for the acquisition or disposition of assets for Oppenheimer, or
who is authorized to incur liabilities on Oppenheimer's behalf,
must act prudently in exercising this authority and must be
careful not to exceed his or her authority. Equally important,
every employee must help ensure that all business transactions
are executed as authorized. Transactions must be properly
reflected on Oppenheimer's books and records. Every employee is
involved, if not in the authorization or execution of business
transactions, in some level of reporting. This may include
reporting travel and entertainment expenses or recording work
hours on a timecard. It is important that all reporting be done
honestly and accurately and that employees cooperate fully with
both internal and independent audits.</p>

<p align="center"><b>10. OPPENHEIMER WRITTEN AND ELECTRONIC
COMMUNICATIONS</b></p>

<p>You must use Oppenheimer's information and communication
systems properly and judiciously. Oppenheimer has strict policies
on use of the Internet and on written and electronic
communications which you must comply with.</p>

<blockquote>
    <blockquote>
        <p><b>A. Access to the Internet</b></p>
    </blockquote>
</blockquote>

<p>Oppenheimer has strict policies on Internet access. Only
authorized connections are permitted, and access to the Internet
must be accomplished via an approved security gateway.
Furthermore, you are not permitted to link to the Internet from
Oppenheimer offices via modem dial-up services or other external
service providers without the express approval of the Director of
Compliance. Additionally, you should exercise good judgment when
using the Internet during business hours for personal and
non-business purposes. You may not do any of the following:</p>

<blockquote>
    <blockquote>
        <p>transmit, copy, or download any material, including
        sexually explicit images or messages and materials
        containing racial, ethnic, or other slurs, that may
        defame, embarrass, threaten, offend, or harm an
        Oppenheimer employee or client or the general public;</p>
        <p>transmit or post non-public corporate information
        about Oppenheimer or any company to any organization or
        individual not authorized to receive or possess it;</p>
        <p>attempt to gain access to any computer, database, or
        network without authorization or wilfully propagate
        computer viruses or other disruptive or destructive
        programs;</p>
        <p>distribute unsolicited e-mail messages,
        advertisements, or postings to multiple newsgroups,
        individuals, or organizations (e.g.,
        &quot;spamming&quot;); and</p>
        <p>use electronic means for the purpose of gambling or to
        send or forward chain letters.</p>
    </blockquote>
</blockquote>

<p>You may not establish e-mail addresses or domain names that
attempt to trade on, or are derived from, the Oppenheimer name or
any corporate, brand names or domain names used within the
Oppenheimer Group; if such use is identified, immediate
relinquishment will be requested. You should not register domain
names on behalf of Oppenheimer and may not establish Internet
websites related to Oppenheimer business without approval from
your Manager and the Director of Compliance and Director of
Information Technology. You are reminded to be sure that your
system passwords are secure. Inappropriate conduct in respect of
the usage of Oppenheimer's communications systems will lead to
disciplinary action, including revocation of privileges,
immediate termination, and referral to regulatory authorities.</p>

<blockquote>
    <blockquote>
        <p><b>B. Written and E-Mail Communications</b></p>
    </blockquote>
</blockquote>

<p>Electronic communications should be treated with the same care
as any other business communication. Any communication relating
to Oppenheimer business must be of an appropriate nature, must
not violate the legal rights of Oppenheimer, any Oppenheimer
employee, or third party, and must be transmitted, stored, and
accessed in the manner that safeguards confidentiality and
complies with applicable law. All written communications,
including those electronically delivered, should be clear,
concise, and professional in tone and content. Communications for
personal, non-business purposes should be kept to a minimum.</p>

<blockquote>
    <blockquote>
        <p><b>C. Communications Monitoring</b></p>
    </blockquote>
</blockquote>

<p>All electronic communications relating to Oppenheimer business
must be made through the Oppenheimer network unless the Director
of Compliance and Director of Information Technology has
expressly authorized another means. Electronic communications,
including connections to Internet and Intranet websites using
Oppenheimer computing or network resources, as the property of
Oppenheimer and are subject to monitoring and surveillance.
Communications by certain Oppenheimer personnel are subject to
detailed supervisory requirements.</p>

<p align="center"><b>11. Report Problems or Irregularities </b></p>

<p>If you believe that you may have breached the Code or a
supplemental code or guideline that applies to you, or have
observed:</p>

<blockquote>
    <blockquote>
        <p>a breach of the Code or a supplemental code or
        guideline by another Oppenheimer employee; or </p>
        <p>a serious weakness or deficiency in Oppenheimer's
        policies, procedures or controls which might enable
        breaches to occur or go undetected;</p>
    </blockquote>
</blockquote>

<p>you have a responsibility to Oppenheimer, your fellow
Oppenheimer employees and yourself to report it to your Manager,
that employee's Manager or the Senior Vice President and
Corporate Counsel.</p>

