Registration No. 333-101878
                                                  File No.811-21268


                                UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC 20549

                                  FORM N-1A


REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933                   [X]
      Pre-Effective Amendment No.                                        [   ]
                                   ----
      Post-Effective Amendment No.  3                                      [X]
                                   ---


                                    and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY

ACT OF 1940                                                                [X]
      Amendment No.   4                                                    [X]
                     ----


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                      OPPENHEIMER TOTAL RETURN BOND FUND
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              (Exact Name of Registrant as Specified in Charter)

            6803 South Tucson Way, Centennial, Colorado 80112-3924
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            (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, including Area Code:  (303) 768-3200

                             Robert G. Zack, Esq.
                            OppenheimerFunds, Inc.
Two World Financial Center, 225 Liberty Street, New York, New York 10281-1008
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                   (Name and Address of Agent for Service)

It is proposed that this filing will become effective (check appropriate box):


[   ]           Immediately upon filing pursuant to paragraph (b)
[   ]           On (date) pursuant to paragraph (b)
[   ]           60 days after filing pursuant to paragraph (a)(1)
[X ]            On August 26, 2005 pursuant to paragraph (a)(1)
[   ]           75 days after filing pursuant to paragraph (a)(2)
[   ]           On _______________ pursuant to paragraph (a)(2) of Rule 485.


If appropriate, check the following box:

[   ] This  post-effective  amendment  designates a new  effective  date for a
previously filed post-effective amendment.

The Registrant hereby amends the Registration  statement on such date or dates
as may be necessary to delay its  effective  date until the  Registrant  shall
file a further  amendment  which  specifically  states that this  Registration
Statement shall  thereafter  become  effective in accordance with section 8(a)
of the  Securities  Act of 1933 or  until  the  Registration  Statement  shall
become  effective on such date as the  Commission,  acting pursuant to Section
8(a), shall determine.



Oppenheimer
Total Return Bond Fund




Prospectus dated August __, 2005




                                         Oppenheimer Total Return Bond Fund is
                                         a mutual fund that seeks to maximize
                                         total return through both capital
                                         appreciation and income. As a
                                         secondary objective, it emphasizes
                                         preservation of capital.
                                              This Prospectus contains
                                         important information about the Fund's
                                         objective, and its investment
                                         policies, strategies and risks. It
                                         also contains important information
                                         about how to buy and sell shares of
As with all mutual funds, the            the Fund and other account features.
Securities and Exchange Commission has   Please read this Prospectus carefully
not approved or disapproved the Fund's   before you invest and keep it for
securities nor has it determined that    future reference about your account.
this Prospectus is accurate or
complete. It is a criminal offense to
represent otherwise.




                                                   [logo] OppenheimerFunds(R)
                                                    The Right Way to Invest





CONTENTS

                  ABOUT THE FUND

                  The Fund's Investment Objectives and Principal Investment
                  Strategies

                  Main Risks of Investing in the Fund

                  The Fund's Performance

                  Fees and Expenses of the Fund

                  About the Fund's Investments

                  How the Fund is Managed

                  ABOUT YOUR ACCOUNT

                  How to Buy Shares
                  Class A Shares
                  Class B Shares
                  Class C Shares
                  Class N Shares
                  Class Y Shares

                  Special Investor Services
                  AccountLink
                  PhoneLink
                  OppenheimerFunds Internet Website
                  Automatic Withdrawal and Exchange Plans
                  Reinvestment Privilege
                  Retirement Plans

                  How to Sell Shares
                  By Checkwriting
                  By Mail
                  By Telephone

                  How to Exchange Shares

                  Shareholder Account Rules and Policies

                  Dividends, Capital Gains and Taxes
                  Financial Highlights




ABOUT THE FUND

The Fund's Investment Objectives and Principal Investment Strategies

WHAT ARE THE FUND'S INVESTMENT OBJECTIVES?  The Fund seeks to maximize total
return through both capital appreciation and income. As a secondary
objective, it emphasizes preservation of capital.

WHAT DOES THE FUND MAINLY INVEST IN?  As a non-fundamental policy (which will
not be changed without providing 60 days notice to Fund shareholder), under
normal market conditions the Fund invests at least 80% of its net assets
(plus borrowings for investment purposes) in bonds. The Fund primarily
invests in investment-grade debt securities, U.S. government securities and
money market instruments, under normal market conditions. Those
investment-grade debt securities can include:

o     domestic and foreign government bonds,
o     domestic and foreign corporate debt obligations,
o     mortgage-related securities (including collateralized mortgage
   obligations ("CMOs")) issued by private issuers, and
o     other debt obligations.

      The Fund's investments in U.S. government securities include securities
issued or guaranteed by the U.S. government or its agencies or
federally-chartered corporate entities referred to as "instrumentalities."
These include mortgage-related U.S. government securities and CMOs.

      There is no set allocation of the Fund's assets among the classes of
securities the Fund buys, but currently the Fund focuses mainly on U.S.
government securities and investment-grade debt securities. However, if
market conditions change, the Fund's portfolio managers might change the
relative allocation of the Fund's assets. The Fund can invest up to 20% of
its total assets in high-yield debt securities that are below
investment-grade (commonly referred to as "junk bonds").

      The Fund seeks to maintain an average effective portfolio duration
(discussed below) of three to six years (measured on a dollar-weighted basis)
to try to reduce the volatility of the value of its securities portfolio. The
Fund has no limitations on the range of maturities of the debt securities in
which it can invest and therefore may hold bonds with short-, medium- or
long-term maturities. Because of market events and interest rate changes, the
duration of the portfolio might not meet that target at all times. The
Manager will attempt to maintain the overall weighted average credit quality
of the portfolio at a rating of "A-" (or equivalent) or higher from any
nationally recognized credit rating organization. These investments are more
fully explained in "About the Fund's Investments," below. As stated below,
the Fund can use derivatives to seek increased returns or to try to hedge
investment risks.

HOW DO THE PORTFOLIO MANAGERS DECIDE WHAT SECURITIES TO BUY OR SELL? In
selecting securities for the Fund, the Fund's portfolio managers analyze the
overall investment opportunities and risks in different sectors of the debt
securities markets by focusing on business cycle analysis and relative values
between the corporate and government sectors. The portfolio managers' overall
strategy is to build a broadly diversified portfolio of corporate and
government bonds. The portfolio managers currently focus on the factors below
(which may vary in particular cases and may change over time), looking
for:

o     Debt securities in market sectors that offer attractive relative value,
o     Investment-grade securities that offer more income than U.S. treasury
      obligations with a good balance of risk and return,
o     High income potential from different types of corporate and government
      securities, and
o     Broad portfolio diversification to help reduce the volatility of the
      Fund's share prices.

The portfolio manager monitors individual issuers for changes in the factors
above and these changes may trigger a decision to sell a security. Generally,
the "total return" sought by the Fund consists of income earned on the Fund's
investments, plus capital appreciation, if any, which generally arises from
decreases in interest rates, improving credit fundamentals for a particular
sector or security, and managing pre-payment risks associated with
mortgage-related securities, as well as other techniques.

WHO IS THE FUND DESIGNED FOR? The Fund is designed for investors seeking high
total return from a fund that invests primarily in investment-grade debt
securities but which can also hold high-yield below investment-grade debt
securities. Those investors should be willing to assume the credit risks of a
fund that typically invests a significant amount of its assets in
corporate-debt securities, and the changes in share prices that can occur
when interest rates change. The Fund is intended as a long-term investment,
not a short-term trading vehicle, and may be appropriate for a part of an
investor's retirement plan portfolio. The Fund is not a complete investment
program.

Main Risks of Investing in the Fund

All investments have risks to some degree. The Fund's investments are subject
to changes in value from a number of factors, described below. They include
changes in general bond market movements in the U.S. and abroad (this is
referred to as "market risk"). There is also the risk that poor security
selection by the Fund's investment Manager, OppenheimerFunds, Inc., will
cause the Fund to underperform other funds having similar objectives.


CREDIT RISK. Debt securities are subject to credit risk. Credit risk is the
risk that the issuer of a debt security might not make interest and principal
payments on the security as they become due. A downgrade in an issuer's
credit rating or other adverse news about an issuer can reduce the value of
that issuer's securities. Securities directly issued by the U.S. Treasury and
certain U.S. government agencies that are backed by the full faith and credit
of the U.S. government have little credit risk. Securities issued by other
agencies or instrumentalities of the U.S. government such as the Federal Home
Loan Mortgage Corporation and the Federal National Mortgage Association are
neither guaranteed nor insured by the U.S. government but generally are
considered to have low credit risks. These securities are described further
below in "Obligations Issued or Guaranteed by U.S. Government Agencies or
Instrumentalities." Securities issued by private issuers have greater credit
risks. If an issuer fails to pay interest, the Fund's income may be reduced.
If an issuer fails to repay principal, the value of that security and of the
Fund's shares may be reduced.


o     Special Risks of Lower-Grade Securities. Because the Fund can invest up
      to 20% of its total assets in securities (including convertible
      securities) below investment-grade, the Fund's credit risks are greater
      than those of funds that buy only investment-grade securities.
      Lower-grade debt securities may be subject to greater market
      fluctuations and greater risks of loss of income and principal than
      investment-grade debt securities. Securities that are (or that have
      fallen) below investment grade are exposed to a greater risk that the
      issuers of those securities might not meet their debt obligations.
      Those risks can reduce the Fund's share prices and the income it earns.
      The market for lower-grade securities may be less liquid, especially
      during times of economic distress, and therefore they may be harder to
      value or to sell at an acceptable price.

INTEREST RATE RISKS. Debt securities are subject to changes in value when
prevailing interest rates change. When prevailing interest rates fall, the
values of outstanding debt securities generally rise. When prevailing
interest rates rise, the values of outstanding debt securities generally
fall, and those securities may sell at a discount from their face amount. The
magnitude of these fluctuations is generally greater for securities having
longer maturities than for short-term securities. However, interest rate
changes may have different effects on the values of mortgage-related
securities because of prepayment risks, discussed below.

      At times, the Fund may buy longer-term debt securities. When the
average duration of the Fund's portfolio is longer, its share prices may
fluctuate more when interest rates change. The Fund can buy zero-coupon or
"stripped" securities, which are particularly sensitive to interest rate
changes and the rate of principal payments (and prepayments). These are
derivative securities that have prices that may go up or down more than other
types of debt securities in response to interest rate changes. The Fund's
share prices can go up or down when interest rates change, because of the
effect of the change on the value of the Fund's investments. Also, if
interest rates fall, the Fund's investments in new securities at lower yields
will reduce the Fund's income.

PREPAYMENT RISK. Prepayment risk is the risk that the issuer of a security
can prepay the principal prior to the security's expected maturity. The
prices and yields of mortgage-related securities are determined, in part, by
assumptions about the cash flows from the rate of payments of the underlying
mortgages. Changes in interest rates may cause the rate of expected
prepayments of those mortgages to change. In general, prepayments increase
when general interest rates fall and decrease when general interest rates
rise.

      The impact of prepayments on the price of a security may be difficult
to predict and may increase the volatility of the price. Interest-only and
principal-only "stripped" securities can be particularly volatile when
interest rates change. If the Fund buys mortgage-related securities at a
premium, accelerated prepayments on those securities could cause the Fund to
lose a portion of its principal investment represented by the premium the
Fund paid.

      If prepayments of mortgages underlying a CMO occur faster than expected
when interest rates fall, the market value and yield of the CMO could be
reduced.  If interest rates rise rapidly, prepayments may occur at slower
rates than expected, which could have the effect of lengthening the expected
maturity of a short- or medium-term security. That could cause its value to
fluctuate more widely in response to changes in interest rates. In turn, this
could cause the value of the Fund's shares to fall more.

RISKS OF USING DERIVATIVE INVESTMENTS. The Fund can use derivatives to seek
increased returns or to try to hedge investment risks. In general terms, a
derivative investment is an investment contract whose value depends on (or is
derived from) the value of an underlying asset, interest rate or index.
Options, futures, interest-only and principal-only securities, structured
notes, interest-rate swap agreements and mortgage-related securities are
examples of derivatives the Fund can use.

      If the issuer of the derivative does not pay the amount due, the Fund
can lose money on the investment. Also, the underlying security or investment
on which the derivative is based, and the derivative itself, may not perform
the way the Manager expected it to perform. If that happens, the Fund's share
prices could fall and the Fund could get less income than expected, or its
hedge might be unsuccessful. Some derivatives may be illiquid, making it
difficult to value or to sell them at an acceptable price. The Fund has
limits on the amount of certain types of derivatives it can hold. However,
using derivatives can cause the Fund to lose money on its investments and/or
increase the volatility of its share prices.

HOW RISKY IS THE FUND OVERALL? The risks described above collectively form
the overall risk profile of the Fund, and can affect the value of the Fund's
investments, its investment performance and the prices of its shares.
Particular investments and investment strategies also have risks. These risks
mean that you can lose money by investing in the Fund. When you redeem your
shares, they may be worth more or less than what you paid for them. The share
price of the Fund will change daily based on changes in interest rates,
market prices of securities and market conditions, and in response to other
economic events. There is no assurance that the Fund will achieve its
investment objective.

      Debt securities are subject to market, credit and interest rate risks
that can affect their values and the share prices of the Fund. Prepayment
risks of mortgage-backed securities can cause the Fund to reinvest proceeds
of its investments in lower-yielding securities. In the OppenheimerFunds
spectrum, the Fund generally has more risks than bond funds that focus
primarily on U. S. government securities, but the Fund's emphasis on
investment-grade securities may make its share prices less volatile than
high-yield bond funds or funds that focus on foreign bonds.

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An investment in the Fund is not a deposit of any bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
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The Fund's Past Performance


The bar chart and table below show one measure of the risks of investing in
the Fund, by showing the Fund's performance (for its Class A shares) for the
full calendar year since the Fund's inception and by showing how the average
annual total returns of the Fund's shares, both before and after taxes,
compared to those of a broad-based market index.  Please remember that the
Fund is intended to be a long-term investment, that performance results are
historical, and that past performance (particularly over a short-term period)
is not necessarily predictive of future results. The after-tax returns for
the other classes of shares will vary.

The after-tax returns are shown for Class A shares only and are calculated
using the historical highest individual federal marginal income tax rates in
effect during the periods shown, and do not reflect the impact of state or
local taxes. The after-tax returns are calculated based on certain
assumptions mandated by regulation and your actual after-tax returns may
differ from those shown, depending on your individual tax situation.  The
after-tax returns set forth below are not relevant to investors who hold
their fund shares through tax-deferred arrangements such as 401(k) plans or
IRAs or to institutional investors not subject to tax. The Fund's past
investment performance, before and after taxes, is not necessarily an
indication of how the Fund will perform in the future.

Annual Total Returns (Class A) (as of 12/31 each year)
[See appendix to prospectus for data in bar chart showing the annual total
return]

Sales charges and taxes are not included in the calculations of return in
this bar chart, and if those charges and taxes were included, the returns may
be less than those shown.

For the period from 1/1/05 through 3/30/05, the cumulative return (not
annualized) before taxes for Class A shares was    -0.33%.

During the period shown in the bar chart, the highest return (not annualized)
before taxes for a calendar quarter was 3.17% (3rd Qtr 04) and the lowest
return (not annualized) before taxes for a calendar quarter was -2.19% (2nd
Qtr 04).

Average Annual Total Returns       1 Year           5 Years
for the periods ended                              (or life of
December 31, 2004                                  class, if less)

Class A Shares (inception
2/21/03)                           -0.66%            1.54%
  Return Before Taxes              -2.05%            0.28%
  Return After Taxes on
  Distributions                    -0.42%            0.60%
  Return After Taxes on
  Distributions and Sale of
  Fund Shares
CitiGroup US Big Bond Index         4.48%           3.90%(1)
(reflects no deduction for
fees, expenses or taxes)
                                   -1.59%            1.18%
Class B Shares (inception
2/21/03)
                                    2.51%            3.29%
Class C Shares (inception
2/21/03)
                                    2.93%            3.81%
Class N Shares (inception
2/21/03)
(1)   From 2/28/03.

The Fund's average annual total returns include applicable sales charges: for
Class A, the current maximum initial sales charge of 4.75%; for Class B, the
contingent deferred sales charge of 5% (1-year) and 4% (life of class); and
for Class C and Class N, the 1% contingent deferred sales charge for the
1-year period. The returns measure the performance of a hypothetical account
and assume that all dividends and capital gains distributions have been
reinvested in additional shares. The performance of the Fund's Class A shares
is compared to CitiGroup US Big Bond Index. The index performance includes
reinvestment of income but does not reflect transaction costs, fees, expenses
or taxes. The Fund's investments vary from those in the index.



Fees and Expenses of the Fund


The  following  tables  are  provided  to help  you  understand  the  fees and
expenses  you may pay if you buy and hold shares of the Fund.  The Fund pays a
variety of expenses  directly for  management  of its assets,  administration,
distribution of its shares and other  services.  Those expenses are subtracted
from the Fund's  assets to  calculate  the Fund's net asset  values per share.
All  shareholders  therefore pay those expenses  indirectly.  Shareholders pay
other expenses  directly,  such as sales charges.  The numbers below are based
on the Fund's  expenses  during its fiscal year ended April 30, 2005, with the
exception  of  Class Y  shares  for  which  the  numbers  below  are  based on
anticipated  expenses  during  the first  fiscal  year that Class Y shares are
offered.  Class Y shares were not offered  during the Fund's fiscal year ended
April 30, 2005.


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Shareholder Fees (charges paid directly from your investment):
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                                Class A  Class B  Class C   Class N   Class Y
                                Shares    Shares   Shares   Shares    Shares
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Maximum Sales Charge (Load) on   4.75%     None     None     None      None
Purchases (as % of offering
price)
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Maximum Deferred Sales Charge
(Load) (as % of the lower of    None(1)   5%(2)    1%(3)     1%(4)     None
the
original offering price or
redemption proceeds)
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Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)
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                                Class A  Class B  Class C   Class N  Class Y
                                Shares    Shares   Shares   Shares    Shares
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Management Fees                  0.50%    0.50%    0.50%     0.50%     0.50%
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Distribution and/or Service      0.25%    1.00%    1.00%     0.50%     None
(12b-1) Fees
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Other Expenses                   0.05%    0.91%    0.67%     0.51%     ____%

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Total Annual Operating           0.80%    2.41%    2.17%     1.51%     ____%
Expenses

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Expenses may vary in future years.  "Other  expenses"  include  transfer agent
fees,  custodial  fees,  and accounting and legal expenses that the Fund pays.
The "Other  Expenses" in the table are based on, among other things,  the fees
the Fund  would  have paid if the  transfer  agent had not waived a portion of
its fee  under a  voluntary  undertaking  to the Fund to limit  these  fees to
0.35% of  average  daily net  assets per  fiscal  year for all  classes.  That
undertaking  may be  amended  or  withdrawn  at any time.  For Class Y shares,
"Other  Expenses"  are  estimates  of those  expenses  based on the  Manager's
projections  of what those  expenses will be during the first fiscal year that
Class Y shares are offered.  The Manager has voluntarily  agreed to waive fees
and/or  reimburse  the Fund for certain  expenses  such that the "Total Annual
Operating Expenses" will not exceed 0.90% for Class A shares,  1.65% for Class
B  shares,   1.65%  for  Class  C  shares,  and  1.15%  for  Class  N  shares,
respectively.  The  voluntary  waivers  described  above  may  be  amended  or
withdrawn at any time.  After the transfer  agent  waiver and  management  fee
waiver  described  above,  the actual "Total Annual  Operating  Expenses" were
0.79% for Class A shares,  1.65% for Class B shares,  1.65% for Class C shares
and 1.15% for Class N shares, respectively.


1. A contingent deferred sales charge may apply to redemptions of investments of
$1 million or more  ($500,000 for certain  retirement  plan accounts) of Class A
shares. See "How to Buy Shares" for details.

2. Applies to redemptions in first year after purchase.  The contingent deferred
sales charge  gradually  declines  from 5% to 1% in years one through six and is
eliminated after that.

3. Applies to shares redeemed within 12 months of purchase.

4.  Applies to shares  redeemed  within 18 months of a  retirement  plan's first
purchase of Class N shares.


Examples. The following examples are intended to help you compare the cost of
investing in the Fund with the cost of investing in other mutual funds. The
examples assume that you invest $10,000 in a class of shares of the Fund for
the time periods indicated and reinvest your dividends and distributions.

      The first example assumes that you redeem all of your shares at the end
of those periods. The second example assumes that you keep your shares. Both
examples also assume that your investment has a 5% return each year and that
the class's operating expenses remain the same. Your actual costs may be
higher or lower because expenses will vary over time. Based on these
assumptions your expenses would be as follows:

     If shares are         1 Year        3 Years       5 Years      10 Years
       redeemed:
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     Class A Shares         $553          $719          $900         $1,421

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     Class B Shares         $747         $1,060        $1,501      $1,989(1)

 ------------------------------------------------------------------------------
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     Class C Shares         $322          $686         $1,177        $2,530

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     Class N Shares         $255          $481          $830         $1,815

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 ------------------------------------------------------------------------------

     Class Y Shares         $___          $___          $___         $____

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   If shares are not       1 Year        3 Years       5 Years      10 Years
       redeemed:
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

     Class A Shares         $553          $719          $900         $1,421

 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

     Class B Shares         $247          $760         $1,301      $1,989(1)

 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

     Class C Shares         $222          $686         $1,177        $2,530

 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

     Class N Shares         $155          $481          $830         $1,815

 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

     Class Y Shares         $___          $___          $___         $____

 ------------------------------------------------------------------------------
 In the first example,  expenses  include the initial sales charge for Class A
 and the  applicable  Class B, Class C and Class N contingent  deferred  sales
 charges.  In the  second  example,  the Class A  expenses  include  the sales
 charge,  but Class B, Class C and Class N expenses do not include  contingent
 deferred sales charges. There is no sales charge on Class Y shares.
 1.  Class B  expenses  for years 7 through  10 are based on Class A  expenses
 since Class B shares automatically  convert to Class A shares 72 months after
 purchase.

About the Fund's Investments

THE FUND'S PRINCIPAL INVESTMENT POLICIES AND RISKS. The allocation of the
Fund's portfolio among the different types of investments will vary over time
based upon the evaluation of economic and market trends. The Fund's portfolio
might not always include all of the different types of investments described
in this prospectus. The Statement of Additional Information contains more
detailed information about the Fund's investment policies and risks.


The Manager tries to reduce risks by carefully researching securities before
they are purchased. The Fund generally attempts to reduce its exposure to
market risks by diversifying its investments. Also, the Fund does not
concentrate 25% or more of its total assets in any one industry.


      However, changes in the overall market prices of securities and any
income they may pay can occur at any time. The share price and yield of the
Fund will change daily based on changes in market prices of securities and
market conditions, and in response to other economic events.

In selecting debt securities and evaluating their yield potential and credit
risk, the Manager does not rely solely on ratings by rating organizations but
evaluates business and economic factors affecting an issuer as well. The debt
securities the Fund buys may be rated by nationally recognized rating
organizations such as Moody's Investors Service ("Moody's") or Standard &
Poor's Ratings Services, Inc. ("S&P"), or they may be unrated securities
assigned an equivalent rating by the Manager. "Investment-grade" rated
securities are those in the four highest rating categories of national
ratings organizations. A description of those ratings definitions is included
in Appendix A to the Statement of Additional Information.

U.S. Government Securities. Not all of the U.S. government securities the
Fund buys are backed by the full faith and credit of the U.S. government as
to payment of interest and repayment of principal. Some are backed by the
right of the entity to borrow from the U.S. Treasury. Others are backed only
by the credit of the instrumentality. All of these different types of
securities described below are generally referred to as "U.S. government
securities" in this Prospectus.
o     U.S. Treasury Obligations. These include Treasury bills (having
      maturities of one year or less when issued), Treasury notes (having
      maturities of more than one year and up to ten years when issued), and
      Treasury bonds (having maturities of more than ten years when issued).
      Treasury securities are backed by the full faith and credit of the
      United States as to timely payments of interest and repayments of
      principal. The Fund can buy U.S. Treasury securities that have been
      "stripped" of their coupons and zero-coupon securities described below.
o     Obligations Issued or Guaranteed by U.S. Government Agencies or
      Instrumentalities. These include direct obligations and
      mortgage-related securities that have different levels of credit
      support from the U.S. government. Some are supported by the full faith
      and credit of the U.S. government, such as Government National Mortgage
      Association ("Ginnie Mae") pass-through mortgage certificates. Some are
      supported by the right of the issuer to borrow from the U.S. Treasury
      under certain circumstances, such as Federal National Mortgage
      Association ("Fannie Mae") bonds or Federal Home Loan Mortgage
      Corporation ("Freddie Mac") obligations.
o     Mortgage-Related U.S. Government Securities. These include interests in
      pools of residential or commercial mortgages, in the form of CMOs and
      other "pass-through" mortgage securities. CMOs that are U.S. government
      securities have collateral to secure payment of interest and principal.
      They may be issued in different series with different interest rates
      and maturities. The collateral is either in the form of mortgage
      pass-through certificates issued or guaranteed by a U.S. agency or
      instrumentality or mortgage loans insured by a U.S. government agency.
      The Fund can have substantial amounts of its assets invested in
      mortgage-related U.S. government securities.
      The prices and yields of CMOs are determined, in part, by assumptions
      about the cash flows from the rate of payments of the underlying
      mortgages. Changes in interest rates may cause the rate of expected
      prepayments of those mortgages to change. These prepayment risks can
      make the prices of CMOs very volatile when interest rates change. That
      volatility will affect the Fund's share prices.

Other Debt Securities. While the Fund invests primarily in investment-grade
      debt securities, it is not required to dispose of debt securities that
      fall below investment grade after the Fund buys them. However, the
      portfolio managers will monitor those holdings to determine whether the
      Fund should sell them. While securities rated "Baa" by Moody's or "BBB"
      by S&P are considered "investment grade," they have some speculative
      characteristics.

      While investment-grade securities are subject to risks of non-payment
      of interest and principal, in general, higher-yielding lower-grade
      bonds, whether rated or unrated, have greater risks than
      investment-grade securities. There may be less of a market for them and
      therefore they may be harder to value and sell at an acceptable price.
      These risks can reduce the Fund's share prices and the income it earns.

o     Private-Issuer Securities. The Fund can invest in securities issued by
      private issuers that do not offer the credit backing of the U.S.
      government. These include multi-class debt or pass-through certificates
      secured by mortgage loans. They may be issued by banks, savings and
      loans, mortgage bankers or special trusts. The Fund can buy other types
      of asset-backed securities collateralized by loans or other assets or
      receivables. Private-issuer mortgage-backed securities are subject to
      the credit risks of the issuers (as well as the interest rate risks and
      prepayment risks discussed above). There is the risk that private
      issuers may not make timely payment of interest or repay principal when
      due, although in some cases those payment obligations may be supported
      by insurance or guarantees.

The Fund's Portfolio "Duration" Strategy.  The "maturity" of a security (the
      date when its principal repayment is due) differs from effective
      duration, which attempts to measure the expected volatility of a
      security's price.

      The Fund measures the duration of its entire portfolio of securities on
      a dollar-weighted basis, to try to maintain an average effective
      duration of its portfolio of three to six years under normal market
      conditions (that is, when financial markets are not in an unstable or
      volatile state). However, duration cannot be relied on as an exact
      prediction of future volatility. There can be no assurance that the
      Fund will achieve its targeted portfolio duration at all times.
      Duration calculations rely on a number of assumptions and variables
      based on the historic performance of similar securities. Therefore,
      duration can be affected by unexpected economic events or conditions
      relating to a particular security. In the case of CMOs, duration
      calculations are based on historic rates of prepayments of underlying
      mortgages. If the mortgages underlying the Fund's investments are
      prepaid more rapidly or more slowly than expected, the duration
      calculation for that security may not be correct.

Foreign Investing. The Fund may invest a portion of its assets in foreign
      debt securities. The Fund can buy debt securities issued by foreign
      governments or companies. The Fund can buy securities of governments
      and companies in under-developed and developed markets.  However, the
      Fund may not invest more than 10% of its net assets in the securities
      of governments and companies in emerging markets.  Debt securities
      issued or guaranteed by a foreign government or its agencies might not
      be backed by the "full faith and credit" of the government.

      The Fund's foreign debt investments can be denominated in U.S. dollars
      or in foreign currencies.   However, the Fund may not invest more than
      20% of its net assets in foreign debt securities.  The Fund will buy
      and sell foreign currency only in connection with the purchase and sale
      of foreign securities and not for speculation.

Risks of Foreign Investing. While foreign securities offer special investment
      opportunities, there are also special risks that can reduce the Fund's
      share prices and returns. The change in value of a foreign currency
      against the U.S. dollar will result in a change in the U.S. dollar
      value of securities denominated in that foreign currency. Currency rate
      changes can also affect the distributions the Fund makes from the
      income it receives from foreign securities as foreign currency values
      change against the U.S. dollar. Foreign investing can result in higher
      transaction and operating costs for the Fund. Foreign issuers are not
      subject to the same accounting and disclosure requirements that U.S.
      companies are subject to.  The value of foreign investments may be
      affected by exchange control regulations, currency devaluation,
      expropriation or nationalization of a company's assets, foreign taxes,
      delays in settlement of transactions, changes in governmental, economic
      or monetary policy in the U.S. or abroad, or other political and
      economic factors.  These risks could cause the prices of foreign
      securities to fall and therefore could depress the Fund's share prices.


      Additionally, if a fund invests a significant amount of its assets in
      foreign securities, it might expose the fund to "time-zone arbitrage"
      attempts by investors seeking to take advantage of the differences in
      value of foreign securities that might result from events that occur
      after the close of the foreign securities market on which a foreign
      security is traded and the close of The New York Stock Exchange ("the
      Exchange") that day, when the Fund's net asset value is calculated. If
      such time-zone arbitrage were successful, it might dilute the interests
      of other shareholders. However, the Fund's use of "fair value pricing"
      to adjust the closing market prices of foreign securities under certain
      circumstances, to reflect what the Manager and the Board believe to be
      their fair value, may help deter those activities.


Special  Risks of Emerging  Markets.  The Fund can buy  securities in emerging
      and  developing  markets.  They  present  risks not found in more mature
      markets.   Those  securities  may  be  more  difficult  to  sell  at  an
      acceptable  price and their prices may be more volatile than  securities
      of  issuers  in more  developed  markets.  Settlements  of trades may be
      subject to greater  delays so that the Fund might not  receive  the sale
      proceeds of a security on a timely basis.

      Emerging markets might have less developed trading markets and
      exchanges, and less developed legal and accounting systems.
      Investments may be subject to greater risks of government restrictions
      on withdrawing the sales proceeds of securities from the country.
      Economies of developing countries may be more dependent on relatively
      few industries that may be highly vulnerable to local and global
      changes. Governments may be more unstable and present greater risks of
      nationalization or restrictions on foreign ownership of stocks of local
      companies. These investments may be substantially more volatile than
      securities of issuers in the U.S. and other developed countries and may
      be very speculative.

Portfolio Turnover. A change in the securities held by the Fund is known as
      "portfolio turnover."  The Fund may engage in active and frequent
      short-term trading to try to achieve its objective and may have a high
      portfolio turnover rate of over 100% annually. Increased portfolio
      turnover creates higher brokerage and transaction costs for the Fund
      (and may reduce performance).   However, most of the Fund's portfolio
      transactions are principal trades that do not entail brokerage fees. If
      the Fund realizes capital gains when it sells its portfolio
      investments, it must generally pay those gains out to shareholders,
      increasing their taxable distributions.

CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? The Fund's Board of
Trustees can change non-fundamental investment policies without shareholder
approval, although significant changes will be described in amendments to
this Prospectus. Fundamental policies cannot be changed without the approval
of a majority of the Fund's outstanding voting shares. The Fund's investment
objective is a fundamental policy.  Other investment restrictions that are
fundamental policies are listed in the Statement of Additional Information.
An investment policy is not fundamental unless this Prospectus or the
Statement of Additional Information says that it is. The Fund's policy to
invest at least 80% of its net assets (plus borrowings for investment
purposes) in bonds is not a fundamental policy; however, it cannot be changed
without 60 days prior notice to shareholders.

