SUBJECT TO COMPLETION, DATED OCTOBER __, 2001
                                     Oppenheimer Tremont Opportunity Fund, LLC
                                                        , 2001

                                        STATEMENT OF ADDITIONAL INFORMATION

                                                6803 S. Tucson Way
                                                Englewood, CO 80112
                                                  (303) 768-3200
                                                toll-free (800) [ ]

                  This  Statement of Additional  Information  ("SAI") is not a prospectus.  This SAI relates to and
should be read in  conjunction  with the  prospectus of  Oppenheimer  Tremont  Opportunity  Fund, LLC (the "Fund"),
dated  _________  __ , 2001.  A copy of the  prospectus  may be obtained by  contacting  the Fund at the  telephone
numbers or address set forth above.

                  The  information  in this SAI is not  complete  and may be  changed.  The Fund may not sell these
securities  until the  registration  statement  filed with the  Securities and Exchange  Commission  (the "SEC") is
effective.  This  SAI is not an  offer to sell  these  securities  and is not  soliciting  an  offer  to buy  these
securities in any state where the offer or sale is not permitted.

                                                 TABLE OF CONTENTS

                                                                                                               PAGE

INVESTMENT POLICIES AND PRACTICES.................................................................................1
REPURCHASES AND TRANSFERS OF INTERESTS...........................................................................10
BOARD OF MANAGERS................................................................................................12
INVESTMENT ADVISORY SERVICES.....................................................................................14
CONFLICTS OF INTEREST............................................................................................18
TAX ASPECTS......................................................................................................20
ERISA CONSIDERATIONS.............................................................................................34
BROKERAGE........................................................................................................36
ACCOUNTANTS AND LEGAL COUNSEL....................................................................................37
CUSTODIAN........................................................................................................37
CONTROL PERSONS..................................................................................................37
SUMMARY OF LLC AGREEMENT.........................................................................................38
FINANCIAL STATEMENTS.............................................................................................41
APPENDIX A......................................................................................................A-1

                                         INVESTMENT POLICIES AND PRACTICES
                  The  investment  objective  and  principal  investment  strategies  of the  Fund,  as well as the
principal  risks  associated  with the  Fund's  investment  strategies,  are set forth in the  prospectus.  Certain
additional investment information is set forth below.

FUNDAMENTAL POLICIES

                  The Fund's stated  fundamental  policies,  which may only be changed by the affirmative vote of a
majority of the outstanding  voting securities of the Fund  ("Interests"),  are listed below.  Within the limits of
these  fundamental  policies,  the Fund's  management has reserved freedom of action.  As defined by the Investment
Company Act of 1940 (the "Investment  Company Act"), the vote of a "majority of the outstanding  voting  securities
of the Fund" means the vote, at an annual or special  meeting of  securityholders  duly called,  (a) of 67% or more
of the voting  securities  present at such  meeting,  if the  holders  of more than 50% of the  outstanding  voting
securities  of the Fund are present or  represented  by proxy;  or (b) of more than 50% of the  outstanding  voting
securities of the Fund, whichever is less.  The Fund may not:

o........Issue senior  securities,  except to the extent  permitted by Section 18 of the Investment  Company Act or
                           as otherwise permitted by the Securities Exchange Commission (the "SEC").

o        Borrow money,  except to the extent permitted by Section 18 of the Investment  Company Act or as otherwise
                           permitted by the SEC.

o        Underwrite  securities of other issuers,  except  insofar as the Fund may be deemed an  underwriter  under
                           the  Securities  Act of 1933, as amended,  in  connection  with the  disposition  of its
                           portfolio securities.

o        Make loans, except through purchasing fixed-income securities,  lending portfolio securities,  or entering
                           into repurchase  agreements in a manner consistent with the Fund's  investment  policies
                           or as otherwise permitted under the Investment Company Act.

o        Purchase,  hold or deal in real estate,  except that the Fund may invest in securities that are secured by
                           real estate,  or issued by  companies  that invest or deal in real estate or real estate
                           investment trusts.

o        Invest in  commodities  or  commodity  contracts,  except  that the Fund may  purchase  and sell  non-U.S.
                           currency,  options,  futures and forward contracts,  including those related to indexes,
                           and options on indexes.

o        Invest  25% or more of the  value of its total  assets  in the  securities  (other  than  U.S.  Government
                           securities)  of issuers  engaged  in any  single  industry.  The  foregoing  restriction
                           shall not apply to the Fund's  investment  in money market  instruments  or money market
                           funds.  This  restriction  also does not apply to the Fund's  investments  in  Portfolio
                           Funds.

                  With respect to these  investment  restrictions  and other policies  described in this SAI or the
prospectus  (except the Fund's policy on borrowings set forth above), if a percentage  restriction is adhered to at
the time of an investment or  transaction,  a later change in percentage  resulting  from a change in the values of
investments or the value of the Fund's total assets,  unless otherwise  stated,  will not constitute a violation of
such  restriction or policy.  The Fund's  investment  policies and  restrictions do not apply to the activities and
transactions of investment  funds in which assets of the Fund are invested,  but will apply to investments  made by
the Fund (or any account consisting solely of Fund assets).

                  The Fund's  investment  objective  is  fundamental  and may not be changed  without the vote of a
majority (as defined by the Investment Company Act) of the Fund's outstanding voting securities.

CERTAIN PORTFOLIO SECURITIES AND OTHER OPERATING POLICIES

                  As discussed in the Fund will invest primarily in private  investment funds ("Portfolio  Funds"),
both domestic and foreign,  that are managed by  alternative  asset  managers  ("Portfolio  Managers")  that employ
various  investment  strategies that  historically  have exhibited a low correlation to the general  performance of
equity,  debt  and  other  markets.  The  Fund  may  also on  occasion  retain  a  Portfolio  Manager  to  manage a
designated  segment of the Fund's  assets (a  "Portfolio  Account")  in  accordance  with the  Portfolio  Manager's
investment program.  Additional  information  regarding the types of securities and financial  instruments in which
Portfolio  Managers may invest the assets of Portfolio  Funds and Portfolio  Funds,  and certain of the  investment
techniques that may be used by Portfolio Managers, is set forth below.


EQUITY SECURITIES

                  The investment  portfolios of Portfolio Funds and Portfolio  Accounts will include long and short
positions in common stocks,  preferred  stocks and convertible  securities of U.S. and foreign  issuers.  The value
of equity securities  depends on business,  economic and other factors  affecting those issuers.  Equity securities
fluctuate  in value,  often  based on  factors  unrelated  to the value of the issuer of the  securities,  and such
fluctuations can be pronounced.

                  Portfolio  Managers  may  generally  invest  Portfolio  Funds and  Portfolio  Accounts  in equity
securities  without  restriction.  These  investments may include  securities issued by companies having relatively
small market  capitalization,  including "micro cap" companies.  The prices of the securities of smaller  companies
may be subject to more abrupt or erratic market movements than larger,  more established  companies,  because these
securities  typically are traded in lower volume and the issuers  typically are more subject to changes in earnings
and  prospects.  These  securities  are also  subject  to other  risks that are less  prominent  in the case of the
securities of larger companies.


FIXED-INCOME SECURITIES

                  Portfolio  Funds and  Portfolio  Accounts  may invest in  fixed-income  securities.  A  Portfolio
Manager will invest in these  securities  when their yield and potential for capital  appreciation  are  considered
sufficiently  attractive  and  also  may  invest  in  these  securities  for  defensive  purposes  and to  maintain
liquidity.  Fixed-income  securities  include bonds,  notes and debentures issued by U.S. and foreign  corporations
and  governments.  These  securities may pay fixed,  variable or floating  rates of interest,  and may include zero
coupon  obligations.  Fixed-income  securities are subject to the risk of the issuer's  inability to meet principal
and interest  payments on its obligations  (i.e.,  credit risk) and are subject to the risk of price volatility due
to such factors as interest rate sensitivity,  market perception of the  creditworthiness or financial condition of
the issuer and general market liquidity  (i.e.,  market risk).  Certain  portfolio  securities,  such as those with
interest  rates that  fluctuate  directly or indirectly  based on multiples of a stated  index,  are designed to be
highly  sensitive to changes in interest  rates and can subject the holders  thereof to  significant  reductions of
yield and possible loss of principal.

                  Portfolio  Funds and Portfolio  Accounts may invest in both investment  grade and  non-investment
grade debt  securities.  Investment  grade debt securities are securities that have received a rating from at least
one nationally  recognized  statistical  rating  organization (a "Rating Agency") in one of the four highest rating
categories or, if not rated by any Rating Agency,  have been determined by a Portfolio  Manager to be of comparable
quality.

                  A Portfolio Fund's or Portfolio  Account's  investments in non-investment  grade debt securities,
including convertible debt securities,  are considered by the Rating Agencies to be predominantly  speculative with
respect to the issuer's  capacity to pay interest  and repay  principal.  Non-investment  grade  securities  in the
lowest  rating  categories  may  involve a  substantial  risk of default or may be in default.  Adverse  changes in
economic  conditions or developments  regarding the individual issuer are more likely to cause price volatility and
weaken the capacity of the issuers of  non-investment  grade  securities to make  principal  and interest  payments
than is the case for higher grade  securities.  In addition,  the market for lower grade  securities may be thinner
and less liquid than the market for higher grade securities.

NON-U.S. SECURITIES

                  Portfolio  Funds and  Portfolio  Accounts  may invest in equity and  fixed-income  securities  of
non-U.S.  issuers and in  depositary  receipts,  such as American  Depositary  Receipts  ("ADRs"),  that  represent
indirect interests in securities of non-U.S.  issuers.  Non-U.S.  securities in which Portfolio Funds and Portfolio
Accounts may invest may be listed on non-U.S.  securities exchanges or traded in non-U.S.  over-the-counter markets
or may be purchased in private  placements  and not be publicly  traded.  Investments  in non-U.S.  securities  are
affected  by risk  factors  generally  not  thought  to be  present  in the U.S.  These  factors  are listed in the
prospectus under "Risk Factors--Non-U.S. Investments."

                  As a general  matter,  Portfolio  Funds and Portfolio  Accounts are not required to hedge against
non-U.S.  currency risks,  including the risk of changing currency exchange rates,  which could reduce the value of
non-U.S.  currency denominated portfolio securities  irrespective of the underlying investment.  However, from time
to time,  a Portfolio  Fund or Portfolio  Account may enter into  forward  currency  exchange  contracts  ("forward
contracts") for hedging purposes and non-hedging  purposes to pursue its investment  objective.  Forward  contracts
are transactions  involving the Portfolio Fund's or Portfolio  Account's  obligation to purchase or sell a specific
currency at a future date at a specified  price.  Forward  contracts may be used by the Portfolio Fund or Portfolio
Account for hedging  purposes to protect  against  uncertainty in the level of future  non-U.S.  currency  exchange
rates,  such as when the  Portfolio  Fund or  Portfolio  Account  anticipates  purchasing  or  selling  a  non-U.S.
security.  This technique  would allow the Portfolio Fund or Portfolio  Account to "lock in" the U.S.  dollar price
of the security.  Forward  contracts  also may be used to attempt to protect the value of the  Portfolio  Fund's or
Portfolio  Account's  existing  holdings of  non-U.S.  securities.  There may be,  however,  imperfect  correlation
between the  Portfolio  Fund's or  Portfolio  Account's  non-U.S.  securities  holdings  and the forward  contracts
entered  into with  respect to such  holdings.  Forward  contracts  also may be used for  non-hedging  purposes  to
pursue the Fund's or a Portfolio Fund's investment  objective,  such as when a Portfolio  Manager  anticipates that
particular non-U.S.  currencies will appreciate or depreciate in value, even though securities  denominated in such
currencies are not then held in the Fund's or Portfolio Fund's investment portfolio.

MONEY MARKET INSTRUMENTS

                  The  Fund,  Portfolio  Funds and  Portfolio  Accounts  may  invest,  for  defensive  purposes  or
otherwise,  some or all of their assets in high quality  fixed-income  securities,  money  market  instruments  and
money  market  mutual  funds,  or may hold cash or cash  equivalents  in such  amounts as the Adviser or  Portfolio
Managers  deem  appropriate  under  the  circumstances.  The  Fund or  Portfolio  Funds  also may  invest  in these
instruments  pending allocation of their respective  offering proceeds.  Money market instruments are high quality,
short-term  fixed-income  obligations,  which  generally  have  remaining  maturities of one year or less,  and may
include U.S. Government  Securities,  commercial paper,  certificates of deposit and bankers' acceptances issued by
domestic  branches of United  States  banks that are  members of the Federal  Deposit  Insurance  Corporation,  and
repurchase agreements.

REPURCHASE AGREEMENTS


                  Repurchase  agreements  are  agreements  under  which the Fund,  a  Portfolio  Fund or  Portfolio
Account  purchases  securities  from a bank that is a member of the Federal  Reserve  System,  a foreign  bank or a
securities  dealer that agrees to  repurchase  the  securities  from the Company at a higher  price on a designated
future date. If the seller under a repurchase  agreement  becomes  insolvent or otherwise  fails to repurchase  the
securities,  the Fund,  Portfolio  Fund or  Portfolio  Account  would have the right to sell the  securities.  This
right,  however,  may be  restricted,  or the value of the  securities  may decline  before the  securities  can be
liquidated.  In the event of the  commencement of bankruptcy or insolvency  proceedings  with respect to the seller
of the securities before the repurchase of the securities under a repurchase  agreement is accomplished,  the Fund,
Portfolio Fund or Portfolio  Account might  encounter a delay and incur costs,  including a decline in the value of
the  securities,  before being able to sell the securities.  Repurchase  agreements that are subject to foreign law
may not enjoy  protections  comparable to those provided to certain  repurchase  agreements  under U.S.  bankruptcy
law, and they therefore may involve  greater risks.  The Fund has adopted  specific  policies  designed to minimize
certain of the risks of loss from its use of repurchase agreements.


REVERSE REPURCHASE AGREEMENTS

                  Reverse  repurchase  agreements involve the sale of a security to a bank or securities dealer and
the simultaneous  agreement to repurchase the security for a fixed price,  reflecting a market rate of interest, on
a specific date.  These  transactions  involve a risk that the other party to a reverse  repurchase  agreement will
be unable or unwilling to complete the  transaction  as scheduled,  which may result in losses to a Portfolio  Fund
or  Portfolio  Account.  Reverse  repurchase  agreements  are a form  of  leverage  which  also  may  increase  the
volatility of a Portfolio Fund's or Portfolio Account's investment portfolio.

SPECIAL INVESTMENT TECHNIQUES

                  Portfolio  Funds and  Portfolio  Accounts may use a variety of special  investment  techniques to
hedge a portion of their  investment  portfolios  against various risks or other factors that generally  affect the
values of securities.  They may also use these  techniques for  non-hedging  purposes in pursuing their  investment
objectives.  These techniques may involve the use of derivative  transactions.  The techniques  Portfolio Funds and
Portfolio  Accounts  may employ may change over time as new  instruments  and  techniques  are  introduced  or as a
result  of  regulatory  developments.  Certain  of the  special  investment  techniques  that  Portfolio  Funds  or
Portfolio  Accounts  may use are  speculative  and  involve  a high  degree  of risk,  particularly  when  used for
non-hedging  purposes.  It is possible  that any hedging  transaction  may not  perform as  anticipated  and that a
Portfolio Fund or Portfolio Account may suffer losses as a result of its hedging activities.

