Supplemental Guarantor Condensed Consolidated Financial Statements

9 Months Ended

Sep. 30, 2011

Supplemental Guarantor Condensed Consolidated Financial [Abstract]

Supplemental Guarantor Condensed Consolidated Financial Statements

13. Supplemental Guarantor Condensed Consolidated Financial Statements

The Company’s Notes are jointly and severally and fully and unconditionally guaranteed on a senior basis by E.A. Viner International Co. and Viner Finance Inc. (together, the Guarantors), unless released as described below. Each of the Guarantors is 100% owned by the Company. The following condensed consolidating financial statements present the financial position, results of operations and cash flows of the Company (referred to as “Parent” for purposes of this note only), the Guarantor subsidiaries, the Non-Guarantor subsidiaries and elimination entries necessary to consolidate the Company. Investments in subsidiaries are accounted for using the equity method for purposes of the consolidated presentation.

Each Guarantor will be automatically and unconditionally released and discharged upon: the sale, exchange or transfer of the capital stock of a Guarantor and the Guarantor ceases to be a direct or indirect subsidiary of the Company if such sale does not constitute an asset sale under the indenture or does not constitute an asset sale effected in compliance with the asset sale and merger covenants of the debenture; a Guarantor being dissolved or liquidated; a Guarantor being designated unrestricted in compliance with the applicable provisions of the Notes; or the exercise by the Company of its legal defeasance option or covenant defeasance option or the discharge of the Company’s obligations under the indenture in accordance with the terms of the indenture.

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING BALANCE SHEET (unaudited)
AS OF SEPTEMBER 30, 2011


			Guarantor			Non-guarantor			Elimin-
Expressed in thousands of dollars.	Parent		Subsidiaries			Subsidiaries			ations			Consolidated
ASSETS
Cash and cash equivalents	$	12,293	$	18,228		$	56,975		$	—		$	87,496
Cash and securities segregated for regulatory and other purposes		—		—			199,948			—			199,948
Deposits with clearing organizations		—		—			22,574			—			22,574
Receivable from brokers and clearing organizations		—		23			335,243			—			335,266
Receivable from customers, net of allowance for credit losses of $2,399		—		—			893,571			—			893,571
Income taxes receivable		4,351		26,618			(702	)		(25,132	)		5,135
Securities purchased under agreement to resell		—		—			589,665			—			589,665
Securities owned, including amounts pledged of $402,666, at fair value		—		12,163			784,702			—			796,865
Subordinated loan receivable		—		112,558			—			(112,558	)		—
Notes receivable, net		—		—			55,965			—			55,965
Office facilities, net		—		—			18,047			—			18,047
Deferred tax asset		93		—			16,791			(16,884	)		—
Intangible assets, net		—		—			37,735			—			37,735
Goodwill		—		—			137,889			—			137,889
Other		4,300		324			161,622			60			166,306
Investment in subsidiaries		500,526		895,821			(189,022	)		(1,207,325	)		—
Intercompany receivables		192,640		(136,446	)		(20,012	)		(36,181	)		—

	$	714,203	$	929,289		$	3,100,991		$	(1,398,021	)	$	3,346,462

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING BALANCE SHEET (unaudited)
AS OF SEPTEMBER 30, 2011


			Guarantor			Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent		Subsidiaries			Subsidiaries		ations			Consolidated

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Drafts payable	$	—	$	—		$	46,049	$	—		$	46,049
Bank call loans		—		—			59,300		—			59,300
Payable to brokers and clearing organizations		—		—			426,590		—			426,590
Payable to customers		—		—			576,981		—			576,981
Securities sold under agreement to repurchase		—		—			860,360		—			860,360
Securities sold, but not yet purchased, at fair value		—		313			210,667		—			210,980
Accrued compensation		—		—			129,050		—			129,050
Accounts payable and other liabilities		8,308		845			299,019		59			308,233
Income taxes payable		2,440		22,555			137		(25,132	)		—
Senior secured note		200,000		—			—		—			200,000
Subordinated indebtedness		—		—			112,558		(112,558	)		—
Deferred income tax, net		—		(1,890	)		32,410		(16,883	)		13,637
Excess of fair value of acquired assets over cost		—		—			7,020		—			7,020
Intercompany payables		—		36,169			—		(36,169	)		—

		210,748		57,992			2,760,141		(190,683	)		2,838,200
Stockholders’ equity attributable to the Oppenheimer Holdings Inc.		503,455		871,297			336,043		(1,207,338	)		503,455
Noncontrolling interest							4,807					4,807
Stockholders’ equity		503,455		871,297			340,850		(1,207,338	)		508,262

