Oppenheimer Holdings Inc.

Notice of Meeting and Management Proxy Circular

2006

 

OPPENHEIMER HOLDINGS INC.

P.O. Box 2015, Suite 1110

20 Eglinton Avenue West

Toronto, Ontario

M4R 1K8

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

To the Shareholders:

      NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of OPPENHEIMER HOLDINGS INC. (the “Corporation”) will be held at The Toronto Board of Trade Downtown Centre, 4th Floor, 1 First Canadian Place, 77 Adelaide St. West, Toronto, Ontario on May 15, 2006, at the hour of 4:30 p.m. (Toronto time) for the following purposes:

      Holders of Class A non-voting shares of the Corporation are entitled to attend and speak at the Annual Meeting of Shareholders. Holders of Class A non-voting shares are not entitled to vote with respect to the matters referred to above.

      Holders of Class B voting shares who are unable to attend the meeting in person are required to date, sign and return the enclosed form of proxy for use by holders of Class B voting shares. Reference is made to the accompanying Management Proxy Circular for details of the matters to be acted upon at the meeting and with respect to the respective voting rights of the holders of the Class A non-voting shares and the Class B voting shares.

DATED at Toronto, Ontario this 15th day of March, 2006.

(signed) A.W. OUGHTRED

Secretary

MANAGEMENT PROXY CIRCULAR

TABLE OF CONTENTS

OPPENHEIMER HOLDINGS INC.

MANAGEMENT PROXY CIRCULAR

(Note: All dollar amounts expressed herein are U.S. dollars unless otherwise indicated)

SOLICITATION OF PROXIES

      This Management Proxy Circular (the “Circular”) is forwarded to holders of Class B voting shares (the “Class B Shares”) and Class A non-voting shares (the “Class A Shares”) of Oppenheimer Holdings Inc. (the “Corporation”) in connection with the solicitation of proxies by the management of the Corporation from the holders of the Class B Shares (the “Class B Shareholders”)for use at the Annual Meeting of Shareholders of the Corporation (the “Meeting”) to be held on May 15, 2006, at the hour of 4:30 p.m. (Toronto time) at The Toronto Board of Trade Downtown Centre, 4th Floor, 1 First Canadian Place, 77 Adelaide St. West, Toronto, Ontario and at any adjournments thereof for the purposes set forth in the Notice of Annual Meeting of Shareholders (the “Notice of Meeting”) which accompanies this Circular. This Circular is dated March 15, 2006, and is first being mailed to Shareholders on or about March 28, 2006.

      The record date for the determination of shareholders entitled to receive notice of the meeting is March 24, 2006. In accordance with the provisions of the Canada Corporations Act the Corporation will prepare a list of holders of the Class B Shareholders as of the record date. Class B Shareholders named in the list will be entitled to vote the Class B Shares on all matters to be voted on at the Meeting except to the extent that (a) the Class B Shareholder has transferred any of the shareholder’s Class B Shares after the record date and (b) the transferee of those shares produces properly endorsed share certificates or otherwise establishes that the transferee owns such shares and demands, not later than immediately before a vote on any matter, that the transferee’s name be included in the list, in which case the transferee of the Class B Shares will be entitled to vote such shares at the Meeting. Holders of Class A Shares (the “Class A Shareholders”) will not be entitled to vote on the matters to be voted on at the Meeting.

      It is planned that the solicitation will be initially by mail, but proxies may also be solicited by employees of the Corporation. The cost of such solicitation will be borne by the Corporation.

      No person is authorized to give any information or to make any representation other than those contained in this Circular and, if given or made, such information or representation should not be relied upon as having been authorized by the Corporation. The delivery of this Circular shall not, under any circumstances, create an implication that there has not been any change in the information set forth herein since the date of this Circular. Except as otherwise stated, the information contained in this Circular is given as of March 15, 2006.