                  DERIVATIVES.  Portfolio  Funds  and  Portfolio  Accounts  may  engage in  transactions  involving
options,  futures and other  derivative  financial  instruments.  Derivatives  can be volatile and involve  various
types and degrees of risk,  depending upon the characteristics of the particular  derivative and the portfolio as a
whole.  Derivatives  permit  Portfolio  Funds and Portfolio  Accounts to increase or decrease the level of risk, or
change the character of the risk, to which their  portfolios  are exposed in much the same way as they can increase
or decrease the level of risk, or change the character of the risk, of their  portfolios by making  investments  in
specific securities.

                  Derivatives  may entail  investment  exposures  that are greater  than their cost would  suggest,
meaning  that a small  investment  in  derivatives  could have a large  potential  impact on a Portfolio  Fund's or
Portfolio Account's performance.

                  If a Portfolio Fund or Portfolio  Account  invests in derivatives at inopportune  times or judges
market  conditions  incorrectly,  such investments may lower the Portfolio Fund's or Portfolio  Account's return or
result in a loss.  A Portfolio  Fund or Portfolio  Account also could  experience  losses if its  derivatives  were
poorly  correlated  with its other  investments,  or if the  Portfolio  Fund or  Portfolio  Account  were unable to
liquidate its position  because of an illiquid  secondary  market.  The market for many derivatives is, or suddenly
can become,  illiquid.  Changes in liquidity  may result in  significant,  rapid and  unpredictable  changes in the
prices for derivatives.


                  OPTIONS AND FUTURES.  The  Portfolio  Managers may utilize  options and futures  contracts.  They
also may use so-called  "synthetic" options (notional  principal  contracts with  characteristics of an OTC option)
or other derivative  instruments  written by  broker-dealers or other permissible  financial  intermediaries.  Such
transactions may be effected on securities exchanges,  in the over-the-counter  market, or negotiated directly with
counterparties.   When  such   transactions   are   purchased   over-the-counter   or   negotiated   directly  with
counterparties,  a Portfolio  Fund or  Portfolio  Account  bears the risk that the  counterparty  will be unable or
unwilling to perform its obligations  under the option  contract.  Such  transactions  may also be illiquid and, in
such cases,  a Portfolio  Manager  may have  difficulty  closing  out its  position.  Over-the-counter  options and
synthetic  transactions  purchased  and sold by  Portfolio  Funds and  Portfolio  Accounts  may include  options on
baskets of specific securities.

                  The Portfolio  Managers may purchase call and put options on specific  securities,  and may write
and sell covered or uncovered call and put options for hedging  purposes and  non-hedging  purposes to pursue their
investment  objectives.  A put  option  gives the  purchaser  of the option the right to sell,  and  obligates  the
writer to buy,  the  underlying  security at a stated  exercise  price at any time prior to the  expiration  of the
option.  Similarly,  a call option gives the  purchaser of the option the right to buy, and obligates the writer to
sell, the  underlying  security at a stated  exercise  price at any time prior to the  expiration of the option.  A
covered  call  option is a call  option  with  respect to which a  Portfolio  Fund or  Portfolio  Account  owns the
underlying  security.  The sale of such an option exposes a Portfolio Fund or Portfolio  Account during the term of
the option to possible loss of opportunity to realize  appreciation in the market price of the underlying  security
or to  possible  continued  holding  of a  security  that  might  otherwise  have  been  sold  to  protect  against
depreciation  in the market  price of the  security.  A covered  put option is a put option  with  respect to which
cash or liquid  securities have been placed in a segregated  account on a Portfolio  Fund's or Portfolio  Account's
books.  The sale of such an option  exposes  the seller  during the term of the option to a decline in price of the
underlying  security while also depriving the seller of the  opportunity to invest the segregated  assets.  Options
sold by the Portfolio Funds and Portfolio Accounts need not be covered.

                  A  Portfolio  Fund or  Portfolio  Account  may close  out a  position  when  writing  options  by
purchasing an option on the same security with the same exercise  price and  expiration  date as the option that it
has previously  written on the security.  The Portfolio Fund or Portfolio  Account will realize a profit or loss if
the amount paid to purchase an option is less or more,  as the case may be, than the amount  received from the sale
thereof.  To close out a position as a  purchaser  of an option,  a Portfolio  Manager  would  ordinarily  effect a
similar  "closing  sale  transaction,"  which  involves  liquidating  position  by selling  the  option  previously
purchased, although the Portfolio Manager could exercise the option should it deem it advantageous to do so.

                  The  use of  derivatives  that  are  subject  to  regulation  by the  Commodity  Futures  Trading
Commission  (the "CFTC") by Portfolio  Funds and Portfolio  Accounts  could cause the Fund to be a commodity  pool,
which would  require the Fund to comply with certain  rules of the CFTC.  However,  the Fund intends to conduct its
operations  to avoid  regulation as a commodity  pool. In this regard,  the Fund's pro rata share of the sum of the
amount of initial margin deposits on futures contracts  entered into by Portfolio Funds and Portfolio  Accounts and
premiums  paid for unexpired  options with respect to such  contracts,  other than for bona fide hedging  purposes,
may not exceed 5% of the liquidation value of the Fund's assets,  after taking into account  unrealized profits and
unrealized  losses  on such  contracts  and  options;  provided,  however,  that in the case of an  option  that is
in-the-money  at the time of purchase,  the  in-the-money  amount may be excluded in calculating the 5% limitation.
The Fund intends to monitor use of futures and related  options by Portfolio  Funds and Portfolio  Accounts to help
assure  compliance with this limitation.  If applicable CFTC rules change,  such percentage  limitations may change
or different conditions may be applied to the Fund's use of certain derivatives.

                  Portfolio  Funds and  Portfolio  Accounts  may enter  into  futures  contracts  in U.S.  domestic
markets or on exchanges  located outside the United States.  Foreign  markets may offer  advantages such as trading
opportunities or arbitrage  possibilities not available in the United States.  Foreign markets,  however,  may have
greater risk potential than domestic  markets.  For example,  some foreign  exchanges are principal markets so that
no common  clearing  facility  exists and an investor may look only to the broker for  performance of the contract.
In addition,  any profits that might be realized in trading could be eliminated by adverse  changes in the exchange
rate,  or a loss could be incurred as a result of those  changes.  Transactions  on foreign  exchanges  may include
both  commodities  which are traded on  domestic  exchanges  and those  which are not.  Unlike  trading on domestic
commodity exchanges, trading on foreign commodity exchanges is not regulated by the CFTC.

                  Engaging in these  transactions  involves risk of loss, which could adversely affect the value of
the Fund's net  assets.  No  assurance  can be given that a liquid  market  will exist for any  particular  futures
contract at any  particular  time.  Many  futures  exchanges  and boards of trade  limit the amount of  fluctuation
permitted  in futures  contract  prices  during a single  trading  day.  Once the daily limit has been reached in a
particular  contract,  no trades may be made that day at a price beyond that limit or trading may be suspended  for
specified  periods  during  the  trading  day.  Futures  contract  prices  could  move  to the  limit  for  several
consecutive  trading days with little or no trading,  thereby  preventing  prompt  liquidation of futures positions
and potentially subjecting a Portfolio Fund or Portfolio Account to substantial losses.

                  Successful use of futures also is subject to a Portfolio  Manager's  ability to correctly predict
movements in the direction of the relevant  market,  and, to the extent the transaction is entered into for hedging
purposes,  to ascertain the appropriate  correlation  between the transaction  being hedged and the price movements
of the futures contract.

                  Some or all of the Portfolio  Managers may purchase and sell stock index futures  contracts for a
Portfolio Fund or Portfolio  Account.  A stock index future obligates a Portfolio Fund or Portfolio  Account to pay
or receive an amount of cash equal to a fixed dollar  amount  specified in the futures  contract  multiplied by the
difference  between the settlement  price of the contract on the  contract's  last trading day and the value of the
index based on the stock prices of the  securities  that comprise it at the opening of trading in those  securities
on the next business day.

                  Some or all of the Portfolio  Managers may purchase and sell interest rate futures  contracts for
a Portfolio Fund or Portfolio  Account.  An interest rate future obligates  represents an obligation to purchase or
sell an amount of a specific debt security at a future date at a specific price.

                  Some or all of the  Portfolio  Managers  may  purchase  and sell  currency  futures.  A  currency
future  creates an obligation  to purchase or sell an amount of a specific  currency at a future date at a specific
price.

                  OPTIONS ON SECURITIES  INDEXES.  Some or all of the Portfolio  Managers may purchase and sell for
the Portfolio  Funds and Portfolio  Accounts  call and put options on stock indexes  listed on national  securities
exchanges or traded in the  over-the-counter  market for hedging purposes and non-hedging  purposes to pursue their
investment  objectives.  A stock index  fluctuates  with changes in the market values of the stocks included in the
index.  Accordingly,  successful  use by a  Portfolio  Manager of options on stock  indexes  will be subject to the
Portfolio  Manager's ability to predict correctly  movements in the direction of the stock market generally or of a
particular  industry or market segment.  This requires  different skills and techniques than predicting  changes in
the price of individual stocks.

                  WARRANTS AND RIGHTS.  Warrants are derivative  instruments that permit, but do not obligate,  the
holder to subscribe  for other  securities  or  commodities.  Rights are similar to warrants,  but normally  have a
shorter  duration and are offered or distributed  to  shareholders  of a company.  Warrants and rights do not carry
with them the right to dividends or voting  rights with respect to the  securities  that they entitle the holder to
purchase,  and they do not represent any rights in the assets of the issuer.  As a result,  warrants and rights may
be considered  more  speculative  than certain other types of equity-like  securities.  In addition,  the values of
warrants and rights do not  necessarily  change with the values of the  underlying  securities or  commodities  and
these instruments cease to have value if they are not exercised prior to their expiration dates.

                  SWAP  AGREEMENTS.  The  Portfolio  Managers  may enter  into  equity,  interest  rate,  index and
currency  rate swap  agreements  on behalf of  Portfolio  Funds and  Portfolio  Accounts.  These  transactions  are
entered into in an attempt to obtain a particular  return when it is considered  desirable to do so,  possibly at a
lower cost than if an investment was made directly in the asset that yielded the desired  return.  Swap  agreements
are two-party  contracts entered into primarily by institutional  investors for periods ranging from a few weeks to
more than a year. In a standard swap  transaction,  two parties agree to exchange the returns (or  differentials in
rates of return) earned or realized on particular predetermined  investments or instruments,  which may be adjusted
for an interest  factor.  The gross  returns to be  exchanged  or  "swapped"  between  the  parties  are  generally
calculated  with respect to a "notional  amount," i.e.,  the return on or increase in value of a particular  dollar
amount invested at a particular  interest rate, in a particular  foreign  currency,  or in a "basket" of securities
representing a particular  index.  Forms of swap agreements  include interest rate caps, under which, in return for
a premium,  one party agrees to make payments to the other to the extent  interest rates exceed a specified rate or
"cap";  interest rate floors,  under which, in return for a premium, one party agrees to make payments to the other
to the extent  interest  rates fall below a specified  level or "floor";  and interest rate collars,  under which a
party  sells a cap and  purchases  a floor or vice  versa in an attempt to protect  itself  against  interest  rate
movements exceeding given minimum or maximum levels.

                  Most swap  agreements  entered into by a Portfolio  Fund or Portfolio  Account  would require the
calculation  of the  obligations  of the parties to the  agreements  on a "net  basis."  Consequently,  a Portfolio
Fund's or Portfolio  Account's current  obligations (or rights) under a swap agreement generally will be equal only
to the net amount to be paid or received  under the agreement  based on the relative  values of the positions  held
by each party to the  agreement  (the "net  amount").  The risk of loss with respect to swaps is limited to the net
amount  of  interest  payments  that a party is  contractually  obligated  to make.  If the  other  party to a swap
defaults,  a Portfolio  Fund's or Portfolio  Account's  risk of loss consists of the net amount of payments that it
contractually is entitled to receive.

                  To achieve  investment  returns  equivalent  to those  achieved by a  Portfolio  Manager in whose
investment  vehicles  the Fund  could not  invest  directly,  perhaps  because  of its  investment  minimum  or its
unavailability  for direct  investment,  the Fund may enter into swap agreements under which the Fund may agree, on
a net basis, to pay a return based on a floating  interest rate, such as LIBOR,  and to receive the total return of
the  reference  investment  vehicle  over a stated time  period.  The Fund may seek to achieve the same  investment
result  through the use of other  derivatives  in similar  circumstances.  The Federal income tax treatment of swap
agreements and other  derivatives  used in the above manner is unclear.  The Fund has does not currently  intend to
use swaps or other derivatives in this manner.


LENDING PORTFOLIO SECURITIES

                  A  Portfolio  Fund or  Portfolio  Account  may lend  securities  from its  portfolio  to brokers,
dealers and other  financial  institutions  needing to borrow  securities  to complete  certain  transactions.  The
Portfolio  Fund or  Portfolio  Account  continues  to be entitled to  payments  in amounts  equal to the  interest,
dividends or other  distributions  payable on the loaned  securities  which affords the Portfolio Fund or Portfolio
Account an  opportunity  to earn  interest on the amount of the loan and on the loaned  securities'  collateral.  A
Portfolio  Fund or Portfolio  Account  generally  will  receive  collateral  consisting  of cash,  U.S.  Government
Securities  or  irrevocable  letters of credit which will be maintained at all times in an amount equal to at least
100% of the  current  market  value of the  loaned  securities.  The  Portfolio  Fund or  Portfolio  Account  might
experience risk of loss if the institution with which it has engaged in a portfolio loan  transaction  breaches its
agreement with the Portfolio Fund or Portfolio Account.

WHEN-ISSUED, DELAYED DELIVERY AND FORWARD COMMITMENT SECURITIES

                  To reduce the risk of changes in  securities  prices and  interest  rates,  a  Portfolio  Fund or
Portfolio Account may purchase  securities on a forward  commitment,  when-issued or delayed delivery basis,  which
means  delivery and payment take place a number of days after the date of the  commitment to purchase.  The payment
obligation  and the interest rate  receivable  with respect to such  purchases are fixed when the Portfolio Fund or
Portfolio  Account enters into the  commitment,  but the Portfolio Fund or Portfolio  Account does not make payment
until it  receives  delivery  from the  counterparty.  After a  Portfolio  Fund or  Portfolio  Account  commits  to
purchase  such  securities,  but  before  delivery  and  settlement,  it may sell the  securities  if it is  deemed
advisable.

                  Securities  purchased  on a forward  commitment  or  when-issued  or delayed  delivery  basis are
subject to changes in value,  generally  changing in the same way, i.e.,  appreciating  when interest rates decline
and  depreciating  when interest  rates rise,  based upon the public's  perception of the  creditworthiness  of the
issuer and changes,  real or  anticipated,  in the level of interest  rates.  Securities  so purchased may expose a
Portfolio Fund or Portfolio  Account to risks because they may experience such  fluctuations  prior to their actual
delivery.  Purchasing  securities on a when-issued or delayed  delivery basis can involve the additional  risk that
the yield  available in the market when the delivery  takes place  actually may be higher than that obtained in the
transaction itself.  Purchasing  securities on a forward  commitment,  when-issued or delayed delivery basis when a
Portfolio  Fund or  Portfolio  Account is fully or almost  fully  invested  results in a form of  leverage  and may
result in greater  potential  fluctuation in the value of the net assets of a Portfolio Fund or Portfolio  Account.
In addition,  there is a risk that  securities  purchased on a  when-issued  or delayed  delivery  basis may not be
delivered  and that the purchaser of securities  sold by a Portfolio  Fund or Portfolio  Account on a forward basis
will not honor its purchase obligation.  In such cases, the Portfolio Fund or Portfolio Account may incur a loss.