OTHER INVESTMENT STRATEGIES AND RISKS. To seek its objective, the Fund can
use the investment techniques and strategies described below which are not
principal policies of the Fund. The Manager might not always use all of them.
These techniques have risks, although some are designed to help reduce
overall investment or market risks.

Forward Rolls.  The Fund can enter into "forward roll" transactions with
      respect to mortgage-related securities.  In this type of transaction,
      the Fund sells a mortgage-related security to a buyer and
      simultaneously agrees to repurchase a similar security at a later date
      at a set price.

      During the period between the sale and the repurchase, the Fund will
      not be entitled to receive interest and principal payments on the
      securities that have been sold.  It is possible that the market value
      of the securities the Fund sells may decline below the price at which
      the Fund is obligated to repurchase securities, or that the
      counterparty might default in its obligation.

Zero-Coupon and "Stripped" Securities. Some of the debt securities the Fund
      buys are zero-coupon bonds that pay no interest. They are issued at a
      substantial discount from their face value. They may be securities
      issued by the U.S. government or private issuers. "Stripped" securities
      are the separate income or principal components of a debt security.
      Some CMOs or other mortgage-related securities may be stripped, with
      each component having a different proportion of principal or interest
      payments. One class might receive all the interest and the other all
      the principal payments.

      Zero-coupon and stripped securities are subject to greater fluctuations
      in price from interest rate changes than typical debt securities that
      pay interest on a regular basis. The Fund may have to pay out the
      imputed income on zero-coupon securities without receiving the cash
      currently. Stripped securities are particularly sensitive to changes in
      interest rates.

      The values of interest-only and principal-only mortgage-related
      securities are very sensitive to changes in interest rates and
      prepayments of underlying mortgages. The market for these securities
      may be limited, making it difficult for the Fund to value or to sell
      its holdings at an acceptable price.

Asset-Backed Securities. The Fund can buy asset-backed securities, which are
      fractional interests in pools of loans collateralized by the loans or
      other assets or receivables. They are typically issued by trusts and
      special purpose corporations that pass the income from the underlying
      pool to the buyer of the interest. These securities are subject to
      prepayment risks and the risk of default by the issuer as well as by
      the borrowers of the underlying loans in the pool.

Illiquid and Restricted Securities. Investments may be illiquid because they
      do not have an active trading market, making it difficult to value them
      or dispose of them promptly at an acceptable price. Restricted
      securities may have terms that limit their resale to other investors or
      may require registration under applicable securities laws before they
      may be sold publicly. The Fund will not invest more than 15% of its net
      assets in illiquid or restricted securities.  Certain restricted
      securities that are eligible for resale to qualified institutional
      purchasers may not be subject to that limit. The Manager monitors
      holdings of illiquid securities on an ongoing basis to determine
      whether to sell any holdings to maintain adequate liquidity.

"Structured" Notes. The Fund can buy "structured" notes, which are
      specially-designed derivative debt investments whose payments of
      principal or interest are linked to the value of an index (such as a
      currency or securities index) or commodity, including financial
      commodities. The terms of the instrument may be "structured" by the
      purchaser (the Fund) and the borrower issuing the note.
      The principal and/or interest payments depend on the performance of one
      or more other securities or indices, and the values of these notes will
      therefore fall or rise in response to the changes in the values of the
      underlying security or index. They are subject to both credit and
      interest rate risks and therefore the Fund could receive more or less
      than it originally invested when the notes mature, or it might receive
      less interest than the stated coupon payment if the underlying
      investment or index does not perform as anticipated. Their values may
      be very volatile and they may have a limited trading market, making it
      difficult for the Fund to sell its investment at an acceptable price.

Hedging. The Fund can buy and sell certain kinds of futures contracts, put
      and call options, interest rate swaps and forward contracts to hedge
      investment risks. These are all examples of hedging instruments.  The
      Fund is not required to use hedging instruments to seek its objective
      and does not currently use them to a significant degree.
      There are special risks in particular hedging strategies. If the
      Manager used a hedging instrument at the wrong time or judged market
      conditions incorrectly, the hedge might fail and the strategy could
      reduce the Fund's return. The Fund could also experience losses if the
      prices of its futures and options positions were not correlated with
      its other investments or if it could not close out a position because
      of an illiquid market.

Short-Term Debt Securities. The Fund can buy high-quality, short-term money
      market instruments, including obligations of the U.S. Government and
      its agencies, short-term corporate debt obligations, bank certificates
      of deposit and bankers' acceptances, and commercial paper, which are
      short-term, negotiable promissory notes of companies.

Temporary Defensive and Interim  Investments.  In times of adverse or unstable
      market,  economic  or  political  conditions,  the Fund can invest up to
      100% of its total assets in  temporary  defensive  investments  that are
      inconsistent with the Fund's principal investment strategies.  Generally
      they  would  be   highly-rated   commercial   paper  and  money   market
      instruments,  U.S.  government  securities  and  repurchase  agreements.
      The  Fund  might  also  hold  these  types  of  securities  pending  the
      investment  of  proceeds  from  the  sale of Fund  shares  or  portfolio
      securities or to meet  anticipated  redemptions  of Fund shares.  To the
      extent the Fund  invests  defensively  in these  securities,  it may not
      achieve its investment objective.


PORTFOLIO HOLDINGS.  The Fund's portfolio holdings are included in
      semi-annual and annual reports that are distributed to shareholders of
      the Fund within 60 days after the close of the period for which such
      report is being made. The Fund also discloses portfolio holdings in its
      Statements of Investments under Form N-Q, which are filed with the
      Securities and Exchange Commission (the "SEC") no later than 60 days
      after the close of the first and third fiscal quarters. These
      additional quarterly filings are publicly available at the SEC.
      Therefore, portfolio holdings of the Fund are made publicly available
      no later than 60 days after the close of each of the Fund's fiscal
      quarters.

      A description of the Fund's  policies and procedures with respect to the
      disclosure  of the  Fund's  portfolio  securities  is  available  in the
      Fund's Statement of Additional Information.


How the Fund Is Managed

THE MANAGER. The Manager chooses the Fund's investments and handles its
day-to-day business. The Manager carries out its duties, subject to the
policies established by the Fund's Board of Trustees, under an investment
advisory agreement that states the Manager's responsibilities. The agreement
sets the fees the Fund pays to the Manager and describes the expenses that
the Fund is responsible to pay to conduct its business.


      The Manager has been an investment  advisor since 1960.  The Manager and
its subsidiaries and controlled  affiliates  managed more than $___ billion in
assets as of June 30, 2005,  including other  Oppenheimer funds with more than
7 million shareholder accounts.  The Manager is located at Two World Financial
Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008.

Advisory Fees. Under the investment advisory agreement, the Fund pays the
      Manager an advisory fee at an annual rate that declines as the Fund's
      assets grow: 0.50% of the first $250 million of average annual net
      assets of the Fund; 0.475% of the next $500 million; and 0.45% of
      average annual net assets in excess of $750 million. The Fund's
      management fee for its fiscal year ended April 30, 2005 was 0.50% of
      average annual net assets for each class of shares. A discussion of the
      matters considered by the Fund's Independent Trustees, in approving the
      Fund's annual report to shareholders for the period ended April 30,
      2005.

Portfolio Managers. The Fund's portfolio is managed by a team of investment
     professionals including Angelo Manioudakis, Benjamin J. Gord, Geoffrey
     Caan, Charles Moon and Antulio N. Bomfim who are primarily responsible
     for the day-to-day management of the Fund's investments.

     Mr. Manioudakis has been a portfolio manager of the Fund since April
     2002, and a Senior Vice President of the Manager and of HarbourView
     Asset Management Corporation since April 2002. He has been a Senior Vice
     President of OFI Institutional Asset Management, Inc. since June 2002.
     He is also a portfolio manager and officer of other portfolios in the
     OppenheimerFunds complex. Mr. Manioudakis was Executive Director and
     portfolio manager for Miller, Anderson & Sherrerd, a division of Morgan
     Stanley Investment Management from August 1993 through April 2002.

     Mr. Gord has been a portfolio manager of the Fund and a Vice President
     of the Manager since April 2002.  He is also a portfolio manager of
     other portfolios in the OppenheimerFunds complex.  Mr. Gord was an
     Executive Director and a senior fixed income analyst at Miller, Anderson
     & Sherrerd, a division of Morgan Stanley Investment Management from
     April 1992 through March 2002.

     Mr. Caan has been a portfolio manager of the Fund and a Vice President
     of the Manager since August 2003. He is also a portfolio manager of
     other portfolios in the OppenheimerFunds complex. Mr. Caan was a Vice
     President of ABN AMRO N.A., Inc. from June 2002 through August 2003, and
     a Vice President of Zurich Scudder Investments from January 1999 through
     June 2002.

     Mr. Moon has been a portfolio manager of the Fund and a Vice President
     of the Manager since April 2002.  He is also a portfolio manager of
     other portfolios in the OppenheimerFunds complex.  Mr. Moon was an
     Executive Director and a portfolio manager at Miller, Anderson &
     Sherrerd, a division of Morgan Stanley Investment Management from June
     1999 through March 2002.

     Mr. Bomfim has been a portfolio manager of the Fund and a Vice President
     of the Manager since October 2003.  He is also a portfolio manager of
     other portfolios in the OppenheimerFunds complex.  Mr. Bomfim was a
     Senior Economist at the Board of Governors of the Federal Reserve System
     from June 1992 to October 2003.

      The Statement of Additional Information provides additional information
      about the portfolio management team's compensation, other accounts they
      manage and their ownership of Fund shares.

PENDING LITIGATION.  A consolidated amended complaint has been filed as
putative derivative and class actions against the Manager, Distributor and
Transfer Agent, as well as 51 of the Oppenheimer funds (collectively the
"funds") including the Fund, 31 present and former Directors or Trustees and
9 present and former officers of certain of the funds. This complaint,
initially filed in the U.S. District Court for the Southern District of New
York on January 10, 2005 and amended on March 4, 2005, consolidates into a
single action and amends six individual previously-filed putative derivative
and class action complaints. Like those prior complaints, the complaint
alleges that the Manager charged excessive fees for distribution and other
costs, improperly used assets of the funds in the form of directed brokerage
commissions and 12b-1 fees to pay brokers to promote sales of the funds, and
failed to properly disclose the use of fund assets to make those payments in
violation of the Investment Company Act and the Investment Advisers Act of
1940. Also, like those prior complaints, the complaint further alleges that
by permitting and/or participating in those actions, the Directors/Trustees
and the Officers breached their fiduciary duties to Fund shareholders under
the Investment Company Act and at common law.  The complaint seeks
unspecified compensatory and punitive damages, rescission of the funds'
investment advisory agreements, an accounting of all fees paid, and an award
of attorneys' fees and litigation expenses.

      The Manager and the Distributor believe the claims asserted in these
law suits to be without merit, and intend to defend the suits vigorously. The
Manager and the Distributor do not believe that the pending actions are
likely to have a material adverse effect on the Fund or on their ability to
perform their respective investment advisory or distribution agreements with
the Fund.


ABOUT YOUR ACCOUNT

How to Buy Shares

You can buy shares several ways, as described below. The Fund's Distributor,
OppenheimerFunds Distributor, Inc., may appoint servicing agents to accept
purchase (and redemption) orders. The Distributor, in its sole discretion,
may reject any purchase order for the Fund's shares.


Buying Shares Through Your Dealer. You can buy shares through any dealer,
      broker or financial institution that has a sales agreement with the
      Distributor. Your dealer will place your order with the Distributor on
      your behalf.  A broker or dealer may charge for that service.
Buying Shares Through the Distributor. Complete an OppenheimerFunds new
      account application and return it with a check payable to
      "OppenheimerFunds Distributor, Inc." Mail it to P.O. Box 5270, Denver,
      Colorado 80217. If you don't list a dealer on the application, the
      Distributor will act as your agent in buying the shares. Class B, Class
      C or Class N shares may not be purchased by an investor directly from
      the Distributor without the investor designating another registered
      broker-dealer. However, we recommend that you discuss your investment
      with a financial advisor before you make a purchase to be sure that the
      Fund is appropriate for you.

o     Paying by Federal Funds Wire. Shares purchased through the Distributor
      may be paid for by Federal Funds wire. The minimum investment is
      $2,500. Before sending a wire, call the Distributor's Wire Department
      at 1.800.225.5677 to notify the Distributor of the wire and to receive
      further instructions.

o     Buying Shares Through OppenheimerFunds AccountLink. With AccountLink,
      you pay for shares by electronic funds transfers from your bank
      account. Shares are purchased for your account by a transfer of money
      from your bank account through the Automated Clearing House (ACH)
      system. You can provide those instructions automatically, under an
      Asset Builder Plan, described below, or by telephone instructions using
      OppenheimerFunds PhoneLink, also described below. Please refer to
      "AccountLink," below for more details.

o     Buying Shares Through Asset Builder Plans. You may purchase shares of
      the Fund automatically each month from your account at a bank or other
      financial institution under an Asset Builder Plan with AccountLink.
      Details are in the Asset Builder application and the Statement of
      Additional Information.


WHAT IS THE MINIMUM AMOUNT YOU MUST INVEST? In most cases, you can buy Fund
shares with a minimum initial investment of $1,000 and make additional
investments at any time with as little as $50. There are reduced minimums
available under the following special investment plans:

o     If you establish one of the many types of retirement plan accounts that
      OppenheimerFunds offers, more fully described below under "Special
      Investor Services," you can start your account with as little as $500.

o     By using an Asset Builder Plan or Automatic Exchange Plan (details are
      in the Statement of Additional Information), or government allotment
      plan, you can make subsequent investments (after making the initial
      investment of $500) for as little as $50. For any type of account
      established under one of these plans prior to November 1, 2002, the
      minimum additional investment will remain $25.

o     The minimum investment requirement does not apply to reinvesting
      dividends from the Fund or other Oppenheimer funds (a list of them
      appears in the Statement of Additional Information, or you can ask your
      dealer or call the Transfer Agent), or reinvesting distributions from
      unit investment trusts that have made arrangements with the Distributor.

AT WHAT PRICE ARE SHARES SOLD? Shares are sold at their offering price which
is the net asset value per share plus any initial sales charge that applies.
The offering price that applies to a purchase order is based on the next
calculation of the net asset value per share that is made after the
Distributor receives the purchase order at its offices in Colorado, or after
any agent appointed by the Distributor receives the order.


Net Asset Value. The Fund calculates the net asset value of each class of
      shares as of the close of the Exchange, on each day the Exchange is
      open for trading (referred to in this Prospectus as a "regular business
      day"). The Exchange normally closes at 4:00 p.m., Eastern time, but may
      close earlier on some days. All references to time in this Prospectus
      mean "Eastern time."

      The net asset value per share for a class of shares on a "regular
      business day" is determined by dividing the value of the Fund's net
      assets attributable to that class by the number of shares of that class
      outstanding on that day.  To determine net asset values, the Fund
      assets are valued primarily on the basis of current market quotations.
      If market quotations are not readily available or do not accurately
      reflect fair value for a security (in the Manager's judgment) or if a
      security's value has been materially affected by events occurring after
      the close of the Exchange or market on which the security is
      principally traded, that security may be valued by another method that
      the Board of Trustees believes accurately reflects the fair value.
      Because some foreign securities trade in markets and on exchanges that
      operate on weekends and U.S. holidays, the values of some of the Fund's
      foreign investments may change on days when investors cannot buy or
      redeem Fund shares.

      The Board has adopted valuation procedures for the Fund and has
      delegated the day-to-day responsibility for fair value determinations
      to the Manager's Valuation Committee.  Fair value determinations by the
      Manager are subject to review, approval and ratification by the Board
      at its next scheduled meeting after the fair valuations are
      determined.  In determining whether current market prices are readily
      available and reliable, the Manager monitors the information it
      receives in the ordinary course of its investment management
      responsibilities for significant events that it believes in good faith
      will affect the market prices of the securities of issuers held by the
      Fund.  Those may include events affecting specific issuers (for
      example, a halt in trading of the securities of an issuer on an
      exchange during the trading day) or events affecting securities markets
      (for example, a foreign securities market closes early because of a
      natural disaster).

      If, after the close of the principal market on which a security held by
      the Fund is traded and before the time as of which the Fund's net asset
      values are calculated that day, a significant event occurs that the
      Manager learns of and believes in the exercise of its judgment will
      cause a material change in the value of that security from the closing
      price of the security on the principal market on which it is traded,
      the Manager will use its best judgment to determine a fair value for
      that security.

      The Manager believes that foreign securities values may be affected by
      volatility that occurs in U.S. markets on a trading day after the close
      of foreign securities markets.  The Manager's fair valuation procedures
      therefore include a procedure whereby foreign securities prices may be
      "fair valued" to take those factors into account.

The Offering Price. To receive the offering price for a particular day, the
      Distributor or its designated agent must receive your order by the time
      the Exchange closes that day. If your order is received on a day when
      the Exchange is closed or after it has closed, the order will receive
      the next offering price that is determined after your order is received.

Buying Through a Dealer. If you buy shares through a dealer, your dealer must
      receive the order by the close of the Exchange and transmit it to the
      Distributor so that it is received before the Distributor's close of
      business on a regular business day (normally 5:00 p.m.) to receive that
      day's offering price, unless your dealer has made alternative
      arrangements with the Distributor. Otherwise, the order will receive
      the next offering price that is determined.


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WHAT CLASSES OF SHARES DOES THE FUND OFFER? The Fund offers investors five
different classes of shares. The different classes of shares represent
investments in the same portfolio of securities, but the classes are subject
to different expenses and will likely have different share prices. When you
buy shares, be sure to specify the class of shares. If you do not choose a
class, your investment will be made in Class A shares.
------------------------------------------------------------------------------
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Class A Shares. If you buy Class A shares, you pay an initial sales charge
      (on investments up to $1 million for regular accounts or lesser amounts
      for certain retirement plans). The amount of that sales charge will
      vary depending on the amount you invest. The sales charge rates are
      listed in "How Can You Buy Class A Shares?" below.
------------------------------------------------------------------------------
Class B Shares. If you buy Class B shares, you pay no sales charge at the
      time of purchase, but you will pay an annual asset-based sales charge.
      If you sell your shares within 6  years of buying them, you will
      normally pay a contingent deferred sales charge. That contingent
      deferred sales charge varies depending on how long you own your shares,
      as described in "How Can You Buy Class B Shares?" below.
------------------------------------------------------------------------------
Class C Shares. If you buy Class C shares, you pay no sales charge at the
      time of purchase, but you will pay an annual asset-based sales charge.
      If you sell your shares within 12 months of buying them, you will
      normally pay a contingent deferred sales charge of 1.0%, as described
      in "How Can You Buy Class C Shares?" below.
------------------------------------------------------------------------------
Class N Shares. If you buy Class N shares (available only through certain
      retirement plans), you pay no sales charge at the time of purchase, but
      you will pay an annual asset-based sales charge. If you sell your
      shares within 18 months of the retirement plan's first purchase of
      Class N shares, you may pay a contingent deferred sales charge of 1.0%,
      as described in "How Can You Buy Class N Shares?" below.
Class Y Shares. Class Y shares are offered only to certain institutional
      investors that have a special agreement with the Distributor.

WHICH CLASS OF SHARES SHOULD YOU CHOOSE? Once you decide that the Fund is an
appropriate investment for you, the decision as to which class of shares is
best suited to your needs depends on a number of factors that you should
discuss with your financial advisor. Some factors to consider are how much
you plan to invest and how long you plan to hold your investment. If your
goals and objectives change over time and you plan to purchase additional
shares, you should re-evaluate those factors to see if you should consider
another class of shares. The Fund's operating costs that apply to a class of
shares and the effect of the different types of sales charges on your
investment will vary your investment results over time.

      The discussion below is not intended to be investment advice or a
recommendation, because each investor's financial considerations are
different. The discussion below assumes that you will purchase only one class
of shares and not a combination of shares of different classes. Of course,
these examples are based on approximations of the effects of current sales
charges and expenses projected over time, and do not detail all of the
considerations in selecting a class of shares. You should analyze your
options carefully with your financial advisor before making that choice.

How Long Do You Expect to Hold Your Investment? While future financial needs
      cannot be predicted with certainty, knowing how long you expect to hold
      your investment will assist you in selecting the appropriate class of
      shares. Because of the effect of class-based expenses, your choice will
      also depend on how much you plan to invest. For example, the reduced
      sales charges available for larger purchases of Class A shares may,
      over time, offset the effect of paying an initial sales charge on your
      investment, compared to the effect over time of higher class-based
      expenses on shares of Class B, Class C or Class N. For retirement plans
      that qualify to purchase Class N shares, Class N shares will generally
      be more advantageous than Class B and Class C shares.

   o  Investing for the Shorter Term. While the Fund is meant to be a
      long-term investment, if you have a relatively short-term investment
      horizon (that is, you plan to hold your shares for not more than six
      years), you should most likely invest in Class A or Class C shares
      rather than Class B shares. That is because of the effect of the Class
      B contingent deferred sales charge if you redeem within six years, as
      well as the effect of the Class B asset-based sales charge on the
      investment return for that class in the short-term. Class C shares
      might be the appropriate choice (especially for investments of less
      than $100,000), because there is no initial sales charge on Class C
      shares, and the contingent deferred sales charge does not apply to
      amounts you sell after holding them one year.

      However, if you plan to invest more than $100,000 for the shorter term,
      then as your investment horizon increases toward six years, Class C
      shares might not be as advantageous as Class A shares. That is because
      the annual asset-based sales charge on Class C shares will have a
      greater impact on your account over the longer term than the reduced
      front-end sales charge available for larger purchases of Class A
      shares.


      If you invest $1 million or more, in most cases Class A shares will be
      the most advantageous choice, no matter how long you intend to hold
      your shares. For that reason, the Distributor normally will not accept
      purchase orders of $100,000 or more of Class B shares or $1 million or
      more of Class C shares from a single investor. Dealers or other
      financial intermediaries purchasing shares for their customers in
      omnibus accounts are responsible for compliance with those limits.


   Investing for the Longer Term. If you are investing  less than $100,000 for
      the longer-term,  for example for retirement,  and do not expect to need
      access  to your  money for seven  years or more,  Class B shares  may be
      appropriate.

Are There  Differences  in Account  Features  That Matter to You? Some account
      features  may  not  be  available  to  Class  B,  Class  C and  Class  N
      shareholders.  Other  features  may  not be  advisable  (because  of the
      effect of the  contingent  deferred  sales  charge) for Class B, Class C
      and Class N shareholders.  Therefore,  you should  carefully  review how
      you plan to use your  investment  account before deciding which class of
      shares to buy.


      Additionally, the dividends payable to Class B, Class C and Class N
      shareholders will be reduced by the additional expenses borne by those
      classes that are not borne by Class A or Class Y shares, such as the
      Class B, Class C and Class N asset-based sales charge described below
      and in the Statement of Additional Information. Also, checkwriting is
      not available on accounts subject to a contingent deferred sales
      charge.


How Do Share Classes Affect Payments to Your Broker? A financial advisor may
      receive different compensation for selling one class of shares than for
      selling another class. It is important to remember that Class B, Class
      C and Class N contingent deferred sales charges and asset-based sales
      charges have the same purpose as the front-end sales charge on sales of
      Class A shares: to compensate the Distributor for concessions and
      expenses it pays to dealers and financial institutions for selling
      shares. The Distributor may pay additional compensation from its own
      resources to securities dealers or financial institutions based upon
      the value of shares of the Fund owned by the dealer or financial
      institution for its own account or for its customers.

HOW CAN YOU BUY CLASS A SHARES? Class A shares are sold at their offering
price, which is normally net asset value plus an initial sales charge.
However, in some cases, described below, purchases are not subject to an
initial sales charge, and the offering price will be the net asset value. In
other cases, reduced sales charges may be available, as described below or in
the Statement of Additional Information. Out of the amount you invest, the
Fund receives the net asset value to invest for your account.

      The sales charge varies depending on the amount of your purchase. A
portion of the sales charge may be retained by the Distributor or allocated
to your dealer as a concession. The Distributor reserves the right to reallow
the entire concession to dealers. The current sales charge rates and
concessions paid to dealers and brokers are as follows:

 ------------------------------------------------------------------------------
 Amount of Purchase       Front-End Sales   Front-End Sales    Concession As
                            Charge As a       Charge As a      Percentage of
                           Percentage of     Percentage of    Offering Price
                           Offering Price         Net
                                            Amount Invested
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 Less than $50,000             4.75%             4.98%             4.00%
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $50,000 or more but           4.50%             4.71%             3.75%
 less than $100,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $100,000 or more but          3.50%             3.63%             2.75%
 less than $250,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $250,000 or more but          2.50%             2.56%             2.00%
 less than $500,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $500,000 or more but          2.00%             2.04%             1.60%
 less than $1 million
 ------------------------------------------------------------------------------

 Due to rounding, the actual sales charge for a particular transaction may be
 higher or lower than the rates listed above.

SPECIAL SALES CHARGE ARRANGEMENTS AND WAIVERS. Appendix C to the Statement of
Additional Information details the conditions for the waiver of sales charges
that apply in certain cases, and the special sales charge rates that apply to
purchases of shares of the Fund by certain groups, or under specified
retirement plan arrangements or in other special types of transactions. To
receive a waiver or special sales charge rate, you must advise the
Distributor when purchasing shares or the Transfer Agent when redeeming
shares that a special condition applies.

Can You Reduce Class A Sales Charges?  You and your spouse may be eligible to
buy Class A shares of the Fund at reduced sales charge rates set forth in the
table above under the Fund's "Right of Accumulation" or a "Letter of Intent."
The Fund reserves the right to modify or to cease offering these programs at
any time.

o     Right of Accumulation. To qualify for the reduced Class A sales charge
         that would apply to a larger purchase than you are currently
         making (as shown in the table above), you can add the value of
         any Class A, Class B or, Class C shares of the Fund or other
         Oppenheimer funds that you or your spouse currently own, or
         are currently purchasing, to the value of your Class A share
         purchase. Your Class A shares of Oppenheimer Money Market
         Fund, Inc. or Oppenheimer Cash Reserves on which you have not
         paid a sales charge will not be counted for this purpose.  In
         totaling your holdings, you may count shares held in your
         individual accounts (including IRAs and 403(b) plans), your
         joint accounts with your spouse, or accounts you or your
         spouse hold as trustees or custodians on behalf of your
         children who are minors. A fiduciary can count all shares
         purchased for a trust, estate or other fiduciary account that
         has multiple accounts (including employee benefit plans for
         the same employer).  If you are buying shares directly from
         the Fund, you must inform the Distributor of your eligibility
         and holdings at the time of your purchase in order to qualify
         for the Right of Accumulation. If you are buying shares
         through your financial intermediary you must notify your
         intermediary of your eligibility for the Right of Accumulation
         at the time of your purchase.

            To count shares of eligible Oppenheimer funds held in
         accounts at other intermediaries under this Right of
         Accumulation, you may be requested to provide the Distributor
         or your current intermediary with a copy of all account
         statements showing your current holdings of the Fund or other
         eligible Oppenheimer funds, including statements for accounts
         held by you and your spouse or in retirement plans or trust or
         custodial accounts for minor children as described above. The
         Distributor or intermediary through which you are buying
         shares will calculate the value of your eligible Oppenheimer
         fund shares, based on the current offering price, to determine
         which Class A sales charge rate you qualify for on your
         current purchase.

o     Letters of Intent. You may also qualify for reduced Class A sales
         charges by submitting a Letter of Intent to the Distributor. A
         Letter of Intent is a written statement of your intention to
         purchase a specified value of Class A, Class B or Class C
         shares of the Fund or other Oppenheimer funds over a 13-month
         period. The total amount of your intended purchases of Class
         A, Class B and Class C shares will determine the reduced sales
         charge rate that will apply to your Class A share purchases of
         the Fund during that period. You can choose to include
         purchases made up to 90 days before the date that you submit a
         Letter. Your Class A shares of Oppenheimer Money Market Fund
         or Oppenheimer Cash Reserves on which you have not paid a
         sales charge will not be counted for this purpose. Submitting
         a Letter of Intent does not obligate you to purchase the
         specified amount of shares.  You may also be able to also
         apply the Right of Accumulation to these purchases.

            If you do not complete the Letter of Intent, the front-end
         sales charge you paid on your purchases will be recalculated
         to reflect the actual value of shares you purchased.  A
         certain portion of your shares will be held in escrow by the
         Fund's Transfer Agent for this purpose. Please refer to "How
         to Buy Shares - Letters of Intent" in the Fund's Statement of
         Additional Information for more complete information.

Other Special Sales Charge Arrangements and Waivers.  The Fund and the
Distributor offer other opportunities to purchase shares without
front-end or contingent deferred sales charges under the programs
described below. The Fund reserves the right to amend or discontinue
these programs at any time without prior notice.

o     Dividend Reinvestment.  Dividends and/or capital gains distributions
         received by a shareholder from the Fund may be reinvested in
         shares of the Fund or any of the other Oppenheimer funds
         without a sales charge, at the net asset value per share in
         effect on the payable date. You must notify the Transfer Agent
         in writing to elect this option and must have an existing
         account in the fund selected for reinvestment.

o     Exchanges of Shares.  Shares of the Fund may be exchanged for shares of
         certain other Oppenheimer funds at net asset value per share
         at the time of exchange, without sales charge, and shares of
         the Fund can be purchased by exchange of shares of certain
         other Oppenheimer funds on the same basis. Please refer to
         "How to Exchange Shares" in this Prospectus and in the
         Statement of Additional Information for more details,
         including a discussion of circumstances in which sales charges
         may apply on exchanges.

o     Reinvestment Privilege.  Within six months of a redemption of certain
         Class A and Class B shares, the proceeds may be reinvested in
         Class A shares of the Fund without sales charge. This
         privilege applies to redemptions of Class A shares that were
         subject to an initial sales charge or Class A or Class B
         shares that were subject to a contingent deferred sales charge
         when redeemed. The investor must ask the Transfer Agent for
         that privilege at the time of reinvestment and must identify
         the account from which the redemption was made.

o Other  Special  Reductions  and Waivers.  The Fund and the  Distributor  offer
additional  arrangements  to reduce or eliminate  front-end  sales charges or to
waive  contingent  deferred sales charges for certain types of transactions  and
for certain  classes of  investors  (primarily  retirement  plans that  purchase
shares in special  programs  through the  Distributor).  These are  described in
greater detail in Appendix C to the Statement of Additional  Information,  which
may be ordered by calling 800.225.5677 or through the OppenheimerFunds  website,
at  www.oppenheimerfunds.com   (follow  the  hyperlinks:  "Access  Accounts  and
Services"  -  "Forms  &  Literature"  -  "Order  Literature"  -  "Statements  of
Additional  Information").  A  description  of these  waivers and special  sales
charge  arrangements  is also  available  for  viewing  on the  OppenheimerFunds
website (follow the hyperlinks:  "Research  Funds" - "Fund  Documents" - "View a
description  . . .").  To receive a waiver or special  sales  charge  rate under
these  programs,  the purchaser must notify the  Distributor (or other financial
intermediary  through which shares are being purchased) at the time of purchase,
or notify the Transfer  Agent at the time of redeeming  shares for those waivers
that apply to contingent deferred sales charges.

o     Purchases by Certain Retirement Plans. There is no initial sales charge
         on purchases of Class A shares of the Fund by (1) retirement
         plans that have $10 million or more in plan assets and that
         have entered into a special agreement with the Distributor and
         by (2) retirement plans that are part of a retirement plan
         product or platform offered by banks, broker-dealers,
         financial advisors, insurance companies or record-keepers that
         have entered into a special agreement with the Distributor for
         this purpose. The Distributor currently pays dealers of record
         concessions in an amount equal to 0.25% of the purchase price
         of Class A shares by those retirement plans from its own
         resources at the time of sale, subject to certain exceptions
         described in "Retirement Plans" in the Statement of Additional
         Information. No contingent deferred sales charge is charged
         upon the redemption of such shares.