<p>Failure to report a known breach of the Code may result in
serious consequences. If a problem or irregularity has been
referred to you, you must resolve the issue or refer it
appropriately using the chain of communication referred to below.</p>

<p>Oppenheimer recognizes that, from time to time, you may be
uncertain about an appropriate course of action. In all such
cases, immediately seek the advice of your Manager, a more senior
officer or the Senior Vice President and Corporate Counsel.
Consult a still more senior officer or one of the persons
referred to below if you do not receive what you consider to be a
reasonable response from any such person.</p>

<p>If you are not satisfied with the resulting response or
action, you should contact or write without fear of reprisal to
the Chief Executive Officer of Oppenheimer or the Senior Vice
President and Corporate Counsel. You will be protected by
Oppenheimer from retaliation or reprisal if you, in good faith,
report actual, suspected or perceived breaches of the Code, or
supplemental codes or guidelines or problems with Oppenheimer
policies, procedures or controls.</p>

<p align="center"><b>12. BREACHES OF THE CODE</b></p>

<p>Breaches of the Code (and supplemental codes or guidelines) or
reported problems with Oppenheimer policies, procedures or
controls will be dealt with promptly and fairly. Any breach of
the Code (and supplemental codes or guidelines) is a serious
matter, and can result in action up to and including termination
of employment. Oppenheimer may be required to report certain
types of breaches to regulatory authorities, in which case the
director, officer or employee may be subject to civil or criminal
proceedings and penalties.</p>

<p align="center"><b>13. Sources of Assistance </b></p>

<p>You are expected to know and understand this Code. If you have
questions or concerns consult your supervisor or your Manager. If
this is not appropriate or if you need further guidance, you may
consult any of the following as you believe appropriate:</p>

<blockquote>
    <blockquote>
        <p>Ms. Lenore Denys<br>
        Director of Human Resources<br>
        Oppenheimer &amp; Co. Inc.<br>
        300 River Place, Suite 4000<br>
        Detroit, MI 48207<br>
        Tel: (313) 566-2309<br>
        Fax: (313) 259-7853<br>
        Email: Lenore.denys@opco.com</p>
        <p>Mr. Allen Holeman<br>
        Director of Compliance<br>
        Oppenheimer &amp; Co. Inc.<br>
        125 Broad Street, 16<sup>th</sup> Floor<br>
        New York, NY 10004<br>
        Tel: (212) 668-8944<br>
        Fax: (212) 668-5896<br>
        Email: Allen.Holeman@opco.com</p>
        <p>Dennis P. McNamara, Esq.<br>
        Senior Vice President and Corporate Counsel,<br>
        Oppenheimer &amp; Co. Inc.<br>
        125 Broad Street, 16th Floor<br>
        New York, NY 10004 U.S.A.<br>
        Tel: (212) 668-5771<br>
        Fax: (212) 425-8627<br>
        E-mail: dennis.mcnamara@opco.com </p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p>Eric Shames, Esq.<br>
        Office of the General Counsel<br>
        Oppenheimer &amp; Co. Inc.<br>
        125 Broad Street, 16<sup>th</sup> Floor<br>
        New York, NY 10004 U.S.A.<br>
        Tel: (212) 668-8073<br>
        Fax: (212) 785-1918<br>
        Email: eric.shames@opco.com</p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p>Ms. Elaine K. Roberts,<br>
        President and Treasurer<br>
        Oppenheimer Holdings Inc.<br>
        20 Eglinton Avenue West<br>
        Suite 1110, P.O. Box 2015<br>
        Toronto, Ontario M4R 1K8<br>
        Tel: (416) 322-1515<br>
        Fax: (416) 322-7007<br>
        E-mail: eroberts@opy.ca</p>
    </blockquote>
</blockquote>

<blockquote>
    <blockquote>
        <p>Mr. Albert G. Lowenthal<br>
        Chairman and CEO<br>
        Oppenheimer Holdings Inc. and Oppenheimer &amp; Co. Inc.<br>
        125 Broad Street<br>
        16th Floor <br>
        New York, N.Y. 10004 U.S.A.<br>
        Tel: (212) 668-5782<br>
        Fax: (212) 943-8728<br>
        E-mail: albert.lowenthal@opco.com</p>
        <p align="left">Mr. Kenneth W. McArthur <br>
        Lead Director <br>
        Oppenheimer Holdings Inc. <br>
        93 Riverwood Parkway<br>
        Toronto, Ontario M8Y 4E4<br>
        Tel: (416) 233-0218<br>
        Fax: (416) 233-7870</p>
        <p align="left">or</p>
        <p align="left">Gulf Harbor Golf and Country Club<br>
        14335 Harbor Links Ct., Unit 20B<br>
        Fort Meyers Florida 33908 USA<br>
        Tel: (239) 481-0249<br>
        Fax: (239) 481-0249</p>
    </blockquote>
</blockquote>

<p>&nbsp;</p>

<p>&nbsp;</p>

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