                                      REPURCHASES AND TRANSFERS OF INTERESTS
REPURCHASE OFFERS

                  As discussed in the prospectus,  offers to repurchase  Interests will be made by the Fund at such
times and on such  terms as may be  determined  by the Board of  Managers  of the Fund (the  "Board"),  in its sole
discretion  in  accordance  with the  provisions  of  applicable  law.  In  determining  whether  the  Fund  should
repurchase  Interests or portions  thereof from Members  pursuant to written  tenders,  the Board will consider the
recommendation  of the Adviser.  The Board also will consider various  factors,  including but not limited to those
listed in the prospectus, in making its determinations.

                  The Board will cause the Fund to make offers to  repurchase  Interests  or portions  thereof from
Members  pursuant  to written  tenders  only on terms it  determines  to be fair to the Fund and to all  Members or
persons  holding  Interests  acquired  from  Members.  When the  Board  determines  that the Fund  will  repurchase
Interests  or  portions  thereof,  notice  will be  provided  to each  Member  describing  the terms  thereof,  and
containing  information  Members should  consider in deciding  whether and how to  participate  in such  repurchase
opportunity.  Members who are deciding  whether to tender their  Interests  or portions  thereof  during the period
that a repurchase  offer is open may ascertain an estimated  net asset value of their  Interests  from  [________],
the Fund's  administrator,  during such period. If a repurchase offer is  oversubscribed by Members,  the Fund will
repurchase only a pro rata portion of the Interests tendered by each Member.


                  As discussed in the  prospectus,  the Fund will issue notes to  tendering  Members in  connection
with the  repurchase  of  Interests.  Upon its  acceptance  of tendered  Interests  for  repurchase,  the Fund will
maintain  daily on its  books a  segregated  account  consisting  of (i)  cash,  (ii)  liquid  securities  or (iii)
interests in Portfolio  Funds that the Fund has requested be withdrawn (or any  combination of the  foregoing),  in
an amount equal to the  aggregate  estimated  unpaid  dollar  amount of the notes issued by the Fund in  connection
with the repurchase offer.

                  Payment for repurchased  Interests may require the Fund to liquidate  portfolio  holdings earlier
than the Investment  Manager would otherwise  liquidate these holdings,  potentially  resulting in losses,  and may
increase  the Fund's  portfolio  turnover.  The  Investment  Manager  intends  to take  measures  (subject  to such
policies as may be  established  by the Board of  Managers)  to attempt to avoid or minimize  potential  losses and
turnover resulting from the repurchase of Interests.


MANDATORY REDEMPTIONS

                  As noted in the  prospectus,  the Fund has the right to  redeem  an  Interest  or  portion  of an
Interest  of a Member or any person  acquiring  an  Interest  or  portion  thereof  from or through a Member  under
certain circumstances.  Such mandatory redemptions may be made if:

o        an Interest or portion  thereof has been  transferred or such an Interest or portion thereof has vested in
                           any person by operation of law as the result of the death,  dissolution,  bankruptcy  or
                           incompetency of a Member;

o        ownership  of an  Interest  by a Member or other  person  will  cause the Fund to be in  violation  of, or
                           subject  the Fund to  additional  registration  or  regulation  under,  the  securities,
                           commodities or other laws of the U.S. or any other relevant jurisdiction;

o        continued  ownership of such an Interest may be harmful or injurious to the business or  reputation of the
                           Fund or the  Adviser,  or may  subject  the  Fund or any  Members  to an  undue  risk of
                           adverse tax or other fiscal consequences;

o        any of the  representations  and  warranties  made by a Member in connection  with the  acquisition  of an
                           Interest or portion thereof was not true when made or has ceased to be true; or

o        it would be in the best interests of the Fund to redeem an Interest or portion thereof.

TRANSFERS OF INTERESTS

                  No person may  become a  substituted  Member  without  the  written  consent of the Board,  which
consent may be withheld for any reason in its sole and  absolute  discretion.  Interests  may be  transferred  only
(i) by operation of law pursuant to the death,  bankruptcy,  insolvency or dissolution of a Member or (ii) with the
written  consent of the Board,  which may be withheld in its sole  discretion and is expected to be granted,  if at
all, only under  extenuating  circumstances.  Without limiting the foregoing,  the Board generally will not consent
to transfer  unless the transfer is (i) one in which the tax basis of the  Interest in the hands of the  transferee
is  determined,  in whole or in part, by reference to its tax basis in the hands of the transferor  (e.g.,  certain
transfers  to  affiliates,  gifts and  contributions  to family  partnerships),  (ii) to  members  of the  Member's
immediate  family  (brothers,  sisters,  spouse,  parents and children),  or (iii) a distribution  from a qualified
retirement  plan  or  an  individual  retirement  account.  The  Board  may  permit  other  pledges,  transfers  or
assignments  under such other  circumstances  and  conditions  as it, in its sole  discretion,  deems  appropriate;
provided,  however, that prior to any such pledge, transfer or assignment,  the Board shall consult with counsel to
--------   -------
the Fund to ensure that such pledge,  transfer or  assignment  will not cause the Fund to be treated as a "publicly
traded  partnership"  taxable as a corporation.  Notice to the Fund of any proposed  transfer must include evidence
satisfactory to the Fund that the proposed  transferee meets any  requirements  imposed by the Fund with respect to
Member  eligibility  and  suitability.  In addition to the  foregoing,  no Member will be  permitted to transfer an
Interest or portion thereof unless after such transfer the balance of the capital  account of the  transferee,  and
of the Member  transferring the Interest if the transfer involves less than its entire Interest,  is at least equal
to Fund's minimum investment requirement.

                  Any transferee meeting the Fund's  eligibility  requirements that acquires an Interest or portion
thereof in the Fund by operation of law as the result of the death,  dissolution,  bankruptcy or  incompetency of a
Member or otherwise,  will be entitled to the allocations and  distributions  allocable to the Interest so acquired
and to transfer such Interest in accordance with the terms of the Fund's Limited  Liability  Company Agreement (the
"LLC  Agreement"),  but will not be  entitled  to the other  rights of a Member  unless and until  such  transferee
becomes a  substituted  Member as  provided  in the LLC  Agreement.  If a Member  transfers  an Interest or portion
thereof  with the  approval  of the  Board,  the Fund  will  promptly  take all  necessary  actions  to admit  such
transferee  or  successor  to the Fund as a Member.  Each Member and  transferee  is required to pay all  expenses,
including  attorneys' and  accountants'  fees,  incurred by the Fund in connection  with such  transfer.  If such a
transferee  does  not meet  the  Member  eligibility  requirements,  the Fund  reserves  the  right to  redeem  its
Interest.  Any transfer of an Interest in violation of the LLC Agreement will not be permitted and will be void.

                  The LLC  Agreement  provides that each Member has agreed to indemnify and hold harmless the Fund,
the  Managers,  the Adviser,  each other  Member and any  affiliate of the  foregoing  against all losses,  claims,
damages,  liabilities,  costs  and  expenses,  including  legal or other  expenses  incurred  in  investigating  or
defending against any such losses, claims,  damages,  liabilities,  costs and expenses or any judgments,  fines and
amounts paid in  settlement,  joint or several,  to which such  persons may become  subject by reason of or arising
from any transfer  made by such Member in  violation  of these  provisions  or any  misrepresentation  made by such
Member in connection with any such transfer.

                                                 BOARD OF MANAGERS
                  The Board of the Fund provides  broad  oversight  over the operations and affairs of the Fund. It
has overall  responsibility  to manage and control the  business  affairs of the Fund,  including  the complete and
exclusive  authority  to  establish  policies  regarding  the  management,  conduct  and  operation  of the  Fund's
business.  The  Board  exercises  the same  powers,  authority  and  responsibilities  on behalf of the Fund as are
customarily exercised by the board of directors of a registered investment company organized as a corporation.

                  The Managers are not required to  contribute  to the capital of the Fund or to hold  Interests in
the Fund.  A majority of the Managers are persons who are not  "interested  persons" (as defined in the  Investment
Company Act) of the Fund  (collectively,  the "Independent  Managers").  The Independent  Managers perform the same
functions for the Fund as are  customarily  exercised by the  non-interested  directors of a registered  investment
company organized as a corporation.

                  The identity of the Managers and brief  biographical  information  regarding  each Manager is set
forth below.  Each Manager who is deemed to be an  "interested  person" of the Fund,  as defined in the  Investment
Company Act, is indicated by an asterisk.

  Name, (Age) and Address During the
             Past 5 Years                     Position(s) Held with Fund               Principal Occupation(s)

[To be added by pre-effective
amendment.]


*        "Interested Person", as defined in the Investment Company Act.

                  The Managers serve on the Board for terms of indefinite  duration.  A Manager's  position in that
capacity  will  terminate  if the Manager is  removed,  resigns or is subject to various  disabling  events such as
death or  incapacity.  A Manager may resign upon 90 days' prior written  notice to the other  Managers,  and may be
removed  either by vote of  two-thirds  of the  Managers  not  subject to the  removal  vote or vote of the Members
holding not less than  two-thirds  of the total number of votes  eligible to be cast by all  Members.  The Managers
will render  assistance  to Members on the  question  of the removal of Managers in the manner  required by Section
16(c) of the  Investment  Company  Act. In the event of any vacancy in the  position  of a Manager,  the  remaining
Managers may appoint an individual to serve as a Manager,  so long as immediately  after such  appointment at least
two-thirds  of the Managers  then serving  would have been elected by the Members.  The Managers may call a meeting
of  Members  to fill any  vacancy in the  position  of a  Manager,  and must do so within 60 days after any date on
which  Managers who were elected by the Members cease to  constitute a majority of the Managers  then  serving.  If
no Manager  remains to manage the  business of the Fund,  the  Adviser  may manage and  control the Fund,  but must
convene a meeting of Members  within 60 days for the purpose of either  electing  new  Managers or  dissolving  the
Fund.

COMPENSATION


               Name and
---------------------------------------                                           Total Compensation from Fund and
          Position with Fund             Aggregate Compensation from the Fund       Fund Complex Paid to Managers
                                                                                           [$-----] (--)*
                                                                                           [$-----] (--)*


*        Represents the number of separate portfolios comprising the investment companies in the Fund complex,
including the Fund, for which the Board member serves.

**       Estimated for the fiscal year ending March 31, 2002.  Amount does not include reimbursed expenses for
attending Board meetings, which amounted to $_____ for all Board members as a group.

                  The  Independent  Managers  are each paid an annual  retainer of $_____ and per  meeting  fees of
$_______,  or $______ in the case of  telephonic  meetings  by the Fund.  The other  Managers  receive no annual or
other fees from the Fund.  All Managers are  reimbursed by the Fund for their  reasonable  out-of-pocket  expenses.
The Managers do not receive any pension or retirement benefits from the Fund.

                                           INVESTMENT ADVISORY SERVICES
THE ADVISER

                  OppenheimerFunds,  Inc. (the "Adviser") serves as the Fund's investment  adviser,  subject to the
ultimate  supervision  of and subject to any policies  established  by the Board.  The Adviser is a majority  owned
subsidiary of Oppenheimer  Acquisition  Corporation,  which in turn is a wholly owned  subsidiary of  Massachusetts
Mutual Life Insurance Company ("MassMutual").

                  Pursuant to the terms of an investment  advisory  agreement entered into between the Fund and the
Adviser  dated as of  _______,  2001 (the  "Advisory  Agreement"),  the  Adviser  is  responsible  for  developing,
implementing and supervising the Fund's investment  program.  The Advisory Agreement  requires the Adviser,  at its
expense,  to provide  the Fund with  adequate  office  space,  facilities  and  equipment,  and to provide  certain
administrative  services to the Fund,  including:  the  compilation  and maintenance of records with respect to the
Fund's  operations  (excluding  the  preparation of accounting  and investor  records);  with the assistance of the
Fund's  administrator,  legal  counsel and  independent  accountants,  the  preparation  of  materials  relating to
meetings  of the Board and  Members,  and the  preparation  and  filing of  required  regulatory  reports;  and the
supervision of services provided by the Fund's administrator and custodian.

                  The Adviser is  authorized,  subject to the approval of the Board and  Members,  to retain one of
its affiliates to provide any or all of the  investment  advisory  services  required to be provided to the Fund or
to assist the Adviser in providing  these  services,  subject to the  requirement  that the Adviser  supervise  the
rendering of any such services to the Fund by its affiliates.

                  As  compensation  for  services  required  to be  provided  by the  Adviser  under  the  Advisory
Agreement,  the Fund will pay the  Adviser a monthly  fee (the  "Management  Fee")  computed  at the annual rate of
1.20% of the  aggregate  value of  outstanding  Interests  determined  as of the last day of the month  (before any
repurchases  of  Interests or Incentive  Allocations,  as defined  below).  The Adviser (or an  affiliated  company
designated by the Adviser) is also entitled to be the special  advisory  member of the Fund (the "Special  Advisory
Member")  and to  receive  in such  capacity a  performance-based  incentive  allocation  that is  determined  as a
percentage of the net profits of the Fund  otherwise  allocable to each Member (the  "Incentive  Allocation").  The
method of computation of the Incentive Allocation is described in the prospectus.


                  The  Advisory  Agreement  was  approved by the Board  (including  a majority  of the  Independent
Managers),  at a  meeting  held  in  person  on  November  [ ],  2001,  and  was  also  approved  on  that  date by
[OppenheimerFunds,  Inc.],  the then sole Member of the Fund.  It has an initial term of two years from the date of
its  execution,  and may be  continued  in effect  from year to year  thereafter  if such  continuance  is approved
annually by the Board or by vote of a majority of the outstanding  voting securities of the Fund;  provided that in
either event the continuance is also approved by a majority of the  Independent  Managers by vote cast in person at
a meeting  called for the  purpose  of voting on such  approval.  The  Advisory  Agreement  is  terminable  without
penalty,  on 60 days'  prior  written  notice:  by the  Board;  by vote of a  majority  of the  outstanding  voting
securities  of the  Fund;  or by the  Adviser.  The  Advisory  Agreement  also  provides  that  it  will  terminate
automatically in the event of its "assignment," as defined by the Investment Company Act and the rules thereunder.

                  The Advisory  Agreement  provides that in the absence of willful  misfeasance,  bad faith,  gross
negligence  in the  performance  of its duties or  reckless  disregard  of its  obligations  and  duties  under the
investment  advisory  agreement,  the  Adviser  is not liable for any loss the Fund  sustains  for any  investment,
adoption of any investment  policy, or the purchase,  sale or retention of any security.  In addition,  it provides
that the  Adviser  may act as  investment  adviser  for any  other  person,  firm or  corporation  and use the name
"Oppenheimer"  in  connection  with  other  investment  companies  for which it may act as  investment  adviser  or
general  distributor.  If the  Adviser  shall no longer act as  investment  adviser of the Fund,  the  Adviser  may
withdraw the right of the Fund to use the name "Oppenheimer" as part of its name.

                  The Adviser or its designee maintains the Fund's accounts, books and other documents required
to be maintained under the Investment Company Act at ________________.

THE INVESTMENT MANAGER

                  As authorized by the Advisory Agreement,  Tremont Partners,  Inc. (the "Investment Manager"),  an
affiliate  of the  Adviser,  has been  assigned  responsibility  for  providing  day-to-day  investment  management
services to the Fund, subject to the supervision of the Adviser.  The Investment  Manager is primarily  responsible
for the  selection of Portfolio  Managers and the  allocation  of the assets of the Fund for  investment  among the
Portfolio  Managers.  In addition,  the  Investment  Manager is  responsible  for investing the cash portion of the
Fund's  assets not  invested  in  Portfolio  Funds or  through  Portfolio  Accounts.  The  Investment  Manager is a
majority owned  subsidiary of Oppenheimer  Acquisition  Corporation,  which in turn is a wholly owned subsidiary of
MassMutual.