      The Corporation has distributed copies of its Annual Report for the year ended December 31, 2005, the Notice of the Meeting, this Circular, and, in the case of Class B shareholders, a form of proxy for use by the Class B Shareholders, to intermediaries such as clearing agencies, securities dealers, banks and trust companies or their nominees for distribution to non-registered shareholders of the Corporation whose shares are held by or in the custody of such intermediaries. Intermediaries are required to forward these documents to non-registered shareholders. The solicitation of proxies from non-registered Class B Shareholders will be carried out by the intermediaries, or by the Corporation if the names and addresses of Class B Shareholders are provided by the intermediaries. The cost of such solicitation will be borne by the Corporation. Non-registered Class B Shareholders who wish to file proxies should follow the instructions of their intermediary with respect to the procedure to be followed. Generally, non-registered Class B Shareholders will either: (a) be provided with a proxy executed by the intermediary, as the registered shareholder, but otherwise uncompleted and the non-registered holder may complete the proxy and return it directly to the Corporation’s transfer agent; or (b) be provided with a request for voting instructions by the intermediary, as the registered shareholder, then the intermediary must send to the Corporation’s transfer agent an executed proxy form completed in accordance

with any voting instructions received by it from the non-registered holder and may not vote in the event that no instructions are received.

CLASS A SHARES AND CLASS B SHARES

      The Corporation has authorized and issued Class A Shares and Class B Shares which are equal in all respects except that Class A Shareholders, as such, are not entitled to vote at meetings of shareholders of the Corporation unless entitled to vote by law, pursuant to the Corporation’s articles or as may be required by regulatory authorities. Class A Shareholders are not entitled to vote the Class A Shares owned or controlled by them on the matters identified in the Notice of Meeting to be voted on.

      Generally, Class A Shareholders are entitled to receive notices of all meetings of shareholders of the Corporation and to attend and speak at such meetings. In addition to notices of shareholders’ meetings, Class A Shareholders are entitled to receive all informational documentation sent to the Class B Shareholders of the Corporation.

      Class B Shareholders are entitled to one vote for each Class B Share held at all meetings of shareholders except meetings at which only the holders of a specified class of shares other than the Class B Shares are entitled to vote.

      In the event of either a “take-over bid” or an “issuer bid” (as those terms are defined in the Securities Act of Ontario) being made for the Class B Shares and no corresponding offer being made to purchase Class A Shares, the Class A Shareholders would have no right under the articles of the Corporation or under any applicable statute to require that a similar offer be made to them to purchase their Class A Shares.

APPOINTMENT AND REVOCATION OF PROXIES

      The persons named in the enclosed form of proxy (the “Management Nominees”) are directors and officers of the Corporation.

      Class B Shareholders have the right to appoint persons, other than the Management Nominees, who need not be a shareholder to represent them at the Meeting. To exercise this right, the Class B Shareholder may insert the name of the desired person in the blank space provided in the form of proxy accompanying this Circular or may submit another form of proxy.

      Class B Shares represented by properly executed proxies will be voted by the Management Nominees on any ballot that may be called for, unless the shareholder has directed otherwise, (i) for the election of Directors (item 2 in the Notice of Meeting), and (ii) for the appointment of auditors and authorizing the directors to fix the remuneration of the auditors (item 3 in the Notice of Meeting).

      It is not intended to use the proxies hereby solicited for the purpose of voting upon the consolidated financial statements of the Corporation for the year ended December 31, 2005, or the report of the auditors thereon.

      Each form of proxy confers discretionary authority with respect to amendments or variations to matters identified in the Notice of Meeting to which the proxy relates and other matters which may properly come before such Meeting. Management knows of no matters to come before the Meeting other than the matters referred to in the Notice of Meeting. However, if matters which are not known to the management should properly come before the Meeting, the proxies will be voted on such matters in accordance with the best judgment of the person or persons voting the proxies.

      A Class B Shareholder who has given a proxy has the power to revoke it prior to the commencement of the Meeting by depositing an instrument in writing executed by the Class B Shareholder or by the Class B Shareholder’s attorney authorized in writing either at the registered office of the Corporation at any time up to and including the last business day preceding the day of the Meeting, or any adjournment thereof, or with the Chairman of the Meeting on the day of the Meeting or any adjournment thereof or in any other manner permitted by law. A Class B Shareholder who has given a proxy has the power to revoke it after the commencement of the Meeting as to any matter on which a vote has not been cast under the proxy by delivering written notice of revocation to the Chairman of the Meeting.

      A Class B Shareholder who has given a proxy may also revoke it by signing a form of proxy bearing a later date and returning such proxy to the Secretary of the Corporation at the registered office of the Corporation prior to the commencement of the Meeting.