Class A Contingent Deferred Sales Charge. There is no initial
      sales charge on purchases of Class A shares of any one or
      more of the Oppenheimer funds aggregating $1 million or
      more, or on purchases of Class A shares by certain
      retirement plans that satisfied certain requirements prior
      to March 1, 2001 ("grandfathered retirement accounts").
      However, those Class A shares may be subject to a Class A
      contingent deferred sales charge, as described below.
      Retirement plans holding shares of Oppenheimer funds in an
      omnibus account(s) for the benefit of plan participants in
      the name of a fiduciary or financial intermediary (other
      than OppenheimerFunds-sponsored Single DB Plus plans) are
      not permitted to make initial purchases of Class A shares
      subject to a contingent deferred sales charge.

      The Distributor pays dealers of record concessions in an amount equal
      to 1.0% of purchases of $1 million or more other than purchases by
      grandfathered retirement accounts.  For grandfathered retirement
      accounts, the concession is 0.75% of the first $2.5 million of
      purchases plus 0.25% of purchases in excess of $2.5 million.  In either
      case, the concession will not be paid on purchases of shares by
      exchange or that were previously subject to a front-end sales charge
      and dealer concession.


      If you redeem any of those shares within an 18-month "holding period"
      measured from the beginning of the calendar month of their purchase, a
      contingent deferred sales charge (called the "Class A contingent
      deferred sales charge") may be deducted from the redemption proceeds.
      That sales charge will be equal to 1.0% of the lesser of:
o     the aggregate net asset value of the redeemed shares at the time of
      redemption (excluding shares purchased by reinvestment of dividends or
      capital gain distributions) or
o     the original net asset value of the redeemed shares.

      The Class A contingent deferred sales charge will not exceed the
      aggregate amount of the concessions the Distributor paid to your dealer
      on all purchases of Class A shares of all Oppenheimer funds you made
      that were subject to the Class A contingent deferred sales charge.

HOW CAN YOU BUY CLASS B SHARES? Class B shares are sold at net asset value
per share without an initial sales charge. However, if Class B shares are
redeemed within six years from the beginning of the calendar month of their
purchase, a contingent deferred sales charge will be deducted from the
redemption proceeds. The Class B contingent deferred sales charge is paid to
compensate the Distributor for its expenses of providing distribution-related
services to the Fund in connection with the sale of Class B shares.

      The amount of the contingent deferred sales charge will depend on the
number of years since you invested and the dollar amount being redeemed,
according to the following schedule for the Class B contingent deferred sales
charge holding period:

-------------------------------------------------------------------------------
Years Since Beginning of Month in       Contingent Deferred Sales Charge on
Which Purchase Order was Accepted       Redemptions in That Year
                                        (As % of Amount Subject to Charge)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
0 - 1                                   5.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
1 - 2                                   4.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
2 - 3                                   3.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
3 - 4                                   3.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
4 - 5                                   2.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
5 - 6                                   1.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
More than 6                             None
-------------------------------------------------------------------------------
In the table,  a "year" is a  12-month  period.  In  applying  the  contingent
deferred  sales charge,  all purchases are considered to have been made on the
first regular business day of the month in which the purchase was made.

Automatic Conversion of Class B Shares. Class B shares automatically convert
      to Class A shares 72 months after you purchase them. This conversion
      feature relieves Class B shareholders of the asset-based sales charge
      that applies to Class B shares under the Class B Distribution and
      Service Plan, described below. The conversion is based on the relative
      net asset value of the two classes, and no sales load or other charge
      is imposed. When any Class B shares that you hold convert, any other
      Class B shares that were acquired by reinvesting dividends and
      distributions on the converted shares will also convert to Class A
      shares. For further information on the conversion feature and its tax
      implications, see "Class B Conversion" in the Statement of Additional
      Information.

HOW CAN YOU BUY CLASS C SHARES? Class C shares are sold at net asset value
per share without an initial sales charge. However, if Class C shares are
redeemed within a holding period of 12 months from the beginning of the
calendar month of their purchase, a contingent deferred sales charge of 1.0%
will be deducted from the redemption proceeds. The Class C contingent
deferred sales charge is paid to compensate the Distributor for its expenses
of providing distribution-related services to the Fund in connection with the
sale of Class C shares.

HOW CAN YOU BUY CLASS N SHARES? Class N shares are offered for sale to
retirement plans (including IRAs and 403(b) plans) that purchase $500,000 or
more of Class N shares of one or more Oppenheimer funds or to group
retirement plans (which do not include IRAs and 403(b) plans) that have
assets of $500,000 or more or 100 or more eligible participants. See
"Availability of Class N shares" in the Statement of Additional Information
for other circumstances where Class N shares are available for purchase.

Class N shares are sold at net asset value without an initial sales charge. A
contingent deferred sales charge of 1.0% will be imposed upon the redemption
of Class N shares, if:
o     The group retirement plan is terminated or Class N shares of all
      Oppenheimer funds are terminated as an investment option of the plan
      and Class N shares are redeemed within 18 months after the plan's first
      purchase of Class N shares of any Oppenheimer fund, or
o     With respect to an IRA or 403(b) plan, Class N shares are redeemed
      within 18 months of the plan's first purchase of Class N shares of any
      Oppenheimer fund.

      Retirement plans that offer Class N shares may impose charges on plan
participant accounts. The procedures for buying, selling, exchanging and
transferring the Fund's other classes of shares (other than the time those
orders must be received by the Distributor or Transfer Agent in Colorado) and
the special account features applicable to purchasers of those other classes
of shares described elsewhere in this Prospectus do not apply to Class N
shares offered through a group retirement plan. Instructions for buying,
selling, exchanging or transferring Class N shares offered through a group
retirement plan must be submitted by the plan, not by plan participants for
whose benefit the shares are held.


WHO CAN BUY CLASS Y SHARES? Class Y shares are sold at net asset value per
share without a sales charge directly to institutional investors that have
special agreements with the Distributor for this purpose. They may include
insurance companies, registered investment companies, employee benefit plans
and Section 529 plans, among others. Individual investors cannot buy Class Y
shares directly.

      Institutional investors that buy Class Y shares for its customers'
accounts may impose charges on those accounts. The procedures for buying,
selling, exchanging and transferring the Fund's other classes of shares
(other than the time those orders must be received by the Distributor or
Transfer Agent at their Colorado office) and the special account features
available to investors buying those other classes of shares do not apply to
Class Y shares. Instructions for buying, selling, exchanging or transferring
Class Y shares must be submitted by the institutional investor, not by its
customers for whose benefit the shares are held.


DISTRIBUTION AND SERVICE (12b-1) PLANS.

Service Plan for Class A Shares. The Fund has adopted a Service Plan for
      Class A shares. It reimburses the Distributor for a portion of its
      costs incurred for services provided to accounts that hold Class A
      shares. Reimbursement is made quarterly at an annual rate of up to
      0.25% of the average annual net assets of Class A shares of the Fund.
      The Distributor currently uses all of those fees to pay dealers,
      brokers, banks and other financial institutions quarterly for providing
      personal service and maintenance of accounts of their customers that
      hold Class A shares. With respect to Class A shares subject to a Class
      A contingent deferred sales charge purchased by grandfathered
      retirement accounts, the Distributor pays the 0.25% service fee to
      dealers in advance for the first year after the shares are sold by the
      dealer. The Distributor retains the first year's service fee paid by
      the Fund. After the shares have been held by grandfathered retirement
      accounts for a year, the Distributor pays the service fee to dealers on
      a quarterly basis.

Distribution and Service Plans for Class B, Class C and Class N Shares. The
      Fund has adopted Distribution and Service Plans for Class B, Class C
      and Class N shares to pay the Distributor for its services and costs in
      distributing Class B, Class C and Class N shares and servicing
      accounts. Under the plans, the Fund pays the Distributor an annual
      asset-based sales charge of 0.75% on Class B and Class C shares and
      0.25% on Class N shares. The Distributor also receives a service fee of
      0.25% per year under the Class B, Class C and Class N plans.

      The asset-based sales charge and service fees increase Class B and
      Class C expenses by 1.0% and increase Class N expenses by 0.50% of the
      net assets per year of the respective class. Because these fees are
      paid out of the Fund's assets on an on-going basis, over time these
      fees will increase the cost of your investment and may cost you more
      than other types of sales charges.

      The Distributor uses the service fees to compensate dealers for
      providing personal services for accounts that hold Class B, Class C or
      Class N shares. The Distributor normally pays the 0.25% service fees to
      dealers in advance for the first year after the shares are sold by the
      dealer. After the shares have been held for a year, the Distributor
      pays the service fees to dealers on a quarterly basis.

      The Distributor currently pays a sales concession of 3.75% of the
      purchase price of Class B shares to dealers from its own resources at
      the time of sale. Including the advance of the service fee, the total
      amount paid by the Distributor to the dealer at the time of sale of
      Class B shares is therefore 4.00%  of the purchase price. The
      Distributor normally retains the Class B asset-based sales charge. See
      the Statement of Additional Information for exceptions.

      The Distributor currently pays a sales concession of 0.75% of the
      purchase price of Class C shares to dealers from its own resources at
      the time of sale. Including the advance of the service fee, the total
      amount paid by the Distributor to the dealer at the time of sale of
      Class C shares is therefore 1.0% of the purchase price. The Distributor
      pays the asset-based sales charge as an ongoing concession to the
      dealer on Class C shares that have been outstanding for a year or more.
      The Distributor normally retains the asset-based sales charge on Class
      C shares during the first year after the purchase of Class C shares.
      See the Statement of Additional Information for exceptions.

      The Distributor currently pays a sales concession of 0.75% of the
      purchase price of Class N shares to dealers from its own resources at
      the time of sale. Including the advance of the service fee, the total
      amount paid by the Distributor to the dealer at the time of sale of
      Class N shares is therefore 1.0% of the purchase price. The Distributor
      normally retains the asset-based sales charge on Class N shares. See
      the Statement of Additional Information for exceptions.


      Under certain circumstances, the Distributor will pay the full Class B,
      Class C or Class N asset-based sales charge and the service fee to the
      dealer beginning in the first year after purchase of such shares in
      lieu of paying the dealer the sales concession and the advance of the
      first year's service fee at the time of purchase, if there is a special
      agreement between the dealer and the Distributor.  In those
      circumstances, the sales concession will not be paid to the dealer.

      For Class C shares purchased through the OppenheimerFunds Recordkeeper
      Pro program, the Distributor will pay the Class C asset-based sales
      charge to the dealer of record in the first year after the purchase of
      such shares in lieu of paying the dealer a sales concession at the time
      of purchase.  The Distributor will use the service fee it receives from
      the Fund on those shares to reimburse FASCorp for providing personal
      services to the Class C accounts holding those shares.

      In addition, the Manager and the Distributor may make substantial
      payments to dealers or other financial intermediaries and service
      providers for distribution and/or shareholder servicing activities, out
      of their own resources, including the profits from the advisory fees
      the Manager receives from the Fund.  Some of these distribution-related
      payments may be made to dealers or financial intermediaries for
      marketing, promotional or related expenses; these payments are often
      referred to as "revenue sharing."  In some circumstances, those types
      of payments may create an incentive for a dealer or financial
      intermediary or its representatives to recommend or offer shares of the
      Fund or other Oppenheimer funds to its customers.  You should ask your
      dealer or financial intermediary for more details about any such
      payments it receives.


Special Investor Services

ACCOUNTLINK. You can use our AccountLink feature to link your Fund account
with an account at a U.S. bank or other financial institution. It must be an
Automated Clearing House (ACH) member. AccountLink lets you:
    o transmit funds electronically to purchase shares by telephone (through
      a service representative or by PhoneLink) or automatically under Asset
      Builder Plans, or
    o have the Transfer Agent send redemption proceeds or transmit dividends
      and distributions directly to your bank account. Please call the
      Transfer Agent for more information.

      You may purchase shares by telephone only after your account has been
established. To purchase shares in amounts up to $250,000 through a telephone
representative, call the Distributor at 1.800.225.5677. The purchase payment
will be debited from your bank account.

      AccountLink privileges should be requested on your Application or your
dealer's settlement instructions if you buy your shares through a dealer.
After your account is established, you can request AccountLink privileges by
sending signature-guaranteed instructions and proper documentation to the
Transfer Agent. AccountLink privileges will apply to each shareholder listed
in the registration on your account as well as to your dealer representative
of record unless and until the Transfer Agent receives written instructions
terminating or changing those privileges. After you establish AccountLink for
your account, any change of bank account information must be made by
signature-guaranteed instructions to the Transfer Agent signed by all
shareholders who own the account.

PHONELINK. PhoneLink is the OppenheimerFunds automated telephone system that
enables shareholders to perform a number of account transactions
automatically using a touch-tone phone. PhoneLink may be used on
already-established Fund accounts after you obtain a Personal Identification
Number (PIN), by calling the PhoneLink number, 1.800.225.5677.
Purchasing Shares. You may purchase shares in amounts up to $100,000 by
      phone, by calling 1.800.225.5677. You must have established AccountLink
      privileges to link your bank account with the Fund to pay for these
      purchases.
Exchanging Shares. With the OppenheimerFunds Exchange Privilege, described
      below, you can exchange shares automatically by phone from your Fund
      account to another OppenheimerFunds account you have already
      established by calling the special PhoneLink number.
Selling Shares. You can redeem shares by telephone automatically by calling
      the PhoneLink number and the Fund will send the proceeds directly to
      your AccountLink bank account. Please refer to "How to Sell Shares,"
      below for details.

CAN YOU SUBMIT TRANSACTION REQUESTS BY FAX? You may send requests for certain
types of account transactions to the Transfer Agent by fax (telecopier).
Please call 1.800.225.5677 for information about which transactions may be
handled this way. Transaction requests submitted by fax are subject to the
same rules and restrictions as written and telephone requests described in
this Prospectus.

OPPENHEIMERFUNDS INTERNET WEBSITE. You can obtain information about the Fund,
as well as your account balance, on the OppenheimerFunds Internet website, at
www.oppenheimerfunds.com. Additionally, shareholders listed in the account
registration (and the dealer of record) may request certain account
transactions through a special section of that website. To perform account
transactions or obtain account information online, you must first obtain a
user I.D. and password on that website. If you do not want to have Internet
account transaction capability for your account, please call the Transfer
Agent at 1.800.225.5677. At times, the website may be inaccessible or its
transaction features may be unavailable.

AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. The Fund has several plans that
enable you to sell shares automatically or exchange them to another
OppenheimerFunds account on a regular basis. Please call the Transfer Agent
or consult the Statement of Additional Information for details.

RETIREMENT PLANS. You may buy shares of the Fund for your retirement plan
account. If you participate in a plan sponsored by your employer, the plan
trustee or administrator must buy the shares for your plan account. The
Distributor also offers a number of different retirement plans that
individuals and employers can use:
Individual Retirement Accounts (IRAs). These include regular IRAs, Roth IRAs,
      SIMPLE IRAs and rollover IRAs.
SEP-IRAs. These are Simplified Employee Pension Plan IRAs for small business
      owners or self-employed individuals.
403(b)(7) Custodial Plans. These are tax-deferred plans for employees of
      eligible tax-exempt organizations, such as schools, hospitals and
      charitable organizations.
401(k) Plans. These are special retirement plans for businesses.
Pension and Profit-Sharing Plans. These plans are designed for businesses and
      self-employed individuals.
      Please call the Distributor for OppenheimerFunds retirement plan
documents, which include applications and important plan information.

How to Sell Shares

You can sell (redeem) some or all of your shares on any regular business day.
Your shares will be sold at the next net asset value calculated after your
order is received in proper form (which means that it must comply with the
procedures described below) and is accepted by the Transfer Agent. The Fund
lets you sell your shares by writing a letter, by wire, by using the Fund's
checkwriting privilege, or by telephone. You can also set up Automatic
Withdrawal Plans to redeem shares on a regular basis. If you have questions
about any of these procedures, and especially if you are redeeming shares in
a special situation, such as due to the death of the owner or from a
retirement plan account, please call the Transfer Agent first, at
1.800.225.5677, for assistance.

Certain Requests Require a Signature Guarantee. To protect you and the Fund
      from fraud, the following redemption requests must be in writing and
      must include a signature guarantee (although there may be other
      situations that also require a signature guarantee):
   o  You wish to redeem more than $100,000 and receive a check
   o  The redemption check is not payable to all shareholders listed on the
      account statement
   o  The redemption check is not sent to the address of record on your
      account statement
   o  Shares are being transferred to a Fund account with a different owner
      or name
   o  Shares are being redeemed by someone (such as an Executor) other than
      the owners.

Where Can You Have Your Signature Guaranteed? The Transfer Agent will accept
      a guarantee of your signature by a number of financial institutions,
      including:
o     a U.S. bank, trust company, credit union or savings association,
o     a foreign bank that has a U.S. correspondent bank,
o     a U.S. registered dealer or broker in securities, municipal securities
      or government securities, or
o     a U.S. national securities exchange, a registered securities
      association or a clearing agency.
      If you are signing on behalf of a corporation, partnership or other
      business or as a fiduciary, you must also include your title in the
      signature.

Retirement Plan Accounts. There are special procedures to sell shares in an
      OppenheimerFunds retirement plan account. Call the Transfer Agent for a
      distribution request form. Special income tax withholding requirements
      apply to distributions from retirement plans. You must submit a
      withholding form with your redemption request to avoid delay in getting
      your money and if you do not want tax withheld. If your employer holds
      your retirement plan account for you in the name of the plan, you must
      ask the plan trustee or administrator to request the sale of the Fund
      shares in your plan account.


Receiving Redemption Proceeds by Wire. While the Fund normally sends your
      money by check, you can arrange to have the proceeds of shares you sell
      sent by Federal Funds wire to a bank account you designate. It must be
      a commercial bank that is a member of the Federal Reserve wire system.
      The minimum redemption you can have sent by wire is $2,500. There is a
      $10 fee for each request. To find out how to set up this feature on
      your account or to arrange a wire, call the Transfer Agent at
      1.800.225.5677.


CHECKWRITING. To write checks against your Fund account, request that
privilege on your account application, or contact the Transfer Agent for
signature cards. They must be signed (with a signature guarantee) by all
owners of the account and returned to the Transfer Agent so that checks can
be sent to you to use. Shareholders with joint accounts can elect in writing
to have checks paid over the signature of one owner. If you previously signed
a signature card to establish checkwriting in another Oppenheimer fund,
simply call 1.800.225.5677 to request checkwriting for an account in this
Fund with the same registration as the other account.
o     Checks can be written to the order of whomever you wish, but may not be
      cashed at the bank the checks are payable through or the Fund's
      custodian bank.
o     Checkwriting privileges are not available for accounts holding shares
      that are subject to a contingent deferred sales charge.
o     Checks must be written for at least $500. Checks written below the
      stated amount on the check will not be accepted. However, if you have
      existing checks indicating a $100 minimum, you may still use them for
      amounts of $100 or more.
o     Checks cannot be paid if they are written for more than your account
      value. Remember, your shares fluctuate in value and you should not
      write a check close to the total account value.
o     You may not write a check that would require the Fund to redeem shares
      that were purchased by check or Asset Builder Plan payments within the
      prior 10 days.
o     Don't use your checks if you changed your Fund account number, until
      you receive new checks.

HOW DO YOU SELL SHARES BY MAIL? Write a letter of instruction that includes:
   o  Your name
   o  The Fund's name
   o  Your Fund account number (from your account statement)
   o  The dollar amount or number of shares to be redeemed
   o  Any special payment instructions
   o  Any share certificates for the shares you are selling
   o  The signatures of all registered owners exactly as the account is
      registered, and
   o  Any special documents requested by the Transfer Agent to assure proper
      authorization of the person asking to sell the shares.

Use the following address for            Send courier or express mail
requests by mail:                        requests to:
OppenheimerFunds Services                OppenheimerFunds Services
P.O. Box 5270                            10200 E. Girard Avenue, Building D
Denver, Colorado 80217                   Denver, Colorado 80231


HOW DO YOU SELL SHARES BY TELEPHONE? You and your dealer representative of
record may also sell your shares by telephone. To receive the redemption
price calculated on a particular regular business day, your call must be
received by the Transfer Agent by the close of the Exchange that day, which
is normally 4:00 p.m., but may be earlier on some days. You may not redeem
shares held in an OppenheimerFunds-sponsored qualified retirement plan
account or under a share certificate by telephone.

   o  To redeem shares through a service representative or automatically on
      PhoneLink, call 1.800.225.5677.
      Whichever method you use, you may have a check sent to the address on
the account statement, or, if you have linked your Fund account to your bank
account on AccountLink, you may have the proceeds sent to that bank account.

Are There Limits on Amounts Redeemed by Telephone?
Telephone Redemptions Paid by Check. Up to $100,000 may be redeemed by
      telephone in any seven-day period. The check must be payable to all
      owners of record of the shares and must be sent to the address on the
      account statement. This service is not available within 30 days of
      changing the address on an account.

Telephone Redemptions Through AccountLink or by Wire. There are no dollar
      limits on telephone redemption proceeds sent to a bank account
      designated when you establish AccountLink. Normally the ACH transfer to
      your bank is initiated on the business day after the redemption. You do
      not receive dividends on the proceeds of the shares you redeemed while
      they are waiting to be transferred.

      If you have requested Federal Funds wire privileges for your account,
      the wire of the redemption proceeds will normally be transmitted on the
      next bank business day after the shares are redeemed. There is a
      possibility that the wire may be delayed up to seven days to enable the
      Fund to sell securities to pay the redemption proceeds. No dividends
      are accrued or paid on the proceeds of shares that have been redeemed
      and are awaiting transmittal by wire.

CAN  YOU  SELL  SHARES  THROUGH  YOUR  DEALER?   The   Distributor   has  made
arrangements  to repurchase  Fund shares from dealers and brokers on behalf of
their  customers.  Brokers or dealers  may  charge for that  service.  If your
shares are held in the name of your dealer,  you must redeem them through your
dealer.

HOW CONTINGENT DEFERRED SALES CHARGES AFFECT REDEMPTIONS. If you purchase
shares subject to a Class A, Class B, Class C or Class N contingent deferred
sales charge and redeem any of those shares during the applicable holding
period for the class of shares, the contingent deferred sales charge will be
deducted from the redemption proceeds (unless you are eligible for a waiver
of that sales charge based on the categories listed in Appendix C to the
Statement of Additional Information and you advise the Transfer Agent of your
eligibility for the waiver when you place your redemption request.)

      A  contingent  deferred  sales charge will be based on the lesser of the
net  asset  value of the  redeemed  shares  at the time of  redemption  or the
original net asset value.  A contingent  deferred  sales charge is not imposed
on:
o     the amount of your  account  value  represented  by an  increase  in net
      asset value over the initial purchase price,
o     shares  purchased by the  reinvestment  of  dividends  or capital  gains
      distributions, or
o     shares redeemed in the special circumstances  described in Appendix C to
      the Statement of Additional Information.
      To determine whether a contingent deferred sales charge applies to a
      redemption, the Fund redeems shares in the following order:
   1. shares acquired by reinvestment of dividends and capital gains
      distributions,
   2. shares held for the holding period that applies to the class, and
   3. shares held the longest during the holding period.

      Contingent deferred sales charges are not charged when you exchange
shares of the Fund for shares of other Oppenheimer funds. However, if you
exchange them within the applicable contingent deferred sales charge holding
period, the holding period will carry over to the fund whose shares you
acquire. Similarly, if you acquire shares of this Fund by exchanging shares
of another Oppenheimer fund that are still subject to a contingent deferred
sales charge holding period, that holding period will carry over to this Fund.

How to Exchange Shares


If you want to change all or part of your investment from one Oppenheimer
fund to another, you can exchange your shares for shares of the same class of
another Oppenheimer fund that offers the exchange privilege. For example, you
can exchange Class A shares of the Fund only for Class A shares of another
fund. To exchange shares, you must meet several conditions:


   o  Shares of the fund selected for exchange must be available for sale in
      your state of residence.

   o  The prospectus of  the selected fund must offer the exchange privilege.
   o  When you establish an account, you must hold the shares you buy for at
      least seven days before you can exchange them. After your account is
      open for seven days, you can exchange shares on any regular business
      day, subject to the limitations described below.
   o  You must meet the minimum purchase requirements for the selected fund.
   o  Generally,  exchanges  may be made only between  identically  registered
      accounts,  unless all account owners send written exchange  instructions
      with a signature guarantee.
   o  Before exchanging into a fund, you must obtain its prospectus and
      should read it.

      For tax purposes, an exchange of shares of the Fund is considered a
sale of those shares and a purchase of the shares of the fund to which you
are exchanging. An exchange may result in a capital gain or loss.

      You can find a list of the Oppenheimer funds that are currently
available for exchanges in the Statement of Additional Information or you can
obtain a list by calling a service representative at 1.800.225.5677. The
funds available for exchange can change from time to time.

      In some cases, sales charges may be imposed on exchange transactions.
In general, a contingent deferred sales charge (CDSC) is not imposed on
exchanges of shares that are subject to a CDSC. However, if you exchange
shares that are subject to a CDSC, the CDSC holding period will be carried
over to the acquired shares, and the CDSC may be imposed if those shares are
redeemed before the end of the CDSC holding period.

      There are a number of other special conditions and limitations that
apply to certain types of exchanges. These conditions and circumstances are
described in detail in the "How to Exchange Shares" section in the Statement
of Additional Information.

HOW DO YOU SUBMIT EXCHANGE REQUESTS? Exchanges may be requested in writing,
by telephone or internet, or by establishing an Automatic Exchange Plan.

Written Exchange Requests. Send a request letter, signed by all owners of the
      account, to the Transfer Agent at the address on the back cover.
      Exchanges of shares for which share certificates have been issued
      cannot be processed unless the Transfer Agent receives the certificates
      with the request letter.
Telephone and Internet Exchange Requests. Telephone exchange requests may be
      made either by calling a service representative or by using PhoneLink
      by calling 1.800.225.5677. You may submit internet exchange requests on
      the OppenheimerFunds internet website, at www.oppenheimerfunds.com. You
      must have obtained a user I.D. and password to make transactions on
      that website. Telephone and/or internet exchanges may be made only
      between accounts that are registered with the same name(s) and address.
      Shares for which share certificates have been issued may not be
      exchanged by telephone or the internet.

Automatic Exchange Plan. Shareholders can authorize the Transfer Agent to
      exchange a pre-determined amount of shares automatically on a monthly,
      quarterly, semi-annual or annual basis.

      Please refer to "How to Exchange Shares" in the Statement of Additional
      Information for more details.

ARE THERE LIMITATIONS ON FREQUENT PURCHASES, REDEMPTIONS AND EXCHANGES?
Risks from Excessive Purchase, Redemption and Short-Term Exchange Activity.
The OppenheimerFunds exchange privilege affords investors the ability to
switch their investments among Oppenheimer funds if their investment needs
change. However, there are limits on that privilege. Frequent purchases,
redemptions and exchanges of fund shares may interfere with the Manager's
ability to manage the fund's investments efficiently, increase the fund's
transaction and administrative costs and/or affect the fund's performance,
depending on various factors, such as the size of the fund, the nature of its
investments, the amount of fund assets the portfolio manager maintains in
cash or cash equivalents, the aggregate dollar amount and the number and
frequency of trades. If large dollar amounts are involved in exchange and/or
redemption transactions, the Fund might be required to sell portfolio
securities at unfavorable times to meet redemption or exchange requests, and
the Fund's brokerage or administrative expenses might be increased.

Therefore, the Manager and the Fund's Board of Trustees have adopted the
following policies and procedures to detect and prevent frequent and/or
excessive exchanges, and/or purchase and redemption activity, while balancing
the needs of investors who seek liquidity from their investment and the
ability to exchange shares as investment needs change. There is no guarantee
that the policies and procedures described below will be sufficient to
identify and deter excessive short-term trading.

o     Timing of Exchanges.  Exchanged shares are normally redeemed from one
      fund and the proceeds are reinvested in the fund selected for exchange
      on the same regular business day on which the Transfer Agent or its
      agent (such as a financial intermediary holding the investor's shares
      in an "omnibus" or "street name" account) receives an exchange request
      that conforms to these policies. The request must be received by the
      close of the Exchange that day, which is normally 4:00 p.m. Eastern
      time, but may be earlier on some days, in order to receive that day's
      net asset value on the exchanged shares. Exchange requests received
      after the close of the Exchange will receive the next net asset value
      calculated after the request is received. However, the Transfer Agent
      may delay the reinvestment of transmitting the proceeds from an
      exchange for up to five business days if it determines, in its
      discretion, that an earlier transmittal of the redemption proceeds to
      the receiving fund would be detrimental to either the fund from which
      the exchange is made or the fund to which the exchange is made. The
      proceeds will be invested in the fund into which the exchange is being
      made at the next net asset value calculated after the proceeds are
      received. In the event that such a delay in the reinvestment of
      proceeds occurs, the Transfer Agent will notify you or your financial
      representative.

o     Limits on Disruptive Activity. The Transfer Agent may, in its
      discretion, limit or terminate trading activity by any person, group or
      account  that it believes would be disruptive, even if the activity has
      not exceeded the policy outlined in this Prospectus. The Transfer Agent
      may review and consider the history of frequent trading activity in all
      accounts in the Oppenheimer funds known to be under common ownership or
      control as part of the Transfer Agent's procedures to detect and deter
      excessive trading activity.

o     Exchanges of Client Accounts by Financial Advisers.  The Fund and the
      Transfer Agent permit dealers and financial intermediaries to submit
      exchange requests on behalf of their customers (unless the customer has
      revoked that authority). The Distributor and/or the Transfer Agent have
      agreements with a number of financial intermediaries that permit them
      to submit exchange orders in bulk on behalf of their clients. Those
      intermediaries are required to follow the exchange policies stated in
      this Prospectus and to comply with additional, more stringent
      restrictions. Those additional restrictions include limitations on the
      funds available for exchanges, the requirement to give advance notice
      of exchanges to the Transfer Agent, and limits on the amount of client
      assets that may be invested in a particular fund. A fund or the
      Transfer Agent may limit or refuse bulk exchange requests submitted by
      such financial intermediaries if, in the Transfer Agent's judgment,
      exercised in its discretion, the exchanges would be disruptive to any
      of the funds involved in the transaction.

o     Redemptions of Shares.  These exchange policy limits do not apply to
      redemptions of shares. Shareholders are permitted to redeem their
      shares on any regular business day, subject to the terms of this
      Prospectus.

o     Right to Refuse Exchange and Purchase Orders.  The Distributor and/or
      the Transfer Agent may refuse any purchase or exchange order in their
      discretion and are not obligated to provide notice before rejecting an
      order. The Fund may amend, suspend or terminate the exchange privilege
      at any time. You will receive 60 days' notice of any material change in
      the exchange privilege unless applicable law allows otherwise.

o     Right to Terminate or Suspend Account Privileges.  The Transfer Agent
      may send a written warning to direct shareholders who the Transfer
      Agent believes may be engaging in excessive purchases, redemptions
      and/or exchange activity and reserves the right to suspend or terminate
      the ability to purchase shares and/or exchange privileges for any
      account that the Transfer Agent determines, in carrying out these
      policies and in the exercise of its discretion, has engaged in
      disruptive or excessive trading activity, with or without such warning.

o     Omnibus Accounts.  If you hold your shares of the Fund through a
      financial intermediary such as a broker-dealer, a bank, an insurance
      company separate account, an investment adviser, an administrator or
      trustee of a retirement plan or 529 plan, that holds your shares in an
      account under its name (these are sometimes referred to as "omnibus" or
      "street name" accounts), that financial intermediary may impose its own
      restrictions or limitations to discourage short-term or excessive
      trading. You should consult your financial intermediary to find out
      what trading restrictions, including limitations on exchanges, they may
      apply.


While the Fund, the Distributor, the Manager and the Transfer Agent encourage
financial intermediaries to apply the Fund's policies to their customers who
invest indirectly in the Fund, the Transfer Agent may not be able to detect
excessive short term trading activity facilitated by, or in accounts
maintained in, the "omnibus" or "street name" accounts of a financial
intermediary. Therefore the Transfer Agent might not be able to apply this
policy to accounts such as (a) accounts held in omnibus form in the name of a
broker-dealer or other financial institution, or (b) omnibus accounts held in
the name of a retirement plan or 529 plan trustee or administrator, or (c)
accounts held in the name of an insurance company for its separate
account(s), or (d) other accounts having multiple underlying owners but
registered in a manner such that the underlying beneficial owners are not
identified to the Transfer Agent.