	$	714,203	$	929,289		$	3,100,991		(1,398,021	)	$	3,346,462

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING BALANCE SHEET (unaudited)
AS OF DECEMBER 31, 2010


			Guarantor			Non-guarantor			Elimin-
Expressed in thousands of dollars.	Parent		Subsidiaries			Subsidiaries			ations			Consolidated
ASSETS
Cash and cash equivalents	$	361	$	(241	)	$	52,734		$	—		$	52,854
Cash and securities segregated for regulatory and other purposes		—		—			142,446			—			142,446
Deposits with clearing organizations		—		—			23,228			—			23,228
Receivable from brokers and clearing organizations		—		62			302,782			—			302,844
Receivable from customers, net of allowance for credit losses of $2,716		—		—			924,817			—			924,817
Income taxes receivable		—		33,557			(702	)		(27,713	)		5,142
Securities purchased under agreement to resell		—		—			347,070			—			347,070
Securities owned, including amounts pledged of $102,501, at fair value		—		—			367,019			—			367,019
Subordinated loan receivable		—		12,558			100,000			(112,558	)		—
Notes receivable, net		—		—			59,786			—			59,786
Office facilities, net		—		—			22,875			—			22,875
Intangible assets, net		—		—			40,979			—			40,979
Goodwill		—		—			137,889			—			137,889
Other		—		(347	)		198,954			58			198,665
Investment in subsidiaries		492,299		782,916			(152,804	)		(1,122,411	)		—
Intercompany receivables		12,135		21,862			1,849			(35,846	)		—

	$	504,795	$	850,367		$	2,568,922		$	(1,298,470	)	$	2,625,614

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING BALANCE SHEET (unaudited)
AS OF DECEMBER 31, 2010


			Guarantor		Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent		Subsidiaries		Subsidiaries		ations			Consolidated

LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities
Drafts payable	$	—	$	—	$	61,055	$	—		$	61,055
Bank call loans		—		—		147,000		—			147,000
Payable to brokers and clearing organizations		—		—		372,697		—			372,697
Payable to customers		—		—		406,916		—			406,916
Securities sold under agreement to repurchase		—		—		390,456		—			390,456
Securities sold, but not yet purchased, at fair value		—		—		160,052		—			160,052
Accrued compensation		—		—		175,938		—			175,938
Accounts payable and other liabilities		131		—		265,346		58			265,535
Income taxes payable		2,440		22,189		3,084		(27,713	)		—
Senior secured credit note		—		—		22,503		—			22,503
Subordinated note		—		—		212,558		(112,558	)		100,000
Deferred income tax, net		—		—		11,186		—			11,186
Excess of fair value of acquired assets over cost		—		—		7,020		—			7,020
Intercompany payables		—		35,896		—		(35,896	)		—

		2,571		58,085		2,235,811		(176,109	)		2,120,358


Stockholders’ equity attributable to the Oppenheimer Holdings Inc.		502,224		792,282		330,079		(1,122,361	)		502,224
Noncontrolling interest		—		—		3,032		—			3,032

Stockholders’ equity		502,224		792,282		333,111		(1,122,361	)		505,256

	$	504,795	$	850,367	$	2,568,922	$	(1,298,470	)	$	2,265,614

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2011


				Guarantor			Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries			Subsidiaries		ations			Consolidated
REVENUE
Commissions	$	—		$	—		$	123,267	$	—		$	123,267
Principal transactions, net		—			(1,391	)		9,624		—			8,233
Interest		1			2,937			14,937		(2,714	)		15,161
Investment banking		—			—			29,199		—			29,199
Advisory fees		—			—			51,320		(624	)		50,696
Other		—			1			5,062					5,063

		1			1,547			233,409		(3,338	)		231,619


EXPENSES
Compensation and related expenses		69			—			148,882		—			148,951
Clearing and exchange fees		—			—			6,514		—			6,514
Communications and technology		24			—			15,114		—			15,138
Occupancy and equipment costs		—			—			18,977		—			18,977
Interest		4,375			11			8,558		(2,714	)		10,230
Other		360			18			27,791		(624	)		27,545