PARTICULARS OF MATTERS TO BE ACTED UPON

      The Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations for the year ended December 31, 2005, are included in the Annual Report, which has been mailed to shareholders with this Circular.

      The nominees proposed for election as directors, which were nominated by the Nominating and Corporate Governance Committee to the Board of Directors, are listed below under the heading “Directors and Executive Officers”. The number of Directors to be elected at the meeting is seven.

      Management proposes that PricewaterhouseCoopers LLP be reappointed as the independent auditors of the Corporation. Information with respect to the appointment of auditors appears below under the heading “Principal Accounting Fees and Services”.

      Mr. A.G. Lowenthal and Mrs. Olga Roberts have advised the Corporation that they intend to vote all of the Class B Shares owned and controlled by them for the matters referred to in the Notice of Meeting to be voted on at the Meeting.

DIRECTORS AND EXECUTIVE OFFICERS

      The Board of Directors of the Corporation currently consists of seven directors to be elected annually. The term of office for each director is from the date of the meeting at which the director is elected until the close of the next annual meeting of shareholders or until his or her successor is duly elected or appointed, unless his or her office is earlier vacated in accordance with the by-laws of the Corporation.

      Pursuant to a Stakeholders Agreement dated December 9, 2002 between the Corporation, Canadian Imperial Bank of Commerce (“CIBC”) and others, CIBC has the right to have two of its designees nominated for election to the Corporation’s Board at the Meeting. CIBC has informed the Corporation that it does not wish to exercise this right at the Meeting.

      The Nominating/ Corporate Governance Committee of the Board (the “Committee”) has recommended and the directors have determined that seven directors are to be elected at the Meeting. Management does not contemplate that any of the nominees named below will be unable to serve as a director, but, if such an event should occur for any reason prior to the Meeting, the Management Nominees reserve the right to vote for another nominee or nominees in their discretion. The following sets out information with respect to the proposed nominees for election as directors as recommended by the Committee, in accordance with the Nominating/ Corporate Governance Committee Charter (available at www.opco.com). The Committee has reported that it is satisfied that each of the nominees (who has served on the Board for the period indicated below) is fully able and fully committed to serve the best interests of the Corporation’s shareholders. The election of the directors nominated requires the affirmative vote of a simple majority of the Class B shares voted at the meeting.

NOTES:

Directors’ and Officers’ Insurance

      The Corporation carries liability insurance for its directors and officers and the directors and officers of its subsidiaries. Between November 30, 2004 and November 30, 2005, the Corporation’s aggregate insurance coverage was $20 million with a $2.5 million deductible at an aggregate annual premium of $591,000. This coverage was renewed for a further year effective November 30, 2005 at an aggregate annual premium of $624,000.

      Under the by-laws of the Corporation, the Corporation is obligated to indemnify the directors and officers of the Corporation and its subsidiaries to the maximum extent permitted by the Canada Business Corporations Act. The Corporation has entered into indemnity agreements with each of its directors providing for such indemnities.

Directors Compensation

      In the year ending December 31, 2005, the Corporation paid directors’ fees as follows:

      In 2005, the directors were paid directors’ fees of $254,710 in the aggregate. Directors are reimbursed for travel and related expenses incurred in attending board and committee meetings. The directors who are not employees of the Corporation and its subsidiaries are also entitled to the automatic grant of stock options under the Corporation’s 1996 Equity Incentive Plan, as amended, pursuant to a formula set out in the Plan.

Audit Committee Financial Expert

      The Board of Directors has determined that the Audit Committee includes one financial expert and that Mr. K.W. McArthur, the financial expert, is independent as that term is used in Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act. Mr. McArthur is a member of the Institute of Chartered Accountants of British Columbia.

EXECUTIVE COMPENSATION

      With respect to the year ended December 31, 2005, the Compensation and Stock Option Committee of the Board of Directors (the “Committee”) was responsible for making recommendations for approval by the Board of Directors with respect to the compensation of the Corporation’s executive officers. The members of the Committee are John L. Bitove and Burton Winberg, each of whom are independent directors of the Corporation and have no interlocking relationship with the Corporation or its subsidiaries.