However, the Transfer Agent will attempt to monitor overall purchase and
redemption activity in those accounts to seek to identify patterns that may
suggest excessive trading by the underlying owners. If evidence of possible
excessive trading activity is observed by the Transfer Agent, the financial
intermediary that is the registered owner will be asked to review account
activity, and to confirm to the Transfer Agent and the fund that appropriate
action has been taken to curtail any excessive trading activity. However, the
Transfer Agent's ability to monitor and deter excessive short-term trading in
omnibus or street name accounts ultimately depends on the capability and
cooperation of the financial intermediaries controlling those accounts.


Additional Policies and Procedures. The Fund's Board has adopted the
following additional policies and procedures to detect and prevent frequent
and/or excessive exchanges and purchase and redemption activity.

o     30-Day Limit.  A direct shareholder may exchange some or all of the
         shares of the Fund held in his or her account to another eligible
         Oppenheimer fund once in a 30 calendar-day period. When shares are
         exchanged into a fund account, that account will be "blocked" from
         further exchanges into another fund for a period of 30 calendar days
         from the date of the exchange. The block will apply to the full
         account balance and not just to the amount exchanged into the
         account. For example, if a shareholder exchanged $1,000 from one
         fund into another fund in which the shareholder already owned shares
         worth $10,000, then, following the exchange, the full account
         balance ($11,000 in this example) would be blocked from further
         exchanges into another fund for a period of 30 calendar days. A
         "direct shareholder" is one whose account is registered on the
         Fund's books showing the name, address and tax ID number of the
         beneficial owner.

o     Exchanges Into Money Market Funds.  A direct shareholder will be
         permitted to exchange shares of a stock or bond fund for shares of a
         money market fund at any time, even if the shareholder has exchanged
         shares into the stock or bond fund during the prior 30 days.
         However, all of the shares held in that money market fund would then
         be blocked from further exchanges into another fund for 30 calendar
         days.

o     Dividend Reinvestments/B Share Conversions.  Reinvestment of dividends
         or distributions from one fund to purchase shares of another fund
         and the conversion of Class B shares into Class A shares will not be
         considered exchanges for purposes of imposing the 30-day limit.

o     Asset Allocation.  Third-party asset allocation and rebalancing
         programs will be subject to the 30-day limit described above. Asset
         allocation firms that want to exchange shares held in accounts on
         behalf of their customers must identify themselves to the Transfer
         Agent and execute an acknowledgement and agreement to abide by these
         policies with respect to their customers' accounts. "On-demand"
         exchanges outside the parameters of portfolio rebalancing programs
         will be subject to the 30-day limit. However, investment programs by
         other Oppenheimer "funds-of-funds" that entail rebalancing of
         investments in underlying Oppenheimer funds will not be subject to
         these limits.

   Automatic Exchange Plans.  Accounts that receive exchange proceeds through
      automatic or systematic exchange plans that are established through the
      Transfer Agent will not be subject to the 30-day block as a result of
      those automatic or systematic exchanges (but may be blocked from
      exchanges, under the 30-day limit, if they receive proceeds from other
      exchanges).


Shareholder Account Rules and Policies


More information about the Fund's policies and procedures for buying, selling
and exchanging shares is contained in the Statement of Additional Information.
A $12 annual "Minimum Balance Fee" is assessed on each Fund account with a
      value of less than $500. The fee is automatically deducted from each
      applicable Fund account annually in September. See the Statement of
      Additional Information to learn how you can avoid this fee and for
      circumstances under which this fee will not be assessed.

The offering of shares may be suspended during any period in which the
      determination of net asset value is suspended, and the offering may be
      suspended by the Board of Trustees at any time the Board believes it is
      in the Fund's best interest to do so.
Telephone transaction privileges for purchases, redemptions or exchanges may
      be modified, suspended or terminated by the Fund at any time. The Fund
      will provide you notice whenever it is required to do so by applicable
      law. If an account has more than one owner, the Fund and the Transfer
      Agent may rely on the instructions of any one owner. Telephone
      privileges apply to each owner of the account and the dealer
      representative of record for the account unless the Transfer Agent
      receives cancellation instructions from an owner of the account.
The Transfer Agent will record any telephone calls to verify data concerning
      transactions and has adopted other procedures to confirm that telephone
      instructions are genuine, by requiring callers to provide tax
      identification numbers and other account data or by using PINs, and by
      confirming such transactions in writing. The Transfer Agent and the
      Fund will not be liable for losses or expenses arising out of telephone
      instructions reasonably believed to be genuine.
Redemption or transfer requests will not be honored until the Transfer Agent
      receives all required documents in proper form. From time to time, the
      Transfer Agent in its discretion may waive certain of the requirements
      for redemptions stated in this Prospectus.
Dealers that perform account transactions for their clients by participating
      in NETWORKING through the National Securities Clearing Corporation are
      responsible for obtaining their clients' permission to perform those
      transactions, and are responsible to their clients who are shareholders
      of the Fund if the dealer performs any transaction erroneously or
      improperly.
The redemption price for shares will vary from day to day because the value
      of the securities in the Fund's portfolio fluctuates. The redemption
      price, which is the net asset value per share, will normally differ for
      each class of shares. The redemption value of your shares may be more
      or less than their original cost.
Payment for redeemed shares ordinarily is made in cash. It is forwarded by
      check, or through AccountLink or by Federal Funds wire (as elected by
      the shareholder) within seven days after the Transfer Agent receives
      redemption instructions in proper form. However, under unusual
      circumstances determined by the Securities and Exchange Commission,
      payment may be delayed or suspended. For accounts registered in the
      name of a broker-dealer, payment will normally be forwarded within
      three business days after redemption.
The Transfer Agent may delay processing any type of redemption payment as
      described under "How to Sell Shares" for recently purchased shares, but
      only until the purchase payment has cleared. That delay may be as much
      as 10 days from the date the shares were purchased. That delay may be
      avoided if you purchase shares by Federal Funds wire or certified
      check, or arrange with your bank to provide telephone or written
      assurance to the Transfer Agent that your purchase payment has cleared.
Involuntary redemptions of small accounts may be made by the Fund if the
      account value has fallen below $500 for reasons other than the fact
      that the market value of shares has dropped. In some cases, involuntary
      redemptions may be made to repay the Distributor for losses from the
      cancellation of share purchase orders.
Shares may be "redeemed in kind" under unusual circumstances (such as a lack
      of liquidity in the Fund's portfolio to meet redemptions). This means
      that the redemption proceeds will be paid with liquid securities from
      the Fund's portfolio. If the Fund redeems your shares in kind, you may
      bear transaction costs and will bear market risks until such time as
      such securities are converted into cash.
Federal regulations may require the Fund to obtain your name, your date of
      birth (for a natural person), your residential street address or
      principal place of business and your Social Security Number, Employer
      Identification Number or other government issued identification when
      you open an account. Additional information may be required in certain
      circumstances or to open corporate accounts.  The Fund or the Transfer
      Agent may use this information to attempt to verify your identity.  The
      Fund may not be able to establish an account if the necessary
      information is not received.  The Fund may also place limits on account
      transactions while it is in the process of attempting to verify your
      identity.  Additionally, if the Fund is unable to verify your identity
      after your account is established, the Fund may be required to redeem
      your shares and close your account.
"Backup withholding" of federal income tax may be applied against taxable
      dividends, distributions and redemption proceeds (including exchanges)
      if you fail to furnish the Fund your correct, certified Social Security
      or Employer Identification Number when you sign your application, or if
      you under-report your income to the Internal Revenue Service.
To avoid sending duplicate copies of materials to households, the Fund will
      mail only one copy of each prospectus, annual and semi-annual report
      and annual notice of the Fund's privacy policy to shareholders having
      the same last name and address on the Fund's records. The consolidation
      of these mailings, called householding, benefits the Fund through
      reduced mailing expense.

      If you want to receive multiple copies of these materials, you may call
      the Transfer Agent at 1.800.225.5677. You may also notify the Transfer
      Agent in writing. Individual copies of prospectuses, reports and
      privacy notices will be sent to you commencing within 30 days after the
      Transfer Agent receives your request to stop householding.

Dividends, Capital Gains and Taxes

DIVIDENDS. The Fund intends to declare dividends separately for each class of
shares from net investment income each regular business day and pay those
dividends monthly. Daily dividends will not be declared or paid on newly
purchased shares until Federal Funds are available to the Fund from the
purchase payment for shares. Dividends and distributions paid to Class A
shares will generally be higher than dividends for Class B, Class C and Class
N shares, which normally have higher expenses than Class A shares. The Fund
has no fixed dividend rate and cannot guarantee that it will pay any
dividends or distributions.

CAPITAL GAINS. The Fund may realize capital gains on the sale of portfolio
securities. If it does, it may make distributions out of any net short-term
or long-term capital gains each year. The Fund may make supplemental
distributions of dividends and capital gains following the end of its fiscal
year. There can be no assurance that the Fund will pay any capital gains
distributions in a particular year.

WHAT CHOICES DO YOU HAVE FOR RECEIVING DISTRIBUTIONS? When you open your
account, specify on your application how you want to receive your dividends
and distributions. You have four options:
Reinvest All Distributions in the Fund. You can elect to reinvest all
      dividends and capital gains distributions in additional shares of the
      Fund.
Reinvest Dividends or Capital Gains. You can elect to reinvest some
      distributions (dividends, short-term capital gains or long-term capital
      gains distributions) in the Fund while receiving the other types of
      distributions by check or having them sent to your bank account through
      AccountLink.
Receive All Distributions in Cash. You can elect to receive a check for all
      dividends and capital gains distributions or have them sent to your
      bank through AccountLink.
Reinvest Your Distributions in Another OppenheimerFunds Account. You can
      reinvest all distributions in the same class of shares of another
      OppenheimerFunds account you have established.

TAXES. If your shares are not held in a tax-deferred retirement account, you
should be aware of the following tax implications of investing in the Fund.
Distributions are subject to federal income tax and may be subject to state
or local taxes. Dividends paid from short-term capital gains and net
investment income are taxable as ordinary income. Long-term capital gains are
taxable as long-term capital gains when distributed to shareholders. It does
not matter how long you have held your shares. Whether you reinvest your
distributions in additional shares or take them in cash, the tax treatment is
the same.

      Every year the Fund will send you and the IRS a statement showing the
amount of any taxable distribution you received in the previous year. Any
long-term capital gains will be separately identified in the tax information
the Fund sends you after the end of the calendar year.


      The Fund intends to qualify each year as a "regulated investment
company" under the Internal Revenue Code, but reserves the right not to
qualify. It qualified during its last fiscal year. The Fund, as a regulated
investment company, will not be subject to federal income taxes on any of its
income, provided that it satisfies certain income, diversification and
distribution requirements.


Avoid "Buying a Distribution." If you buy shares on or just before the Fund
      declares a capital gains distribution, you will pay the full price for
      the shares and then receive a portion of the price back as a taxable
      capital gain.
Remember, There May be Taxes on Transactions. Because the Fund's share prices
      fluctuate, you may have a capital gain or loss when you sell or
      exchange your shares. A capital gain or loss is the difference between
      the price you paid for the shares and the price you received when you
      sold them. Any capital gain is subject to capital gains tax.
Returns of Capital Can Occur. In certain cases, distributions made by the
      Fund may be considered a non-taxable return of capital to shareholders.
      If that occurs, it will be identified in notices to shareholders.

      This  information  is only a  summary  of  certain  federal  income  tax
information  about your  investment.  You should consult with your tax advisor
about  the  effect  of an  investment  in the  Fund  on  your  particular  tax
situation.

Financial Highlights


The Financial Highlights Table is presented to help you understand the Fund's
financial performance since inception. Certain information reflects financial
results for a single Fund share.  Financial information for Class Y shares is
not included since those shares are not currently offered for sale.  The
total returns in the table represent the rate that an investor would have
earned (or lost) on an investment in the Fund (assuming reinvestment of all
dividends and distributions). This information has been audited by
______________ the Fund's independent registered public accounting firm,
whose report, along with the Fund's financial statements, is included in the
Statement of Additional Information, which is available on request.





INFORMATION AND SERVICES

For More Information on Oppenheimer Total Return Bond Fund

The following additional information about the Fund is available without
charge upon request:

STATEMENT OF ADDITIONAL INFORMATION. This document includes additional
information about the Fund's investment policies, risks, and operations. It
is incorporated by reference into this Prospectus (which means it is legally
part of this Prospectus).

ANNUAL AND SEMI-ANNUAL REPORTS. Additional information about the Fund's
investments and performance is available in the Fund's Annual and Semi-Annual
Reports to shareholders. The Annual Report includes a discussion of market
conditions and investment strategies that significantly affected the Fund's
performance during its last fiscal year.

How to Get More Information
You can request the Statement of Additional Information, the Annual and
Semi-Annual Reports, the notice explaining the Fund's privacy policy and
other information about the Fund or your account:

--------------------------------------------------------------------------------
By Telephone:                 Call OppenheimerFunds Services toll-free:
                              1.800.525.7048
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
By Mail:                      Write to:
                              OppenheimerFunds Services
                              P.O. Box 5270
                              Denver, Colorado 80217-5270
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

On the Internet:              You can request these documents by e-mail or
                              through the OppenheimerFunds website. You may
                              also read or download certain documents on the
                              OppenheimerFunds website at:
                              www.oppenheimerfunds.com
                              ------------------------

--------------------------------------------------------------------------------

Information about the Fund including the Statement of Additional Information
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.  Reports and other information
about the Fund are available on the EDGAR database on the SEC's Internet
website at www.sec.gov. Copies may be obtained after payment of a duplicating
           -----------
fee by electronic request at the SEC's e-mail address: publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, D.C. 20549-0102.
No one has been authorized to provide any information about the Fund or to
make any representations about the Fund other than what is contained in this
Prospectus. This Prospectus is not an offer to sell shares of the Fund, nor a
solicitation of an offer to buy shares of the Fund, to any person in any
state or other jurisdiction where it is unlawful to make such an offer.

The Fund's shares are distributed by:                [logo]   OppenheimerFunds
Distributor, Inc.
The Fund's SEC File No.: 811-21268

PR0535.001.0805
Printed on recycled paper


                          Appendix to Prospectus of
                        Oppenheimer Total Return Bond Fund

      Graphic material included in the Prospectus of Oppenheimer Total Return
Bond Fund (the "Fund") under the heading: "Annual Total Return (Class A) (%
as of 12/31 each year)":

      A bar chart will be included in the Prospectus of the Fund depicting
the annual total returns of a hypothetical investment in Class A shares of
the Fund since inception, without deducting sales charges or taxes. Set forth
below are the relevant data points that will appear in the bar chart:

            Year Ended                 Annual Total Return
            ----------                 -------------------
              4/30/04                     4.30%






Oppenheimer Total Return Bond Fund
6803 South Tucson Way, Centennial, Colorado 80112-3924

1.800 CALL OPP (225.5677)


Statement of Additional Information dated August __, 2005

     This Statement of Additional Information is not a Prospectus. This document
contains  additional  information about the Fund and supplements  information in
the  Prospectus  dated  August __,  2005.  It should be read  together  with the
Prospectus.  You can obtain  the  Prospectus  by writing to the Fund's  Transfer
Agent,  OppenheimerFunds  Services, at P.O. Box 5270, Denver, Colorado 80217, by
calling  the  Transfer  Agent  at  the  toll-free  number  shown  above,  or  by
downloading    it   from    the    OppenheimerFunds    Internet    website    at
www.oppenheimerfunds.com.


Contents
                                                                        Page
About the Fund

Additional Information About the Fund's Investment Policies and Risks......
    The Fund's Investment Policies.........................................
    Other Investment Techniques and Strategies.............................
    Investment Restrictions................................................
    Disclosure of Portfolio Holdings.......................................

How the Fund is Managed ...................................................
    Organization and History...............................................
    Board of Trustees and Oversight Committees.............................
    Trustees and Officers of the Fund......................................
    The Manager............................................................
Brokerage Policies of the Fund.............................................
Distribution and Service Plans.............................................
Performance of the Fund....................................................

About Your Account
How To Buy Shares..........................................................
How To Sell Shares.........................................................
How To Exchange Shares.....................................................
Dividends, Capital Gains and Taxes.........................................
Additional Information About the Fund......................................

Financial Information About the Fund

Independent Registered Public Accounting Firm's Report.....................
Financial Statements.......................................................


Appendix A: Ratings Definitions............................................A-1
Appendix B: Industry Classifications.......................................B-1
Appendix C: Special Sales Charge Arrangements and Waivers..................C-1




A B O U T  T H E  F U N D

Additional Information About the Fund's Investment Policies and Risks

The investment  objective,  the principal investment policies and the main risks
of the Fund are  described  in the  Prospectus.  This  Statement  of  Additional
Information contains supplemental information about those policies and risks and
the types of securities that the Fund's  investment  Manager,  OppenheimerFunds,
Inc. (the "Manager"),  can select for the Fund.  Additional  information is also
provided  about  the  strategies  that the Fund  may use to try to  achieve  its
objective.

The Fund's Investment Policies.  The composition of the Fund's portfolio and the
techniques  and  strategies  that the  Manager  may use in  selecting  portfolio
securities  will  vary over  time.  The Fund is not  required  to use all of the
investment  techniques and strategies  described below in seeking its objective.
It may use some of the special  investment  techniques  and  strategies  at some
times or not at all.

     In selecting securities for the Fund's portfolio, the Manager evaluates the
merits of  particular  securities  primarily  through  the  exercise  of its own
investment  analysis.  In the case of non-governmental  issues, that process may
include,  among other things,  evaluation of the issuer's historical operations,
prospects for the industry of which the issuer is part,  the issuer's  financial
condition,   its  pending  product  developments  and  business  (and  those  of
competitors),  the  effect of  general  market and  economic  conditions  on the
issuer's  business,  and legislative  proposals that might affect the issuer. In
the  case  of  foreign  issuers,  the  Manager  may  consider  general  economic
conditions,  the conditions of a particular country's economy in relation to the
U.S.  economy or other  foreign  economies,  general  political  conditions in a
country or region, the effect of taxes, the efficiencies and costs of particular
markets (as well as their liquidity) and other factors.

     |X| Debt Securities. The Fund can invest in a variety of debt securities to
seek its objective.  Foreign debt securities are subject to the risks of foreign
securities described below. In general,  debt securities are also subject to two
additional types of risk: credit risk and interest rate risk.

     o Credit  Risk.  Credit  risk  relates to the ability of the issuer to meet
interest  or  principal  payments  or both  as  they  become  due.  In  general,
lower-grade,  higher-yield  bonds are subject to credit risk to a greater extent
than lower-yield, higher-quality bonds.

     The Fund's investments  primarily are investment-grade  debt securities and
U.S. government securities.  U.S. government  securities,  although unrated, are
generally  considered  to be  equivalent  to  securities  in the highest  rating
categories.  Investment-grade  bonds are bonds  rated at least  "Baa" by Moody's
Investors  Service,  Inc.  ("Moody's"),  or at least  "BBB" by Standard & Poor's
Rating Service ("S&P") or Fitch, Inc. ("Fitch"), or that have comparable ratings
by  another  nationally-recognized  rating  organization.  The Fund can also buy
non-investment-grade debt securities (commonly referred to as "junk bonds").

     In making  investments  in debt  securities,  the  Manager may rely to some
extent on the ratings of ratings organizations or it may use its own research to
evaluate  a  security's  credit-worthiness.  If  securities  the  Fund  buys are
unrated,  to be  considered  part of the  Fund's  holdings  of  investment-grade
securities,  they must be judged by the Manager to be of  comparable  quality to
bonds rated as investment grade by a rating organization.

     o Interest  Rate Risk.  Interest  rate risk refers to the  fluctuations  in
value of debt securities  resulting from the inverse  relationship between price
and yield.  For  example,  an  increase in general  interest  rates will tend to
reduce the market  value of  already-issued  debt  securities,  and a decline in
general  interest  rates will tend to increase  their value.  In addition,  debt
securities having longer maturities tend to offer higher yields, but are subject
to potentially greater fluctuations in value from changes in interest rates than
obligations having shorter maturities.

     Fluctuations  in the market  value of debt  securities  after the Fund buys
them will not affect the interest income payable on those securities (unless the
security  pays  interest at a variable  rate pegged to interest  rate  changes).
However,  those price  fluctuations  will be reflected in the  valuations of the
securities,  and therefore the Fund's net asset values will be affected by those
fluctuations.

     o Special  Risks of  Lower-Grade  Debt  Securities.  The Fund can invest in
lower-grade debt securities.  Because  lower-grade debt securities tend to offer
higher  yields  than  investment-grade  securities,  the Fund  might  invest  in
lower-grade securities if the Manager is trying to achieve higher income.

     "Lower-grade"  debt  securities are those rated below  "investment  grade,"
which  means they have a rating  lower than "Baa" by Moody's or lower than "BBB"
by S&P or Fitch, or similar ratings by other rating  organizations.  If they are
unrated,  and are determined by the Manager to be of comparable  quality to debt
securities rated below investment  grade, they are considered part of the Fund's
portfolio of lower-grade securities.

     Some of the special  credit risks of  lower-grade  securities are discussed
below.  There is a greater risk that the issuer may default on its obligation to
pay  interest  or to  repay  principal  than  in the  case  of  investment-grade
securities. The issuer's low creditworthiness may increase the potential for its
insolvency.  An overall  decline in values in the high yield bond market is also
more likely during a period of a general economic downturn. An economic downturn
or an  increase in interest  rates  could  severely  disrupt the market for high
yield bonds,  adversely affecting the values of outstanding bonds as well as the
ability of issuers to pay  interest or repay  principal.  In the case of foreign
high yield  bonds,  these risks are in addition to the special  risks of foreign
investing  discussed  in the  Prospectus  and in this  Statement  of  Additional
Information.

     To the extent they can be converted into stock,  convertible securities may
be less subject to some of the risks of  volatility  than  non-convertible  high
yield bonds,  since stock may be more liquid and less  affected by some of these
risk factors.

     While  securities  rated  "Baa" by  Moody's  or  "BBB" by S&P or Fitch  are
investment  grade and are not regarded as junk bonds,  those  securities  may be
subject to special risks and have some speculative characteristics.  Definitions
of the debt security ratings categories of Moody's,  S&P, and Fitch are included
in Appendix A to this Statement of Additional Information.


     |X|  Duration  of the  Fund's  Portfolio.  The  Fund  can  invest  in  debt
securities  of any  maturity  or  duration  but  currently  seeks to  maintain a
dollar-weighted average effective portfolio duration of three to six years under
normal market  conditions.  The goal is to try to manage the  sensitivity of the
Fund's  portfolio  to changes in interest  rates,  and in doing so to manage the
volatility  of the Fund's  share prices in response to those  changes.  However,
unanticipated  events may change the effective  duration of a security after the
Fund buys it,  and  there can be no  assurance  that the Fund will  achieve  its
targeted duration at all times.


     The Manager determines the effective duration of debt obligations purchased
by the Fund considering  various factors that apply to a particular type of debt
obligation,  including  those  described  below.  Duration  is a measure  of the
expected life of a security on a current-value  basis expressed in years,  using
calculations that consider the security's yield, coupon interest payments, final
maturity and call features.

     While a debt security's  maturity can be used to measure the sensitivity of
the  security's  price to changes in interest  rates,  the term to maturity of a
security  does not take into  account the pattern (or  expected  pattern) of the
security's payments of interest or principal prior to maturity. Duration, on the
other hand,  measures  the length of the time  interval  from the present to the
time when the interest and principal  payments are scheduled to be received (or,
in the case of a  mortgage-related  security,  when the  interest  payments  are
expected to be received).  Duration calculations weigh them by the present value
of the  cash to be  received  at each  future  point in  time.  If the  interest
payments on a debt  security  occur prior to the  repayment  of  principal,  the
duration  of the  security  is less than its stated  maturity.  For  zero-coupon
securities, duration and term to maturity are equal.

     Absent other factors,  the lower the stated or coupon rate of interest on a
debt security or the longer the maturity or the lower the  yield-to-maturity  of
the debt  security,  the longer the duration of the  security.  Conversely,  the
higher the stated or coupon rate of  interest,  the shorter the  maturity or the
higher the yield-to-maturity of a debt security, the shorter the duration of the
security.

     Futures,  options and options on futures in general have durations that are
closely  related to the duration of the securities  that underlie them.  Holding
long futures  positions or call option positions  (backed by liquid assets) will
tend to lengthen the portfolio's duration.

     In some cases the standard effective duration calculation does not properly
reflect the interest  rate  exposure of a security.  For  example,  floating and
variable  rate  securities  often have final  maturities  of ten or more  years.
However, their exposure to interest rate changes corresponds to the frequency of
the times at which their interest  coupon rate is reset. In the case of mortgage
pass-through securities,  the stated final maturity of the security is typically
30 years,  but current rates or prepayments  are more important to determine the
security's interest rate exposure.  In these and other similar  situations,  the
Manager will use other analytical  techniques that consider the economic life of
the  security  as well as relevant  macroeconomic  factors  (such as  historical
prepayment rates) in determining the Fund's effective duration.

     |X| Mortgage-Related Securities.  Mortgage-related securities are a form of
derivative  investment  collateralized  by pools of  commercial  or  residential
mortgages.  Pools of mortgage  loans are  assembled  as  securities  for sale to
investors  by  government  agencies  or entities  or by private  issuers.  These
securities  include  collateralized  mortgage  obligations  ("CMOs"),   mortgage
pass-through securities, stripped mortgage pass-through securities, interests in
real   estate   mortgage   investment   conduits   ("REMICs")   and  other  real
estate-related securities.

     Mortgage-related  securities  that are issued or  guaranteed by agencies or
instrumentalities  of the U.S.  government  have  relatively  little credit risk
(depending  on the nature of the issuer) but are subject to interest  rate risks
and prepayment risks, as described in the Prospectus.

     As with other debt securities,  the prices of  mortgage-related  securities
tend  to  move  inversely  to  changes  in  interest  rates.  The  Fund  can buy
mortgage-related  securities  that have  interest  rates that move  inversely to
changes in general  interest  rates,  based on a multiple  of a specific  index.
Although the value of a  mortgage-related  security  may decline  when  interest
rates rise, the converse is not always the case.

     In periods of declining  interest  rates,  mortgages  are more likely to be
prepaid.  Therefore, a mortgage-related  security's maturity can be shortened by
unscheduled  prepayments  on  the  underlying  mortgages.  Therefore,  it is not
possible to predict  accurately  the  security's  yield.  The principal  that is
returned  earlier than expected may have to be  reinvested in other  investments
having a lower yield than the prepaid security.  Therefore, these securities may
be less  effective  as a means of "locking  in"  attractive  long-term  interest
rates,  and they may have less  potential  for  appreciation  during  periods of
declining  interest  rates,  than  conventional  bonds  with  comparable  stated
maturities.

     Prepayment  risks can lead to  substantial  fluctuations  in the value of a
mortgage-related  security.  In turn,  this can  affect  the value of the Fund's
shares. If a mortgage-related  security has been purchased at a premium,  all or
part of the  premium  the Fund  paid may be lost if  there is a  decline  in the
market value of the security, whether that results from interest rate changes or
prepayments   on  the   underlying   mortgages.   In  the   case   of   stripped
mortgage-related securities, if they experience greater rates of prepayment than
were  anticipated,  the Fund may fail to recoup its  initial  investment  on the
security.

     During  periods  of  rapidly   rising   interest   rates,   prepayments  of
mortgage-related  securities  may occur at slower than  expected  rates.  Slower
prepayments  effectively  may lengthen a  mortgage-related  security's  expected
maturity.  Generally,  that would cause the value of the  security to  fluctuate
more widely in responses to changes in interest rates. If the prepayments on the
Fund's  mortgage-related   securities  were  to  decrease  broadly,  the  Fund's
effective  duration and  therefore  its  sensitivity  to interest  rates,  would
increase.

     As with other debt securities,  the values of  mortgage-related  securities
may be affected by changes in the market's perception of the creditworthiness of
the entity issuing the securities or guaranteeing them. Their values may also be
affected by changes in government regulations and tax policies.

     o Collateralized Mortgage Obligations.  Collateralized mortgage obligations
or "CMOs," are  multi-class  bonds that are backed by pools of mortgage loans or
mortgage pass-through certificates. They may be collateralized by:

(1)  pass-through  certificates  issued or  guaranteed  by  Government  National
Mortgage Association (Ginnie Mae), Federal National Mortgage Association (Fannie
Mae), or Federal Home Loan Mortgage Corporation (Freddie Mac),

(2) unsecuritized  mortgage loans insured by the Federal Housing  Administration
or guaranteed by the Department of Veterans' Affairs,

(3) unsecuritized conventional mortgages,

(4) other mortgage-related securities, or

(5) any combination of these.

     Each  class of CMO,  referred  to as a  "tranche,"  is issued at a specific
coupon rate and has a stated  maturity  or final  distribution  date.  Principal
prepayments  on the  underlying  mortgages  may cause the CMO to be retired much
earlier than the stated maturity or final  distribution  date. The principal and
interest on the underlying  mortgages may be allocated among the several classes
of a series of a CMO in  different  ways.  One or more  tranches may have coupon
rates that reset  periodically at a specified  increase over an index. These are
floating  rate  CMOs,  and  typically  have a cap on the  coupon  rate.  Inverse
floating rate CMOs have a coupon rate that moves in the reverse  direction to an
applicable  index.  The  coupon  rate on these  CMOs will  increase  as  general
interest  rates  decrease.  These are usually much more volatile than fixed rate
CMOs or floating rate CMOs.

     |X| U.S. Government  Securities.  These are securities issued or guaranteed
by the U.S. Treasury or other U.S.  government  agencies or  federally-chartered
corporate entities referred to as  "instrumentalities."  The obligations of U.S.
government agencies or instrumentalities in which the Fund can invest may or may
not be  guaranteed  or  supported  by the "full  faith and credit" of the United
States.  "Full faith and credit"  means  generally  that the taxing power of the
U.S. government is pledged to the payment of interest and repayment of principal
on a  security.  If a security is not backed by the full faith and credit of the
United  States,  the owner of the security must look  principally  to the agency
issuing the obligation  for  repayment.  The owner might not be able to assert a
claim against the United States if the issuing  agency or  instrumentality  does
not meet its commitment.

     o U.S.  Treasury  Obligations.  These  include  Treasury  bills (which have
maturities  of one  year  or less  when  issued),  Treasury  notes  (which  have
maturities of more than one year and up to ten years when issued),  and Treasury
bonds  (which  have  maturities  of more than ten years when  issued).  Treasury
securities  are backed by the full  faith and credit of the United  States as to
timely  payments of interest and  repayments of principal.  Other U.S.  Treasury
obligations  the Fund can buy include U.S.  Treasury  securities  that have been
"stripped"  by a Federal  Reserve Bank,  zero-coupon  U.S.  Treasury  securities
described below, and Treasury Inflation-Protection Securities ("TIPS").

     o Treasury  Inflation-Protection  Securities.  The Fund can buy these TIPS,
which are designed to provide an  investment  vehicle that is not  vulnerable to
inflation. The interest rate paid by TIPS is fixed. The principal value rises or
falls  semi-annually  based on changes in the published Consumer Price Index. If
inflation  occurs,  the principal and interest  payments on TIPS are adjusted to
protect investors from inflationary loss. If deflation occurs, the principal and
interest  payments will be adjusted  downward,  although the principal  will not
fall below its face amount at maturity.


     o  Obligations  Issued  or  Guaranteed  by  U.S.   Government  Agencies  or
Instrumentalities.   These  include  direct  obligations  and   mortgage-related
securities  that have different  levels of credit  support from the  government.
Some are supported by the full faith and credit of the U.S. government,  such as
Ginnie  Maes.  Some are  supported by the right of the issuer to borrow from the
U.S. Treasury under certain circumstances,  such as Fannie Mae bonds. Others are
supported only by the credit of the entity that issued them, such as Freddie Mac
obligations.


     o Mortgage-Related U.S. Government  Securities.  These include interests in
pools of  residential  or commercial  mortgages,  in the form of  collateralized
mortgage obligations and other "pass-through" mortgage securities. CMOs that are
U.S.  government  securities  have  collateral to secure payment of interest and
principal.  They may be issued in different series with different interest rates
and  maturities.  The collateral is either in the form of mortgage  pass-through
certificates  issued  or  guaranteed  by a U.S.  agency  or  instrumentality  or
mortgage  loans  insured  by  a  U.S.  government  agency.  The  Fund  can  have
significant amounts of its assets invested in  mortgage-related  U.S. government
securities.