                  The  Investment  Manager  provides  services to the Fund pursuant to the terms of a  sub-advisory
agreement  entered  into  between  the  Adviser  and  the  Investment  Manager  dated  as  of  _______,  2001  (the
"Sub-Advisory  Agreement").  In consideration of the Investment  Manager's  provision of services to the Fund under
the  Sub-Advisory  Agreement,  the Adviser pays (out of the  Management  Fee that it receives) a monthly fee to the
Investment  Manager,  computed  at the  annual  rate of  0.60% of the  aggregate  value  of  outstanding  Interests
determined  as of the last day of the month  (before any  repurchases  of Interests or Incentive  Allocations).  In
addition,  the Adviser has designated the Investment  Manager as the Special  Advisory  Member of the Fund. In such
capacity,  the Investment Manager is entitled to receive the Incentive  Allocation from the net profits of the Fund
otherwise  allocable to each Member.  The Incentive  Allocation is a  performance-based  allocation equal to 10% of
the net  profits,  if any, of the Fund that  otherwise  would have been  credited  to the  capital  account of each
Member,  subject to a "high water mark" and "hurdle rate." The method of  computation  of the Incentive  Allocation
is described in the prospectus.


                  The  Sub-Advisory  Agreement was approved by the Board  (including a majority of the  Independent
Managers),  at a  meeting  held  in  person  on  November  [ ],  2001,  and  was  also  approved  on  that  date by
[OppenheimerFunds,  Inc.],  the then sole Member of the Fund.  It has an initial term of two years from the date of
its  execution,  and may be  continued  in effect  from year to year  thereafter  if such  continuance  is approved
annually by the Board or by vote of a majority of the outstanding  voting securities of the Fund;  provided that in
either event the continuance is also approved by a majority of the  Independent  Managers by vote cast in person at
a meeting  called for the purpose of voting on such  approval.  The  Sub-Advisory  Agreement is terminable  without
penalty,  on 60 days'  prior  written  notice:  by the  Board;  by vote of a  majority  of the  outstanding  voting
securities of the Fund; by the Adviser;  or by the Investment  Manager.  The  Sub-Advisory  Agreement also provides
that it will terminate  automatically in the event of its  "assignment,"  as defined by the Investment  Company Act
and the rules thereunder.

                  The  Sub-Advisory  Agreement  provides  that in the  absence of willful  misfeasance,  bad faith,
gross  negligence in the  performance of its duties or reckless  disregard of its  obligations and duties under the
investment  advisory  agreement,  the  Investment  Manager is not liable to the Fund or to the Adviser for any loss
the Fund sustains for any  investment,  adoption of any investment  policy,  or the purchase,  sale or retention of
any security.  In addition,  it provides that the  Investment  Manager may act as investment  adviser for any other
person,  firm or corporation  and use the name "Tremont" in connection  with other  investment  companies for which
it may act as investment  adviser.  If the  Sub-Adviser  shall no longer act as an investment  adviser of the Fund,
the Sub-Adviser may withdraw the right of the Fund to use the name "Tremont" as part of its name.

FUND EXPENSES


                  The Fund will bear all  expenses  incurred  in its  business  and  operations  other  than  those
specifically  required to be borne by the Adviser  pursuant to the Advisory  Agreement.  Expenses borne by the Fund
include, but are not limited to, the following:
o        all costs and expenses  directly  related to portfolio  transactions and positions for the Fund's account,
                           including,  but not limited to,  brokerage  commissions,  research  fees,  interest  and
                           commitment  fees on loans and debit  balances,  borrowing  charges  on  securities  sold
                           short,  dividends on  securities  sold but not yet  purchased,  custodial  fees,  margin
                           fees,  transfer  taxes and premiums,  taxes  withheld on foreign  dividends and indirect
                           expenses from investments in Portfolio Funds;
o        all costs and expenses  associated with the organization  and  registration of the Fund,  certain offering
                           costs and the costs of compliance with any applicable Federal or state laws;
o        all  costs and  expenses  associated  with the  organization  of  separate  investment  funds  managed  by
                           Portfolio Managers retained by the Fund;
o        attorneys' fees and disbursements  associated with updating the Fund's registration statement,  prospectus
                           and  other  offering  related  documents  (the  "Offering  Materials");   the  costs  of
                           printing the Offering  Materials;  the costs of distributing  the Offering  Materials to
                           prospective  investors;  and  attorneys'  fees  and  disbursements  associated  with the
                           preparation and review thereof;
o        the costs and  expenses of holding  meetings of the Board and any  meetings  of Members,  including  legal
                           costs associated with the preparation and filing of proxy materials;
o        the fees and  disbursements  of legal  counsel to the Fund,  legal  counsel to the  Independent  Managers,
                           independent  accountants for the Fund and other  consultants and  professionals  engaged
                           on behalf of the Fund;
o        the Management Fee and the fees and charges of the Fund's custodian and administrator;
o        the costs of a fidelity bond and any liability insurance obtained on behalf of the Fund or the Board;
o        all costs and  expenses  of  preparing,  setting in type,  printing  and  distributing  reports  and other
                           communications to Members;
o        all expenses of computing the Fund's net asset value,  including  any  equipment or services  obtained for
                           these purposes;
o        all  charges  for  equipment  or  services  used  in  communicating   information   regarding  the  Fund's
                           transactions  among the Adviser and any  custodian  or other agent  engaged by the Fund;
                           and
o        such other types of expenses as may be approved from time to time by the Board of Managers.

                  The Portfolio Funds will bear all expenses  incurred in connection with their  operations.  These
expenses are similar to those  incurred by the Fund.  The  Portfolio  Managers  generally  will charge  asset-based
fees to and receive  performance-based  allocations  from the Portfolio  Funds,  which  effectively will reduce the
investment  returns of the Portfolio  Funds and the amount of any  distributions  from the  Portfolio  Funds to the
Fund.  These expenses, fees and allocations will be in addition to those incurred by the Fund itself.

CODES OF ETHICS

                  The Fund, the Adviser,  the Investment  Manager and  OppenheimerFunds  Distributor,  Inc.,  which
serves as the  Fund's  distributor,  have each  adopted  codes of  ethics.  The codes are  designed  to detect  and
prevent  improper  personal trading by certain of personnel,  including  investment  personnel,  that might compete
with or otherwise take advantage of the Fund's  portfolio  transactions.  Covered  persons include the Managers and
the officers and directors of the Adviser and the Investment  Adviser,  as well as employees of the Adviser and the
Investment  Manager  having  knowledge of the  investments  and  investment  intentions  of the Fund.  The codes of
ethics permit persons  subject to the Code to invest in securities,  including  securities that may be purchased or
held by the  Fund,  subject  to a number  of  restrictions  and  controls.  Compliance  with the codes of ethics is
carefully monitored and enforced.

                  The codes of ethics are included as an exhibit to the Fund's  registration  statement  filed with
the  Securities  and  Exchange  Commission  and can be reviewed and copied at the SEC's  Public  Reference  Room in
Washington,  D.C.  Information on the operation of the Public  Reference Room may be obtained by calling the SEC at
1-202-942-8090.  The  codes  of  ethics  are  available  on the  EDGAR  database  on the  SEC's  Internet  site  at
http://www.sec.gov,  and also may be  obtained,  after  paying a  duplicating  fee,  by  electronic  request at the
following E-mail address:  publicinfo@sec.gov,  or by writing the SEC's Public Reference Section,  Washington, D.C.
20549-0102.

                                               CONFLICTS OF INTEREST
THE ADVISER

                  The Adviser and its affiliates  manage the assets of registered  investment  companies other than
the  Fund and  provide  investment  advisory  services  to  other  accounts.  The  Fund  has no  interest  in these
activities.  The  Adviser  and its  officers  or  employees  who assist in  providing  services to the Fund will be
engaged  in  substantial  activities  other  than on  behalf  of the Fund and may have  conflicts  of  interest  in
allocating  their time and  activity  between  the Fund and other  registered  investment  companies  and  accounts
managed by the Adviser.  OppenheimerFunds  and its officers and employees  will devote so much of their time to the
affairs of the Fund as in their judgment is necessary and appropriate.

THE INVESTMENT MANAGER

                  The  Investment  Manager  also  provides  investment  advisory and other  services,  directly and
through  affiliates,  to various  entities and accounts other than the Fund ("Tremont  Accounts").  The Fund has no
interest in these  activities.  The  Investment  Manager  and the  investment  professionals  who, on behalf of the
Investment  Manager,  will  provide  investment  advisory  services  to the Fund  will be  engaged  in  substantial
activities other than on behalf of the Fund, may have differing  economic  interests in respect of such activities,
and may have  conflicts  of  interest  in  allocating  their time and  activity  between  the Fund and the  Tremont
Accounts.  Such  persons  will  devote  only so much  time to the  affairs  of the  Fund as in  their  judgment  is
necessary and appropriate.

PARTICIPATION IN INVESTMENT OPPORTUNITIES
                  The  Investment   Manager  expects  to  employ  an  investment  program  for  the  Fund  that  is
substantially  similar to the investment  program employed by it for certain Tremont Accounts,  including a private
investment  partnership  that has an investment  program that is  substantially  the same as the Fund's  investment
program.  As a general matter,  the Investment  Manager will consider  participation by the Fund in all appropriate
investment   opportunities  that  are  under  consideration  for  those  other  Tremont  Accounts.   There  may  be
circumstances,  however,  under which the  Investment  Manager will cause one or more Tremont  Accounts to commit a
larger  percentage of their respective  assets to an investment  opportunity  than to which the Investment  Manager
will commit the Fund's assets.  There also may be  circumstances  under which the Investment  Manager will consider
participation  by Tremont Accounts in investment  opportunities in which the Investment  Manager does not intend to
invest on behalf of the Fund, or vice versa.

                  The  Investment  Manager will  evaluate  for the Fund and for each  Tremont  Account a variety of
factors  that  may be  relevant  in  determining  whether  a  particular  investment  opportunity  or  strategy  is
appropriate and feasible for the Fund or a Tremont  Account at a particular  time,  including,  but not limited to,
the following:  (1) the nature of the investment  opportunity  taken in the context of the other investments at the
time;  (2) the  liquidity of the  investment  relative to the needs of the  particular  entity or account;  (3) the
availability of the opportunity (i.e., size of obtainable  position);  (4) the transaction costs involved;  and (5)
the  investment  or  regulatory  limitations  applicable  to  the  particular  entity  or  account.  Because  these
considerations  may differ for the Fund and the  Tremont  Accounts  in the  context  of any  particular  investment
opportunity,  the  investment  activities  of the Fund and the Tremont  Accounts  may differ from time to time.  In
addition,  the fees and  expenses  of the Fund will differ from those of the  Tremont  Accounts.  Accordingly,  the
future performance of the Fund and the Tremont Accounts will vary.

                  When the  Investment  Manager  determines  that it would be  appropriate  for the Fund and one or
more Tremont  Accounts to participate in an investment  transaction in the same Portfolio Fund or other  investment
at the same time, it will attempt to aggregate,  place and allocate  orders on a basis that the Investment  Manager
believes to be fair and equitable,  consistent with its  responsibilities  under applicable law.  Decisions in this
regard are  necessarily  subjective and there is no requirement  that the Fund  participate,  or participate to the
same extent as the Tremont  Accounts,  in all investments or trades.  However,  no participating  entity or account
will receive  preferential  treatment over any other and the  Investment  Manager will take steps to ensure that no
participating entity or account will be systematically  disadvantaged by the aggregation,  placement and allocation
of orders and investments.

                  Situations may occur,  however,  where the Fund could be disadvantaged  because of the investment
activities  conducted by the Investment  Manager for the Tremont  Accounts.  Such situations may be based on, among
other things,  the  following:  (1) legal  restrictions  or other  limitations  (including  limitations  imposed by
Portfolio  Managers with respect to Portfolio  Funds) on the combined  size of positions  that may be taken for the
Fund and the  Tremont  Accounts,  thereby  limiting  the size of the Fund's  position  or the  availability  of the
investment  opportunity;  (2) the difficulty of  liquidating  an investment  for the Fund and the Tremont  Accounts
where the market  cannot absorb the sale of the combined  positions;  and (3) the  determination  that a particular
investment is warranted only if hedged with an option or other  instrument and there is a limited  availability  of
such options or other  instruments.  In particular,  the Fund may be legally restricted from entering into a "joint
transaction"  (as defined in the Investment  Company Act) with the Tremont  Accounts with respect to the securities
of an issuer without first obtaining exemptive relief from the SEC.  See "Other Matters" below.

                  Directors,  officers,  employees  and  affiliates  of the  Investment  Manager  may buy and  sell
securities  or other  investments  for their own accounts  and may have actual or  potential  conflicts of interest
with  respect  to  investments  made on  behalf  of the  Fund.  As a result of  differing  trading  and  investment
strategies  or  constraints,  positions  may be taken by  directors,  officers,  employees  and  affiliates  of the
Investment  Manager,  or by the Investment Manager for the Tremont Accounts,  that are the same,  different or made
at a different time than positions taken for the Fund.

OTHER MATTERS

                  Except in  accordance  with  applicable  law,  the  Adviser,  the  Investment  Manager  and their
affiliates are not permitted to buy  securities or other  property  from, or sell  securities or other property to,
the Fund.  However,  subject to certain  conditions  imposed by applicable rules under the Investment  Company Act,
the Fund may effect certain  principal  transactions in securities with one or more accounts managed by the Adviser
or the Investment  Manager,  except for accounts as to which the Adviser,  the  Investment  Manager or any of their
affiliates  serves as a  general  partner  or as to which  they may be deemed  to be an  affiliated  person  (or an
affiliated  person of such a  person),  other  than an  affiliation  that  results  solely  from the  Adviser,  the
Investment  Manager  or  one  of  their  affiliates  serving  as  an  investment  adviser  to  the  account.  These
transactions  would be made in  circumstances  where the Investment  Manager has determined it would be appropriate
for the Fund to  purchase  (or  sell),  and the  Investment  Manager  or the  Adviser  has  determined  it would be
appropriate for another account to sell (or purchase), the same security or instrument on the same day.

                  Future investment  activities of the Adviser,  the Investment  Manager and their affiliates,  and
of their respective directors, officers or employees, may give rise to additional conflicts of interest.

                                                    TAX ASPECTS
                  The  following  is a summary  of  certain  aspects  of the  income  taxation  of the Fund and its
Members  which should be considered  by a  prospective  Member.  The Fund has not sought a ruling from the Internal
Revenue Service (the  "Service") or any other Federal,  state or local agency with respect to any of the tax issues
affecting  the Fund,  nor has it obtained an opinion of counsel  with  respect to any Federal tax issues other than
the characterization of the Fund as a partnership for Federal income tax purposes.

                  This  summary of certain  aspects of the Federal  income tax  treatment of the Fund is based upon
the  Internal  Revenue  Code of 1986,  as amended (the  "Code"),  judicial  decisions,  Treasury  Regulations  (the
"Regulations")  and rulings in  existence  on the date  hereof,  all of which are subject to change.  This  summary
does not  discuss  the  impact of  various  proposals  to amend the Code  which  could  change  certain  of the tax
consequences  of an investment  in the Fund.  This summary also does not discuss all of the tax  consequences  that
may be relevant to a particular  investor or to certain  investors  subject to special  treatment under the Federal
income tax laws, such as insurance companies.