Summary Compensation Table

      The following table sets forth total annual compensation paid or accrued by the Corporation to or for the account of the Corporation’s chief executive officer, chief financial officer and each of the three most highly paid executive officers of the Corporation and its subsidiaries, Oppenheimer & Co. Inc. (“Oppenheimer”) and Oppenheimer Asset Management Inc. (“OAM”), the Corporation’s principal operating subsidiaries, other than the chief executive officer and chief financial officer, whose total cash compensation for the fiscal year ended December 31, 2005 exceeded $100,000 (the “Named Executives”).

OPTION GRANTS FOR THE YEAR ENDED DECEMBER 31, 2005

      The Corporation did not grant any options to the Named Executives in 2005.

AGGREGATED OPTION EXERCISES AND YEAR-END VALUE TABLE

      The following table sets forth information with respect to options exercised during the year ended December 31, 2005 by the Named Executives and as to unexercised options held by them at December 31, 2005:

REPORT OF THE COMPENSATION AND STOCK OPTION COMMITTEE

      The following report of the Committee discusses generally the Committee’s executive compensation objectives and policies and their relationship to corporate performance in 2005. In addition, the report specifically discusses the Committee’s bases for compensation in 2005 of the Corporation’s Chief Executive Officer, as well as the other senior executive officers of the Corporation and Oppenheimer.

Objectives and Policies

      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 Corporation’s success in the short-term, long-term or both.

      The Corporation’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.

      In arriving at its recommendations concerning the specific components of the Corporation’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 Corporation as measured by net income levels and earnings per share, among other factors.

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

      Compensation for the Corporation’s senior executive officers involves a significant component of remuneration which is contingent on the performance of both the Corporation and the senior executive officer: the discretionary 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 Corporation’s shareholders).

      Base Salary. 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 Corporation’s industry. The Committee then makes recommendations to the Board with respect to base salaries.

      Annual Bonus. 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 Corporation 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. 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.

      Stock Option Grants. Under the Corporation’s 1996 Equity Incentive Plan (the “Equity Incentive Plan”), senior executive officers and employees of the Corporation 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.

          Chief Executive Officer Compensation

      Mr. A.G. Lowenthal, the Chairman of the Board and the Chief Executive Officer of the Corporation 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.

      On March 15, 2005, the Corporation and Mr. A.G. Lowenthal entered into an Amended and Restated Performance-Based Compensation Agreement (the “Performance-Based Compensation Agreement”) which replaced an earlier Performance-Based Compensation Agreement dated January 1, 2001 (the “2001 Agreement”) which was due to expire on December 31, 2005. The Performance-Based Compensation Agreement was approved by the shareholders of the Corporation at the annual and special meeting of shareholders held May 9, 2005. The purpose of the Performance-Based Compensation Agreement is to set the terms under which Mr. Lowenthal’s annual performance-based compensation is to be calculated during the term thereof.

      In March of 2005, the Committee established performance goals under the 2001 Agreement entitling Mr. Lowenthal to a Performance Award under the 2001 Agreement for the year 2005 of an aggregate of $2,584,398, determined by the application of a formula based on the following components: (i) the amount by which the closing price of one Class A Share at January 1, 2006, exceeded the closing price of one Class A Share as at December 31, 2003, multiplied by 200,000 shares; (ii) 5% of the amount by which the Corporation’s consolidated profit before income taxes for the year ended December 31, 2005 exceeded 10% of the amount of the Corporation’s restated consolidated shareholders’ equity as at December 31, 2004; (iii) 2.5% of pre tax profit up to $10,000,000, 4% of pre tax profit in excess of $10,000,000 up to $40,000,000, and 5% of pre tax profit over $40,000,000; and (iv) $500,000. In March of 2005, the Committee set Mr. Lowenthal’s base salary for 2005 at $500,000. Mr. Lowenthal advised the Committee that regardless of the Corporation’s satisfaction of the 2005 performance goals he would not accept the full amount of the bonus to which he would be entitled and the Committee agreed to reduce the amount of his bonus to $1,700,000.

          U.S. Internal Revenue Code Section 162(m)

      The Corporation 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 “U.S. Tax Code”).

      Section 162(m) of the U.S. Tax Code generally disallows a tax deduction to public corporations for annual compensation of over $1,000,000 paid to any of the Corporation’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.