     The prices and yields of CMOs are determined, in part, by assumptions about
the cash flows from the rate of payments of the underlying mortgages. Changes in
interest rates may cause the rate of expected  prepayments of those mortgages to
change.  In general,  prepayments  increase when general interest rates fall and
decrease when interest rates rise.

     If  prepayments  of mortgages  underlying a CMO occur faster than  expected
when interest rates fall, the market value and yield of the CMO will be reduced.
Additionally,  the Fund may have to reinvest  the  prepayment  proceeds in other
securities paying interest at lower rates, which could reduce the Fund's yield.

     When interest  rates rise rapidly,  if  prepayments  occur more slowly than
expected, a short- or medium-term CMO can in effect become a long-term security,
subject  to  greater  fluctuations  in  value.  These are the  prepayment  risks
described  above and can make the  prices of CMOs very  volatile  when  interest
rates change.  The prices of longer-term  debt securities tend to fluctuate more
than those of  shorter-term  debt  securities.  That  volatility will affect the
Fund's share prices.

     o Commercial  (Privately-Issued)  Mortgage Related Securities. The Fund can
invest in commercial  mortgage-related  securities  issued by private  entities.
Generally these are multi-class  debt or  pass-through  certificates  secured by
mortgage loans on commercial properties.  They are subject to the credit risk of
the issuer.  These securities  typically are structured to provide protection to
investors in senior classes from possible losses on the underlying  loans.  They
do so by having holders of subordinated classes take the first loss if there are
defaults on the underlying  loans.  They may also be protected to some extent by
guarantees, reserve funds or additional collateralization mechanisms.

     |X|  Asset-Backed   Securities.   Asset-backed  securities  are  fractional
interests in pools of assets,  typically accounts  receivable or consumer loans.
They are issued by trusts or special-purpose corporations.  These securities are
subject to prepayment  risks and the risk of default by the issuer as well as by
the  borrowers  of the  underlying  loans  in the  pool.  They  are  similar  to
mortgage-backed securities,  described above, and are backed by a pool of assets
that consist of obligations of individual borrowers. The income from the pool is
passed through to the holders of participation  interest in the pools. The pools
may  offer a credit  enhancement,  such as a bank  letter of  credit,  to try to
reduce the risks that the underlying debtors will not pay their obligations when
due.  However,  the enhancement,  if any, might not be for the full par value of
the  security.  If the  enhancement  is exhausted  and any required  payments of
interest or repayments  of principal are not made,  the Fund could suffer losses
on its investment or delays in receiving payment.

     The  value of an  asset-backed  security  is  affected  by  changes  in the
market's perception of the asset backing the security,  the  creditworthiness of
the  servicing  agent for the loan pool,  the  originator  of the loans,  or the
financial institution providing any credit enhancement,  and is also affected if
any  credit   enhancement  has  been  exhausted.   The  risks  of  investing  in
asset-backed  securities are ultimately  related to payment of consumer loans by
the individual borrowers.  As a purchaser of an asset-backed  security, the Fund
would  generally have no recourse to the entity that originated the loans in the
event of default by a borrower. The underlying loans are subject to prepayments,
which may shorten the weighted  average life of asset-backed  securities and may
lower  their  return,  in the  same  manner  as in the  case of  mortgage-backed
securities and CMOs, described above.

     |X|  Participation   Interests.   The  Fund  can  invest  in  participation
interests,   subject  to  the  Fund's  limitation  on  investments  in  illiquid
investments. A participation interest is an undivided interest in a loan made by
the  issuing   financial   institution  in  the  proportion   that  the  buyer's
participation interest bears to the total principal amount of the loan. Not more
than 5% of the Fund's net assets can be invested in  participation  interests of
the same borrower.  The issuing financial  institution may have no obligation to
the Fund other than to pay the Fund the  proportionate  amount of the  principal
and interest payments it receives.

     Participation  interests are primarily dependent upon the  creditworthiness
of the borrowing  corporation,  which is obligated to make payments of principal
and interest on the loan.  There is a risk that a borrower  may have  difficulty
making  payments.  If a borrower  fails to pay  scheduled  interest or principal
payments, the Fund could experience a reduction in its income. The value of that
participation  interest  might also  decline,  which could  affect the net asset
value of the  Fund's  shares.  If the  issuing  financial  institution  fails to
perform its obligations under the participation  agreement, the Fund might incur
costs and delays in  realizing  payment  and suffer a loss of  principal  and/or
interest.

     |X| Foreign Securities. "Foreign securities" include debt securities issued
or guaranteed by companies  organized under the laws of countries other than the
United States and debt securities issued or guaranteed by governments other than
the U.S.  government or by foreign  supra-national  entities,  such as the World
Bank. Those securities may be traded on foreign  securities  exchanges or in the
foreign over-the-counter  markets.  Securities denominated in foreign currencies
issued by U.S.  companies are also  considered to be "foreign  securities."  The
Fund expects to have  investments  in foreign  securities  as part of its normal
investment strategy.

     Securities of foreign issuers that are  represented by American  Depository
Receipts or that are listed on a U.S.  securities exchange or traded in the U.S.
over-the-counter markets are not considered "foreign securities" for the purpose
of the Fund's  investment  allocations,  because they are not subject to many of
the special  considerations  and risks,  discussed below,  that apply to foreign
securities traded and held abroad.

     American  Depository  Receipts ("ADR") facilities may be either "sponsored"
or "un-sponsored."  While sponsored and un-sponsored ADR facilities are similar,
distinctions  exist  between  the rights and  duties of ADR  holders  and market
practices.  Sponsored  facilities  have  the  backing  or  participation  of the
underlying   foreign   issuers.   Un-sponsored   facilities   do  not  have  the
participation by or consent of the issuer of the deposited shares.  Un-sponsored
facilities usually request a letter of non-objection from the issuer. Holders of
un-sponsored  ADRs generally  bear all the costs of such facility.  The costs of
the facility can include deposit and withdrawal  fees,  currency  conversion and
other service fees.  The depository of an  un-sponsored  facility may not have a
duty to distribute shareholder communications from the issuer or to pass through
voting  rights.  Issuers  of  un-sponsored  ADRs do not  have an  obligation  to
disclose material information about the foreign issuers in the U.S. As a result,
the  value of the  un-sponsored  ADR may not  correlate  with  the  value of the
underlying  security  trading  abroad  or any  material  information  about  the
security or the issuer disseminated  abroad.  Sponsored facilities enter into an
agreement  with the issuer  that sets out rights and duties of the  issuer,  the
depository and the ADR holder. The sponsored agreement also allocates fees among
the  parties.  Most  sponsored  agreements  provide  that  the  depository  will
distribute shareholder notices, voting instructions and other communications.

     Investing in foreign  securities  offers  potential  benefits not available
from  investing  solely in  securities  of domestic  issuers.  They  include the
opportunity to invest in foreign issuers that appear to offer income  potential,
or in foreign countries with economic policies or business cycles different from
those of the  U.S.,  or to  reduce  fluctuations  in  portfolio  value by taking
advantage of foreign securities markets that do not move in a manner parallel to
U.S.  markets.  The Fund will hold foreign  currency only in connection with the
purchase or sale of foreign securities.

     o Foreign Debt  Obligations.  The debt obligations of a foreign  government
and its agencies and  instrumentalities  may or may not be supported by the full
faith and credit of the foreign  government.  The Fund can buy securities issued
by certain  "supra-national"  entities,  which  include  entities  designated or
supported by  governments to promote  economic  reconstruction  or  development,
international  banking  organizations and related government agencies.  Examples
are the International Bank for  Reconstruction and Development  (commonly called
the "World Bank"), the Asian Development bank and the Inter-American Development
Bank.

     The   governmental   members   of   these   supra-national   entities   are
"stockholders" that typically make capital contributions and may be committed to
make  additional  capital  contributions  if the  entity  is unable to repay its
borrowings.  A supra-national  entity's  lending  activities may be limited to a
percentage  of its  total  capital,  reserves  and net  income.  There can be no
assurance that the constituent  foreign  governments will continue to be able or
willing to honor their capitalization commitments for those entities.

     The Fund can invest in U.S. dollar-denominated "Brady Bonds." These foreign
debt  obligations may be fixed-rate par bonds or  floating-rate  discount bonds.
They are  generally  collateralized  in full as to  repayment  of  principal  at
maturity by U.S. Treasury zero-coupon obligations that have the same maturity as
the Brady  Bonds.  Brady Bonds can be viewed as having  three or four  valuation
components:  (i) the  collateralized  repayment of principal at final  maturity;
(ii) the collateralized interest payments;  (iii) the uncollateralized  interest
payments;  and (iv) any  uncollateralized  repayment  of  principal at maturity.
Those uncollateralized amounts constitute what is called the "residual risk."

     If  there  is  a  default  on  collateralized   Brady  Bonds  resulting  in
acceleration  of the payment  obligations of the issuer,  the  zero-coupon  U.S.
Treasury  securities held as collateral for the payment of principal will not be
distributed to investors,  nor will those  obligations be sold to distribute the
proceeds.  The collateral will be held by the collateral  agent to the scheduled
maturity of the  defaulted  Brady Bonds.  The  defaulted  bonds will continue to
remain  outstanding,  and the face  amount  of the  collateral  will  equal  the
principal  payments  which  would  have then been due on the Brady  Bonds in the
normal  course.  Because of the residual  risk of Brady Bonds and the history of
defaults with respect to commercial bank loans by public and private entities of
countries   issuing  Brady  Bonds,   Brady  Bonds  are  considered   speculative
investments.

     Because the Fund can purchase securities denominated in foreign currencies,
a change in the value of a foreign currency against the U.S. dollar could result
in a change in the amount of income  the Fund has  available  for  distribution.
Because a portion of the Fund's  investment  income may be  received  in foreign
currencies,  the Fund will be required to compute its income in U.S. dollars for
distribution  to  shareholders,  and  therefore the Fund will absorb the cost of
currency fluctuations. After the Fund has distributed income, subsequent foreign
currency  losses may result in the Fund's  having  distributed  more income in a
particular fiscal period than was available from investment income,  which could
result in a return of capital to shareholders.

     o Risks of Foreign  Investing.  Investments in foreign securities may offer
special  opportunities  for investing but also present special  additional risks
and  considerations  not  typically  associated  with  investments  in  domestic
securities. Some of these additional risks are:

o     reduction of income by foreign taxes;

o fluctuation in value of foreign  investments  due to changes in currency rates
or currency devaluation,  or currency control regulations (for example, currency
blockage);

o     transaction charges for currency exchange;

o     lack of public information about foreign issuers;

o lack of uniform  accounting,  auditing and  financial  reporting  standards in
foreign countries comparable to those applicable to domestic issuers;

o     less volume on foreign exchanges than on U.S. exchanges;

o greater volatility and less liquidity on foreign markets than in the U.S.;

o less  governmental  regulation of foreign  issuers,  securities  exchanges and
brokers than in the U.S.;

o     greater difficulties in commencing lawsuits;

o     higher brokerage commission rates than in the U.S.;

o increased  risks of delays in settlement of portfolio  transactions or loss of
certificates for portfolio securities;

o     foreign withholding taxes;

o  possibilities  in some  countries of  expropriation,  confiscatory  taxation,
political,  financial or social instability or adverse diplomatic  developments;
and o unfavorable differences between the U.S. economy and foreign economies.

     In the past, U.S.  government policies have discouraged certain investments
abroad by U.S.  investors,  through  taxation or other  restrictions,  and it is
possible that such restrictions could be re-imposed.

     o Special Risks of Emerging Markets. Emerging and developing markets abroad
may also offer special  opportunities  for investing but have greater risks than
more developed foreign markets, such as those in Europe, Canada,  Australia, New
Zealand and Japan. There may be even less liquidity in their securities markets,
and  settlements  of  purchases  and  sales  of  securities  may be  subject  to
additional  delays.  They are  subject to greater  risks of  limitations  on the
repatriation of income and profits because of currency  restrictions  imposed by
local  governments.  Those  countries may also be subject to the risk of greater
political and economic  instability,  which can greatly affect the volatility of
prices of securities in those countries. The Manager will consider these factors
when  evaluating  securities in these  markets,  and the Fund currently does not
expect to invest a substantial portion of its assets in emerging markets.

     o Passive  Foreign  Investment  Companies.  Some securities of corporations
domiciled  outside  the U.S.,  which the Fund may  purchase,  may be  considered
passive foreign  investment  companies  ("PFICs") under U.S. tax laws. PFICs are
those foreign corporations which generate primarily passive income. They tend to
be growth  companies  or  "start-up"  companies.  For  federal tax  purposes,  a
corporation is deemed a PFIC if 75% or more of the foreign  corporation's  gross
income for the income year is passive income or if 50% or more of its assets are
assets that produce or are held to produce  passive  income.  Passive  income is
further defined as any income to be considered  foreign personal holding company
income within the subpart F provisions defined by IRCss.954.

     Investing in PFICs involves the risks  associated with investing in foreign
securities,  as described above.  There are also the risks that the Fund may not
realize  that a foreign  corporation  it  invests in is a PFIC for  federal  tax
purposes.  Federal tax laws impose  severe tax penalties for failure to properly
report  investment income from PFICs.  Following  industry  standards,  the Fund
makes every  effort to ensure  compliance  with  federal tax  reporting of these
investments.  PFICs are  considered  foreign  securities for the purposes of the
Fund's minimum  percentage  requirements  or limitations of investing in foreign
securities.

     Subject to the limits under the  Investment  Company Act, the Fund may also
invest in foreign  mutual funds which are also deemed PFICs (since nearly all of
the income of a mutual fund is  generally  passive  income).  Investing in these
types of PFICs may allow  exposure to various  countries  because  some  foreign
countries limit, or prohibit, all direct foreign investment in the securities of
companies domiciled therein.

     In  addition  to bearing  their  proportionate  share of a fund's  expenses
(management fees and operating expenses), shareholders will also indirectly bear
similar  expenses  of such  entities.  Additional  risks of  investing  in other
investment  companies are described below under  "Investment in Other Investment
Companies."

Other Investment Techniques and Strategies. In seeking its objective, the Fund may
from time to time use the types of investment strategies and investments described
below. It is not required to use all of these strategies at all times, and at times
may not use them.

     |X|   Zero-Coupon   Securities.   The   Fund   can  buy   zero-coupon   and
delayed-interest securities, and "stripped" securities.  Stripped securities are
debt securities  whose interest coupons are separated from the security and sold
separately.  The  Fund  can buy  different  types  of  zero-coupon  or  stripped
securities,  including,  among others, foreign debt securities and U.S. Treasury
notes or bonds that have been stripped of their interest coupons,  U.S. Treasury
bills issued without interest coupons, and certificates  representing  interests
in stripped securities.

     Zero-coupon  securities do not make periodic interest payments and are sold
at a deep  discount  from their face value at maturity.  The buyer  recognizes a
rate of return determined by the gradual appreciation of the security,  which is
redeemed at face value on a specified  maturity date.  This discount  depends on
the time remaining until  maturity,  as well as prevailing  interest rates,  the
liquidity of the security and the credit  quality of the issuer.  In the absence
of threats to the issuer's credit quality,  the discount typically  decreases as
the maturity date approaches.  Some zero-coupon  securities are convertible,  in
that they are zero-coupon  securities until a predetermined  date, at which time
they convert to a security with a specified coupon rate.

     Because zero-coupon  securities pay no interest and compound  semi-annually
at the rate fixed at the time of their  issuance,  their value is generally more
volatile  than the value of other  debt  securities.  Their  value may fall more
dramatically than the value of  interest-bearing  securities when interest rates
rise. When prevailing interest rates fall,  zero-coupon  securities tend to rise
more rapidly in value because they have a fixed rate of return.

     The  Fund's  investment  in  zero-coupon  securities  may cause the Fund to
recognize income and make  distributions to shareholders  before it receives any
cash payments on the zero-coupon  investment.  To generate cash to satisfy those
distribution  requirements,  the Fund may have to sell portfolio securities that
it  otherwise  might  have  continued  to hold or to use cash  flows  from other
sources such as the sale of Fund shares.

     |X| "Stripped" Mortgage-Related Securities. The Fund can invest in stripped
mortgage-related  securities that are created by segregating the cash flows from
underlying  mortgage  loans or  mortgage  securities  to create  two or more new
securities.  Each  has a  specified  percentage  of  the  underlying  security's
principal or interest payments. These are a form of derivative investment.

     Mortgage  securities may be partially  stripped so that each class receives
some interest and some principal.  However,  they may be completely stripped. In
that case all of the interest is distributed to holders of one type of security,
known as an  "interest-only"  security,  or "I/O," and all of the  principal  is
distributed to holders of another type of security,  known as a "principal-only"
security or "P/O." Strips can be created for pass through certificates or CMOs.

     The yields to maturity  of I/Os and P/Os are very  sensitive  to  principal
repayments  (including   prepayments)  on  the  underlying  mortgages.   If  the
underlying  mortgages   experience  greater  than  anticipated   prepayments  of
principal,  the Fund might not fully  recoup its  investment  in an I/O based on
those  assets.  If  underlying   mortgages   experience  less  than  anticipated
prepayments  of  principal,  the yield on the P/Os based on them  could  decline
substantially. The market for some of these securities may be limited, making it
difficult for the Fund to dispose of its holdings at an acceptable price.

     |X| Floating Rate and Variable Rate  Obligations.  Some securities the Fund
can  purchase  have  variable or floating  interest  rates.  Variable  rates are
adjusted at stated  periodic  intervals.  Variable rate  obligations  may have a
demand  feature that allows the Fund to tender the obligation to the issuer or a
third party prior to its  maturity.  The tender may be at par value plus accrued
interest, according to the terms of the obligations.

     The  interest  rate  on a  floating  rate  note is  adjusted  automatically
according to a stated  prevailing  market rate, such as a bank's prime rate, the
91-day U.S. Treasury Bill rate, or some other standard. The instrument's rate is
adjusted automatically each time the base rate is adjusted. The interest rate on
a variable  rate note is also based on a stated  prevailing  market  rate but is
adjusted  automatically at specified  intervals.  Generally,  the changes in the
interest rate on such  securities  reduce the fluctuation in their market value.
As interest rates decrease or increase,  the potential for capital  appreciation
or  depreciation  is less  than  that  for  fixed-rate  obligations  of the same
maturity.  The Manager may determine  that an unrated  floating rate or variable
rate obligation meets the Fund's quality  standards by reason of being backed by
a letter of credit or  guarantee  issued  by a bank  that  meets  those  quality
standards.

     Floating rate and variable rate demand notes that have a stated maturity in
excess of one year may have  features  that  permit the  holder to  recover  the
principal amount of the underlying security at specified intervals not exceeding
one year and upon no more than 30 days' notice.  The issuer of that type of note
normally has a corresponding  right in its discretion,  after a given period, to
prepay  the  outstanding  principal  amount of the note plus  accrued  interest.
Generally  the issuer  must  provide a specified  number of days'  notice to the
holder.

     Step-coupon  bonds have a coupon  interest  rate that changes  periodically
during the life of the  security  on  predetermined  dates that are set when the
security is issued.

     |X| "When-Issued" and "Delayed-Delivery"  Transactions. The Fund may invest
in securities on a "when-issued"  basis and may purchase or sell securities on a
"delayed-delivery"  basis. When-issued and delayed-delivery are terms that refer
to  securities  whose terms and  indenture  are available and for which a market
exists, but which are not available for immediate delivery.

     When  such  transactions  are  negotiated,  the price  (which is  generally
expressed in yield terms) is fixed at the time the commitment is made.  Delivery
and payment for the  securities  take place at a later date.  The securities are
subject  to change in value from  market  fluctuations  during the period  until
settlement.  The value at  delivery  may be less than the  purchase  price.  For
example,  changes in interest  rates in a direction  other than that expected by
the Manager before  settlement  will affect the value of such securities and may
cause a loss to the Fund. During the period between purchase and settlement,  no
payment is made by the Fund to the issuer  and no  interest  accrues to the Fund
from the  investment  until it receives the security at  settlement.  There is a
risk of loss to the  Fund if the  value  of the  security  changes  prior to the
settlement date, and there is the risk that the other party may not perform.

     The Fund may engage in when-issued  transactions to secure what the Manager
considers to be an  advantageous  price and yield at the time the  obligation is
entered  into.  When the Fund  enters  into a  when-issued  or  delayed-delivery
transaction,  it relies on the other  party to  complete  the  transaction.  Its
failure  to do so may  cause  the Fund to lose the  opportunity  to  obtain  the
security at a price and yield the Manager considers to be advantageous.

     When the Fund engages in when-issued and delayed-delivery  transactions, it
does so for the purpose of acquiring or selling  securities  consistent with its
investment  objective and policies or for delivery pursuant to options contracts
it has entered into,  and not for the purpose of investment  leverage.  Although
the Fund will enter into  delayed-delivery or when-issued purchase  transactions
to acquire  securities,  it may dispose of a commitment prior to settlement.  If
the Fund chooses to dispose of the right to acquire a when-issued security prior
to its  acquisition or to dispose of its right to delivery or receive  against a
forward commitment, it may incur a gain or loss.

     At the time the Fund makes the commitment to purchase or sell a security on
a when-issued or delayed-delivery basis, it records the transaction on its books
and reflects the value of the security  purchased in determining  the Fund's net
asset value. In a sale transaction,  it records the proceeds to be received. The
Fund will  identify  on its books  liquid  assets at least equal in value to the
value of the Fund's purchase commitments until the Fund pays for the investment.

     When-issued and delayed-delivery  transactions can be used by the Fund as a
defensive  technique to hedge against  anticipated changes in interest rates and
prices.  For instance,  in periods of rising  interest rates and falling prices,
the Fund might sell securities in its portfolio on a forward commitment basis to
attempt to limit its  exposure  to  anticipated  falling  prices.  In periods of
falling  interest  rates  and  rising  prices,  the Fund  might  sell  portfolio
securities  and  purchase the same or similar  securities  on a  when-issued  or
delayed-delivery basis to obtain the benefit of currently higher cash yields.

     |X|  Repurchase  Agreements.  The Fund can  acquire  securities  subject to
repurchase agreements. It might do so for liquidity purposes to meet anticipated
redemptions of Fund shares, or pending the investment of the proceeds from sales
of Fund shares, or pending the settlement of portfolio securities  transactions,
or for temporary defensive purposes.

     In  a  repurchase   transaction,   the  Fund  buys  a  security  from,  and
simultaneously  resells it to, an approved vendor for delivery on an agreed-upon
future  date.  The resale  price  exceeds the  purchase  price by an amount that
reflects an agreed-upon  interest rate effective for the period during which the
repurchase  agreement is in effect.  Approved  vendors  include U.S.  commercial
banks,  U.S.  branches  of  foreign  banks,  or  broker-dealers  that  have been
designated as primary  dealers in government  securities.  They must meet credit
requirements set by the Manager from time to time.

     The  majority  of these  transactions  run from  day to day,  and  delivery
pursuant to the resale typically occurs within one to five days of the purchase.
Repurchase  agreements  having a maturity  beyond  seven days are subject to the
Fund's limits on holding illiquid  investments,  as described in the Prospectus.
The Fund will not enter into a repurchase agreement that causes more than 15% of
its net assets to be subject to repurchase  agreements  having a maturity beyond
seven days. There is no limit on the amount of the Fund's net assets that may be
subject to  repurchase  agreements  having  maturities of seven days or less for
defensive purposes.

     Repurchase agreements,  considered "loans" under the Investment Company Act
of  1940  ("Investment  Company  Act"),  are  collateralized  by the  underlying
security.  The Fund's repurchase  agreements require that at all times while the
repurchase  agreement is in effect,  the value of the  collateral  must equal or
exceed the repurchase  price to fully  collateralize  the repayment  obligation.
However,  if the vendor fails to pay the resale price on the delivery  date, the
Fund may incur costs in disposing of the collateral and may experience losses if
there is any  delay in its  ability  to do so.  The  Manager  will  monitor  the
vendor's  creditworthiness  to confirm that the vendor is financially  sound and
will continuously monitor the collateral's value.

     Pursuant  to an  Exemptive  Order  issued by the  Securities  and  Exchange
Commission  ("SEC"),  the Fund, along with other affiliated  entities managed by
the  Manager,  may  transfer  uninvested  cash  balances  into one or more joint
repurchase  accounts.  These  balances  are  invested in one or more  repurchase
agreements,  secured by U.S. government securities.  Securities that are pledged
as collateral for  repurchase  agreements are held by a custodian bank until the
agreements mature.  Each joint repurchase  arrangement  requires that the market
value  of the  collateral  be  sufficient  to cover  payments  of  interest  and
principal; however, in the event of default by the other party to the agreement,
retention or sale of the collateral may be subject to legal proceedings.

     Investment in Other Investment  Companies.  The Fund can also invest in the
securities of other  investment  companies,  which can include  open-end  funds,
closed-end funds and unit investment trusts,  subject to the limits set forth in
the  Investment  Company  Act  that  apply to those  types of  investments.  For
example,  the Fund can  invest in  Exchange-Traded  Funds,  which are  typically
open-end funds or unit investment trusts,  listed on a stock exchange.  The Fund
might do so as a way of  gaining  exposure  to the  segments  of the  equity  or
fixed-income  markets  represented by the Exchange-Traded  Funds' portfolio,  at
times when the Fund may not be able to buy those portfolio securities directly.

     Investing  in  another  investment  company  may  involve  the  payment  of
substantial  premiums  above the value of such  investment  company's  portfolio
securities and is subject to limitations  under the Investment  Company Act. The
Fund does not intend to invest in other investment  companies unless the Manager
believes that the potential  benefits of the  investment  justify the payment of
any premiums or sales charges.  As a shareholder of an investment  company,  the
Fund  would  be  subject  to its  ratable  share  of that  investment  company's
expenses,  including its advisory and administration expenses. The Fund does not
anticipate  investing a substantial  amount of its net assets in shares of other
investment companies.

     |X| Illiquid and Restricted  Securities.  Under the policies and procedures
established  by the  Fund's  Board  of  Trustees,  the  Manager  determines  the
liquidity of certain of the Fund's  investments.  To enable the Fund to sell its
holdings of a restricted  security not registered  under  applicable  securities
laws, the Fund may have to cause those securities to be registered. The expenses
of  registering  restricted  securities  may be  negotiated by the Fund with the
issuer at the time the Fund  buys the  securities.  When the Fund  must  arrange
registration because the Fund wishes to sell the security, a considerable period
may elapse  between the time the  decision is made to sell the  security and the
time the security is  registered  so that the Fund could sell it. The Fund would
bear the risks of any downward price fluctuation during that period.

     The Fund may also acquire restricted securities through private placements.
Those  securities have  contractual  restrictions on their public resale.  Those
restrictions  may make it more  difficult  to value  them,  and might  limit the
Fund's  ability to dispose of the securities and might lower the amount the Fund
could realize upon the sale.

     The Fund has limitations that apply to purchases of restricted  securities,
as  stated  in the  Prospectus.  Those  percentage  restrictions  do  not  limit
purchases  of  restricted  securities  that are  eligible  for sale to qualified
institutional purchasers under Rule 144A of the Securities Act of 1933, if those
securities have been determined to be liquid by the Manager under Board-approved
guidelines.  Those  guidelines  take into account the trading  activity for such
securities and the  availability of reliable  pricing  information,  among other
factors.  If there is a lack of  trading  interest  in a  particular  Rule  144A
security, the Fund's holdings of that security may be considered to be illiquid.

     Illiquid  securities  include repurchase  agreements  maturing in more than
seven days and participation  interests that do not have puts exercisable within
seven days.

     |X| Forward Rolls. The Fund can enter into "forward roll" transactions with
respect to mortgage-related  securities.  In this type of transaction,  the Fund
sells a  mortgage-related  security  to a buyer  and  simultaneously  agrees  to
repurchase a similar  security  (the same type of security,  and having the same
coupon and  maturity) at a later date at a set price.  The  securities  that are
repurchased  will have the same interest rate as the  securities  that are sold,
but  typically  will be  collateralized  by different  pools of mortgages  (with
different  prepayment  histories)  than the  securities  that  have  been  sold.
Proceeds  from  the  sale  are  invested  in  short-term  instruments,  such  as
repurchase agreements. The income from those investments, plus the fees from the
forward roll transaction,  are expected to generate income to the Fund in excess
of the yield on the securities that have been sold.

      The Fund will only enter into "covered" rolls. To assure its future payment
of the purchase price, the Fund will identify on its books liquid assets in an
amount equal to the payment obligation under the roll.

     These  transactions have risks.  During the period between the sale and the
repurchase,  the Fund will not be entitled  to receive  interest  and  principal
payments on the  securities  that have been sold. It is possible that the market
value of the  securities  the Fund sells might  decline below the price at which
the Fund is obligated to repurchase securities.

     |X| Convertible Securities. Convertible securities are debt securities that
are  convertible  into an issuer's  common stock.  Convertible  securities  rank
senior to common stock in a  corporation's  capital  structure and therefore are
subject to less risk than common stock in the case of the issuer's bankruptcy or
liquidation.

     The value of a convertible security is a function of its "investment value"
and its  "conversion  value." If the  investment  value  exceeds the  conversion
value, the security will,  behave more like a debt security,  and the security's
price will likely  increase when interest  rates fall and decrease when interest
rates rise. If the conversion  value exceeds the investment  value, the security
will behave more like an equity security. In that case, it will likely sell at a
premium over its conversion value and its price will tend to fluctuate  directly
with the price of the underlying security.

     While some convertible  securities are a form of debt security,  in certain
cases their  conversion  feature  (allowing  conversion into equity  securities)
causes them to be regarded by the  Manager  more as "equity  equivalents."  As a
result,  the rating  assigned  to the  security  might  have less  impact on the
Manager's investment decision with respect to convertible securities than in the
case of non-convertible fixed-income securities. Convertible debt securities are
subject to the credit risks and  interest  rate risks  described  above in "Debt
Securities."

     To determine whether  convertible  securities should be regarded as "equity
equivalents," the Manager may examine the following factors:

(1) whether,  at the option of the  investor,  the  convertible  security can be
exchanged for a fixed number of shares of common stock of the issuer,

(2) whether the issuer of the  convertible  securities has restated its earnings
per share of common stock on a fully  diluted basis  (considering  the effect of
conversion of the convertible securities), and

(3) the extent to which the  convertible  security  may be a  defensive  "equity
substitute,"  providing the ability to  participate in any  appreciation  in the
price of the issuer's common stock.

     Borrowing for Leverage. The Fund has the ability to borrow from banks on an
unsecured  basis to invest the  borrowed  funds in  portfolio  securities.  This
speculative  technique is known as "leverage."  Currently,  under the Investment
Company Act, absent  exemptive  relief, a mutual fund may borrow only from banks
and the  maximum  amount it may borrow is up to  one-third  of its total  assets
(including the amount borrowed) less all liabilities and indebtedness other than
borrowing.  The fund may also borrow up to 5% of its total assets for  temporary
purposes  from  any  person.  Under  the  Investment  Company  Act,  there  is a
rebuttable  presumption  that a loan is temporary if it is repaid within 60 days
and not extended or renewed. If the value of the Fund's assets fails to meet the
300% asset coverage requirement, the Fund will reduce its bank debt within three
days to meet the requirement. To do so, the Fund might have to sell a portion of
its investments at a disadvantageous time.

     The Fund will pay interest on its  borrowings,  and that  interest  expense
will raise the overall  expenses of the Fund and reduce its returns.  If it does
borrow,  its expenses will be greater than  comparable  funds that do not borrow
for leverage. Additionally, the Fund's net asset value per share might fluctuate
more  than  that of funds  that do not  borrow.  Currently,  the  Fund  does not
contemplate using this technique, but if it does so, it will not likely do so to
a substantial degree.

     |X| Loans of  Portfolio  Securities.  To raise cash for income or liquidity
purposes,  the Fund can lend its portfolio  securities  to brokers,  dealers and
other types of financial institutions approved by the Fund's Board of Trustees.