                  EACH  PROSPECTIVE  MEMBER  SHOULD  CONSULT WITH ITS OWN TAX ADVISER IN ORDER FULLY TO  UNDERSTAND
THE FEDERAL, STATE, LOCAL AND FOREIGN INCOME TAX CONSEQUENCES OF AN INVESTMENT IN THE FUND.

                  In  addition  to the  particular  matters  set forth in this  section,  tax-exempt  organizations
should review  carefully  those  sections of the  prospectus  and the SAI regarding  liquidity and other  financial
matters to ascertain  whether the investment  objectives of the Fund are consistent  with their overall  investment
plans.  Each  prospective  tax-exempt  Member is urged to consult  its own counsel  regarding  the  acquisition  of
Interests.

Tax Treatment of Fund Operations
--------------------------------

                  Classification  of the Fund.  The Fund will  receive  an  opinion  of  Schulte  Roth & Zabel LLP,
                  ---------------------------
counsel to the Fund,  that under the  provisions of the Code and the  Regulations,  as in effect on the date of the
opinion,  as well as under the  relevant  authority  interpreting  the Code and the  Regulations,  and  based  upon
certain  representations  of the Board,  the Fund will be treated as a partnership  for Federal income tax purposes
and not as an association taxable as a corporation.

                  Under  Section  7704 of the  Code,  "publicly  traded  partnerships"  are  generally  treated  as
corporations  for Federal income tax purposes.  A publicly  traded  partnership is any partnership the interests in
which are traded on an established  securities  market or which are readily  tradable on a secondary market (or the
substantial  equivalent  thereof).  Interests in the Fund will not be traded on an established  securities  market.
Regulations  concerning the  classification  of  partnerships as publicly traded  partnerships  (the  "Section 7704
Regulations")  provide certain safe harbors under which interests in a partnership  will not be considered  readily
tradable on a secondary  market (or the substantial  equivalent  thereof).  The Fund may not be eligible for any of
those safe harbors.  In  particular,  it will not qualify under the private  placement safe harbor set forth in the
Section 7704 Regulations if the Fund has more than 100 Members.

                  The Section  7704  Regulations  specifically  provide that the fact that a  partnership  does not
qualify for the safe harbors is disregarded  for purposes of  determining  whether  interests in a partnership  are
readily  tradable  on a  secondary  market  (or the  substantial  equivalent  thereof).  Rather,  in this event the
partnership's  status is  examined  under a general  facts and  circumstances  test set forth in the  Section  7704
Regulations.  Schulte  Roth &Zabel LLP also will render its  opinion  that,  under this "facts and  circumstances"
test, and based upon the  anticipated  operations of the Fund as well as the  legislative  history to Section 7704,
the text of the Section 7704 Regulations and certain  representations  of the Board, the interests in the Fund will
not be readily  tradable on a secondary market (or the substantial  equivalent  thereof) and,  therefore,  that the
Fund will not be treated as a publicly traded partnership taxable as a corporation.

                  Neither of the opinions of counsel  described  above,  however,  is binding on the Service or the
courts.  If it were determined  that the Fund should be treated as an association or a publicly traded  partnership
taxable as a corporation  for Federal  income tax purposes (as a result of a successful  challenge to such opinions
by the Service,  changes in the Code,  the  Regulations or judicial  interpretations  thereof,  a material  adverse
change in facts,  or  otherwise),  the  taxable  income of the Fund would be subject to  corporate  income tax when
recognized by the Fund;  distributions  of such income,  other than in certain  redemptions of Interests,  would be
treated as dividend  income when received by the Members to the extent of the current or  accumulated  earnings and
profits of the Fund; and Members would not be entitled to report profits or losses realized by the Fund.

                  UNLESS  OTHERWISE  INDICATED,  REFERENCES IN THE FOLLOWING  DISCUSSION OF THE TAX CONSEQUENCES OF
FUND INVESTMENTS,  ACTIVITIES, INCOME, GAIN AND LOSS, INCLUDE THE DIRECT INVESTMENTS,  ACTIVITIES, INCOME, GAIN AND
LOSS OF THE  FUND,  AND  THOSE  INDIRECTLY  ATTRIBUTABLE  TO THE FUND AS A RESULT  OF IT  BEING  AN  INVESTOR  IN A
PORTFOLIO FUND.

                  As a  partnership,  the Fund is not  itself  subject  to Federal  income  tax.  The Fund files an
annual  partnership  information  return with the Service which reports the results of  operations.  Each Member is
required to report  separately on its income tax return its distributive  share of the Fund's net long-term capital
gain or loss, net short-term  capital gain or loss and all other items of ordinary  income or loss.  Each Member is
taxed on its  distributive  share of the Fund's  taxable  income and gain  regardless of whether it has received or
will receive a distribution from the Fund.

                  Allocation of Profits and Losses.  Under the LLC Agreement,  the Fund's net capital  appreciation
                  --------------------------------
or net capital  depreciation  for each  accounting  period is  allocated  among the  Members  and to their  capital
accounts  without  regard to the amount of income or loss actually  recognized  by the Fund for Federal  income tax
purposes.  The LLC Agreement  provides that items of income,  deduction,  gain, loss or credit actually  recognized
by the Fund for each fiscal year generally are to be allocated for income tax purposes  among the Members  pursuant
to Regulations  issued under Sections  704(b) and 704(c) of the Code,  based upon amounts of the Fund's net capital
appreciation  or net capital  depreciation  allocated to each  Member's  capital  account for the current and prior
fiscal years.

                  Under the LLC  Agreement,  the Board has the  discretion  to allocate  specially an amount of the
Fund's capital gain  (including  short-term  capital gain) for Federal income tax purposes to the Special  Advisory
Member and to a withdrawing  Member to the extent that the Member's  capital account exceeds its Federal income tax
basis in its Interest.  There can be no assurance that, if the Board makes such a special  allocation,  the Service
will accept such  allocation.  If such  allocation  is  successfully  challenged  by the Service,  the Fund's gains
allocable to the remaining Members would be increased.

                  Tax Elections;  Returns;  Tax Audits. The Code provides for optional  adjustments to the basis of
                  ------------------------------------
partnership  property  upon  distributions  of  partnership  property to a partner  and  transfers  of  partnership
interests  (including by reason of death)  provided  that a partnership  election has been made pursuant to Section
754. Under the LLC Agreement,  at the request of a Member,  the Board, in its sole  discretion,  may cause the Fund
to make such an election.  Any such  election,  once made,  cannot be revoked  without the Service's  consent.  The
actual  effect of any such election may depend upon whether any  Portfolio  Fund also makes such an election.  As a
result of the  complexity  and added  expense of the tax  accounting  required to implement  such an election,  the
Board presently does not intend to make such election.

                  The Board  decides  how to report  the  partnership  items on the  Fund's  tax  returns,  and all
Members  are  required  under the Code to treat the items  consistently  on their own  returns,  unless they file a
statement with the Service  disclosing the  inconsistency.  Given the  uncertainty  and complexity of the tax laws,
it is  possible  that the Service may not agree with the manner in which the Fund's  items have been  reported.  In
the event the income tax returns of the Fund are audited by the Service,  the tax  treatment  of the Fund's  income
and deductions  generally is determined at the limited  liability  company level in a single proceeding rather than
by individual audits of the Members.  A Member chosen by the Board,  designated as the "Tax Matters  Partner",  has
considerable  authority to make  decisions  affecting the tax treatment and  procedural  rights of all Members.  In
addition,  the Tax Matters  Partner has the  authority to bind certain  Members to  settlement  agreements  and the
right on behalf of all Members to extend the statute of limitations  relating to the Members' tax liabilities  with
respect to Fund items.

Tax Consequences to a Withdrawing Member
----------------------------------------

                  A Member receiving a cash liquidating  distribution  from the Fund, in connection with a complete
withdrawal  from the Fund,  generally will recognize  capital gain or loss to the extent of the difference  between
the proceeds  received by such Member and such Member's  adjusted tax basis in its  Interest.  Such capital gain or
loss will be  short-term,  long-term,  or some  combination  of both,  depending  upon the  timing of the  Member's
contributions  to the Fund.  However,  a  withdrawing  Member  will  recognize  ordinary  income to the extent such
Member's  allocable  share of the Fund's  "unrealized  receivables"  exceeds the Member's basis in such  unrealized
receivables  (as  determined  pursuant  to the  Regulations).  For  these  purposes,  accrued  but  untaxed  market
discount,  if any, on  securities  held by the Fund will be treated as an  unrealized  receivable,  with respect to
which  a  withdrawing  Member  would  recognize   ordinary  income.  A  Member  receiving  a  cash   nonliquidating
distribution  will  recognize  income in a similar  manner only to the extent  that the amount of the  distribution
exceeds such Member's adjusted tax basis in its Interest.

                  As discussed  above,  the LLC Agreement  provides that the Board may specially  allocate items of
Fund capital gain  (including  short-term  capital gain) to a withdrawing  Member to the extent its capital account
would  otherwise  exceed its adjusted tax basis in its  Interest.  Such a special  allocation of gain may result in
the withdrawing  Member  recognizing  capital gain, which may include short-term capital gain, in the Member's last
taxable year in the Fund,  thereby reducing the amount of long-term  capital gain recognized during the tax year in
which it receives its liquidating distribution upon withdrawal.

                  Distributions  of  Property.   A  partner's   receipt  of  a  distribution  of  property  from  a
                  ---------------------------
partnership  is generally  not  taxable.  However,  under  Section 731 of the Code, a  distribution  consisting  of
marketable  securities  generally  is  treated  as a  distribution  of  cash  (rather  than  property)  unless  the
distributing  partnership  is an "investment  partnership"  within the meaning of Section  731(c)(3)(C)(i)  and the
recipient is an "eligible  partner"  within the meaning of Section  731(c)(3)(C)(iii).  The Fund will  determine at
the appropriate  time whether it qualifies as an "investment  partnership."  Assuming it so qualifies,  if a Member
is an "eligible  partner",  which term should include a Member whose  contributions to the Fund consisted solely of
cash, the recharacterization rule described above would not apply.

Tax Treatment of Fund Investments
---------------------------------

                  In General.  The Fund expects to act as a trader or investor,  and not as a dealer,  with respect
                  ----------
to its  securities  transactions.  A trader and an investor are persons who buy and sell  securities  for their own
accounts.  A dealer,  on the other hand, is a person who purchases  securities for resale to customers  rather than
for investment or speculation.

                  Generally,  the gains and losses  realized by a trader or an  investor on the sale of  securities
are capital  gains and losses.  Thus,  subject to the  treatment  of certain  currency  exchange  gains as ordinary
income  (see  "Currency  Fluctuations  - 'Section  988' Gains or Losses"  below)  and  certain  other  transactions
described  below,  the Fund expects that its gains and losses from its  securities  transactions  typically will be
capital gains and capital  losses.  These capital  gains and losses may be long-term or  short-term  depending,  in
general,  upon the length of time the Fund maintains a particular  investment position and, in some cases, upon the
nature of the  transaction.  Property held for more than one year generally will be eligible for long-term  capital
gain or loss  treatment.  The  application  of certain rules relating to short sales,  to so-called  "straddle" and
"wash sale"  transactions and to Section 1256 Contracts  (defined below) may serve to alter the manner in which the
Fund's holding period for a security is determined or may otherwise  affect the  characterization  as short-term or
long-term,  and also the timing of the realization,  of certain gains or losses.  Moreover,  the straddle rules and
short sale rules may require the capitalization of certain related expenses of the Fund.1

                  The maximum ordinary income tax rate for individuals is 39.1%2 and,  in   general,   the  maximum
individual income tax rate for long-term capital gains is 20%3 (unless   the   taxpayer   elects  to  be  taxed  at
ordinary rates - see  "Limitation on  Deductibility  of Interest and Short Sale Expenses"  below),  although in all
cases the actual rates may be higher due to the phase out of certain tax  deductions,  exemptions and credits.  The
excess of capital  losses over capital gains may be offset against the ordinary  income of an individual  taxpayer,
subject to an annual  deduction  limitation of $3,000.  For  corporate  taxpayers,  the maximum  income tax rate is
35%.  Capital losses of a corporate  taxpayer may be offset only against  capital gains,  but unused capital losses
may be carried back three years (subject to certain limitations) and carried forward five years.

                  The Fund may realize  ordinary  income from  dividends  and  accruals of interest on  securities.
The Fund may hold debt  obligations  with  "original  issue  discount." In such case, the Fund would be required to
include  amounts  in  taxable  income on a  current  basis  even  though  receipt  of such  amounts  may occur in a
subsequent  year. The Fund may also acquire debt  obligations  with "market  discount." Upon disposition of such an
obligation,  the Fund  generally  would be required to treat gain realized as interest  income to the extent of the
market  discount  which accrued  during the period the debt  obligation  was held by the Fund. The Fund may realize
ordinary  income or loss with respect to its  investments in  partnerships  engaged in a trade or business.  Income
or  loss  from  transactions  involving  certain  derivative  instruments,  such as swap  transactions,  will  also
generally  constitute  ordinary  income or loss. In addition,  amounts,  if any,  payable by the Fund in connection
with equity  swaps,  interest  rate swaps,  caps,  floors and collars  likely  would be  considered  "miscellaneous
itemized  deductions"  which,  for a noncorporate  Member,  may be subject to restrictions on their  deductibility.
See  "Deductibility  of Fund  Investment  Expenditures by Noncorporate  Members" below.  Moreover,  gain recognized
from certain "conversion transactions" will be treated as ordinary income.4

                  Currency  Fluctuations - "Section 988" Gains or Losses.  To the extent that its  investments  are
                  ------------------------------------------------------
made in  securities  denominated  in a foreign  currency,  gain or loss  realized  by the Fund  frequently  will be
affected  by the  fluctuation  in the  value of such  foreign  currencies  relative  to the  value  of the  dollar.
Generally,  gains or losses with  respect to the Fund's  investments  in common  stock of foreign  issuers  will be
taxed as capital gains or losses at the time of the  disposition of such stock.  However,  under Section 988 of the
Code,  gains and losses of the Fund on the acquisition and disposition of foreign  currency (e.g.,  the purchase of
                                                                                             ----
foreign  currency  and  subsequent  use of the  currency to acquire  stock)  will be treated as ordinary  income or
loss.  Moreover,  under Section 988,  gains or losses on disposition  of debt  securities  denominated in a foreign
currency  to the extent  attributable  to  fluctuation  in the value of the  foreign  currency  between the date of
acquisition  of the debt  security  and the  date of  disposition  will be  treated  as  ordinary  income  or loss.
Similarly,  gains or losses  attributable  to  fluctuations  in exchange rates that occur between the time the Fund
accrues interest or other  receivables or accrues expenses or other  liabilities  denominated in a foreign currency
and the time the Fund  actually  collects  such  receivables  or pays such  liabilities  may be treated as ordinary
income or ordinary loss.

                  As indicated above, the Fund may acquire foreign currency forward  contracts,  enter into foreign
currency  futures  contracts and acquire put and call options on foreign  currencies.  Generally,  foreign currency
regulated  futures  contracts  and option  contracts  that qualify as "Section 1256  Contracts"  (see "Section 1256
Contracts"  below),  will not be subject to ordinary  income or loss treatment under Section 988.  However,  if the
Fund acquires currency futures  contracts or option contracts that are not Section 1256 Contracts,  or any currency
forward  contracts,  any gain or loss  realized  by the Fund with  respect to such  instruments  will be  ordinary,
unless (i) the  contract  is a capital  asset in the hands of the Fund and is not a part of a straddle  transaction
and (ii) an election is made (by the close of the day the  transaction  is entered  into) to treat the gain or loss
attributable to such contract as capital gain or loss.