      In order to qualify for exemptions under Section 162(m) in 2001, the 2001 Agreement was adopted and approved by the Class B Shareholders and in 2005 the Performance-Based Compensation Agreement was adopted and approved by the Class B Shareholders.

      To the extent consistent with the Corporation’s general compensation objectives, the Committee considers the potential effect of Section 162(m) on compensation paid to the executive officers of the Corporation and its subsidiaries. However, the Committee reserves the right to award and recommend the awarding of non-deductible 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 Corporation’s efforts to qualify, that the compensation paid by the Corporation to its executive officers will in fact satisfy the requirements for the exemption from the Section 162(m) deduction limit.

          Members of the Compensation and Stock Option Committee

Burton Winberg — Chairman

John L. Bitove

Share Performance Graph

      The following graph shows changes over the past five year period of U.S. $100 invested in (1) the Company’s Class A Shares, (2) the Standard & Poors 500 Index, and (3) the Standard & Poors/ Toronto Stock Exchange Composite Index.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The authorized capital of the Corporation includes 99,680 Class B Shares all of which are issued and outstanding and may be voted at the Meeting and an unlimited number of Class A shares of which 12,631,207 Class A shares were outstanding as at March 15, 2006.

      The following table sets forth certain information regarding the beneficial ownership of each class of shares of the Corporation as at March 15, 2006, with respect to (i) each person known by the Corporation to beneficially own, or exercise control or discretion over, more than 5% of any class of the Corporation’s shares, (ii) each of the Corporation’s directors, (iii) each of the Corporation’s executive officers named in the Summary Compensation Table set forth herein and (iv) the directors and executive officers as a group.

      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 “beneficial ownership” of shares which such person or group has the right to acquire within 60 days after March 15, 2006. The percentage of shares deemed outstanding is based on 12,631,207 Class A Shares and 99,680 Class B Shares outstanding as of March 15, 2006. 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 the exercise of outstanding options held by such persons within 60 days after March 15, 2006.

      There are no outstanding rights to acquire beneficial ownership of any Class B Shares.

SHARE COMPENSATION PLANS

Equity Incentive Plan

      Class A Shares authorized for issuance under the Equity Incentive Plan, as amended as at December 31, 2005 are as follows: All Class A Shares authorized under the Equity Incentive Plan have been approved by the shareholders of the Company.

      A description of the Equity Incentive Plan appears in Note 12 of the Corporation’s financial statements for the year ended December 31, 2005. The Corporation does not have any warrants or rights outstanding as at December 31, 2005.

Oppenheimer Employee Share Plan

      Class A Shares authorized for issuance under the Oppenheimer Employee Share Plan (the “ESP”) as at December 31, 2005 are as follows: All Class A Shares authorized for issue under the ESP have been approved by the shareholders of the Corporation.

Other Share-Based Compensation

      Class A Shares issued to certain employees of Oppenheimer as at December 31, 2005 were as follows: All such Class A Shares have been approved by the shareholders of the Corporation.

Section 16(a) Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934 requires the Corporation’s directors and executive officers, and persons who own more than ten percent of a registered class of the Corporation’s equity securities, to file by specific dates with the Securities Exchange Commission (the “SEC”) initial reports of ownership and reports of changes in ownership of equity securities of the Corporation. Officers, directors and greater than ten percent shareholders are required by SEC regulation to furnish the Corporation with copies of all Section 16(a) forms that they file. The Corporation is required to report in this Circular any failure of its directors and executive

officers and greater than ten percent shareholders 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).

      To the Corporation’s knowledge, based solely on review of copies of such reports furnished to the Corporation during the fiscal year ended December 31, 2005 and representations made to the Corporation by such persons, all Section 16(a) filing requirements applicable to the Corporation’s officers, directors and greater than ten percent Shareholders were complied with.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Indebtedness of Directors and Executive Officers

      The following sets out information with respect to the aggregate indebtedness of directors and executive officers under securities purchase and other programs. At December 31, 2005 and since that date none of the directors and the executive officers of the Corporation were or have been indebted to the Corporation.

      During the year 2005 certain of the directors, executive officers and senior officers of the Company, Oppenheimer and OAM maintained margin accounts with Oppenheimer 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 collectibility.