     These  loans are  limited  to not more than 25% of the value of the  Fund's
total  assets.  The  Fund  currently  does  not  intend  to  engage  in loans of
securities,  but if it does so,  such  loans  will not  likely  exceed 5% of the
Fund's total assets.

     There are some risks in connection with securities lending.  The Fund might
experience a delay in receiving  additional  collateral  to secure a loan,  or a
delay in recovery of the loaned  securities if the borrower  defaults.  The Fund
must  receive  collateral  for  a  loan.  Under  current  applicable  regulatory
requirements  (which  are  subject to  change),  on each  business  day the loan
collateral must be at least equal to the value of the loaned securities. It must
consist of cash, bank letters of credit or securities of the U.S.  government or
its agencies or  instrumentalities,  or other cash equivalents in which the Fund
is permitted to invest.  To be acceptable as collateral,  letters of credit must
obligate a bank to pay  amounts  demanded  by the Fund if the  demand  meets the
terms of the letter. The terms of the letter of credit and the issuing bank both
must be satisfactory to the Fund.

     When it lends securities,  the Fund receives amounts equal to the dividends
or interest on loaned securities. It also receives one or more of (a) negotiated
loan fees, (b) interest on securities  used as  collateral,  and (c) interest on
any short-term debt securities purchased with such loan collateral.  Either type
of interest may be shared with the  borrower.  The Fund may also pay  reasonable
finder's,  custodian and administrative fees in connection with these loans. The
terms of the Fund's loans must meet applicable  tests under the Internal Revenue
Code and must  permit  the Fund to  reacquire  loaned  securities  on five days'
notice or in time to vote on any important matter.

     |X| Money Market  Instruments.  The following is a brief description of the
types of the U.S. dollar denominated money market securities the Fund can invest
in. Money market securities are  high-quality,  short-term debt instruments that
may be issued by the U.S.  government,  corporations,  banks or other  entities.
They may have fixed, variable or floating interest rates.

     o  U.S.  Government   Securities.   These  include  obligations  issued  or
guaranteed by the U.S.  government or any of its agencies or  instrumentalities,
described above.

     o Bank Obligations. The Fund can buy time deposits, certificates of deposit
and bankers' acceptances. They must be:

     o obligations  issued or guaranteed by a domestic bank (including a foreign
branch of a domestic bank) having total assets of at least U.S. $1 billion, or o
obligations of a foreign bank with total assets of at least U.S. $1 billion.

     "Banks"  include  commercial  banks,  savings  banks and  savings  and loan
associations,  which may or may not be members of the Federal Deposit  Insurance
Corporation.

     o Commercial  Paper. The Fund can invest in commercial paper if it is rated
within  the top three  rating  categories  of S&P and  Moody's  or other  rating
organizations.

     If the paper is not rated,  it may be purchased  if the Manager  determines
that  it is  comparable  to  rated  commercial  paper  in the top  three  rating
categories of national rating organizations.

     The  Fund  can buy  commercial  paper,  including  U.S.  dollar-denominated
securities of foreign  branches of U.S.  banks,  issued by other entities if the
commercial  paper  is  guaranteed  as  to  principal  and  interest  by a  bank,
government or corporation whose  certificates of deposit or commercial paper may
otherwise be purchased by the Fund.

     o Variable  Amount Master  Demand Notes.  Master demand notes are corporate
obligations  that permit the  investment of  fluctuating  amounts by the Fund at
varying rates of interest under direct arrangements between the Fund, as lender,
and the borrower.  They permit daily changes in the amounts  borrowed.  The Fund
has the right to increase  the amount  under the note at any time up to the full
amount provided by the note agreement,  or to decrease the amount.  The borrower
may prepay up to the full amount of the note without penalty. These notes may or
may not be backed by bank letters of credit.

     Because these notes are direct lending  arrangements between the lender and
borrower, it is not expected that there will be a trading market for them. There
is no secondary  market for these notes,  although they are redeemable (and thus
are  immediately  repayable by the borrower) at principal  amount,  plus accrued
interest,  at any time.  Accordingly,  the Fund's  right to redeem such notes is
dependent  upon the ability of the  borrower to pay  principal  and  interest on
demand.

     The Fund has no  limitations  on the type of issuer  from whom these  notes
will be purchased.  However, in connection with such purchases and on an ongoing
basis,  the  Manager  will  consider  the  earning  power,  cash  flow and other
liquidity ratios of the issuer, and its ability to pay principal and interest on
demand,  including  a  situation  in which all holders of such notes made demand
simultaneously. Investments in master demand notes are subject to the limitation
on investments by the Fund in illiquid securities, described in the Prospectus.

     |X| Derivatives. The Fund can invest in a variety of derivative investments
to seek income or for hedging purposes. Some derivative investments the Fund can
use are the hedging instruments  described below in this Statement of Additional
Information.   Segregated   accounts  will  be  maintained  for  all  derivative
transactions, as required by the Investment Company Act.

     Among the derivative  investments the Fund can invest in are "index-linked"
or "currency-linked"  notes.  Principal and/or interest payments on index-linked
notes  depend  on  the  performance  of an  underlying  index.  Currency-indexed
securities are typically short-term or intermediate-term debt securities.  Their
value at  maturity or the rates at which they pay income are  determined  by the
change in value of the U.S. dollar against one or more foreign  currencies or an
index. In some cases,  these securities may pay an amount at maturity based on a
multiple of the amount of the relative  currency  movements.  This type of index
security offers the potential for increased income or principal  payments but at
a greater  risk of loss than a typical  debt  security of the same  maturity and
credit quality.

     Other  derivative  investments the Fund can use include "debt  exchangeable
for common stock" of an issuer or "equity-linked  debt securities" of an issuer.
At maturity, the debt security is exchanged for common stock of the issuer or it
is payable in an amount based on the price of the  issuer's  common stock at the
time of maturity.  Both  alternatives  present a risk that the amount payable at
maturity will be less than the principal amount of the debt because the price of
the issuer's common stock might not be as high as the Manager expected.

Credit Derivatives.  The Fund may enter into credit default swaps, both directly
("unfunded  swaps")  and  indirectly  in the  form of a swap  embedded  within a
structured  note ("funded  swaps"),  to protect against the risk that a security
will  default.  Unfunded  and  funded  credit  default  swaps may be on a single
security,  or on a basket of  securities.  The Fund pays a fee to enter into the
swap and receives a fixed payment during the life of the swap. The Fund may take
a short  position  in the  credit  default  swap (also  known as "buying  credit
protection"),  or may take a long position in the credit default swap note (also
known as "selling credit protection").

     The  Fund  would  take a short  position  in a  credit  default  swap  (the
"unfunded  swap")  against a long  portfolio  position to  decrease  exposure to
specific  high yield  issuers.  If the short  credit  default  swap is against a
corporate issue, the Fund must own that corporate issue.  However,  if the short
credit default swap is against sovereign debt, the Fund may own either:  (i) the
reference obligation,  (ii) any sovereign debt of that foreign country, or (iii)
sovereign debt of any country that the Manager  determines is closely correlated
as an inexact bona fide hedge.

     If the Fund takes a short  position in the credit default swap, if there is
a credit  event  (including  bankruptcy,  failure  to  timely  pay  interest  or
principal,  or a  restructuring),  the Fund will deliver the defaulted bonds and
the swap  counterparty  will pay the par amount of the bonds. An associated risk
is adverse pricing when purchasing bonds to satisfy the delivery obligation.  If
the  swap is on a basket  of  securities,  the  notional  amount  of the swap is
reduced by the par amount of the defaulted bond, and the fixed payments are then
made on the reduced notional amount.

     Taking a long  position in the credit  default swap note (i.e.,  purchasing
the "funded  swap") would  increase the Fund's  exposure to specific  high yield
corporate issuers. The goal would be to increase liquidity in that market sector
via  the  swap  note  and its  associated  increase  in the  number  of  trading
instruments,   the   number  and  type  of  market   participants,   and  market
capitalization.

     If the Fund takes a long position in the credit default swap note, if there
is a credit  event  the Fund  will pay the par  amount of the bonds and the swap
counterparty  will deliver the bonds.  If the swap is on a basket of securities,
the  notional  amount of the swap is reduced by the par amount of the  defaulted
bond, and the fixed payments are then made on the reduced notional amount.

     The Fund will  invest no more than 25 % of its total  assets in  "unfunded"
credit default swaps.

     The Fund will limit its  investments in "funded"  credit default swap notes
to no more than 10% of its total assets.

     Other risks of credit  default  swaps include the cost of paying for credit
protection if there are no credit events,  pricing  transparency  when assessing
the cost of a credit default swap,  counterparty  risk, and the need to fund the
delivery  obligation  (either cash or the defaulted bonds,  depending on whether
the Fund is long or short the swap, respectively).

     |X|  Hedging.  The  Fund can use  hedging  instruments  although  it is not
obligated to use them in seeking its  objective.  To attempt to protect  against
declines  in the  market  value of the Fund's  portfolio,  to permit the Fund to
retain  unrealized  gains  in the  value  of  portfolio  securities  which  have
appreciated,  or to facilitate  selling securities for investment  reasons,  the
Fund could: o sell futures contracts, o buy puts on futures or on securities, or
o write covered  calls on securities or futures.  Covered calls may also be used
to  increase  the  Fund's  income,  but the  Manager  does not  expect to engage
extensively in that practice.

     The Fund can use hedging to establish a position in the  securities  market
as a temporary substitute for purchasing  particular  securities.  In that case,
the Fund would  normally seek to purchase the securities and then terminate that
hedging  position.  The Fund  might  also use this type of hedge to  attempt  to
protect against the possibility that its portfolio securities would not be fully
included  in a rise in  value of the  market.  To do so the  Fund  could:  o buy
futures, or o buy calls on futures or on securities.

     The Fund is not  obligated  to use hedging  instruments,  even though it is
permitted  to use them in the  Manager's  discretion,  as described  below.  The
Fund's  strategy  of  hedging  with  futures  and  options  on  futures  will be
incidental  to  the  Fund's  activities  in  the  underlying  cash  market.  The
particular  hedging  instruments the Fund can use are described  below. The Fund
may employ new hedging  instruments and strategies  when they are developed,  if
those investment methods are consistent with the Fund's investment objective and
are permissible under applicable regulations governing the Fund.

     o Futures.  The Fund can buy and sell futures  contracts that relate to (1)
broadly-based  bond  or  other  security  indices  (these  are  referred  to  as
"financial  futures"),  (2)  commodity  contracts  (these  are  referred  to  as
"commodity  futures"),  (3) debt securities  (these are referred to as "interest
rate  futures"),  (4)  foreign  currencies  (these are  referred  to as "forward
contracts"),  (5)  individual  stock  (these are  referred  to as "single  stock
futures") and (6) bond indices (these are referred to as "bond index futures").

     A  broadly-based  stock index is used as the basis for trading  stock index
futures.  In some  cases,  these  futures may be based on stocks of issuers in a
particular  industry  or group of  industries.  A stock index  assigns  relative
values to the  securities  included  in the index  and its value  fluctuates  in
response to the  changes in value of the  underlying  securities.  A stock index
cannot be purchased or sold directly.  Bond index futures are similar  contracts
based on the future value of the basket of  securities  that comprise the index.
These contracts obligate the seller to deliver,  and the purchaser to take, cash
to settle the futures  transaction.  There is no delivery made of the underlying
securities  to settle the futures  obligation.  Either party may also settle the
transaction by entering into an offsetting contract.

     An interest rate future  obligates the seller to deliver (and the purchaser
to take)  cash or a  specified  type of debt  security  to  settle  the  futures
transaction.  Either party could also enter into an offsetting contract to close
out the position.

     Similarly,  a single stock future  obligates the seller to deliver (and the
purchaser  to take) cash or a  specified  equity  security to settle the futures
transaction.  Either party could also enter into an offsetting contract to close
out the  position.  Single  stock  futures  trade on a very  limited  number  of
exchanges, with contracts typically not fungible among the exchanges.

     The Fund can invest a portion of its assets in commodity futures contracts.
Commodity  futures  may be based upon  commodities  within  five main  commodity
groups: (1) energy,  which includes crude oil, natural gas, gasoline and heating
oil; (2) livestock,  which  includes  cattle and hogs;  (3)  agriculture,  which
includes wheat, corn, soybeans,  cotton, coffee, sugar and cocoa; (4) industrial
metals,  which includes  aluminum,  copper,  lead, nickel, tin and zinc; and (5)
precious metals, which includes gold, platinum and silver. The Fund may purchase
and sell commodity futures  contracts,  options on futures contracts and options
and  futures on  commodity  indices  with  respect to these five main  commodity
groups and the individual  commodities within each group, as well as other types
of commodities.

     No  money is paid or  received  by the  Fund on the  purchase  or sale of a
future. Upon entering into a futures  transaction,  the Fund will be required to
deposit an initial  margin  payment with the futures  commission  merchant  (the
"futures  broker").  Initial  margin  payments will be deposited with the Fund's
custodian bank in an account  registered in the futures broker's name.  However,
the  futures  broker  can gain  access  to that  account  only  under  specified
conditions.  As the future is marked to market (that is, its value on the Fund's
books is  changed) to reflect  changes in its market  value,  subsequent  margin
payments,  called  variation  margin,  will be paid to or by the futures  broker
daily.

     At any time prior to expiration of the future,  the Fund may elect to close
out  its  position  by  taking  an  opposite  position,  at  which  time a final
determination  of variation  margin is made and any additional cash must be paid
by or released to the Fund.  Any loss or gain on the future is then  realized by
the Fund for tax purposes.  All futures transactions,  except forward contracts,
are effected  through a clearinghouse  associated with the exchange on which the
contracts are traded.

     o Put and Call  Options.  The Fund  can buy and sell  certain  kinds of put
options  ("puts")  and  call  options  ("calls").  The  Fund  can buy  and  sell
exchange-traded  and  over-the-counter  put and call  options,  including  index
options, securities options, currency options,  commodities options, and options
on the other types of futures described above.

     o Writing Covered Call Options.  The Fund can write (that is, sell) covered
calls. If the Fund sells a call option, it must be covered.  That means the Fund
must own the security subject to the call while the call is outstanding, or, for
calls on futures  and  indices,  the call may be covered by  segregating  liquid
assets to enable the Fund to satisfy its  obligations  if the call is exercised.
Up to 50% of the Fund's total assets may be subject to calls the Fund writes.

     When the Fund writes a call on a security,  it receives  cash (a  premium).
The  Fund  agrees  to  sell  the  underlying   security  to  a  purchaser  of  a
corresponding  call on the  same  security  during  the call  period  at a fixed
exercise price  regardless of market price changes  during the call period.  The
call period is usually not more than nine months.  The exercise price may differ
from the market price of the underlying security.  The Fund has the risk of loss
that the price of the  underlying  security may decline  during the call period.
That risk may be offset to some extent by the premium the Fund receives.  If the
value of the  investment  does not rise above the call price,  it is likely that
the call will lapse  without being  exercised.  In that case the Fund would keep
the cash premium and the investment.

     When the Fund writes a call on an index,  it receives cash (a premium).  If
the buyer of the call exercises it, the Fund will pay an amount of cash equal to
the  difference  between the closing  price of the call and the exercise  price,
multiplied by a specified  multiple that  determines the total value of the call
for each point of difference. If the value of the underlying investment does not
rise above the call price,  it is likely that the call will lapse  without being
exercised. In that case the Fund would keep the cash premium.

     The  Fund's  custodian  bank,  or a  securities  depository  acting for the
custodian bank,  will act as the Fund's escrow agent,  through the facilities of
the Options  Clearing  Corporation  ("OCC"),  as to the investments on which the
Fund has written  calls  traded on exchanges  or as to other  acceptable  escrow
securities.  In that way, no margin will be required for such transactions.  OCC
will release the  securities  on the  expiration  of the option or when the Fund
enters into a closing transaction.

     When the Fund writes an over-the-counter ("OTC") option, it will enter into
an  arrangement  with a primary  U.S.  government  securities  dealer which will
establish  a formula  price at which the Fund  will have the  absolute  right to
repurchase  that OTC option.  The  formula  price will  generally  be based on a
multiple of the premium  received  for the option,  plus the amount by which the
option is exercisable  below the market price of the  underlying  security (that
is, the option is "in the money").  When the Fund writes an OTC option,  it will
treat  as  illiquid  (for  purposes  of  its  restriction  on  holding  illiquid
securities)  the  mark-to-market  value of any OTC  option it holds,  unless the
option is subject to a buy-back agreement by the executing broker.

     To terminate its obligation on a call it has written, the Fund may purchase
a corresponding  call in a "closing  purchase  transaction."  The Fund will then
realize a profit or loss,  depending  upon  whether the net of the amount of the
option  transaction costs and the premium received on the call the Fund wrote is
more or less  than the  price of the call the Fund  purchases  to close  out the
transaction.  The Fund may  realize  a profit if the call  expires  unexercised,
because the Fund will retain the underlying security and the premium it received
when it wrote the call. Any such profits are considered short-term capital gains
for federal  income tax  purposes,  as are the  premiums on lapsed  calls.  When
distributed by the Fund they are taxable as ordinary income.  If the Fund cannot
effect a closing purchase  transaction due to the lack of a market, it will have
to hold the callable securities until the call expires or is exercised.

     The Fund may also  write  calls on a futures  contract  without  owning the
futures contract or securities  deliverable under the contract. To do so, at the
time the call is  written,  the Fund must  cover the call by  identifying  on it
books an  equivalent  dollar  amount of liquid  assets.  The Fund will  identify
additional  liquid  assets  on its  books to cover  the call if the value of the
identified  assets drops below 100% of the current value of the future.  Because
of this asset coverage requirement, in no circumstances would the Fund's receipt
of an exercise  notice as to that  future  require the Fund to deliver a futures
contract.  It would simply put the Fund in a short  futures  position,  which is
permitted by the Fund's hedging policies.

     o  Writing  Put  Options.  The Fund can sell  put  options  on  securities,
broadly-based  securities indices,  foreign currencies and futures. A put option
on  securities  gives  the  purchaser  the  right to sell,  and the  writer  the
obligation to buy, the  underlying  investment at the exercise  price during the
option  period.  The Fund will not write puts if, as a result,  more than 50% of
the Fund's net  assets  would be  required  to be  segregated  to cover such put
options.

     If the  Fund  writes  a put,  the put  must be  covered  by  liquid  assets
identified on the Fund's books. The premium the Fund receives from writing a put
represents a profit, as long as the price of the underlying  investment  remains
equal to or above the exercise price of the put. However,  the Fund also assumes
the obligation  during the option period to buy the underlying  investment  from
the buyer of the put at the exercise price,  even if the value of the investment
falls below the exercise price.

     If a put the Fund has written expires unexercised, the Fund realizes a gain
in the amount of the premium less the transaction costs incurred.  If the put is
exercised,  the Fund must  fulfill its  obligation  to purchase  the  underlying
investment  at the exercise  price.  That price will  usually  exceed the market
value of the investment at that time. In that case, the Fund may incur a loss if
it sells the  underlying  investment.  That loss will be equal to the sum of the
sale price of the underlying  investment and the premium  received minus the sum
of the exercise price and any transaction costs the Fund incurred.

     When writing a put option on a security,  to secure its  obligation  to pay
for the underlying security the Fund will deposit in escrow liquid assets with a
value equal to or greater than the exercise price of the underlying  securities.
The Fund therefore forgoes the opportunity of investing the segregated assets or
writing calls against those assets.

     As long as the Fund's  obligation  as the put writer  continues,  it may be
assigned an exercise notice by the broker-dealer through which the put was sold.
That notice will require the Fund to take  delivery of the  underlying  security
and pay the exercise price. The Fund has no control over when it may be required
to purchase the underlying security, since it may be assigned an exercise notice
at any time prior to the termination of its obligation as the writer of the put.
That obligation terminates upon expiration of the put. It may also terminate if,
before it receives  an  exercise  notice,  the Fund  effects a closing  purchase
transaction by purchasing a put of the same series as it sold. Once the Fund has
been  assigned  an  exercise  notice,   it  cannot  effect  a  closing  purchase
transaction.

     The Fund may decide to effect a closing  purchase  transaction to realize a
profit on an outstanding  put option it has written or to prevent the underlying
security  from being put.  Effecting a closing  purchase  transaction  will also
permit  the Fund to write  another  put option on the  security,  or to sell the
security and use the proceeds from the sale for other investments. The Fund will
realize  a profit  or loss  from a closing  purchase  transaction  depending  on
whether the cost of the  transaction  is less or more than the premium  received
from  writing  the put option.  Any profits  from  writing  puts are  considered
short-term  capital gains for federal tax purposes,  and when distributed by the
Fund, are taxable as ordinary income.

     o Purchasing  Calls and Puts.  The Fund can purchase  calls on  securities,
broadly-based  securities indices,  foreign currencies and futures. It may do so
to  protect  against  the  possibility   that  the  Fund's  portfolio  will  not
participate in an anticipated rise in the securities market.  When the Fund buys
a call (other than in a closing purchase  transaction),  it pays a premium.  The
Fund  then has the  right to buy the  underlying  investment  from a seller of a
corresponding  call on the same  investment  during  the call  period at a fixed
exercise price.

     The Fund  benefits  only if it sells the call at a profit or if, during the
call period,  the market price of the underlying  investment is above the sum of
the call price plus the transaction  costs and the premium paid for the call and
the Fund  exercises  the call. If the Fund does not exercise the call or sell it
(whether or not at a profit),  the call will become  worthless at its expiration
date.  In that case the Fund will  have paid the  premium  but lost the right to
purchase the underlying investment.

The Fund can buy puts on securities,  broadly-based  securities indices, foreign
currencies and futures,  whether or not it owns the underlying investment.  When
the Fund  purchases a put, it pays a premium and,  except as to puts on indices,
has the  right  to sell the  underlying  investment  to a  seller  of a put on a
corresponding investment during the put period at a fixed exercise price.

          Buying a put on  securities  or futures the Fund owns enables the Fund
     to attempt to protect itself during the put period against a decline in the
     value of the underlying  investment below the exercise price by selling the
     underlying  investment at the exercise price to a seller of a corresponding
     put. If the market price of the underlying  investment is equal to or above
     the exercise  price and, as a result,  the put is not  exercised or resold,
     the put will become worthless at its expiration date. In that case the Fund
     will  have  paid the  premium  but lost  the  right to sell the  underlying
     investment.  However,  the Fund may sell the put  prior to its  expiration.
     That sale may or may not be at a profit.

          Buying a put on an investment  the Fund does not own (such as an index
     or  future)  permits  the  Fund  either  to  resell  the  put or to buy the
     underlying  investment and sell it at the exercise price.  The resale price
     will vary  inversely  to the  price of the  underlying  investment.  If the
     market price of the underlying  investment is above the exercise price and,
     as a result, the put is not exercised, the put will become worthless on its
     expiration date.

          When the Fund purchases a call or put on an index or future, it pays a
     premium,  but  settlement  is in  cash  rather  than  by  delivery  of  the
     underlying  investment to the Fund.  Gain or loss depends on changes in the
     index in question  (and thus on price  movements in the  securities  market
     generally)  rather than on price  movements  in  individual  securities  or
     futures contracts.

          The Fund may buy a call or put only if, after the purchase,  the value
     of all call and put  options  held by the Fund  will not  exceed  5% of the
     Fund's total assets.

          o Buying and Selling Options on Foreign  Currencies.  The Fund can buy
     and sell calls and puts on foreign currencies.  They include puts and calls
     that  trade  on  a   securities   or   commodities   exchange   or  in  the
     over-the-counter  markets or are quoted by major recognized dealers in such
     options.

          The Fund  could use these  calls  and puts to try to  protect  against
     declines in the dollar  value of foreign  securities  and  increases in the
     dollar cost of foreign securities the Fund wants to acquire.

          If the  Manager  anticipates  a rise in the dollar  value of a foreign
     currency in which securities to be acquired are denominated,  the increased
     cost of those  securities  may be partially  offset by purchasing  calls or
     writing puts on that foreign currency. If the Manager anticipates a decline
     in the dollar value of a foreign currency,  the decline in the dollar value
     of portfolio  securities  denominated  in that currency  might be partially
     offset  by  writing  calls or  purchasing  puts on that  foreign  currency.
     However,  the currency rates could fluctuate in a direction  adverse to the
     Fund's  position.  The Fund will then have incurred option premium payments
     and transaction costs without a corresponding benefit.

          A call the Fund writes on a foreign  currency is "covered" if the Fund
     owns the underlying foreign currency covered by the call or has an absolute
     and immediate  right to acquire that foreign  currency  without  additional
     cash  consideration (or it can do so for additional cash consideration held
     in a segregated  account by its custodian bank) upon conversion or exchange
     of other foreign currency held in its portfolio.

          The Fund could  write a call on a foreign  currency to provide a hedge
     against a decline in the U.S.  dollar  value of a  security  which the Fund
     owns or has the right to acquire and which is  denominated  in the currency
     underlying  the  option.  That  decline  might be one that occurs due to an
     expected  adverse  change  in  the  exchange  rate.  This  is  known  as  a
     "cross-hedging"  strategy.  In those  circumstances,  the Fund  covers  the
     option by  identifying  liquid  assets on its books having a value equal to
     its obligation under the option.

          o Risks of  Hedging  with  Options  and  Futures.  The use of  hedging
     instruments requires special skills and knowledge of investment  techniques
     that are different than what is required for normal  portfolio  management.
     If the Manager uses a hedging instrument at the wrong time or judges market
     conditions  incorrectly,  hedging  strategies may reduce the Fund's return.
     The Fund could also  experience  losses if the  prices of its  futures  and
     options positions were not correlated with its other investments.

          The Fund's option activities could affect its portfolio  turnover rate
     and brokerage commissions.  The exercise of calls written by the Fund might
     cause the Fund to sell related  portfolio  securities,  thus increasing its
     turnover  rate.  The exercise by the Fund of puts on securities  will cause
     the sale of underlying investments, increasing portfolio turnover. Although
     the  decision  whether  to  exercise  a put it holds is within  the  Fund's
     control, holding a put might cause the Fund to sell the related investments
     for reasons that would not exist in the absence of the put.

          The Fund could pay a brokerage  commission each time it buys a call or
     put,  sells a call or put,  or buys or sells an  underlying  investment  in
     connection with the exercise of a call or put. Those  commissions  could be
     higher on a relative  basis than the  commissions  for direct  purchases or
     sales of the underlying investments. Premiums paid for options are small in
     relation to the market value of the underlying  investments.  Consequently,
     put and call options offer large amounts of leverage.  The leverage offered
     by trading in options could result in the Fund's net asset value being more
     sensitive to changes in the value of the underlying investment.

          If a covered call  written by the Fund is  exercised on an  investment
     that  has  increased  in  value,  the  Fund  will be  required  to sell the
     investment at the call price. It will not be able to realize any additional
     appreciation  in excess of the  covered  call price if the  investment  has
     increased in value above the call price.

          An option  position  may be closed out only on a market that  provides
     secondary trading for options of the same series, and there is no assurance
     that a liquid  secondary market will exist for any particular  option.  The
     Fund might  experience  losses if it could not close out a position because
     of an illiquid market for the future or option.

          There  is a  risk  in  using  short  hedging  by  selling  futures  or
     purchasing puts on  broadly-based  indices or futures to attempt to protect
     against declines in the value of the Fund's portfolio securities.  The risk
     is that the prices of the futures or the  applicable  index will  correlate
     imperfectly with the behavior of the cash prices of the Fund's  securities.
     For  example,  it  is  possible  that  while  the  Fund  has  used  hedging
     instruments in a short hedge, the market might advance and the value of the
     securities held in the Fund's  portfolio  might decline.  If that occurred,
     the Fund would lose money on the hedging  instruments and also experience a
     decline in the value of its portfolio securities. However, while this could
     occur for a very  brief  period or to a very  small  degree,  over time the
     value of a  diversified  portfolio of  securities  will tend to move in the
     same direction as the indices upon which the hedging instruments are based.

          The risk of imperfect  correlation increases as the composition of the
     Fund's  portfolio  diverges from the securities  included in the applicable
     index.  To  compensate  for the imperfect  correlation  of movements in the
     price of the portfolio  securities  being hedged and movements in the price
     of the hedging  instruments,  the Fund might use hedging  instruments  in a
     greater dollar amount than the dollar amount of portfolio  securities being
     hedged.  It might do so if the  historical  volatility of the prices of the
     portfolio securities being hedged is more than the historical volatility of
     the applicable index.

          The ordinary  spreads  between prices in the cash and futures  markets
     are  subject  to  distortions,  due to  differences  in the nature of those
     markets.  First,  all  participants  in the  futures  market are subject to
     margin deposit and maintenance requirements. Rather than meeting additional
     margin deposit requirements,  investors may close futures contracts through
     offsetting transactions which could distort the normal relationship between
     the cash and futures markets.  Second,  the liquidity of the futures market
     depends on participants  entering into offsetting  transactions rather than
     making or taking  delivery.  To the extent  participants  decide to make or
     take  delivery,  liquidity  in the futures  market  could be reduced,  thus
     producing  distortion.  Third,  from the point of view of speculators,  the
     deposit  requirements  in the futures  market are less  onerous than margin
     requirements in the securities markets. Therefore,  increased participation
     by speculators in the futures market may cause temporary price distortions.

          The Fund can use hedging  instruments  to  establish a position in the
     securities markets as a temporary substitute for the purchase of individual
     securities  (long  hedging) by buying futures and/or calls on such futures,
     broadly-based  indices or on securities.  It is possible that when the Fund
     does so the market might decline.  If the Fund then concludes not to invest
     in securities  because of concerns that the market might decline further or
     for other reasons,  the Fund will realize a loss on the hedging instruments
     that is not offset by a reduction in the price of the securities purchased.

                         o Forward  Contracts.  Forward  contracts  are  foreign
                    currency  exchange  contracts.  They are used to buy or sell
                    foreign  currency for future delivery at a fixed price.  The
                    Fund  uses  them to  "lock  in" the U.S.  dollar  price of a
                    security denominated in a foreign currency that the Fund has
                    bought or sold, or to protect  against  possible losses from
                    changes  in the  relative  values of the U.S.  dollar  and a
                    foreign  currency.  The Fund  may  also use  "cross-hedging"
                    where the Fund hedges  against  changes in currencies  other
                    than  the   currency   in  which  a  security  it  holds  is
                    denominated.

                         Under a forward contract, one party agrees to purchase,
                    and another  party agrees to sell, a specific  currency at a
                    future date.  That date may be any fixed number of days from
                    the date of the  contract  agreed upon by the  parties.  The
                    transaction price is set at the time the contract is entered
                    into.  These  contracts are traded in the inter-bank  market
                    conducted  directly  among currency  traders  (usually large
                    commercial banks) and their customers.

                         The Fund may use forward  contracts to protect  against
                    uncertainty in the level of future exchange  rates.  The use
                    of  forward   contracts  does  not  eliminate  the  risk  of
                    fluctuations in the prices of the underlying  securities the
                    Fund owns or intends to  acquire,  but it does fix a rate of
                    exchange in advance.  Although forward  contracts may reduce
                    the risk of loss from a decline  in the value of the  hedged
                    currency,  at the same time they limit any potential gain if
                    the value of the hedged currency increases.

                         When the Fund enters into a contract  for the  purchase
                    or sale of a security denominated in a foreign currency,  or
                    when it anticipates receiving dividend payments in a foreign
                    currency, the Fund might desire to "lock-in" the U.S. dollar
                    price of the security or the U.S.  dollar  equivalent of the
                    dividend  payments.  To do so, the Fund  could  enter into a
                    forward  contract  for the purchase or sale of the amount of
                    foreign currency involved in the underlying transaction,  in
                    a fixed  amount  of U.S.  dollars  per  unit of the  foreign
                    currency.   This  is  called  a  "transaction   hedge."  The
                    transaction  hedge will protect the Fund against a loss from
                    an adverse change in the currency  exchange rates during the
                    period  between the date on which the  security is purchased
                    or sold or on which the payment is declared, and the date on
                    which the payments are made or received.