                  Section 1256  Contracts.  In the case of Section 1256  Contracts,  the Code  generally  applies a
                  -----------------------
"mark to market"  system of taxing  unrealized  gains and  losses on such  contracts  and  otherwise  provides  for
special rules of taxation.  A Section 1256 Contract includes certain regulated futures  contracts,  certain foreign
currency forward contracts,  and certain options contracts.  Under these rules,  Section 1256 Contracts held by the
Fund at the end of each taxable  year of the Fund are treated for Federal  income tax purposes as if they were sold
by the Fund for their fair market value on the last  business day of such taxable  year.  The net gain or loss,  if
any,  resulting  from such deemed sales (known as "marking to market"),  together  with any gain or loss  resulting
from actual  sales of Section  1256  Contracts,  must be taken into  account by the Fund in  computing  its taxable
income for such  year.  If a Section  1256  Contract  held by the Fund at the end of a taxable  year is sold in the
following  year,  the amount of any gain or loss realized on such sale will be adjusted to reflect the gain or loss
previously taken into account under the "mark to market" rules.

                  Capital  gains and losses  from such  Section  1256  Contracts  generally  are  characterized  as
short-term  capital  gains or losses to the extent of 40% thereof and as long-term  capital  gains or losses to the
extent of 60%  thereof.  Such gains and losses will be taxed under the general  rules  described  above.  Gains and
losses from certain foreign  currency  transactions  will be treated as ordinary income and losses.  (See "Currency
Fluctuations  - 'Section  988' Gains or Losses.") If an individual  taxpayer  incurs a net capital loss for a year,
the portion  thereof,  if any,  which  consists of a net loss on Section 1256 Contracts may, at the election of the
taxpayer,  be carried  back three years.  Losses so carried  back may be deducted  only against net capital gain to
the extent that such gain includes gains on Section 1256 Contracts.

                  Mixed  Straddle  Election.  The Code allows a taxpayer  to elect to offset  gains and losses from
                  -------------------------
positions  which are part of a "mixed  straddle."  A "mixed  straddle" is any straddle in which one or more but not
all positions are Section 1256  Contracts.  Pursuant to Temporary  Regulations,  the Fund (and any Portfolio  Fund)
may be  eligible to elect to  establish  one or more mixed  straddle  accounts  for  certain of its mixed  straddle
trading  positions.  The mixed straddle  account rules require a daily "marking to market" of all open positions in
the account and a daily  netting of gains and losses from  positions in the account.  At the end of a taxable year,
the annual net gains or losses from the mixed straddle  account are recognized  for tax purposes.  The  application
of the  Temporary  Regulations'  mixed  straddle  account  rules  is not  entirely  clear.  Therefore,  there is no
assurance that a mixed straddle account election by the Fund will be accepted by the Service.

                  Short  Sales.  Gain or loss from a short sale of  property  is  generally  considered  as capital
                  ------------
gain or loss to the extent the  property  used to close the short sale  constitutes  a capital  asset in the Fund's
hands.  Except with respect to certain  situations  where the  property  used to close a short sale has a long-term
holding period on the date the short sale is entered into,  gains on short sales  generally are short-term  capital
gains.  A loss on a short sale will be  treated  as a  long-term  capital  loss if, on the date of the short  sale,
"substantially  identical  property"  has been held by the Fund for more than one year.  In  addition,  these rules
may also terminate the running of the holding period of "substantially identical property" held by the Fund.

                  Gain or loss on a short sale will  generally not be realized  until such time that the short sale
is closed.  However,  if the Fund holds a short sale position with respect to stock,  certain debt  obligations  or
partnership  interests  that  has  appreciated  in  value  and  then  acquires  property  that  is the  same  as or
substantially  identical  to the  property  sold  short,  the Fund  generally  will  recognize  gain on the date it
acquires such  property as if the short sale were closed on such date with such  property.  Similarly,  if the Fund
holds an appreciated  financial position with respect to stock, certain debt obligations,  or partnership interests
and  then  enters  into a short  sale  with  respect  to the same or  substantially  identical  property,  the Fund
generally will recognize gain as if the  appreciated  financial  position were sold at its fair market value on the
date it enters into the short sale. The subsequent  holding period for any appreciated  financial  position that is
subject to these  constructive  sale rules will be  determined as if such position were acquired on the date of the
constructive sale.

                  Effect of  Straddle  Rules on  Members'  Securities  Positions.  The  Service  may treat  certain
                  --------------------------------------------------------------
positions in securities held (directly or indirectly) by a Member and its indirect  interest in similar  securities
held by the Fund as "straddles" for Federal income tax purposes.  The  application of the "straddle"  rules in such
a case could affect a Member's  holding period for the securities  involved and may defer the recognition of losses
with respect to such securities.5

                  Limitation on  Deductibility  of Interest and Short Sale Expenses.  For  noncorporate  taxpayers,
                  -----------------------------------------------------------------
Section 163(d) of the Code limits the deduction for "investment  interest"  (i.e.,  interest or short sale expenses
                                                                             ----
for "indebtedness  properly allocable to property held for investment").  Investment  interest is not deductible in
the current year to the extent that it exceeds the taxpayer's "net investment  income,"  consisting of net gain and
ordinary income derived from investments in the current year less certain directly  connected  expenses (other than
interest or short sale  expenses).  For this purpose,  any long-term  capital gain is excluded from net  investment
income unless the taxpayer elects to pay tax on such amount at ordinary income tax rates.

                  For  purposes  of this  provision,  the  Fund's  activities  will be  treated  as giving  rise to
investment  income for a Member,  and the investment  interest  limitation  would apply to a noncorporate  Member's
share of the interest and short sale expenses  attributable to the Fund's  operation.  In such case, a noncorporate
Member  would be  denied a  deduction  for all or part of that  portion  of its  distributive  share of the  Fund's
ordinary losses  attributable to interest and short sale expenses unless it had sufficient  investment  income from
all sources  including  the Fund. A Member that could not deduct  losses  currently as a result of the  application
of  Section  163(d)  would  be  entitled  to carry  forward  such  losses  to  future  years,  subject  to the same
limitation.  The  investment  interest  limitation  would also apply to interest paid by a  noncorporate  Member on
money  borrowed to finance its  investment in the Fund.  Potential  investors are advised to consult with their own
tax advisers  with respect to the  application  of the  investment  interest  limitation  in their  particular  tax
situations.

                  Deductibility  of Fund  Investment  Expenditures  by Noncorporate  Members.  Investment  expenses
                  --------------------------------------------------------------------------
(e.g.,  investment  advisory fees) of an individual,  trust or estate are deductible only to the extent they exceed
-----
2% of adjusted gross income.6  In  addition,  the Code  further  restricts  the  ability of an  individual  with an
adjusted  gross income in excess of a specified  amount (for 2001,  $132,950 or $66,475 for a married person filing
a separate return) to deduct such investment  expenses.  Under such provision,  investment expenses in excess of 2%
of  adjusted  gross  income may only be  deducted to the extent such  excess  expenses  (along with  certain  other
itemized  deductions) exceed the lesser of (i) 3% of the excess of the individual's  adjusted gross income over the
specified  amount or (ii) 80% of the amount of certain  itemized  deductions  otherwise  allowable  for the taxable
year.7  Moreover,  such investment  expenses are  miscellaneous  itemized  deductions which are not deductible by a
noncorporate taxpayer in calculating its alternative minimum tax liability.

                  Pursuant to  Temporary  Regulations  issued by the  Treasury  Department,  these  limitations  on
deductibility  should not apply to a  noncorporate  Member's  share of the trade or business  expenses of the Fund.
These  limitations will apply,  however,  to a noncorporate  Member's share of the investment  expenses of the Fund
(including  the  Management  Fee,  the fee paid to the  Administrator  and any fee  payable  to the  managers  of a
Portfolio  Fund),  to the extent such expenses are allocable to a Portfolio Fund that is not in a trade or business
within the meaning of the Code or to the  investment  activity of the Fund.  The Fund intends to treat its expenses
attributable  to a  Portfolio  Fund that is engaged in trade or  business  within the meaning of the Code or to the
trading  activity of the Fund as not being subject to such  limitations,  although  there can be no assurance  that
the Service will agree.

                  The  consequences of these  limitations  will vary depending upon the particular tax situation of
each  taxpayer.  Accordingly,  noncorporate  Members  should  consult  their  tax  advisers  with  respect  to  the
application of these limitations.

                  No  deduction  is allowed  for sales  loads paid by a Member to acquire an  Interest in the Fund;
 instead any such fees will be included in the Member's  adjusted  tax basis for its  Interest in the Fund.  To the
 extent that any portion of the investor  servicing  fee is treated as a selling  expense,  such  portion  would be
 subject to the same treatment.

                  Application  of Rules for Income and Losses  from  Passive  Activities.  The Code  restricts  the
                  ----------------------------------------------------------------------
deductibility  of losses from a "passive  activity"  against  certain  income  which is not derived  from a passive
activity.  This  restriction  applies to  individuals,  personal  service  corporations  and certain  closely  held
corporations.  Pursuant  to  Temporary  Regulations  issued  by the  Treasury  Department,  income or loss from the
Fund's  securities  investment and trading  activity  generally  will not constitute  income or loss from a passive
activity.  Therefore,  passive losses from other sources  generally could not be deducted  against a Member's share
of such  income and gain from the Fund.  Income or loss  attributable  to the Fund's  investments  in  partnerships
engaged in certain trades or businesses may constitute passive activity income or loss.

                  "Phantom Income" From Fund  Investments.  Pursuant to various  "anti-deferral"  provisions of the
                   --------------------------------------
Code (the "Subpart F," "passive foreign  investment  company" and "foreign  personal holding company"  provisions),
investments  (if any) by the Fund in  certain  foreign  corporations  may cause a Member to (i)  recognize  taxable
income prior to the Fund's  receipt of  distributable  proceeds,  (ii) pay an interest  charge on receipts that are
deemed as having been deferred or (iii)  recognize  ordinary income that, but for the  "anti-deferral"  provisions,
would have been treated as long-term or short-term capital gain.

Foreign Taxes
-------------

                  It is possible that certain  dividends and interest  directly or indirectly  received by the Fund
from  sources  within  foreign  countries  will be subject to  withholding  taxes  imposed  by such  countries.  In
addition,  the  Fund or a  Portfolio  Fund  may also be  subject  to  capital  gains  taxes in some of the  foreign
countries where they purchase and sell  securities.  Tax treaties  between certain  countries and the United States
may reduce or eliminate  such taxes.  It is  impossible to predict in advance the rate of foreign tax the Fund will
directly or indirectly pay since the amount of the Fund's assets to be invested in various countries is not known.

                  The Members  will be informed by the Fund as to their  proportionate  share of the foreign  taxes
paid by the Fund or a  Portfolio  Fund,  which  they will be  required  to  include in their  income.  The  Members
generally  will be entitled to claim  either a credit  (subject,  however,  to various  limitations  on foreign tax
credits) or, if they itemize their  deductions,  a deduction  (subject to the limitations  generally  applicable to
deductions)  for their share of such foreign taxes in computing  their Federal  income taxes.  A Member that is tax
exempt will not ordinarily benefit from such credit or deduction.

Unrelated Business Taxable Income
---------------------------------

                  Generally,  an exempt  organization  is exempt from Federal income tax on its passive  investment
income,  such as  dividends,  interest  and  capital  gains,  whether  realized  by the  organization  directly  or
indirectly through a partnership in which it is a partner.8  This type of income is exempt  even if it is  realized
from securities trading activity which constitutes a trade or business.

                  This  general  exemption  from tax does not  apply to the  "unrelated  business  taxable  income"
("UBTI")  of an exempt  organization.  Generally,  except as noted  above with  respect to  certain  categories  of
exempt trading  activity,  UBTI includes income or gain derived (either  directly or through  partnerships)  from a
trade or  business,  the  conduct  of which is  substantially  unrelated  to the  exercise  or  performance  of the
organization's  exempt purpose or function.  UBTI also includes "unrelated  debt-financed  income," which generally
consists  of  (i)  income  derived  by  an  exempt   organization   (directly  or  through  a   partnership)   from
income-producing property with respect to which there is "acquisition  indebtedness" at any time during the taxable
year, and (ii) gains derived by an exempt  organization  (directly or through a partnership)  from the  disposition
of property with respect to which there is "acquisition  indebtedness" at any time during the  twelve-month  period
ending with the date of such  disposition.  With respect to its investments in  partnerships  engaged in a trade or
business, the Fund's income (or loss) from these investments may constitute UBTI.

                  The Fund may incur "acquisition  indebtedness" with respect to certain of its transactions,  such
as the purchase of  securities  on margin.  Based upon a published  ruling  issued by the Service  which  generally
holds that income and gain with  respect to short sales of publicly  traded stock does not  constitute  income from
debt  financed  property for purposes of computing  UBTI,  the Fund will treat its short sales of securities as not
involving "acquisition indebtedness" and therefore not resulting in UBTI.9  To  the  extent  the  Fund   recognizes
income (i.e.,  dividends and interest) from securities  with respect to which there is  "acquisition  indebtedness"
        ----
during a taxable year,  the  percentage of such income which will be treated as UBTI generally will be based on the
percentage  which the  "average  acquisition  indebtedness"  incurred  with  respect to such  securities  is of the
"average amount of the adjusted basis" of such securities during the taxable year.

                  To the  extent  the  Fund  recognizes  gain  from  securities  with  respect  to  which  there is
"acquisition  indebtedness" at any time during the twelve-month  period ending with the date of their  disposition,
the  percentage  of such gain  which  will be treated  as UBTI will be based on the  percentage  which the  highest
amount of such  "acquisition  indebtedness"  is of the "average  amount of the adjusted  basis" of such  securities
during the taxable year. In determining  the unrelated  debt-financed  income of the Fund, an allocable  portion of
deductions  directly connected with the Fund's  debt-financed  property is taken into account.  Thus, for instance,
a percentage of losses from  debt-financed  securities (based on the debt/basis  percentage  calculation  described
above) would offset gains treated as UBTI.

                  Since the calculation of the Fund's "unrelated  debt-financed  income" is complex and will depend
in large part on the amount of leverage, if any, used by the Fund from time to time,10 it    is    impossible    to
predict  what  percentage  of the Fund's  income and gains will be treated as UBTI for a Member  which is an exempt
organization.  An exempt  organization's  share of the income or gains of the Fund which is treated as UBTI may not
be offset by losses of the exempt  organization  either from the Fund or otherwise,  unless such losses are treated
as  attributable  to an unrelated  trade or business  (e.g.,  losses from securities for which there is acquisition
                                                       ----
indebtedness).

                  To the extent that the Fund generates  UBTI,  the  applicable  Federal tax rate for such a Member
generally  would be either the  corporate  or trust tax rate  depending  upon the nature of the  particular  exempt
organization.  An exempt  organization may be required to support,  to the satisfaction of the Service,  the method
used to  calculate  its UBTI.  The Fund will be  required  to  report to a Member  which is an exempt  organization
information  as to the  portion,  if any, of its income and gains from the Fund for each year which will be treated
as UBTI. The  calculation of such amount with respect to  transactions  entered into by the Fund is highly complex,
and there is no assurance that the Fund's calculation of UBTI will be accepted by the Service.