		4,828			29			225,836		(3,338	)		227,355

Profit before income taxes		(4,827	)		1,518			7,573		—			4,264
Income tax provision (benefit)		(2,252	)		610			3,447		—			1,805
Net profit for the period		(2,575	)		908			4,126		—			2,459
Less net profit attributable to non- Controlling interest, net of tax		—			—			353		—			353
Equity in subsidiaries		4,681			—			—		(4,681	)		—

Net profit attributable to Oppenheimer Holdings Inc.	$	2,106		$	908		$	3,773	$	(4,681	)	$	2,106

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011


				Guarantor			Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries			Subsidiaries		ations			Consolidated
REVENUE
Commissions	$	—		$	—		$	380,912	$	—		$	380,912
Principal transactions, net		—			(1,698	)		34,235		—			32,537
Interest		1			7,356			43,167		(6,925	)		43,599
Investment banking		—			—			92,357		(1,000	)		91,357
Advisory fees		—			—			151,015		(1,815	)		149,200
Other		—			1			31,948					31,949

		1			5,659			733,634		(9,740	)		729,554


EXPENSES
Compensation and related expenses		221			—			479,581		—			479,802
Clearing and exchange fees		—			—			19,127		—			19,127
Communications and technology		45			—			47,101		—			47,146
Occupancy and equipment costs		—			—			56,047		—			56,047
Interest		8,167			3,438			23,993		(6,925	)		28,673
Other		1,906			280			83,591		(2,815	)		82,962

		10,339			3,718			709,440		(9,740	)		713,757

Profit before income taxes		(10,338	)		1,941			24,194					15,797
Income tax provision (benefit)		(4,444	)		876			10,707		—			7,139
Net profit for the period		(5,894	)		1,065			13,487		—			8,658
Less net profit attributable to non- Controlling interest, net of tax		—			—			1,775		—			1,775
Equity in subsidiaries		12,777			—			—		(12,777	)		—

Net profit attributable to Oppenheimer Holdings Inc.	$	6,883		$	1,065		$	11,712	$	(12,777	)	$	6,883

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (unaudited)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2010


				Guarantor		Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries		Subsidiaries		ations			Consolidated
REVENUE
Commissions	$	—		$	—	$	120,940	$	—		$	120,940
Principal transactions, net		—			—		22,646					22,646
Interest		—			1,839		11,220		(1,839	)		11,220
Investment banking		—			—		21,791		—			21,791
Advisory fees		—			—		43,854		(498	)		43,356
Other		—			—		15,190					15,190

		—			1,839		235,641		(2,337	)		235,143


EXPENSES
Compensation and related expenses		126			—		159,360		—			159,486
Clearing and exchange fees		—			—		5,525		—			5,525
Communications and technology		—			—		15,838		—			15,838
Occupancy and equipment costs		—			—		18,162		—			18,162
Interest		—			1,591		6,794		(1,839	)		6,546
Other		148			103		22,376		(498	)		22,127

		274			1,694		228,055		(2,337	)		227,684

Profit (loss) before income taxes		(274	)		147		7,586		—			7,459
Income tax provision (benefit)		(110	)		79		3,240		—			3,210
Net profit (loss) for the period		(164	)		67		4,346		—			4,249
Less net profit attributable to non- controlling interest, net of tax		—			—		595		—			595
Equity in subsidiaries		3,818			—		—		(3,818	)		—

Net profit (loss) attributable to Oppenheimer Holdings Inc.	$	3,654		$	67	$	3,751		($3,818	)	$	3,654

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2010


				Guarantor			Non-guarantor		Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries			Subsidiaries		ations			Consolidated
REVENUE
Commissions	$	—		$	—		$	398,719	$	—		$	398,719
Principal transactions, net		—			(276	)		61,079		—			60,803
Interest		—			5,335			31,995		(5,334	)		31,996
Investment banking		—			—			83,311		—			83,311
Advisory fees		—			—			131,620		(1,486	)		130,134
Other		—			—			34,550		—			34,550

		—			5,059			741,274		(6,820	)		739,513


EXPENSES
Compensation and related expenses		228			—			485,537		—			485,765
Clearing and exchange fees		—			—			19,910		—			19,910
Communications and technology		29			—			48,549		—			48,578
Occupancy and equipment costs		—			—			54,884		—			54,884
Interest		—			4,951			18,398		(5,333	)		18,016
Other		625			202			76,275		(1,487	)		75,615

		882			5,153			703,553		(6,820	)		702,768

Profit (loss) before income taxes		(882	)		(94	)		37,721		—			36,745
Income tax provision (benefit)		(353	)		(30	)		15,254		—			14,871
Net profit (loss) for the period		(529	)		(64	)		22,467		—			21,874
Less net profit attributable to non- controlling interest, net of tax		—			—			1,505		—			1,505
Equity in subsidiaries		20,898			—			—		(20,898	)		—