                         The Fund could also use  forward  contracts  to lock in
                    the U.S. dollar value of portfolio positions. This is called
                    a "position  hedge."  When the Fund  believes  that  foreign
                    currency might suffer a substantial decline against the U.S.
                    dollar,  it could  enter into a forward  contract to sell an
                    amount of that foreign currency  approximating  the value of
                    some or all of the Fund's portfolio  securities  denominated
                    in that foreign  currency.  When the Fund  believes that the
                    U.S.  dollar might suffer a  substantial  decline  against a
                    foreign currency,  it could enter into a forward contract to
                    buy  that  foreign  currency  for  a  fixed  dollar  amount.
                    Alternatively,  the Fund could enter into a forward contract
                    to sell a different foreign currency for a fixed U.S. dollar
                    amount if the Fund  believes  that the U.S.  dollar value of
                    the  foreign  currency  to be sold  pursuant  to its forward
                    contract will fall  whenever  there is a decline in the U.S.
                    dollar value of the currency in which  portfolio  securities
                    of the Fund are denominated. That is referred to as a "cross
                    hedge."

                         The Fund will cover its short  positions in these cases
                    by  identifying  to its custodian bank assets having a value
                    equal to the aggregate amount of the Fund's commitment under
                    forward  contracts.  The Fund  will not enter  into  forward
                    contracts  or maintain a net  exposure to such  contracts if
                    the consummation of the contracts would obligate the Fund to
                    deliver an amount of foreign currency in excess of the value
                    of  the  Fund's   portfolio   securities   or  other  assets
                    denominated in that currency or another currency that is the
                    subject of the hedge.

                         However,  to avoid excess  transactions and transaction
                    costs,  the Fund may  maintain  a net  exposure  to  forward
                    contracts  in excess of the  value of the  Fund's  portfolio
                    securities or other assets denominated in foreign currencies
                    if the  excess  amount is  "covered"  by  liquid  securities
                    denominated  in any  currency.  The  cover  must be at least
                    equal at all  times to the  amount  of that  excess.  As one
                    alternative,  the Fund may purchase a call option permitting
                    the Fund to purchase  the amount of foreign  currency  being
                    hedged by a forward sale  contract at a price no higher than
                    the forward contract price. As another alternative, the Fund
                    may  purchase a put option  permitting  the Fund to sell the
                    amount of foreign  currency  subject  to a forward  purchase
                    contract  at a price  as high or  higher  than  the  forward
                    contact price.

                         The  precise  matching  of the  amounts  under  forward
                    contracts and the value of the securities involved generally
                    will not be possible  because the future value of securities
                    denominated   in  foreign   currencies   will  change  as  a
                    consequence of market movements between the date the forward
                    contract  is entered  into and the date it is sold.  In some
                    cases the  Manager  might  decide to sell the  security  and
                    deliver  foreign  currency to settle the  original  purchase
                    obligation. If the market value of the security is less than
                    the  amount of foreign  currency  the Fund is  obligated  to
                    deliver,  the Fund might have to purchase additional foreign
                    currency on the "spot"  (that is, cash) market to settle the
                    security trade. If the market value of the security  instead
                    exceeds the amount of foreign currency the Fund is obligated
                    to deliver to settle the trade,  the Fund might have to sell
                    on the spot  market some of the  foreign  currency  received
                    upon  the sale of the  security.  There  will be  additional
                    transaction costs on the spot market in those cases.

                         The projection of short-term  currency market movements
                    is extremely  difficult,  and the successful  execution of a
                    short-term  hedging  strategy is highly  uncertain.  Forward
                    contracts   involve  the  risk  that  anticipated   currency
                    movements will not be accurately predicted, causing the Fund
                    to sustain  losses on these  contracts and to pay additional
                    transactions  costs.  The use of forward  contracts  in this
                    manner  might  reduce  the Fund's  performance  if there are
                    unanticipated changes in currency prices to a greater degree
                    than if the Fund had not entered into such contracts.

                         At  or  before  the  maturity  of  a  forward  contract
                    requiring the Fund to sell a currency, the Fund might sell a
                    portfolio  security  and  use  the  sale  proceeds  to  make
                    delivery of the currency.  In the alternative the Fund might
                    retain the security and offset its contractual obligation to
                    deliver the currency by purchasing a second contract.  Under
                    that  contract  the Fund will obtain,  on the same  maturity
                    date,  the same amount of the currency  that it is obligated
                    to  deliver.  Similarly,  the Fund might close out a forward
                    contract  requiring  it to purchase a specified  currency by
                    entering  into a second  contract  entitling  it to sell the
                    same amount of the same currency on the maturity date of the
                    first  contract.  The Fund would realize a gain or loss as a
                    result of entering into such an offsetting  forward contract
                    under either  circumstance.  The gain or loss will depend on
                    the extent to which the exchange  rate or rates  between the
                    currencies involved moved between the execution dates of the
                    first contract and offsetting contract.

                         The costs to the Fund of engaging in forward  contracts
                    varies with factors  such as the  currencies  involved,  the
                    length of the contract period and the market conditions then
                    prevailing.  Because  forward  contracts are usually entered
                    into on a principal  basis, no brokerage fees or commissions
                    are involved.  Because these  contracts are not traded on an
                    exchange,  the Fund must evaluate the credit and performance
                    risk of the counterparty under each forward contract.

      Although the Fund values its assets daily in terms of U.S. dollars, it does
not intend to convert its holdings of foreign currencies into U.S. dollars on a
daily basis. The Fund may convert foreign currency from time to time, and will
incur costs in doing so. Foreign exchange dealers do not charge a fee for
conversion, but they do seek to realize a profit based on the difference between
the prices at which they buy and sell various currencies. Thus, a dealer might
offer to sell a foreign currency to the Fund at one rate, while offering a lesser
rate of exchange if the Fund desires to resell that currency to the dealer.

         o Interest Rate Swap Transactions. The Fund can enter into interest rate
swap agreements. In an interest rate swap, the Fund and another party exchange
their right to receive or their obligation to pay interest on a security. For
example, they might swap the right to receive floating rate payments for fixed rate
payments. The Fund can enter into swaps only on securities that it owns. The Fund
will not enter into swaps with respect to more than 25% of its total assets. Also,
the Fund will identify on its book liquid assets (such as cash or U.S. government
securities) to cover any amounts it could owe under swaps that exceed the amounts
it is entitled to receive, and it will adjust that amount daily, as needed.

      Swap agreements entail both interest rate risk and credit risk. There is a
risk that, based on movements of interest rates in the future, the payments made by
the Fund under a swap agreement will be greater than the payments it received.
Credit risk arises from the possibility that the counterparty will default. If the
counterparty defaults, the Fund's loss will consist of the
net amount of contractual interest payments that the Fund has not yet received. The
Manager will monitor the creditworthiness of counterparties to the Fund's interest
rate swap transactions on an ongoing basis.

      The Fund can enter into swap transactions with certain counterparties
pursuant to master netting agreements. A master netting agreement provides that all
swaps done between the Fund and that counterparty shall be regarded as parts of an
integral agreement. If amounts are payable on a particular date in the same
currency in respect of one or more swap transactions, the amount payable on that
date in that currency shall be the net amount. In addition, the master netting
agreement may provide that if one party defaults generally or on one swap, the
counterparty may terminate all of the swaps with that party. Under these
agreements, if a default results in a loss to one party, the measure of that
party's damages is calculated by reference to the average cost of a replacement swap
for each swap. It is measured by the mark-to-market value at the time of the
termination of each swap. The gains and losses on all swaps are then netted, and
the result is the counterparty's gain or loss on termination. The termination of
all swaps and the netting of gains and losses on termination is generally referred
to as "aggregation."

            o Swaption Transactions. The Fund may enter into a swaption
transaction, which is a contract that grants the holder, in return for payment of
the purchase price (the "premium") of the option, the right, but not the
obligation, to enter into an interest rate swap at a preset rate within a specified
period of time, with the writer of the contract.  The writer of the contract
receives the premium and bears the risk of unfavorable changes in the preset rate
on the underlying interest rate swap.  Unrealized gains/losses on swaptions are
reflected in investment assets and investment liabilities in the Fund's statement
of financial condition.

                  o Regulatory Aspects of Hedging Instruments. The Commodities
Futures Trading Commission (the "CFTC") recently eliminated limitations on futures
trading by certain regulated entities including registered investment companies and
consequently registered investment companies may engage in unlimited futures
transactions and options thereon provided that the Fund claims an exclusion from
regulation as a commodity pool operator. The Fund has claimed such an exclusion
from registration as a commodity pool operator under the Commodity Exchange Act
("CEA"). The Fund may use futures and options for hedging and non-hedging purposes
to the extent consistent with its investment objective, internal risk management
guidelines adopted by the Fund's investment advisor (as they may be amended from
time to time), and as otherwise set forth in the Fund's prospectus or this
statement of additional information.

      Transactions in options by the Fund are subject to limitations established by
the option exchanges. The exchanges limit the maximum number of options that may be
written or held by a single investor or group of investors acting in concert. Those
limits apply regardless of whether the options were written or purchased on the
same or different exchanges or are held in one or more accounts or through one or
more different exchanges or through one or more brokers. Thus, the number of
options that the Fund may write or hold may be affected by options written or held
by other entities, including other investment companies having the same advisor as
the Fund (or an advisor that is an affiliate of the Fund's advisor). The exchanges
also impose position limits on futures transactions. An exchange may order the
liquidation of positions found to be in violation of those limits and may impose
certain other sanctions.


      Under interpretations of the staff of the SEC regarding applicable provisions
of the Investment Company Act, when the Fund purchases a future, it must identify
liquid assets on its books in an amount equal to the purchase price of the future,
less the margin deposit applicable to it.

            o Tax Aspects of Certain Hedging Instruments. Certain foreign currency
exchange contracts in which the Fund may invest are treated as "Section 1256
contracts" under the Internal Revenue Code. In general, gains or losses relating to
Section 1256 contracts are characterized as 60% long-term and 40% short-term
capital gains or losses under the Code. However, foreign currency gains or losses
arising from Section 1256 contracts that are forward contracts generally are
treated as ordinary income or loss. In addition, Section 1256 contracts held by the
Fund at the end of each taxable year are "marked-to-market," and unrealized gains
or losses are treated as though they were realized. These contracts also may be
marked-to-market for purposes of determining the excise tax applicable to
investment company distributions and for other purposes under rules prescribed
pursuant to the Internal Revenue Code. An election can be made by the Fund to
exempt those transactions from this marked-to-market treatment.

      Certain forward contracts the Fund enters into may result in "straddles" for
federal income tax purposes. The straddle rules may affect the character and timing
of gains (or losses) recognized by the Fund on straddle positions. Generally, a
loss sustained on the disposition of a position making up a straddle is allowed
only to the extent that the loss exceeds any unrecognized gain in the offsetting
positions making up the straddle. Disallowed loss is generally allowed at the point
where there is no unrecognized gain in the offsetting positions making up the
straddle, or the offsetting position is disposed of.

      Under the Internal Revenue Code, the following gains or losses are treated as
ordinary income or loss:

      (1)   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, and
      (2)   gains or losses attributable to fluctuations in the value of a foreign
            currency between the date of acquisition of a debt security denominated
            in a foreign currency or foreign currency forward contracts and the
            date of disposition.

      Currency gains and losses are offset against market gains and losses on each
trade before determining a net "Section 988" gain or loss under the Internal
Revenue Code for that trade, which may increase or decrease the amount of the
Fund's investment income available for distribution to its shareholders.

      |X| Portfolio Turnover. "Portfolio turnover" describes the rate at which the
Fund traded its portfolio securities during its last fiscal year. For example, if a
fund sold all of its securities during the year, its portfolio turnover rate would
have been 100%. The Fund's portfolio turnover rate will fluctuate from year to
year, and the Fund may have a portfolio turnover rate of more than 100% annually.

      Increased portfolio turnover may result in higher brokerage and transaction
costs for the Fund, which may reduce its overall performance. Additionally, the
realization of capital gains from selling portfolio securities may result in
distributions of taxable long-term capital gains to shareholders, since the Fund
will normally distribute all of its capital gains realized each year, to avoid
excise taxes under the Internal Revenue Code.

      |X| Temporary Defensive and Interim Investments.  In times of adverse or
unstable market, economic or political conditions, the Fund can invest up to 100%
of its assets in temporary defensive investments that are inconsistent with the
Fund's principal investment strategies.  Generally, they would be cash equivalents
(such as commercial paper), money market instruments, short-term debt securities,
U.S. Government securities, or repurchase agreements.  They could include other
investment-grade debt securities.  The Fund might also hold these types of
securities pending the investment of proceeds from the sale of Fund shares or
portfolio securities or to meet anticipated redemptions of Fund shares.  To the
extent the Fund invests defensively in these securities, it might not achieve its
investment objective.

Investment Restrictions

      |X| What Are "Fundamental Policies?" Fundamental policies are those policies
that the Fund has adopted to govern its investments that can be changed only by the
vote of a "majority" of the Fund's outstanding voting securities. Under the
Investment Company Act, a "majority" vote is defined as the vote of the holders of
the lesser of:

o     67% or more of the shares present or represented by proxy at a shareholder
           meeting, if the holders of more than 50% of the outstanding shares are
           present or represented by proxy, or
o     more than 50% of the outstanding shares.

      The Fund's investment objective is a fundamental policy. Other policies
described in the Prospectus or this Statement of Additional Information are
"fundamental" only if they are identified as such. The Fund's Board of Trustees can
change non-fundamental policies without shareholder approval. However, significant
changes to investment policies will be described in supplements or updates to the
Prospectus or this Statement of Additional Information, as appropriate. The Fund's
most significant investment policies are described in the Prospectus.

      |X|   Does the Fund Have Additional Fundamental Policies?  The following
investment restrictions are fundamental policies of the Fund.

      o  The Fund cannot buy securities or other instruments issued or guaranteed
by any one issuer if more than 5% of its total assets would be invested in
securities or other instruments of that issuer or if it would then own more than
10% of that issuer's voting securities.  This limitation applies to 75% of the
Fund's total assets.  The limit does not apply to securities issued or guaranteed by
the U.S. government or any of its agencies or instrumentalities or securities of
other investment companies.

      o  The Fund cannot make loans, except to the extent permitted under the
Investment Company Act, the rules or regulations thereunder or any exemption
therefrom that is applicable to the Fund, as such statute, rules or regulations may
be amended or interpreted from time to time.

o     The Fund may not borrow money, except to the extent permitted under the
Investment Company Act, the rules or regulations thereunder or any exemption
therefrom that is applicable to the Fund, as such statute, rules or regulations may
be amended or interpreted from time to time.

      o  The Fund cannot invest 25% or more of its total assets in any one
industry.  That limit does not apply to securities issued or guaranteed by the U.S.
government or its agencies and instrumentalities.

o     The Fund cannot buy or sell real estate.  However, the Fund can purchase and
sell securities issued or secured by companies that invest in or deal in real
estate or interests in real estate.

o     The Fund cannot buy or sell commodities or commodity contracts.  However, the
Fund can buy and sell derivative instruments and other hedging instruments, such as
futures contracts, options, swaps, and forward contracts.

      o  The Fund cannot underwrite securities of other companies. A permitted
exception is in case it is deemed to be an underwriter under the Securities Act of
1933 when reselling any securities held in its own portfolio.

      o  The Fund cannot issue "senior securities," but this does not prohibit
certain investment activities for which assets of the Fund are designated as
segregated, or margin, collateral or escrow arrangements are established, to cover
the related obligations. Examples of those activities include borrowing money,
reverse repurchase agreements, delayed-delivery and when-issued arrangements for
portfolio securities transactions, and contracts to buy or sell derivatives,
hedging instruments, options or futures.

      Unless the Prospectus or this Statement of Additional Information states that
a percentage restriction applies on an ongoing basis, it applies only at the time
the Fund makes an investment (except in the case of borrowing and investments in
illiquid securities). The Fund need not sell securities to meet the percentage
limits if the value of the investment increases in proportion to the size of the
Fund.

      For purposes of the Fund's policy not to concentrate its investments, the
Fund has adopted the industry classifications set forth in Appendix B to this
Statement of Additional Information. That is not a fundamental policy.


      The Fund cannot invest in the securities of other registered investment
companies or registered unit investment trusts in reliance on sub-paragraph (F) or
(G) of section 12(d)(1) of the Investment Company Act of 1940.


      The Fund currently has no intention of investing in commodity contracts. If
the Fund's intention changes, the Prospectus and this Statement of Additional
Information will be revised accordingly.


Disclosure of Portfolio Holdings.  The Fund has adopted policies and procedures
concerning the dissemination by employees, officers and/or directors of the
Investment Advisor, Distributor, and Transfer Agent of information about the
portfolio securities holdings of the Funds.  These policies are designed to assure
that dissemination of non-public information about portfolio securities is
distributed for a legitimate business purpose, and is done in a manner that (a)
conforms to applicable laws and regulations and (b) is designed to prevent that
information from being used in a way that could negatively affect the Fund's
investment program or enable third parties to use that information in a manner that
is harmful to a Fund.

      Until publicly disclosed, a Fund's portfolio holdings are proprietary,
confidential business information. While recognizing the importance of providing
Fund shareholders with information about their Fund's investments and providing
portfolio information to a variety of third parties to assist with the management,
distribution and administrative process, such need for transparency must be
balanced against the risk that third parties who gain access to a Fund's portfolio
holdings information could attempt to use that information to trade ahead of or
against the Fund, which could negatively affect the prices the Fund is able to
obtain in portfolio transactions or the availability of the portfolio securities
that portfolio managers are trading in on a Fund's behalf.

      The Investment Advisor and its subsidiaries and affiliates, employees,
officers, and directors, shall neither solicit nor accept any compensation or other
consideration (including any agreement to maintain assets in the Fund or in other
investment companies or accounts managed by the Investment Advisor or any
affiliated person of the Investment Advisor) in connection with the disclosure a
Fund's non-public portfolio holdings. The receipt of investment advisory fees or
other fees and compensation paid to the investment Advisor and their subsidiaries
pursuant to agreements approved by the Fund's Board shall not be deemed to be
"compensation" or "consideration" for these purposes.  It is a violation of the Code
of Ethics for any covered person to release holdings in contravention of portfolio
holdings disclosure policies and procedures adopted by the Fund.

      A list of the top 10 or more portfolio securities holdings (based on invested
                        ----------
assets), listed by security or by issuer, as of the end of each month may be
disclosed to third parties (subject to the procedures below) no sooner than 15 days
after month-end.  The top 10 or more  holdings also shall be posted on the
OppenheimerFunds' website at www.oppenheimerfunds.com in the "Fund Profiles"
section.  Other general information about a Fund's portfolio investments, such as
portfolio composition by asset class, industry, country, currency, credit rating or
maturity, may also be posted with a 15-day lag.

      Except under special limited circumstances discussed below, month-end lists
of a Fund's complete portfolio holdings may be disclosed no sooner than 30-days
after the relevant month-end, subject to the procedures below. If they have not
been disclosed publicly, they may be disclosed pursuant to special requests for
legitimate business reasons, provided that:

o     The third-party recipient must first submit a request for release of Fund
      portfolio holdings, explaining the business reason for the request;
o     Senior officers (a Senior Vice President or above) in the Investment
      Advisor's Portfolio and Legal departments must approve the completed request
      for release of Fund portfolio holdings; and
o     The third-party recipient must sign the Investment Advisor's portfolio
      holdings non-disclosure agreement before receiving the data, agreeing to keep
      confidential information that is not publicly available regarding a Fund's
      holdings and agreeing not to trade directly or indirectly based on the
      information.

      Complete Fund portfolio holdings positions may be released to the following
categories of entities or individuals on an ongoing basis, provided that such
entity or individual either (1) has signed an agreement to keep such information
confidential and not trade on the basis of such information or (2) is subject to
fiduciary obligations, as a member of the Fund's Board, or as an employee, officer
and/or director of the Investment Advisor, Distributor, or Transfer Agent, or their
respective legal counsel, not to disclose such information except in conformity
with these policies and procedures and not to trade for his/her personal account on
the basis of such information:

o     Employees of the Fund's Investment Advisor, Distributor and Transfer Agent
      who need to have access to such information (as determined by senior officers
      of such entity),
o     The Fund's certified public accountants and auditors,
o     Members of the Fund's Board and the Board's legal counsel,
o     The Fund's custodian bank,
o     A proxy voting service designated by the Fund and its Board,
o     Rating/ranking organizations (such as Lipper and Morningstar),
o     Portfolio pricing services retained by the Investment Advisor to provide
      portfolio security prices, and
o     Dealers, to obtain bids (price quotations, because securities are not priced
      by the Fund's regular pricing services).

      Portfolio holdings information of a Fund may be provided, under limited
circumstances, to brokers and dealers or with whom the Fund trades and/or entities
that provide investment coverage and/or analytical information regarding the Fund's
portfolio, provided that there is a legitimate investment reason for providing the
information to the broker or dealer or other entity.  Month-end portfolio holdings
information may, under this procedure, be provided to vendors providing research
information and/or analytics to the fund, with at least a 15-day delay after the
month end, but in certain cases may be provided to a broker or analytical vendor
with a 1- 2 day lag to facilitate the provision of requested investment information
to the manager to facilitate a particular trade or the portfolio manager's
investment process for the Fund.  Any third party receiving such information must
first sign the Investment Advisor's portfolio holdings non-disclosure agreement as
a pre-condition to receiving this information.

      Portfolio holdings information (which may include information on individual
securities positions or multiple securities) may be provided to the entities listed
below (1) by portfolio traders employed by the Investment Advisor in connection
with portfolio trading, and (2) by the members of the Investment Advisor's Security
Valuation Group and Accounting Departments in connection with portfolio pricing or
other portfolio evaluation purposes:

o     Brokers and dealers in connection with portfolio transactions (purchases and
      sales)
o     Brokers and dealers to obtain bids or bid and asked prices (if securities
      held by a Fund are not priced by the fund's regular pricing services)
o     Dealers to obtain price quotations where the fund is not identified as the
      owner

      Portfolio holdings information (which may include information on a Fund's
entire portfolio or individual securities therein) may be provided by senior
officers of the Investment Advisor or attorneys on the legal staff of the
Investment Advisor, Distributor, or Transfer Agent, in the following circumstances:

o     Response to legal process in litigation matters, such as responses to
      subpoenas or in class action matters where the Fund may be part of the
      plaintiff class (and seeks recovery for losses on a security) or a defendant,
o     Response to regulatory requests for information (the SEC, NASD, state
      securities regulators, and/or foreign securities authorities, including
      without limitation requests for information in inspections or for position
      reporting purposes),
o     To potential sub-advisors of portfolios (but only pursuant to confidentiality
      agreements),
o     To consultants for retirement plans for plan sponsors/discussions at due
      diligence meetings (if entire portfolio holdings are provided, however, it
      shall be done only pursuant to a confidentiality agreement),
o     Investment bankers in connection with merger discussions (but only pursuant
      to confidentiality agreements)

      Portfolio managers and analysts may, subject to the Investment Advisor's
policies on communications with the press and other media, discuss portfolio
information in interviews with members of the media, or in due diligence or similar
meetings with clients or prospective purchasers of Fund shares or their financial
intermediary representatives.

      The Fund's shareholders may, under unusual circumstances (such as a lack of
liquidity in the Fund's portfolio to meet redemptions), receive redemption proceeds
of their Fund shares paid as pro rata shares of securities held in the Fund's
portfolio.  In such circumstances, disclosure of the Fund's portfolio holdings may
be made to such shareholders.

      The Chief Compliance Officer of the Fund and the Investment Advisor,
Distributor, and Transfer Agent (the "CCO") shall oversee the compliance by the
Investment Advisor, Distributor, Transfer Agent, and their personnel with these
policies and procedures. At least annually, the CCO shall report to the Fund Board
on such compliance oversight and on the categories of entities and individuals to
which disclosure of portfolio holdings of the Funds has been made during the
preceding year pursuant to these policies. The CCO shall report to the Fund Board
any material violation of these policies and procedures during the previous
calendar quarter and shall make recommendations to the Companies and to the Boards
as to any amendments that the CCO believes are necessary and desirable to carry out
or improve these policies and procedures.

      The Investment Advisor and/or the Fund have entered into ongoing arrangements
to make available information about the Fund's portfolio holdings.  One or more of
the Oppenheimer funds may currently disclose portfolio holdings information based
on ongoing arrangements to the following parties:


          ---------------------------------------------------------

          A.G. Edwards & Sons           Keijser Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          ABG Securities                Kempen & Co. USA Inc.

          ---------------------------------------------------------
          ---------------------------------------------------------

          ABN AMRO                      Kepler Equities/Julius
                                        Baer Sec

          ---------------------------------------------------------
          ---------------------------------------------------------

          Advest                        KeyBanc Capital Markets

          ---------------------------------------------------------
          ---------------------------------------------------------

          AG Edwards                    Leerink Swan

          ---------------------------------------------------------
          ---------------------------------------------------------

          American Technology Research  Legg Mason

          ---------------------------------------------------------
          ---------------------------------------------------------

          Auerbach Grayson              Lehman

          ---------------------------------------------------------
          ---------------------------------------------------------

          Banc of America Securities    Lehman Brothers

          ---------------------------------------------------------
          ---------------------------------------------------------

          Barclays                      Lipper

          ---------------------------------------------------------
          ---------------------------------------------------------

          Baseline                      Loop Capital Markets

          ---------------------------------------------------------
          ---------------------------------------------------------

          Bear Stearns                  MainFirst Bank AG

          ---------------------------------------------------------
          ---------------------------------------------------------

          Belle Haven                   Makinson Cowell US Ltd

          ---------------------------------------------------------
          ---------------------------------------------------------

          Bloomberg                     Maxcor Financial

          ---------------------------------------------------------
          ---------------------------------------------------------

          BNP Paribas                   Merrill

          ---------------------------------------------------------
          ---------------------------------------------------------

          BS Financial Services         Merrill Lynch

          ---------------------------------------------------------
          ---------------------------------------------------------

          Buckingham Research Group     Midwest Research

          ---------------------------------------------------------
          ---------------------------------------------------------

          Caris & Co.                   Mizuho Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          CIBC World Markets            Morgan Stanley

          ---------------------------------------------------------
          ---------------------------------------------------------

          Citigroup                     Morningstar

          ---------------------------------------------------------
          ---------------------------------------------------------

          Citigroup Global Markets      Natexis Bleichroeder

          ---------------------------------------------------------
          ---------------------------------------------------------

          Collins Stewart               Ned Davis Research Group

          ---------------------------------------------------------
          ---------------------------------------------------------

          Craig-Hallum Capital Group LLCNomura Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          Credit Agricole Cheuvreux     Pacific Crest
          N.A. Inc.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Credit Suisse First Boston    Pacific Crest Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          Daiwa Securities              Pacific Growth Equities

          ---------------------------------------------------------
          ---------------------------------------------------------

          Davy                          Petrie Parkman

          ---------------------------------------------------------
          ---------------------------------------------------------

          Deutsche Bank                 Pictet

          ---------------------------------------------------------
          ---------------------------------------------------------

          Deutsche Bank Securities      Piper Jaffray Inc.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Dresdner Kleinwort WassersteinPlexus

          ---------------------------------------------------------
          ---------------------------------------------------------

          Emmet & Co                    Prager Sealy & Co.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Empirical Research            Prudential Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          Enskilda Securities           Ramirez & Co.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Essex Capital Markets         Raymond James

          ---------------------------------------------------------
          ---------------------------------------------------------

          Exane BNP Paribas             RBC Capital Markets

          ---------------------------------------------------------
          ---------------------------------------------------------

          Factset                       RBC Dain Rauscher

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fidelity Capital Markets      Research Direct

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fimat USA Inc.                Robert W. Baird

          ---------------------------------------------------------
          ---------------------------------------------------------

          First Albany                  Roosevelt & Cross

          ---------------------------------------------------------
          ---------------------------------------------------------

          First Albany Corporation      Russell Mellon

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fixed Income Securities       Ryan Beck & Co.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fortis Securities             Sanford C. Bernstein

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fox-Pitt, Kelton              Scotia Capital Markets

          ---------------------------------------------------------
          ---------------------------------------------------------

          Friedman, Billing, Ramsey     SG Cowen & Co.

          ---------------------------------------------------------
          ---------------------------------------------------------

          Fulcrum Global Partners       SG Cowen Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          Garp Research                 Soleil Securities Group

          ---------------------------------------------------------
          ---------------------------------------------------------

          George K Baum & Co.           Standard & Poors

          ---------------------------------------------------------
          ---------------------------------------------------------

          Goldman                       Stone & Youngberg

          ---------------------------------------------------------
          ---------------------------------------------------------

          Goldman Sachs                 SWS Group

          ---------------------------------------------------------
          ---------------------------------------------------------

          HSBC                          Taylor Rafferty

          ---------------------------------------------------------
          ---------------------------------------------------------

          HSBC Securities Inc           Think Equity Partners

          ---------------------------------------------------------
          ---------------------------------------------------------

          ING Barings                   Thomas Weisel Partners

          ---------------------------------------------------------
          ---------------------------------------------------------

          ISI Group                     UBS

          ---------------------------------------------------------
          ---------------------------------------------------------

          Janney Montgomery             Wachovia

          ---------------------------------------------------------
          ---------------------------------------------------------

          Jefferies                     Wachovia Corp

          ---------------------------------------------------------
          ---------------------------------------------------------

          Jeffries & Co.                Wachovia Securities

          ---------------------------------------------------------
          ---------------------------------------------------------

          JP Morgan                     Wescott Financial

          ---------------------------------------------------------
          ---------------------------------------------------------

          JP Morgan Securities          William Blair

          ---------------------------------------------------------
          ---------------------------------------------------------

          JPP Eurosecurities            Yieldbook

          ---------------------------------------------------------
          ---------------------------------------------------------

          Keefe, Bruyette & Woods

          ---------------------------------------------------------

How the Fund is Managed

Organization and History.  The Fund is an open-end, diversified, management
investment company with an unlimited number of authorized shares of beneficial
interest.  The Fund was organized as a Massachusetts business trust on November 4,
2002.

|X|  Classes  of  Shares.  The  Trustees  are  authorized,  without  shareholder
approval,  to create  new  series  and  classes  of  shares.  The  Trustees  may
reclassify  unissued  shares of the Fund into  additional  series of  classes of
shares.  The  Trustees  also may divide or combine  the shares of a class into a
greater or lesser number of shares without changing the proportionate beneficial
interest of a  shareholder  in the Fund.  Shares do not have  cumulative  voting
rights or preemptive or subscription rights. Shares may be voted in person or by
proxy at shareholder meetings.

The Fund currently has five classes of shares:  Class A, Class B, Class C, Class
N and  Class Y.  All  classes  invest  in the same  investment  portfolio.  Only
retirement  plans  may  purchase  Class N  shares.  Only  certain  institutional
investors may elect to purchase Class Y shares. Each class of shares:

o     has its own dividends and distributions,
o     pays certain expenses which may be different for the different classes,
o     may have a different net asset value,
o     may have separate voting rights on matters in which interests of one class
     are
         different from interests of another class, and
o     votes as a class on matters that affect that class alone.

Shares  are  freely  transferable,  and each share of each class has one vote at
shareholder  meetings,  with fractional shares voting  proportionally on matters
submitted  to the vote of  shareholders.  Each share of the Fund  represents  an
interest in the Fund  proportionately  equal to the interest of each other share
of the same class.

|X| Meetings of Shareholders. As a Massachusetts business trust, the Fund is not
required  to  hold,  and  does not plan to  hold,  regular  annual  meetings  of
shareholders,  but may do so from  time to  time on  important  matters  or when
required  to do so by the  Investment  Company  Act  or  other  applicable  law.
Shareholders have the right, upon a vote or declaration in writing of two-thirds
of the  outstanding  shares of the Fund,  to remove a Trustee  or to take  other
action described in the Fund's Declaration of Trust.

The Trustees will call a meeting of shareholders to vote on the removal of a
Trustee upon the written request of the record holders of 10% of its outstanding
shares.  If the Trustees receive a request from at least 10 shareholders stating
that they wish to communicate with other shareholders to request a meeting to
remove a Trustee, the Trustees will then either make the Fund's shareholder list
available to the applicants or mail their communication to all other shareholders
at the applicants' expense. The shareholders making the request must have been
shareholders for at least six months and must hold shares of the Fund valued at
$25,000 or more or constituting at least 1% of the Fund's outstanding shares. The
Trustees may also take other action as permitted by the Investment Company Act.