                  In general,  if UBTI is allocated to an exempt  organization such as a qualified  retirement plan
or a private  foundation,  the portion of the Fund's income and gains which is not treated as UBTI will continue to
be exempt from tax, as will the  organization's  income and gains from other  investments  which are not treated as
UBTI.  Therefore,  the  possibility of realizing  UBTI from its investment in the Fund generally  should not affect
the tax-exempt status of such an exempt organization.11  However,  a charitable  remainder trust will not be exempt
from  Federal  income  tax under  Section  664(c) of the Code for any year in which it has  UBTI.  A  title-holding
company  will not be  exempt  from tax if it has  certain  types of UBTI.  Moreover,  the  charitable  contribution
deduction  for a trust  under  Section  642(c) of the Code may be limited for any year in which the trust has UBTI.
A prospective  investor should consult its tax adviser with respect to the tax  consequences of receiving UBTI from
the Fund.  (See "ERISA Considerations.")

Certain Issues Pertaining to Specific Exempt Organizations
----------------------------------------------------------

                  Private  Foundations.  Private  foundations  and their  managers  are subject to excise  taxes if
                  --------------------
they  invest "any amount in such a manner as to  jeopardize  the  carrying  out of any of the  foundation's  exempt
purposes." This rule requires a foundation  manager,  in making an investment,  to exercise "ordinary business care
and prudence" under the facts and circumstances  prevailing at the time of making the investment,  in providing for
the  short-term  and  long-term  needs of the  foundation  to carry out its exempt  purposes.  The factors  which a
foundation  manager may take into  account in  assessing an  investment  include the expected  rate of return (both
income and capital  appreciation),  the risks of rising and falling price levels, and the need for  diversification
within the foundation's portfolio.

                  In order to avoid the  imposition  of an excise  tax, a private  foundation  may be  required  to
distribute  on an annual  basis its  "distributable  amount,"  which  includes,  among  other  things,  the private
foundation's  "minimum  investment  return,"  defined  as 5% of  the  excess  of  the  fair  market  value  of  its
nonfunctionally  related  assets  (assets  not  used  or held  for use in  carrying  out  the  foundation's  exempt
purposes),  over certain  indebtedness  incurred by the foundation in connection with such assets.  It appears that
a  foundation's  investment in the Fund would most probably be classified as a  nonfunctionally  related  asset.  A
determination  that an interest in the Fund is a  nonfunctionally  related asset could  conceivably cause cash flow
problems for a prospective  Member which is a private  foundation.  Such an organization  could be required to make
distributions in an amount  determined by reference to unrealized  appreciation in the value of its interest in the
Fund.  Of course,  this factor  would  create less of a problem to the extent that the value of the  investment  in
the Fund is not significant in relation to the value of other assets held by a foundation.

                  In some  instances,  an investment in the Fund by a private  foundation  may be prohibited by the
"excess  business  holdings"  provisions of the Code.  For example,  if a private  foundation  (either  directly or
together with a "disqualified  person")  acquires more than 20% of the capital  interest or profits interest of the
Fund,  the  private  foundation  may be  considered  to have  "excess  business  holdings."  If this  occurs,  such
foundation  may be required to divest  itself of its  interest in the Fund in order to avoid the  imposition  of an
excise  tax.  However,  the  excise  tax  will  not  apply if at least  95% of the  gross  income  from the Fund is
"passive"  within the applicable  provisions of the Code and Regulations.  Although there can be no assurance,  the
Board believes that the Fund will meet such 95% gross income test.

                  A  substantial  percentage of  investments  of certain  "private  operating  foundations"  may be
restricted to assets directly devoted to their tax-exempt purposes.  Otherwise,  generally,  rules similar to those
discussed above govern their operations.

                  Qualified  Retirement  Plans.  Employee  benefit  plans  subject  to  the  provisions  of  ERISA,
                  ----------------------------
Individual  Retirement  Accounts and Keogh Plans should  consult  their counsel as to the  implications  of such an
investment under ERISA.  (See "ERISA Considerations.")

                  Endowment   Funds.   Investment   managers  of  endowment  funds  should  consider   whether  the
                  -----------------
acquisition  of an Interest is legally  permissible.  This is not a matter of Federal law, but is determined  under
state statutes.  It should be noted,  however,  that under the Uniform Management of Institutional Funds Act, which
has been adopted,  in various  forms,  by a large number of states,  participation  in investment  partnerships  or
similar  organizations in which funds are commingled and investment  determinations  are made by persons other than
the governing board of the endowment fund is allowed.

State and Local Taxation
------------------------

                  In  addition  to the Federal  income tax  consequences  described  above,  prospective  investors
should  consider  potential  state and local tax  consequences  of an investment  in the Fund.  State and local tax
laws differ in the  treatment  of limited  liability  companies  such as the Fund. A few  jurisdictions  may impose
entity  level  taxes  on a  limited  liability  company  if it is  found  to  have  sufficient  contact  with  that
jurisdiction.  Such taxes are  frequently  based on the income and capital of the entity that is  allocated  to the
jurisdiction.  Although  there  can be no  assurance,  except as noted  below,  the Fund  intends  to  conduct  its
activities so that it will not be subject to entity level taxation by any state or local jurisdiction.

                  State and local laws often differ from Federal  income tax laws with respect to the  treatment of
specific items of income,  gain, loss,  deduction and credit. A Member's  distributive  share of the taxable income
or loss of the Fund generally will be required to be included in  determining  its reportable  income for state and
local tax purposes in the  jurisdiction  in which it is a resident.  A  partnership  in which the Fund  acquires an
interest may conduct  business in a jurisdiction  which will subject to tax a Member's  share of the  partnership's
income  from  that  business.  Prospective  investors  should  consult  their  tax  advisers  with  respect  to the
availability of a credit for such tax in the jurisdiction in which that Member is a resident.

                  The Fund,  which is treated  as a  partnership  for New York  State and New York City  income tax
purposes,  should  not be subject  to the New York City  unincorporated  business  tax,  which is not  imposed on a
partnership  which  purchases and sells  securities for its "own account." (This exemption may not be applicable to
the extent a  partnership  in which the Fund invests  conducts a business in New York City.) By reason of a similar
"own account"  exemption,  it is also expected  that a nonresident  individual  Member should not be subject to New
York  State  personal  income tax with  respect to his share of income or gain  realized  directly  by the Fund.  A
nonresident  individual  Member will not be subject to New York City earnings tax on  nonresidents  with respect to
his investment in the Fund.

                  Individual  Members  who are  residents  of New York State and New York City should be aware that
the New York State and New York City personal income tax laws limit the  deductibility  of itemized  deductions and
interest  expense for  individual  taxpayers at certain income levels.  These  limitations  may apply to a Member's
share of some or all of the Fund's  expenses.  Prospective  Members are urged to consult  their tax  advisers  with
respect to the impact of these  provisions and the Federal  limitations on the  deductibility  of certain  itemized
deductions and investment expenses on their New York State and New York City tax liability.

                  For  purposes  of the New  York  State  corporate  franchise  tax and the New York  City  general
corporation  tax,  a  corporation  generally  is  treated  as doing  business  in New York State and New York City,
respectively,  and is subject to such corporate  taxes as a result of the ownership of a partnership  interest in a
partnership which does business in New York State and New York City, respectively.12  Each  of the New  York  State
and New York City corporate taxes are imposed,  in part, on the  corporation's  taxable income or capital allocable
to the relevant  jurisdiction by application of the appropriate  allocation  percentages.  Moreover, a non-New York
corporation  which does  business in New York State may be subject to a New York State  license fee. A  corporation
which is subject to New York State corporate  franchise tax solely as a result of being a non-managing  member in a
New York  partnership  may, under certain  circumstances,  elect to compute its New York State corporate  franchise
tax by taking into account only its distributive  share of such  partnership's  income and loss. There is currently
no similar provision in effect for purposes of the New York City general corporation tax.

                  Regulations  under  both the New York State  corporate  franchise  tax and New York City  general
corporation  tax,  however,  provide an  exemption  to this  general  rule in the case of a  "portfolio  investment
partnership,"  which is defined,  generally,  as a partnership which meets the gross income requirements of Section
851(b)(2) of the Code.  New York State (but not New York City) has adopted  regulations  that also  include  income
and gains from commodity  transactions  described in Section  864(b)(2)(B)(iii) as qualifying gross income for this
purpose.  The  qualification of the Fund as a "portfolio  investment  partnership"  with respect to its investments
through  Portfolio  Accounts and  Portfolio  Funds must be  determined  on an annual  basis and,  with respect to a
taxable year, the Fund and/or one or more  Portfolio  Funds may not qualify as portfolio  investment  partnerships.
Therefore,  a corporate  non-managing  member may be treated as doing  business in New York State and New York City
as a result of its interest in the Fund or its indirect interest in a nonqualifying Portfolio Fund.

                  A trust or other  unincorporated  organization  which by reason of its purposes or  activities is
exempt  from  Federal  income tax is also  exempt  from New York  State and New York City  personal  income  tax. A
nonstock  corporation  which is exempt from  Federal  income tax is  generally  presumed to be exempt from New York
State  corporate  franchise  tax and New York City  general  corporation  tax.  New York  State  imposes a tax with
respect to such exempt entities on UBTI  (including  unrelated  debt-financed  income) at a rate which is currently
equal to the New York State  corporate  franchise tax rate (plus the corporate  surtax).  There is no New York City
tax on the UBTI of an otherwise exempt entity.

                  Each  prospective  corporate  Member  should  consult its tax adviser with regard to the New York
State and New York City tax consequences of an investment in the Fund.

ERISA CONSIDERATIONS
                  Persons  who are  fiduciaries  with  respect to an  employee  benefit  plan or other  arrangement
subject to the  Employee  Retirement  Income  Security  Act of 1974,  as  amended  (an  "ERISA  Plan" and  "ERISA,"
respectively),  and  persons who are  fiduciaries  with  respect to an IRA or Keogh  Plan,  which is not subject to
ERISA but is subject to the  prohibited  transaction  rules of Section 4975 of the Code (together with ERISA Plans,
"Benefit Plans") should consider,  among other things,  the matters described below before  determining  whether to
invest in the Fund.

                  ERISA imposes certain general and specific  responsibilities  on persons who are fiduciaries with
respect  to an ERISA  Plan,  including  prudence,  diversification,  an  obligation  not to engage in a  prohibited
transaction  and other  standards.  In  determining  whether a particular  investment is  appropriate  for an ERISA
Plan,  Department  of Labor  ("DOL")  regulations  provide that a fiduciary of an ERISA Plan must give  appropriate
consideration  to, among other things,  the role that the investment  plays in the ERISA Plan's  portfolio,  taking
into  consideration  whether  the  investment  is designed  reasonably  to further the ERISA  Plan's  purposes,  an
examination  of the risk and return  factors,  the  portfolio's  composition  with regard to  diversification,  the
liquidity  and  current  return of the total  portfolio  relative to the  anticipated  cash flow needs of the ERISA
Plan, the income tax  consequences  of the investment  (see "Tax  Aspects--Unrelated  Business  Taxable Income" and
"--Certain  Issues  Pertaining to Specific Exempt  Organizations")  and the projected return of the total portfolio
relative to the ERISA  Plan's  funding  objectives.  Before  investing  the assets of an ERISA Plan in the Fund,  a
fiduciary should  determine  whether such an investment is consistent with its fiduciary  responsibilities  and the
foregoing  regulations.  For example,  a fiduciary  should  consider  whether an  investment in the Fund may be too
illiquid  or too  speculative  for a  particular  ERISA  Plan,  and  whether  the assets of the ERISA Plan would be
sufficiently   diversified.   If  a  fiduciary   with  respect  to  any  such  ERISA  Plan   breaches  its  or  his
responsibilities  with regard to selecting an  investment  or an  investment  course of action for such ERISA Plan,
the  fiduciary  itself or himself  may be held  liable for  losses  incurred  by the ERISA Plan as a result of such
breach.

                  Because the Fund is  registered as an investment  company under the  Investment  Company Act, the
underlying  assets of the Fund should not be  considered  to be "plan  assets" of the ERISA Plans  investing in the
Fund for purposes of ERISA's (or the Code's)  fiduciary  responsibility  and prohibited  transaction  rules.  Thus,
the Adviser  and the  Investment  Manager  will not be  fiduciaries  within the meaning of ERISA by reason of their
authority with respect to the Fund.

                  A Benefit Plan which  proposes to invest in the Fund will be required to  represent  that it, and
any  fiduciaries  responsible  for such  Plan's  investments,  are aware of and  understand  the Fund's  investment
objective,  policies and strategies,  that the decision to invest plan assets in the Fund was made with appropriate
consideration  of relevant  investment  factors with regard to the Benefit Plan and is  consistent  with the duties
and  responsibilities  imposed upon fiduciaries  with regard to their  investment  decisions under ERISA and/or the
Code.

                  Certain prospective  Benefit Plan Members may currently maintain  relationships with the Adviser,
the  Investment  Manager or their  affiliates.  Each of such  persons  may be deemed to be a party in  interest  to
and/or a fiduciary of any Benefit Plan to which it provides  investment  management,  investment  advisory or other
services.  ERISA  prohibits (and the Code  penalizes) the use of ERISA and Benefit Plan assets for the benefit of a
party in interest and also  prohibits (or  penalizes) an ERISA or Benefit Plan fiduciary from using its position to
cause such Plan to make an  investment  from  which it or certain  third  parties  in which such  fiduciary  has an
interest  would receive a fee or other  consideration.  ERISA and Benefit Plan Members  should consult with counsel
to determine if  participation  in the Fund is a transaction  that is prohibited by ERISA or the Code.  Fiduciaries
of ERISA or Benefit Plan  Members  will be required to  represent  that the decision to invest in the Fund was made
by them as fiduciaries that are independent of such affiliated  persons,  that such fiduciaries are duly authorized
to make such investment  decision and that they have not relied on any  individualized  advice or recommendation of
such affiliated persons, as a primary basis for the decision to invest in the Fund.

                  The provisions of ERISA and the Code are subject to extensive and continuing  administrative  and
judicial  interpretation  and  review.  The  discussion  of  ERISA  and the  Code  contained  in  this  SAI and the
prospectus is general and may be affected by future  publication  of  regulations  and rulings.  Potential  Benefit
Plan Members  should  consult  their legal  advisers  regarding  the  consequences  under ERISA and the Code of the
acquisition and ownership of Interests.

BROKERAGE

                  Each  Portfolio  Manager  is  directly  responsible  for  placing  orders  for the  execution  of
portfolio  transactions  for the  Portfolio  Fund or Portfolio  Account that it manages and for the  allocation  of
brokerage.  Transactions  on U.S.  stock  exchanges  and on some  foreign  stock  exchanges  involve the payment of
negotiated  brokerage  commissions.  On the great majority of foreign stock  exchanges,  commissions  are fixed. No
stated  commission is generally  applicable to securities  traded in  over-the-counter  markets,  but the prices of
those securities include undisclosed commissions or mark-ups.

                  In  selecting  brokers  and  dealers to execute  transactions  on behalf of a  Portfolio  Fund or
Portfolio  Account,  each  Portfolio  Manager will  generally  seek to obtain the best price and  execution for the
transactions,  taking into account  factors such as price,  size of order,  difficulty of execution and operational
facilities  of a brokerage  firm,  the scope and quality of  brokerage  services  provided,  and the firm's risk in
positioning  a block of  securities.  Although it is  expected  that each  Portfolio  Manager  generally  will seek
reasonably  competitive  commission  rates,  a Portfolio  Manager will not  necessarily  pay the lowest  commission
available on each  transaction.  The Portfolio  Managers will  typically have no obligation to deal with any broker
or group of brokers in executing transactions in portfolio securities.