Other Relationships and Transactions

      Robert Lowenthal, the son of A.G. Lowenthal, the Chairman of the Board and Chief Executive Officer of the Corporation, is the head of Information Technology for Oppenheimer. He received a salary, bonus and other perquisites aggregating $292,000 during fiscal 2005. In addition, on February 25, 2005, Robert Lowenthal was awarded options to purchase 5,000 Class A Shares at $23.31 per share under the Equity Incentive Plan. The Corporation is sponsoring Robert Lowenthal in the pursuit of an Executive MBA at Columbia University ($72,000 paid in 2005 is included in the total above).

      Andrew Crystal, brother of R. Crystal, a director of the Corporation, is an Oppenheimer financial advisor and is compensated on the same basis as other Oppenheimer financial advisors in comparable circumstances.

      As disclosed under “Security Ownership of Certain Beneficial Owners and Management”, Olga Roberts, the mother of E.K. Roberts, a director of the Corporation and President and Treasurer of the Company, owns 324,955 Class A Shares and 44,309 Class B Shares, representing 2.6% of the outstanding Class A Shares and 44.4% of the outstanding Class B Shares.

PRINCIPAL ACCOUNTING FEES AND SERVICES

      The following information is provided in accordance with the requirements of Item 9(e) of Schedule 14A of the Exchange Act, “Principal Accounting Fees and Services”.

      PricewaterhouseCoopers LLP has served as the auditors of the Corporation since 1993. PricewaterhouseCoopers LLP has advised the Corporation that neither the firm nor any of its members or associates has any direct financial interest or any material indirect financial interest in the Corporation or any of its affiliates other than as accountants.

      The fees billed to the Corporation and its subsidiaries by PricewaterhouseCoopers LLP during the years 2005 and 2004 were as follows:

      The audit fees include the fees for the audit of the Corporation’s annual consolidated financial statements for the year 2005 and the review of the quarterly financial statements included in the Forms 10-Q filed by the Corporation during the year and the interim reports to shareholders sent to shareholders during the year. Other audit-related fees include fees for audits of the Corporation’s employee benefit plans. During 2005 and 2004, the Corporation retained Ernst & Young LLP to provide tax related services to the Corporation.

      The Audit Committee has the sole authority and responsibility to nominate independent auditors for appointment by shareholders, and to recommend to shareholders that independent auditors be removed. The Audit Committee has nominated PricewaterhouseCoopers LLP for appointment as the Corporation’s auditors by the shareholders at the Meeting.

      The Audit Committee recommends and the Board 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.

      The appointment of PricewaterhouseCoopers LP as independent auditors requires the affirmative vote of a simple majority of the Class B Shares voted at the Meeting.

STATEMENT OF CORPORATE GOVERNANCE PRACTICES

      The Class A Shares are listed on the Toronto Stock Exchange and the New York Stock Exchange (the “NYSE”). Accordingly, the Corporation is subject to the corporate governance and disclosure requirements of the Canadian securities administrators (the “CSA”), the NYSE Corporate Governance Rules (the “NYSE Rules”) and the United States Sarbanes-Oxley Act of 2002 (“SOX”). Attached as Schedule A are a description of the Corporation’s governance practices as required by the CSA and checklists describing the Corporation’s alignment with the NYSE Rules, the governance provisions of SOX and descriptions of the Committees of the Board of Directors. The Company’s Statement of Corporate Governance Practices, Code of Conduct and Committee Charters, as well as its Code of Ethics and Whistleblower Policy are posted on the Company’s website at www.opco.com. These documents can also be requested by writing to the Company at its head office or by making an email request to investorrelations@opy.ca.

REPORT OF THE AUDIT COMMITTEE

      As required by the Corporation’s Audit Committee charter, the Audit Committee reports as follows.

      The Audit Committee of the Board oversees the Corporation’s financial reporting process on behalf of the Board. It meets with management, the internal audit group and the Corporation’s auditors regularly and reports the results of its activities to the Board. In this connection, the Audit Committee has done with respect to fiscal 2005 the following:

      Based on the foregoing, the Audit Committee recommended to the Board that the Corporation’s audited financial statements prepared in accordance with US GAAP be included in the Corporation’s Annual Report on Form 10-K and Annual Report to Shareholders for the year ended December 31, 2005.