Net profit (loss) attributable to Oppenheimer Holdings Inc.	$	20,369		$	(64	)	$	20,962	$	(20,898	)	$	20,369

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011


				Guarantor			Non-guarantor			Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries			Subsidiaries			ations			Consolidated
Cash flows from operations:
Net profit (loss) for the period	$	(5,894	)	$	1,065		$	13,487		$	—		$	8,658
Adjustments to reconcile net profit (loss) to net cash used in operating activities:
Depreciation and amortization		—			—			9,299			—			9,299
Deferred income tax		(93	)		(1,890	)		4,434			—			2,451
Amortization of notes receivable		—			—			15,103			—			15,103
Amortization of debt issuance costs		—			—			734			—			734
Amortization of intangibles		—			—			3,244			—			3,244
Provision for credit losses		—			—			(317	)					(317	)
Share-based compensation		—			—			118			—			118
Changes in operating assets and liabilities		(180,979	)		54,010			105,755			36,423			15,210

Cash provided by (used in) continuing operations		(186,966	)		53,186			151,856			36,423			54,500


Cash flows from investing activities:
Purchase of office facilities		—			—			(3,865	)		—			(3,865	)

Cash used in investing activities		—			—			(3,865	)		—			(3,865	)


Cash flows from financing activities:
Cash dividends paid on Class A non-voting and Class B voting common stock		(4,506	)		—			—			—			(4,506	)
Issuance of Class A non-voting common Stock		337			—			—			—			337
Senior secured note issuance		200,000			—			—			—			200,000
Senior secured credit note repayments		—			—			(22,503	)		—			(22,503	)
Subordinated note repayments		—			—			(100,000	)		—			(100,000	)
Other financing activities		3,067			(34,717	)		(21,247	)		(36,423	)		(89,321	)

Cash provided by (used in) financing activities		198,898			(34,717	)		(143,750	)		(36,423	)		(15,993	)

Net increase (decrease) in cash and cash equivalents		11,932			18,469			4,241			—			34,642
Cash and cash equivalents, beginning of period		361			(241	)		52,734			—			52,854

Cash and cash equivalents, end of period	$	12,293		$	18,228		$	56,975			—		$	87,496

OPPENHEIMER HOLDINGS INC.
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS (unaudited)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2010


				Guarantor			Non-guarantor			Elimin-
Expressed in thousands of dollars.	Parent			Subsidiaries			Subsidiaries			ations			Consolidated
Cash flows from operations:
Net profit (loss) for the period		($529	)		($64	)	$	22,467			—		$	21,874
Adjustments to reconcile net profit (loss) to net cash used in operating activities:
Depreciation and amortization		—			—			9,053			—			9,053
Deferred income tax		—			—			32,336			—			32,336
Amortization of notes receivable		—			—			15,062			—			15,062
Amortization of debt issuance costs		—			—			742			—			742
Amortization of intangibles		—			—			3,243			—			3,243
Provision for credit losses		—			—			336			—			336
Share-based compensation		—			—			3,979			—			3,979
Changes in operating assets and liabilities		(1,921	)		(7,037	)		(137,776	)		(3,720	)		(150,454	)

Cash provided by (used in) continuing operations		(2,450	)		(7,101	)		(50,558	)		(3,720	)		(63,829	)


Cash flows from investing activities:
Purchase of office facilities		—			—			(11,877	)		—			(11,877	)

Cash used in investing activities		—			—			(11,877	)		—			(11,877	)


Cash flows from financing activities:
Cash dividends paid on Class A non-voting and Class B voting common stock		(4,401	)		—			—			—			(4,401	)
Issuance of Class A non-voting common Stock		2,132			—			—			—			2,132
Senior secured credit note repayments		—			—			(9,500	)		—			(9,500	)
Other financing activities		7,823			10,164			41,851			8,861			68,699

Cash provided by (used in) financing activities		5,554			10,164			32,351			8,861			56,930

Net increase (decrease) in cash and cash equivalents		3,104			3,063			(30,084	)		5,141			(18,776	)
Cash and cash equivalents, beginning of period		2,475			2,359			64,084			—			68,918

Cash and cash equivalents, end of period	$	5,579		$	5,422		$	34,000			5,141		$	50,142

- Definition

The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document.

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