                  Consistent  with the  principle  of seeking  best price and  execution,  a Portfolio  Manager may
place orders for a Portfolio  Fund or Portfolio  Account  with brokers that provide the  Portfolio  Manager and its
affiliates with  supplemental  research,  market and statistical  information,  including advice as to the value of
securities,  the  advisability  of  investing  in,  purchasing  or  selling  securities,  and the  availability  of
securities  or  purchasers  or sellers of  securities,  and  furnishing  analyses and reports  concerning  issuers,
industries,  securities,  economic  factors and trends,  portfolio  strategy and the  performance of accounts.  The
expenses of the  Portfolio  Managers are not  necessarily  reduced as a result of the receipt of this  supplemental
information,  which may be useful to the Portfolio  Managers or their  affiliates in providing  services to clients
other than the Portfolio Funds and the Portfolio  Accounts they manage.  In addition,  not all of the  supplemental
information is necessarily used by a Portfolio  Manager in connection with the Portfolio Fund or Portfolio  Account
it manages.  Conversely,  the  information  provided to a Portfolio  Manager by brokers and dealers  through  which
other  clients of the Portfolio  Manager or its  affiliates  effect  securities  transactions  may be useful to the
Portfolio Manager in providing services to the Portfolio Fund or a Portfolio Account.

                  It is anticipated that Portfolio  Managers  (including each Portfolio  Manager retained to manage
a Portfolio  Account) will generally follow  brokerage  placement  practices  similar to those described above. The
brokerage  placement  practices  described  above will also be followed by the Investment  Manager to the extent it
places  transactions  for the Fund.  However,  certain  Portfolio  Managers  (other than those  managing  Portfolio
Accounts) may have policies that permit the use of brokerage  commissions  of a Portfolio  Fund to obtain  products
or services that are not research related and that may benefit the Portfolio Manager.


ACCOUNTANTS AND LEGAL COUNSEL
                  ____________________  serves as the  independent  public  accountants  of the Fund. Its principal
business address is ____________________________.

                  Schulte Roth & Zabel LLP, New York,  New York,  acts as legal counsel to the Fund.  Mayer,  Brown
& Platt, New York, New York, acts as legal counsel to the Independent Managers.

CUSTODIAN
                  ___________________  (the "Custodian")  serves as the primary custodian of the Fund's assets, and
may maintain  custody of the Fund's  assets with  domestic and non-U.S.  subcustodians  (which may be banks,  trust
companies,  securities  depositories and clearing agencies) approved by the Board.  Assets of the Fund are not held
by the Adviser or the  Investment  Manager or  commingled  with the assets of other  accounts  except to the extent
that  securities  are held in the name of a  custodian  in a  securities  depository,  clearing  agency or  omnibus
customer account of such custodian.  The Custodian's principal business address is __________________________.

CONTROL PERSONS
                  Before  commencement of the Fund's  operations,  the Adviser and the Investment Manager intend to
invest  approximately  $[ ] million in the Fund in order to provide the Fund  initial  capital  and for  investment
purposes.  Interests  held by the Adviser and the Investment  Manager may  constitute  more than 25% of outstanding
Interests when the Fund's operations  commence upon the closing of the initial offering of Interests,  depending on
the aggregate  investments  made in the Fund by other  persons.  By virtue of their  ownership of more the than 25%
of the outstanding  Interests,  the Adviser and the Investment Manager,  and MassMutual (which controls the Adviser
and the Investment  Manager),  may be deemed to control the Fund and (depending on the value of Interests then held
by other  Members)  may be in a position  to control  the  outcome  of voting on  matters as to which  Members  are
entitled to vote.  The Adviser is a  corporation  organized  under the laws of Colorado and maintains its principal
office at 6803 S.Tucson Way,  Englewood,  Colorado 80112. The Investment  Manager is a corporation  organized under
the laws of  Connecticut  and  maintains its principal  office at 555 Theodore  Fremd Avenue,  Rye, New York 10580.
MassMutual  is  a  mutual  life   insurance   company   organized   under  the  laws  of  [  ]  and  maintains  its
principal office at 1295 State Street, Springfield, Massachusetts 01111.

                  Before the commencement of the Fund's  operations,  the persons named above were the only persons
owning of record or beneficially 5% or more of the outstanding Interests.

SUMMARY OF LLC AGREEMENT
                  The following is a summary  description of additional  items and of select  provisions of the LLC
Agreement  that are not  described  elsewhere  in this SAI or in the Fund's  prospectus.  The  description  of such
items and  provisions  is not  definitive  and  reference  should be made to the complete text of the LLC Agreement
contained in Appendix A to the prospectus.

LIABILITY OF MEMBERS

                  Members in the Fund will be members of a limited  liability  company as provided  under  Delaware
law.  Under  Delaware  law and the LLC  Agreement,  a Member  will not be  liable  for the  debts,  obligations  or
liabilities  of the Fund  solely by reason of being a Member,  except  that the  Member  may be  obligated  to make
capital contributions to the Fund pursuant to the LLC Agreement,  to repay any funds wrongfully  distributed to the
Member.  A Member may be required to  contribute to the Fund,  whether  before or after the Fund's  dissolution  or
after the  Member  ceases to be a Member,  such  amounts  as the Fund deems  necessary  to meet the  Fund's  debts,
obligations or liabilities  (not to exceed for any Member,  the aggregate amount of any  distributions,  amounts in
connection  with the  repurchase of all or a portion of the Member's  interests  and any other amounts  received by
the Member from the Fund during or after the fiscal year to which any debt,  obligation  or  liability  of the Fund
is incurred).

DUTY OF CARE

                  The LLC Agreement  provides that neither the Managers,  the Adviser,  or the  Investment  Manager
(including  certain of their  affiliates,  among  others) shall be liable to the Fund or any of the Members for any
loss or damage  occasioned by any act or omission in the  performance of their  respective  services as such in the
absence of willful  misfeasance,  bad faith,  gross  negligence  or reckless  disregard  of their  duties.  The LLC
Agreement also contains provisions for the  indemnification,  to the extent permitted by law, of the Managers,  the
Adviser,  and the Investment Manager (including certain of their affiliates,  among others) by the Fund, but not by
the Members  individually,  against any  liability  and expense to which any of them may be liable  which arises in
connection  with the  performance  of their  activities  on  behalf  of the  Fund.  None of these  persons  will be
personally  liable to any  Member  for the  repayment  of any  balance  in such  Member's  capital  account  or for
contributions  by such Member to the capital of the Fund or by reason of any change in the Federal or state  income
tax laws applicable to the Fund or its Members.  The rights of indemnification  and exculpation  provided under the
LLC  Agreement  do not provide for  indemnification  of a Manager,  the Adviser or the  Investment  Manager for any
liability,  including liability under Federal securities laws which, under certain circumstances,  impose liability
even on persons that act in good faith, to the extent, but only to the extent, that such  indemnification  would be
in violation of applicable law.

AMENDMENT OF THE LLC AGREEMENT


                  The LLC Agreement may generally be amended,  in whole or in part,  with the approval of the Board
(including a majority of the  Independent  Managers,  if required by the  Investment  Company Act), and without the
approval  of the  Members,  unless the  approval of Members is required by the  Investment  Company  Act.  However,
certain  amendments  to the LLC  Agreement  involving  capital  accounts  and  allocations  thereto may not be made
without the written consent of any Member  adversely  affected  thereby or unless each Member has received  written
notice of the  amendment  and any Member  objecting to the  amendment  has been  allowed a  reasonable  opportunity
(pursuant to any  procedures  as may be prescribed  by the Board) to tender its entire  Interest for  repurchase by
the Fund.


POWER OF ATTORNEY

                  By purchasing  an Interest and by signing the LLC Agreement  (which each Member will do by virtue
of signing the Member  certification  form attached to the prospectus as Appendix __), each Member will appoint the
Adviser and each of the  Managers his or her  attorney-in-fact  for purposes of filing  required  certificates  and
documents  relating to the formation and continuance of the Fund as a limited  liability company under Delaware law
or signing all  instruments  effecting  authorized  changes in the Fund or the LLC  Agreement and  conveyances  and
other instruments deemed necessary to effect the dissolution or termination of the Fund.

                  The power-of-attorney  granted in the LLC Agreement is a special  power-of-attorney  coupled with
an interest in favor of the Adviser and each of the Managers  and as such is  irrevocable  and  continues in effect
until all of such Member's  Interest has been  withdrawn  pursuant to a repurchase or redemption of the Interest or
a  transfer  to one or more  transferees  that  have  been  approved  by the  Board  for  admission  to the Fund as
substitute Members.

TERM, DISSOLUTION AND LIQUIDATION

                  The Fund will be dissolved:

o        upon the  affirmative  vote to dissolve  the Fund by both (1) the Board and (2)  Members  holding at least
                           two-thirds of the total number of votes eligible to be cast by all Members;

o        upon the expiration of any two-year  period which  commences on the date on which any Member has submitted
                           to the Fund a written request for the repurchase of its entire  Interest,  in accordance
                           with the LLC Agreement, if the Fund has not repurchased the Member's Interest;

o        at the election of the Adviser;

o        upon the  failure  of Members to elect  successor  Managers  at a meeting  called by the  Adviser  when no
                           Manager remains; or

o        as required by operation of law.

                  Upon the occurrence of any event of dissolution,  the Board or the Adviser,  acting as liquidator
under  appointment  by the Board (or  another  liquidator,  if the Board  does not  appoint  the  Adviser to act as
liquidator  or is unable to  perform  this  function),  is  charged  with  winding  up the  affairs of the Fund and
liquidating  its assets.  Net  profits or net loss during the fiscal  period  including  the period of  liquidation
will be allocated as described in the prospectus under "Capital Accounts -- Allocation of Net Profits and Losses."

                  Upon the  dissolution  of the Fund,  its assets are to be  distributed  (1) first to satisfy  the
debts,  liabilities  and  obligations  of the Fund,  other than debts to Members,  including  actual or anticipated
liquidation  expenses,  (2)  next  to  satisfy  debts  owing  to the  Members,  and  (3)  finally  to  the  Members
proportionately  in accordance with the balances in their respective  capital  accounts.  Assets may be distributed
in-kind  on a pro rata  basis if the  Board or  liquidator  determines  that  such a  distribution  would be in the
interests of the Members in facilitating an orderly liquidation.

VOTING


                  Each  Member has the right to cast a number of votes equal to the value of the  Member's  capital
account at a meeting  of  Members  called by the Board or by  Members  holding  25% or more of the total  number of
votes  eligible to be cast.  Members will be entitled to vote on any matter on which  shareholders  of a registered
investment  company  organized  as a  corporation  would  normally be entitled to vote,  including  the election of
Managers,  approval of the Fund's  agreement  any  investment  adviser of the Fund,  and approval of the  Company's
auditors,  and on certain other matters,  to the extent that the Investment  Company Act requires a vote of Members
on any such  matters.  Except for the exercise of their voting  privileges,  Members in their  capacity as such are
not entitled to participate in the  management or control of the Fund's  business,  and may not act for or bind the
Fund.  The interest of the Special Advisory Member is non-voting.


REPORTS TO MEMBERS

                  The Fund will furnish to Members as soon as practicable after the end of each taxable year such
information as is necessary for such Members to complete Federal and state income tax or information returns,
along with any other tax information required by law.  The Fund will send to Members a semi-annual and an audited
annual report within 60 days after the close of the period for which it is being made, or as otherwise required
by the Investment Company Act.  Quarterly reports from the Adviser or Investment Manager regarding the Fund's
operations during such period also will be sent to Members.

FISCAL YEAR


                  For accounting  purposes,  the Fund's fiscal year is the 12-month  period ending on March 31. The
first  fiscal year of the Fund will  commence on the date of the  initial  closing and will end on March 31,  2002.
The 12-month period ending December 31 of each year will be the taxable year of the Fund.


                                               FINANCIAL STATEMENTS
                  The following comprise the financial statements of the Fund:

o        Independent Auditors' Report.

o        Statement of Assets and Liabilities.

o        Statement of Operations.

o        Notes to the Financial Statements.

                                           INDEPENDENT AUDITORS' REPORT



                                  [To be included in a pre-effective amendment.]

                                                  APPENDIX A


                                   SPECIAL SALES CHARGE ARRANGEMENTS AND WAIVERS

                                    [To be included by pre-effective amendment]




--------
1        Generally, in the absence of Regulations requiring it, the Fund will not treat positions held through
different investment Portfolio Accounts or Portfolio Funds as offsetting positions for purposes of the straddle
rules.
2        Under recently enacted legislation, this rate is reduced in stages until calendar year 2006 when the
maximum rate will be 35%.  However, this legislation contains a "sunset" provision that will result in the top
rate being restored to 39.6% in 2011.
3        The maximum individual long-term capital gains tax rate is 18% for certain property purchased after
December 31, 2000 and held for more than five years.
4        Generally, a conversion transaction is one of several enumerated transactions where substantially all of
the taxpayer's return is attributable to the time value of the net investment in the transaction.  The enumerated
transactions are (i) the holding of any property (whether or not actively traded) and entering into a contract to
sell such property (or substantially identical property) at a price determined in accordance with such contract,
but only if such property was acquired and such contract was entered into on a substantially contemporaneous
basis, (ii) certain straddles, (iii) generally any other transaction that is marketed or sold on the basis that
it would have the economic characteristics of a loan but the interest-like return would be taxed as capital gain
or (iv) any other transaction specified in Regulations.
5        The Fund will not generally be in a position to furnish to Members information regarding the securities
positions of its Portfolio Funds which would permit a Member to determine whether its transactions in securities,
which are also held by such Portfolio Funds, should be treated as offsetting positions for purposes of the
straddle rules.
6        However, Section 67(e) of the Code provides that, in the case of a trust or an estate, such limitation
does not apply to deductions or costs which are paid or incurred in connection with the administration of the
estate or trust and would not have been incurred if the property were not held in such trust or estate.  There is
a disagreement between two Federal Courts of Appeal on the question of whether the investment advisory fees
incurred by a trust are exempt (under Section 67(e)) from the 2% of adjusted gross income floor on
deductibility.  Members that are trusts or estates should consult their tax advisors as to the applicability of
these cases to the investment expenses that are allocated to them.
7        Under recently enacted legislation, the latter limitation on itemized deductions will be reduced
starting in calendar year 2006 and will be completely eliminated by 2010.  However, this legislation contains a
"sunset" provision that will result in the limitation on itemized deductions being restored in 2011.
8        With certain exceptions, tax-exempt organizations which are private foundations are subject to a 2%
Federal excise tax on their "net investment income."  The rate of the excise tax for any taxable year may be
reduced to 1% if the private foundation meets certain distribution requirements for the taxable year.  A private
foundation will be required to make payments of estimated tax with respect to this excise tax.
9        Moreover, income realized from option writing and futures contract transactions generally would not
constitute UBTI.
10       The calculation of a particular exempt organization's UBTI would also be affected if it incurs
indebtedness to finance its investment in the Fund.  An exempt organization is required to make estimated tax
payments with respect to its UBTI.
11       Certain exempt organizations which realize UBTI in a taxable year will not constitute "qualified
organizations" for purposes of Section 514(c)(9)(B)(vi)(I) of the Code, pursuant to which, in limited
circumstances, income from certain real estate partnerships in which such organizations invest might be treated
as exempt from UBTI.  A prospective tax-exempt Member should consult its tax adviser in this regard.
12       New York State (but not New York City) generally exempts from corporate franchise tax a non-New York
corporation which (i) does not actually or constructively own a 1% or greater limited partnership interest in a
partnership doing business in New York and (ii) has a tax basis in such limited partnership interest not greater
than $1 million.