          Members of the Audit Committee

      During 2005, nine meetings of the Audit Committee were held. All of the members of the Audit Committee attended such meetings except for two meetings which were attended by two of the members of the Audit Committee.

INCORPORATION BY REFERENCE

      The Corporation’s consolidated financial statements including its consolidated balance sheets for the years ended December 31, 2005 and December 31, 2004, its consolidated statements of operations, changes in shareholders equity and cash flows for the years ended December 31, 2005, 2004 and 2003 and the notes thereto contained in the Corporation’s Annual Report to Shareholders for the fiscal year ended December 31, 2005, a copy of which is being contemporaneously distributed with this Circular, are incorporated by reference into this Circular. Any statement contained in a document which is incorporated, or deemed to be incorporated, by reference into this Circular, shall be considered modified or superseded for purposes of this Circular to the extent that a statement contained in this Circular or in any other subsequently filed document which also is, or is deemed to be, incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Circular.

SHAREHOLDER PROPOSALS

      The Canada Business Corporations Act (the “CBCA”), which governs the Corporation provides that a shareholder entitled to vote at a meeting of shareholders may, in accordance with the provisions of the CBCA submit a notice of a proposal to the Corporation that the shareholder wishes to be considered by the shareholders entitled to vote at a meeting of shareholders. In order for any shareholder proposal, for the next meeting of shareholders of the Corporation following the May 15, 2006 Meeting, or any adjournment thereof, to be included in the Circular for such meeting, the proposal must comply with the provisions of the CBCA and be submitted to the Corporation at its registered office at 20 Eglinton Avenue West, Suite 1110, Toronto, Ontario M4R 1K8 (Attention: Secretary) prior to February 15, 2007 in the case of the Corporation’s 2007 annual meeting of shareholders or at least 60 days prior to any special meeting of shareholders.

SHAREHOLDER COMMUNICATIONS WITH THE BOARD

      Holders of Class A and Class B Shares may communicate with the Board, including to request copies of the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2005, including its financial statements and MD&A, by e-mail to investorrelations@opy.ca (Attention: Board of Directors) or by mail to:

      All such correspondence will be forwarded to the Lead Director or to any individual Director or Directors to whom the communication is or are directed, unless the communication is unduly hostile, threatening, illegal, does not reasonably relate to the Corporation or its business or is similarly inappropriate. The President of the Corporation has the authority to discard or disregard inappropriate communications or to take other reasonable actions with respect to any such inappropriate communications.

      Additional information relating to the Corporation is available on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

DIRECTORS’ APPROVAL

      The contents of and sending of this Circular have been approved by the Board of Directors of the Corporation.

DATED AS OF this 15th day of March, 2006.

(signed) A.W. Oughtred

Secretary

SCHEDULE A

STATEMENT OF CORPORATE GOVERNANCE PRACTICES/ CSA REQUIREMENTS

Mandate and Duties of the Board of Directors

      The fundamental responsibility of the Board is to supervise the management of the business of the Corporation with a view to maximizing shareholder value and ensuring corporate conduct in a legal and ethical manner through a system of corporate governance and internal controls appropriate to the Corporation’s business. Given the nature of the Corporation’s business and the size and composition of the Board, the Board has determined that there is no current need to develop a specific mandate for the Board, the chief executive officer or the chairs of the Board committees. The Board has adopted a statement of Corporate Governance Guidelines to which it adheres.

      In fulfilling its mandate, the Board’s responsibilities include:

Independence of the Board of Directors

      Four of the Corporation’s seven directors are independent as required by the CSA Guidelines for Corporate Governance and by the New York Stock Exchange Corporate Governance Rules. To be considered independent under these rules, the Board must determine that a Director has no direct or indirect material relationship with the Corporation. The board has determined that Messrs. Bitove, Crystal, McArthur and Winberg are independent directors and that Mr. Lowenthal, the Chairman of the Board and chief executive officer of the Corporation, Ms. Roberts, the President and Treasurer of the Corporation and Mr. Oughtred, the Secretary of the Corporation, are not independent.

      At each regular meeting of the Board, the independent directors are afforded an opportunity to meet in the absence of management. As well, at meetings of the Audit Committee, the members of the Committee are afforded the opportunity to meeting with the auditors in the absence of management.

      The independent Directors and the Directors that are not independent, understand the need for directors to be independent minded and to assess and question management initiatives and recommendations from an independent perspective. The Board has a Lead Director, Mr. K. W. McArthur, an independent director who, among other things, chairs sessions of the independent directors in the absence of management.

Orientation and Continuing Education

      The Nominating/ Corporate Governance Committee of the Board, as required by its Charter, is responsible for the orientation of new directors as to the business of the Corporation, the role of the board and the Board committees.

      The Board encourages the Directors to maintain the skill and knowledge necessary to meet their obligations as Directors. This includes attendance at continuing education sessions and providing written materials on governance and related matters. Mr. A. W. Oughtred attended the Institute of Corporate Directors (Canada)

Corporate Governance College Programme and is certified as an Institute of Corporate Directors Director (ICD.D).

Nomination of Directors

      The Board currently consists of seven Directors. The Board has determined that this is an appropriate size for the Board

      The Board has a Nominating/ Corporate Governance Committee each of the members of which are independent. The duties of this Committee which include the recruitment of directors and the nomination of individuals for Board positions are set out below.

Board Compensation

      The Board has a Compensation and Stock Option Committee the duties of which (described below) include making recommendations as to directors’ compensation. The Directors other than Mr. Lowenthal and Ms. Roberts are entitled to the automatic grant of stock options on a periodic basis under the Corporation’s 1996 Equity Incentive Plan.

      In addition to the Committees referred to above, the Board has an Audit Committee composed of three independent directors the duties of which are described below.

Director, Committee Assessments

      The Board does not currently have a formal director assessment process. The Board’s Lead Director is responsible for assessing the performance and contribution of individual Board members and, if necessary, to address issues arising from such assessments with members of the Board.

      The Board does formally assess the Audit Committee on an annual basis.

NEW YORK STOCK EXCHANGE AND SARBANES-OXLEY GOVERNANCE REQUIREMENTS

      Set out below are (i) checklists summarizing the corporate governance requirements of the New York Stock Exchange, the Sarbanes-Oxley Act of 2002, the Corporation’s alignment with such requirements and a description of how the Corporation’s corporate governance policies align with such requirements and (ii) descriptions of the Corporation’s Board Committees.

BOARD COMMITTEES

Board Committees

      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,

      The Board has adopted a written charter for the Audit Committee, a copy of which is attached to the Management Information Circular of the Corporation dated March 25, 2004 as Schedule D. The Audit Committee:

      (see also “Report of The Audit Committee”)

      The Board has adopted a Compensation and Stock Option Committee Charter. The Compensation and Stock Option Committee:

      (see also “Report of the Compensation and Stock Option Committee”)

      The Board has adopted a Nominating/ Corporate Governance Committee Charter.

      The Nominating/ Corporate Governance Committee:

Oppenheimer Holdings Inc. Suite 1110, P.O. Box 2015

20 Eglinton Avenue West Toronto ON Canada M4R1K8

 

OPPENHEIMER HOLDINGS INC.

Class B Voting Shares

Proxy, Solicited by Management, for the

Annual Meeting of Shareholders,

May 15, 2006

The undersigned holder of Class B voting shares of Oppenheimer Holdings Inc. hereby appoints Mr. A.G. Lowenthal or, failing him, Ms. E.K. Roberts or instead of either of them
________________________________________________________________________________
as nominee, with full power of substitution, to attend, vote and otherwise act for the undersigned at the Annual Meeting of Shareholders to be held on May 15, 2006 and at any adjournment thereof to the same extent and with the same power as if the undersigned were personally present at the said meeting or adjournment or adjournments thereof and hereby revokes any proxy previously given; provided that the undersigned shareholder specifies and directs the persons above named that the Class B voting shares registered in the name of the undersigned shall be:

(or if no specification is made, VOTED FOR) for the election of directors. (Listed as item #2 on the Notice of Meeting).

(or if no specification is made, VOTED FOR) for the appointment of PricewaterhouseCoopers LLP as auditors and authorizing the directors to fix the remuneration of the auditors. (Listed as item #3 on the Notice of Meeting).

DATED                                     , 2006.