Shareholder and Trustee  Liability.  The Fund's Declaration of Trust contains an
express   disclaimer  of  shareholder  or  Trustee   liability  for  the  Fund's
obligations.  It also provides for indemnification and reimbursement of expenses
out of the Fund's  property for any shareholder  held personally  liable for its
obligations.  The  Declaration of Trust also states that upon request,  the Fund
shall assume the defense of any claim made against a shareholder  for any act or
obligation   of  the  Fund  and  shall  satisfy  any  judgment  on  that  claim.
Massachusetts  law permits a shareholder  of a business trust (such as the Fund)
to be  held  personally  liable  as a  "partner"  under  certain  circumstances.
However,  the risk that a Fund  shareholder will incur financial loss from being
held  liable as a  "partner"  of the Fund is  limited to the  relatively  remote
circumstances in which the Fund would be unable to meet its obligations.

The Fund's  contractual  arrangements  state that any person doing business with
the Fund (and each  shareholder  of the Fund)  agrees under its  Declaration  of
Trust to look solely to the assets of the Fund for  satisfaction of any claim or
demand  that may arise out of any  dealings  with the  Fund.  Additionally,  the
Trustees  shall have no personal  liability  to any such  person,  to the extent
permitted by law.

|X| Board of Trustees and Oversight Committees.  The Fund is governed by a Board
of Trustees,  which is responsible  for protecting the interests of shareholders
under  Massachusetts law. The Trustees meet periodically  throughout the year to
oversee the Fund's activities, review its performance, and review the actions of
the Manager.


The Board of Trustees has an Audit  Committee.  The Audit Committee is comprised
solely of Independent  Trustees.  The members of the Audit  Committee are Joseph
Wikler  (Chairman),  Ronald Abdow and Peter Wold. The Audit  Committee held ____
meetings  during  the fiscal  year ended  April 30,  2005.  The Audit  Committee
provides the Board with  recommendations  regarding  the selection of the Fund's
independent  auditor.  The Audit Committee also reviews the scope and results of
audits and the audit fees charged,  reviews reports from the Fund's  independent
auditor concerning the Fund's internal accounting procedures,  and controls, and
reviews  reports of the Manager's  internal  auditor,  among other duties as set
forth in the Committee's charter.


The Audit Committee's  functions  include selecting and nominating,  to the full
Board,  nominees  for  election  as  Trustees,   and  selecting  and  nominating
Independent  Trustees  for  election.  The Audit  Committee  may,  but need not,
consider  the advice and  recommendation  of the Manager and its  affiliates  in
selecting  nominees.  The full  Board  elects  new  trustees  except  for  those
instances when a shareholder vote is required.

To date, the Committee has been able to identify from its own resources an ample
number of qualified  candidates.  Nonetheless,  shareholders may submit names of
individuals,  accompanied by complete and properly  supported  resumes,  for the
Audit Committee's  consideration by mailing such information to the Committee in
care of the Fund.  The  Committee  may consider  such persons at such time as it
meets to consider  possible  nominees.  The  Committee,  however,  reserves sole
discretion  to  determine  the   candidates  to  present  to  the  Board  and/or
shareholders when it meets for the purpose of considering potential nominees.

Trustees and Officers of the Fund. Except for Messrs.  Murphy and Walcott,  each
of the Trustees are "Independent Trustees" under the Investment Company Act. Mr.
Murphy is an "Interested  Trustee," because he is affiliated with the Manager by
virtue of his  positions  as an officer and  director of the  Manager,  and as a
shareholder  of its  parent  company.  Mr.  Walcott is an  "Interested  Trustee"
because of his former position as an officer of the Manager's parent company.

The Fund's  Trustees  and officers  and their  positions  held with the Fund and
length of  service  in such  position(s)  and their  principal  occupations  and
business  affiliations during the past five years are listed in the chart below.
The information for the Trustees also includes the dollar range of shares of the
Fund as well as the aggregate dollar range of shares  beneficially  owned in any
of the Oppenheimer funds overseen by the Trustees.  All of the Trustees are also
trustees or directors of the following  Oppenheimer funds (referred to as "Board
IV Funds"):


Oppenheimer Dividend Growth Fund           Oppenheimer Real Estate Fund
Oppenheimer International Large-Cap
  Core Fund                                Oppenheimer Select Value Fund
Oppenheimer International Value Fund       Oppenheimer Total Return Bond Fund
Oppenheimer Limited Term California        Oppenheimer  Tremont  Market Neutral
    Municipal Fund                                Fund LLC
                                           Oppenheimer    Tremont   Opportunity
Oppenheimer Portfolio Series:                     Fund LLC
                                           OFI Tremont  Core  Strategies  Hedge
   Active Allocation Fund                     Fund
                                           OFI  Tremont  Market  Neutral  Hedge
   Aggressive Investor Fund                   Fund
   Conservative Investor Fund
   Moderate Investor Fund


Present  or former  officers,  directors,  trustees  and  employees  (and  their
immediate  family  members) of the Fund,  the Manager  and its  affiliates,  and
retirement  plans  established  by them for their  employees  are  permitted  to
purchase Class A shares of the Fund and the other Oppenheimer funds at net asset
value without  sales  charge.  The sales charges on Class A shares is waived for
that  group  because  of  the  economies  of  sales  efforts   realized  by  the
Distributor.


Messrs. Gord, Manioudakis,  Moon, Gillespie,  Miao, Murphy, Petersen,  Vandehey,
Vottiero,  Wixted and Zack and Mses.  Bloomberg and Ives who are officers of the
Fund,  respectively hold the same offices with one or more of the other Board IV
Funds as with the Fund.  As of June __, 2005 the  Trustees  and  officers of the
Fund, as a group,  owned of record or beneficially less than 1% of each class of
shares of the Fund. The foregoing statement does not reflect ownership of shares
held of record by an employee  benefit plan for employees of the Manager,  other
than the shares  beneficially  owned under that plan by the officers of the Fund
listed above. In addition,  each Independent Trustee, and his family members, do
not own securities of either the Manager or Distributor of the Board IV Funds or
any person  directly or  indirectly  controlling,  controlled by or under common
control with the Manager or Distributor.


      The address of each Independent Trustee and Interested Trustee in the charts
below is 6803 S. Tucson Way, Centennial, CO 80112-3924. Each Trustee serves for an
indefinite term, until his or her resignation, retirement, death or removal.

--------------------------------------------------------------------------------------
                                Independent Trustees
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
Name,                Principal Occupation(s) During Past 5     Dollar    Aggregate
                                                                         Dollar
                                                                         Range Of
                                                                         Shares
                                                                         Beneficially
                                                                         Owned in
                     Years;                                    Range of  Any of the
Position(s) Held     Other Trusteeships/Directorships Held by  Shares    Oppenheimer
with Fund,           Trustee;                                  BeneficialFunds
Length of Service,   Number of Portfolios in Fund Complex      Owned in  Overseen by
Age                  Currently Overseen by Trustee             the Fund  Trustee
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
                                                                 As of December 31,

                                                                        2004

--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------

Peter I. Wold,       President of Wold Properties, Inc. (an    $50,001   Over $100,000
Chairman of the      oil and gas exploration and production    -
Board since          company); Vice President, Secretary and   $100,000
December 2004,       Treasurer of Wold Trona Company, Inc.
Trustee since 2003,  (soda ash processing and production);
Age: 57              Vice President of Wold Talc Company,
                     Inc. (talc mining); Managing Member,
                     Hole-in-the-Wall Ranch (cattle
                     ranching); formerly Director and
                     Chairman of the Board, Denver Branch of
                     the Federal Reserve Bank of Kansas City
                     (1993 - 1999) and Director of
                     PacifiCorp. (1995 - 1999), an electric
                     utility. Oversees 14 portfolios in the
                     OppenheimerFunds complex.

--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------

Ronald J. Abdow,     Chairman (since 1959) of Abdow               $0         Over
Trustee since 2003,  Corporation (operator of restaurants);                $100,000
Age: 73              Trustee of the following real estate
                     businesses (owners and operators of
                     restaurants): G&R Realty Co. (since
                     1978), G&R Trust Co. (since 1973), Abdow
                     Partnership (since 1975), Auburn
                     Associates (since 1983) and Hazard
                     Associates (since 1985); Trustee of
                     MassMutual Premiun (since November 1,
                     2004), MML Series Investment Fund (since
                     1993) and of MassMutual Institutional
                     Funds (MMIF) (since 1994) (open-end
                     investment companies); Trustee (since
                     1987) of Bay State Health System (health
                     services); Chairman (since 1996) of
                     Western Mass Development Corp.
                     (non-profit land development); Chairman
                     (since 1991) of American International
                     College (non-profit college). Oversees
                     14 portfolios in the OppenheimerFunds
                     complex.

--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------

Joseph M. Wikler,    Self-employed as an investment               $0     $50,001-$100,000
Trustee since 2003,  consultant; a director (since 1996) of
Age: 64              Lakes Environmental Association, and
                     Medintec (since 1992) and Cathco (since
                     1995) (medical device companies); a
                     member of the investment committee of
                     the Associated Jewish Charities of
                     Baltimore (since 1994); formerly a
                     director of Fortis/Hartford mutual funds
                     (1994 - December 2001). Oversees 14
                     portfolios in the OppenheimerFunds
                     complex.

--------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------
                                 Interested Trustee
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Name,                Principal Occupation(s) During Past 5     Dollar    Aggregate
                                                                         Dollar
                                                                         Range Of
                                                                         Shares
                                                                         Beneficially
                                                                         Owned in
                     Years;                                    Range of  Any of the
Position(s) Held     Other Trusteeships/Directorships Held by  Shares    Oppenheimer
with Fund,           Trustee;                                  BeneficialFunds
Length of Service,   Number of Portfolios in Fund Complex      Owned in  Overseen
Age                  Currently Overseen by Trustee             the Fund  by Trustee
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
                                                                As of December 31,

                                                                       2004

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Eustis Walcott,      Principal with Ardsley Associates (since     $0     $10,001-50,000
Trustee since 2003   2000) (consulting firm); Director (since
Age: 67              October 2000) of Cornerstone Real Estate
                     Advisors LLC (real estate equity
                     investment management services) and MML
                     Investors Services (individual
                     retirement, insurance, investment, and
                     life event planning products and
                     services company) (both affiliates of
                     the Manager; Trustee of OFI Trust
                     Company (since 2001) (also an affiliate
                     of the Manager. Formerly Trustee of the
                     American International College (1995 -
                     December 2003); Senior Vice President,
                     MassMutual Financial Group (May 1990 -
                     July 2000). Oversees 14 portfolios in
                     the OppenheimerFunds complex.

-------------------------------------------------------------------------------------

      The address of Mr. Murphy in the chart below is Two World Financial Center,
225 Liberty Street, 11th Floor, New York, NY 10281-1008. Mr. Murphy serves for an
indefinite term, until his resignation, death or removal.

--------------------------------------------------------------------------------------
                           Interested Trustee and Officer
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
                                                                         Aggregate
                                                                         Dollar Range
                                                                         Of Shares
                                                                         Beneficially
                                                                Dollar   Owned in
                                                                Range    Any of the
Name,                Principal Occupation(s) During Past 5      of       Oppenheimer
Position(s) Held     Years;                                     Shares   Funds
with Fund,           Other Trusteeships/Directorships Held by   BeneficiaOverseen by
Length of Service;   Trustee;                                   Owned    Trustee
Age                  Number of Portfolios in Fund Complex       in the
                     Currently Overseen by Trustee              Fund
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
                                                                 As of December 31,

                                                                        2004

--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------

John V. Murphy,      Chairman, Chief Executive Officer and         $0    Over $100,000
President and        director (since June 2001) and President
Trustee,             (since September 2000) of the Manager;
Trustee since 2003   President and a director or trustee of
Age: 55              other Oppenheimer funds; President and a
                     director (since July 2001) of Oppenheimer
                     Acquisition Corp. (the Manager's parent
                     holding company) and of Oppenheimer
                     Partnership Holdings, Inc. (a holding
                     company subsidiary of the Manager); a
                     director (since November 2001) of
                     OppenheimerFunds Distributor, Inc. (a
                     subsidiary of the Manager); Chairman and
                     a director (since July 2001) of
                     Shareholder Services, Inc. and of
                     Shareholder Financial Services, Inc.
                     (transfer agent subsidiaries of the
                     Manager); President and a director (since
                     July 2001) of OppenheimerFunds Legacy
                     Program (a charitable trust program
                     established by the Manager); a director
                     of the following investment advisory
                     subsidiaries of the Manager: OFI
                     Institutional Asset Management, Inc.,
                     Centennial Asset Management Corporation,
                     Trinity Investment Management Corporation
                     and Tremont Capital Management, Inc.
                     (since November 2001), HarbourView Asset
                     Management Corporation and OFI Private
                     Investments, Inc. (since July 2001);
                     President (since November 1, 2001) and a
                     director (since July 2001) of Oppenheimer
                     Real Asset Management, Inc.; Executive
                     Vice President (since February 1997) of
                     Massachusetts Mutual Life Insurance
                     Company (the Manager's parent company); a
                     director (since June 1995) of DLB
                     Acquisition Corporation (a holding
                     company that owns the shares of Babson
                     Capital Management LLC); a member of the
                     Investment Company Institute's Board of
                     Governors (elected to serve from October
                     3, 2003 through September 30, 2006).
                     Formerly, Chief Operating Officer
                     (September 2000-June 2001) of the
                     Manager; President and trustee (November
                     1999-November 2001) of MML Series
                     Investment Fund and MassMutual Select
                     Funds (open-end investment companies); a
                     director (September 1999-August 2000) of
                     C.M. Life Insurance Company; President,
                     Chief Executive Officer and director
                     (September 1999-August 2000) of MML Bay
                     State Life Insurance Company; a director
                     (June 1989-June 1998) of Emerald Isle
                     Bancorp and Hibernia Savings Bank (a
                     wholly-owned subsidiary of Emerald Isle
                     Bancorp). Oversees 66 portfolios as
                     Trustee/Director and 20 additional
                     portfolios as Officer in the
                     OppenheimerFunds complex.

--------------------------------------------------------------------------------------


      The address of the Officers in the chart below is as follows: for Messrs.
Gord, Manioudakis, Moon, Zack, Gillespie and Miao and Ms. Bloomberg, Two World
Financial Center, 225 Liberty Street, New York, NY 10281-1008, for Messrs.
Vandehey, Vottiero, Petersen and Wixted and Ms. Ives, 6803 S. Tucson Way,
Centennial, CO 80112-3924. Each Officer serves for an indefinite term or until his
or her earlier resignation, death or removal.


-------------------------------------------------------------------------------------
                                Officers of the Fund
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Name,
Position(s) Held with Fund,
Length of Service,
Age                            Principal Occupation(s) During Past 5 Years
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Benjamin J. Gord, Vice         Vice President of the Manager (since April 2002), of
President and                  HarbourView Asset Management Corporation (since
Portfolio Manager since 2003   April 2002) and of OFI Institutional Asset
Age:  42                       Management, Inc. (as of June 2002); a portfolio
                               manager of 11 other portfolios in the
                               OppenheimerFunds complex. Formerly an executive
                               director and senior fixed income analyst at Miller
                               Anderson & Sherrerd, a division of Morgan Stanley
                               Investment Management (April 1992-March 2002).

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Angelo Manioudakis, Vice       Senior Vice President of the Manager (since April
President and Portfolio        2002), of HarbourView Asset Management Corporation
Manager since 2003             (since April, 2002 and of OFI Institutional Asset
Age: 38                        Management, Inc. (since June 2002); an officer of 14

                               portfolios in the OppenheimerFunds complex. Formerly
                               Executive Director and portfolio manager for Miller,
                               Anderson & Sherrerd, a division of Morgan Stanley
                               Investment Management (August 1993-April 2002).
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Charles Moon, Vice President   Vice President of the Manager (since April 2002, of
and                            HarbourView Asset Management Corporation (since
Portfolio Manager since 2003   April 2002) and of OFI Institutional Asset
Age:  39                       Management, Inc. (since June 2002); a portfolio
                               manager of 11 other portfolios in the
                               OppenheimerFunds complex. Formerly executive
                               director and portfolio manager at Miller Anderson &
                               Sherrerd, a division of Morgan Stanley Investment
                               Management (June 1999-March 2002); Vice President of
                               Citicorp Securities Inc. (June 1993-May 1999).

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Mark S. Vandehey,              Senior Vice President and Chief Compliance Officer
Vice President and Chief       (since March 2004) of the Manager; Vice President
Compliance Officer since 2004  (since June 1983) of OppenheimerFunds Distributor,
Age:  54                       Inc., Centennial Asset Management Corporation and
                               Shareholder Services, Inc. Formerly (until February
                               2004) Vice President and Director of Internal Audit
                               of the Manager. An officer of 86 portfolios in the
                               Oppenheimer funds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Brian W. Wixted,               Senior Vice President and Treasurer (since March
Treasurer since 2003           1999) of the Manager; Treasurer of HarbourView Asset
Age: 45                        Management Corporation, Shareholder Financial
                               Services, Inc., Shareholder Services, Inc.,
                               Oppenheimer Real Asset Management Corporation, and
                               Oppenheimer Partnership Holdings, Inc. (since March
                               1999), of OFI Private Investments, Inc. (since March
                               2000), of OppenheimerFunds International Ltd. and
                               OppenheimerFunds plc (since May 2000), of OFI
                               Institutional Asset Management, Inc. (since November
                               2000), and of OppenheimerFunds Legacy Program (a
                               Colorado non-profit corporation) (since June 2003);
                               Treasurer and Chief Financial Officer (since May
                               2000) of OFI Trust Company (a trust company
                               subsidiary of the Manager); Assistant Treasurer
                               (since March 1999) of Oppenheimer Acquisition Corp.
                               Formerly Assistant Treasurer of Centennial Asset
                               Management Corporation (March 1999-October 2003) and
                               OppenheimerFunds Legacy Program (April 2000-June
                               2003); Principal and Chief Operating Officer (March
                               1995-March 1999) at Bankers Trust Company-Mutual
                               Fund Services Division. An officer of 86 portfolios
                               in the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Brian Petersen,                Assistant Vice President of the Manager since August
Assistant Treasurer since 2004 2002; formerly Manager/Financial Product Accounting
Age: 34                        (November 1998-July 2002) of the Manager. An officer
                               of 86 portfolios in the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Philip Vottiero,               Vice President/Fund Accounting of the Manager since
Assistant Treasurer since      March 2002. Formerly Vice President/Corporate
2003                           Accounting of the Manager (July 1999-March 2002)
Age:  42                       prior to which he was Chief Financial Officer at
                               Sovlink Corporation (April 1996-June 1999). An
                               officer of 86 portfolios in the OppenheimerFunds
                               complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Robert G. Zack,                Executive Vice President (since January 2004) and
Secretary since 2003           General Counsel (since February 2002) of the
Age: 55                        Manager; General Counsel and a director (since
                               November 2001) of the Distributor; General Counsel
                               (since November 2001) of Centennial Asset Management
                               Corporation; Senior Vice President and General
                               Counsel (since November 2001) of HarbourView Asset
                               Management Corporation; Secretary and General
                               Counsel (since November 2001) of Oppenheimer
                               Acquisition Corp.; Assistant Secretary and a
                               director (since October 1997) of OppenheimerFunds
                               International Ltd. and OppenheimerFunds plc; Vice
                               President and a director (since November 2001) of
                               Oppenheimer Partnership Holdings, Inc.; a director
                               (since November 2001) of Oppenheimer Real Asset
                               Management, Inc.; Senior Vice President, General
                               Counsel and a director (since November 2001) of
                               Shareholder Financial Services, Inc., Shareholder
                               Services, Inc., OFI Private Investments, Inc. and
                               OFI Trust Company; Vice President (since November
                               2001) of OppenheimerFunds Legacy Program; Senior
                               Vice President and General Counsel (since November
                               2001) of OFI Institutional Asset Management, Inc.; a
                               director (since June 2003) of OppenheimerFunds
                               (Asia) Limited. Formerly Senior Vice President (May
                               1985-December 2003), Acting General Counsel
                               (November 2001-February 2002) and Associate General
                               Counsel (May 1981-October 2001) of the Manager;
                               Assistant Secretary of Shareholder Services, Inc.
                               (May 1985-November 2001), Shareholder Financial
                               Services, Inc. (November 1989-November 2001); and
                               OppenheimerFunds International Ltd. (October
                               1997-November 2001). An officer of 86 portfolios in
                               the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Kathleen T. Ives,              Vice President (since June 1998) and Senior Counsel
Assistant Secretary since 2003 and Assistant Secretary (since October 2003) of the
Age:  39                       Manager; Vice President (since 1999) and Assistant
                               Secretary (since October 2003) of the Distributor;
                               Assistant Secretary (since October 2003) of
                               Centennial Asset Management Corporation; Vice
                               President and Assistant Secretary (since 1999) of
                               Shareholder Services, Inc.; Assistant Secretary
                               (since December 2001) of OppenheimerFunds Legacy
                               Program and of Shareholder Financial Services, Inc..
                               Formerly an Assistant Counsel (August 1994-October
                               2003) and Assistant Vice President of the Manager
                               (August 1997-June 1998). An officer of 86 portfolios
                               in the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Lisa I. Bloomberg,             Vice President and Associate Counsel of the Manager
Assistant Secretary since 2004 since May 2004; formerly First Vice President and
Age:  37                       Associate General Counsel of UBS Financial Services
                               Inc. (formerly, PaineWebber Incorporated) (May 1999
                               - April 2004) prior to which she was an Associate at
                               Skaden, Arps, Slate, Meagher & Flom, LLP (September
                               1996 - April 1999). An officer of 86 portfolios in
                               the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Phillip S. Gillespie,          Senior Vice President and Deputy General Counsel of
Assistant Secretary since 2004 the Manager since September 2004. Formerly Mr.
Age:  41                       Gillespie held the following positions at Merrill
                               Lynch Investment Management: First Vice President
                               (2001-September 2004); Director (from 2000) and Vice
                               President (1998-2000). An officer of 86 portfolios
                               in the OppenheimerFunds complex.

-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Wayne Miao,                    Assistant Vice President and Assistant Counsel of
Assistant Secretary since 2004 the Manager since June 2004. Formerly an Associate
Age:  32                       with Sidley Austin Brown & Wood LLP (September 1999
                               - May 2004). An officer of 86 portfolios in the
                               OppenheimerFunds complex.

-------------------------------------------------------------------------------------


      |X|   Remuneration  of Trustees.  The officers of the Fund and Mr.  Murphy (who
is an officer  and Trustee of the Fund) are  affiliated  with the Manager and receive
no salary or fee from the Fund.  The  remaining  Trustees  of the Fund  received  the
compensation  shown below from the Fund with respect to the Fund's  fiscal year ended
April 30, 2005. The Total  Compensation  from all 10 of the Board IV Funds (including
the Fund)  represents  compensation  received  for serving as a trustee and member of
a committee  (if  applicable)  of the boards of those funds during the calendar  year
ended December 31, 2004.


------------------------------------------------------------------------------------
Trustee Name and Other Fund           Aggregate          Total Compensation From
Position(s) (as applicable)       Compensation From      Funds and Fund Complex*
                                       Fund(1)              Paid to Trustees
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Ronald J. Abdow

Trustee, Audit Committee Member         $2,000                 $81,833(2)

------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Eustis Walcott

Trustee                                 $1,800                   $18,500

------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Joseph M. Wikler

Trustee, Audit Committee                $2,583                   $23,000

Chairman
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Peter I. Wold

Chairman of the Board, Audit            $2,333                   $20,500

Committee Member
------------------------------------------------------------------------------------

1. Aggregate Compensation From Fund includes fees and deferred compensation,  if
any, for a Trustee.

2. Includes $61,333  compensation paid to Mr. Abdow for serving as a trustee for
two open-end investment companies (MassMutual Institutional Funds and MML Series
Investment Fund) the investment advisor for which is the indirect parent company
of the  Fund's  Manager.  The  Manager  also  serves as the  Sub-Advisor  to the
MassMutual  International  Equity  Fund,  a series of  MassMutual  Institutional
Funds.


* For purposes of this section only,  "Fund  Complex"  includes the  Oppenheimer
funds,  MassMutual  Institutional  Funds  and  MML  Series  Investment  Fund  in
accordance  with SEC  regulations.  The  Manager  does not  consider  MassMutual
Institutional   Funds  and  MML  Series  Investment  Fund  to  be  part  of  the
OppenheimerFunds' "Fund Complex" as that term may be otherwise interpreted.



|X| Major  Shareholders.  As of June __,  2005,  the only  persons  who owned of
record or were known by the Fund to own of record 5% or more of any class of the
Fund's  outstanding  shares,  and their  holdings of that class as of that date,
were:

OppenheimerFunds  Inc.,  C/O  Tim  Abbuhl,  Bldg.  2,  6803  South  Tucson  Way,
Centennial, Colorado 80112-3924 (which owned __________ Class A shares or _____%
of the Class A shares then outstanding).

RPSS TR Rollover IRA, FBO Catherine P.  Anderson,  2478 North  Mountain  Avenue,
Upland, California 91784-8677 (which owned __________ Class N shares or ____% of
the Class N shares then outstanding).

RPSS TR Steve's  Mirror & Glass LTD,  401(k) Plan,  Attn:  Bill  Bicknese,  2816
Harmony Drive,  Bettendorf,  Iowa  52722-3108  (which owned  __________  Class N
shares or ____% of the Class N shares then outstanding).

Joseph  Taylor,  MD, TR, Reading  Internal  Medicine  Associates,  20 PondMeadow
Drive,  Suite 206,  Reading,  Massachusetts  01867-3261  (which owned __________
Class N shares or ____% of the Class N shares then outstanding).

RPSS TR, Craig Funeral Home,  401(k) Plan,  Attn.:  Margie Craig, 1475 Old Dixie
Highway,  St.  Augustine,  Florida  32084-6209  (which owned  __________ Class N
shares or ____% of the Class N shares then outstanding).



The Manager.  The Manager is  wholly-owned by Oppenheimer  Acquisition  Corp., a
holding company  controlled by Massachusetts  Mutual Life Insurance  Company,  a
global, diversified insurance and financial services organization.


|X| Code of Ethics.  The Fund,  the Manager and the  Distributor  have a Code of
Ethics.  It is  designed  to detect and  prevent  improper  personal  trading by
certain employees, including portfolio managers, that would compete with or take
advantage of the Fund's portfolio transactions.  Covered persons include persons
with  knowledge of the  investments  and  investment  intentions of the Fund and
other funds  advised by the  Manager.  The Code of Ethics does permit  personnel
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 Code of Ethics is carefully  monitored  and enforced by the
Manager.


The Code of Ethics is an exhibit to the Fund's registration statement filed with
the SEC and can be reviewed  and copied at the SEC's  Public  Reference  Room in
Washington,  D.C. You can obtain information about the hours of operation of the
Public Reference Room by calling the SEC at  1.202.942.8090.  The Code of Ethics
can also be viewed as part of the  Fund's  registration  statement  on the SEC's
EDGAR  database  at the SEC's  Internet  website at  www.sec.gov.  Copies may be
obtained,  ----------- after paying a duplicating fee, by electronic  request at
the following  E-mail address:  publicinfo@sec.gov.,  or by writing to the SEC's
Public Reference Section, ------------------- Washington, D.C. 20549-0102.


Portfolio Proxy Voting. The Fund has adopted Portfolio Proxy Voting Policies and
Procedures under which the Fund votes proxies relating to securities ("portfolio
proxies") held by the Fund. The Fund's primary consideration in voting portfolio
proxies is the financial  interests of the Fund and its  shareholders.  The Fund
has retained an unaffiliated  third-party as its agent to vote portfolio proxies
in accordance with the Fund's Portfolio Proxy Voting  Guidelines and to maintain
records of such  portfolio  proxy voting.  The Proxy Voting  Guidelines  include
provisions to address  conflicts of interest that may arise between the Fund and
OFI where an OFI directly-controlled affiliate manages or administers the assets
of a pension plan of a company  soliciting the proxy. The Fund's Portfolio Proxy
Voting  Guidelines on routine and  non-routine  proxy  proposals are  summarized
below.


o The Fund votes with the  recommendation of the issuer's  management on routine
matters,   including   election  of  directors   nominated  by  management   and
ratification of auditors, unless circumstances indicate otherwise.

o In general, the Fund opposes anti-takeover  proposals and supports elimination
of anti-takeover proposals, absent unusual circumstances.

o The Fund  supports  shareholder  proposals  to  reduce a  super-majority  vote
requirement,  and opposes  management  proposals  to add a  super-majority  vote
requirement.

o The Fund opposes proposals to classify the board of directors.

o The Fund supports proposals to eliminate cumulative voting.

o The Fund opposes re-pricing of stock options.

o The Fund generally  considers executive  compensation  questions such as stock
option plans and bonus plans to be ordinary business activity. The Fund analyzes
stock option plans, paying particular  attention to their dilutive effect. While
the Fund  generally  supports  management  proposals,  the Fund opposes plans it
considers to be excessive.


The Fund is required to file Form N-PX,  with its complete  proxy voting  record
for the 12 months ended June 30th,  no later than August 31st of each year.  The
Fund's Form N-PX  filing is  available  (i) without  charge,  upon  request,  by
calling the Fund  toll-free at  1.800.525.7048  and (ii) on the SEC's website at
www.sec.gov.

|X| The Investment Advisory Agreement.  The Manager provides investment advisory
and  management  services  to the Fund under an  investment  advisory  agreement
between the Manager and the Fund. The Manager selects  securities for the Fund's
portfolio and handles its  day-to-day  business.  The portfolio  managers of the
Fund  are  employed  by the  Manager  and are the  persons  who are  principally
responsible for the day-to-day management of the Fund's portfolio. Other members
of the Manager's Fixed Income Portfolio Team provide the portfolio managers with
counsel and support in managing the Fund's portfolio.


The  agreement  requires the Manager,  at its expense,  to provide the Fund with
adequate office space, facilities and equipment. It also requires the Manager to
provide  and  supervise  the  activities  of  all  administrative  and  clerical
personnel  required  to provide  effective  administration  for the Fund.  Those
responsibilities include the compilation and maintenance of records with respect
to its  operations,  the  preparation  and  filing  of  specified  reports,  and
composition of proxy materials and registration statements for continuous public
sale of shares of the Fund.


The Fund pays expenses not  expressly  assumed by the Manager under the advisory
agreement.  The advisory  agreement lists examples of expenses paid by the Fund.
The major categories relate to interest,  taxes, brokerage commissions,  fees to
certain  Trustees,  legal and  audit  expenses,  custodian  and  transfer  agent
expenses,  share issuance costs,  certain  printing and  registration  costs and
non-recurring expenses,  including litigation costs. The management fees paid by
the Fund to the Manager are calculated at the rates described in the Prospectus,
which are applied to the assets of the Fund as a whole.  The fees are  allocated
to each class of shares  based upon the  relative  proportion  of the Fund's net
assets  represented by that class.  The management  fees paid by the Fund to the
Manager during its last three fiscal years were:


 ------------------------------------------------------------------------------
  Fiscal Year ended 4/30:    Management Fees Paid to OppenheimerFunds, Inc.
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
          2003(1)                                $24,656
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
           2004                                 $185,574
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------

           2005                                 $241,713

 ------------------------------------------------------------------------------
1 For the fiscal period from February 21, 2003  (commencement  of operations) to
April 30, 2003.


The  investment  advisory  agreement  states  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  Manager 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.

The  agreement  permits the Manager to act as  investment  advisor for any other
person, firm or corporation and to use the name "Oppenheimer" in connection with
other investment companies for which it may act as investment advisor or general
distributor.  If the Manager  shall no longer act as  investment  advisor to the
Fund,  the  Manager  may  withdraw  the  right  of  the  Fund  to use  the  name
"Oppenheimer" as part of its name.

Portfolio  Manager.  The Fund's  portfolio  is  managed by a team of  investment
professionals  comprised of Angelo Manioudakis,  Benjamin J. Gord, Charles Moon,
Geoffrey  Caan and  Antulio  N.  Bomfim  (each is  referred  to as a  "portfolio
manager" and collectively they are referred to as the "portfolio  managers") who
are responsible for the day-to-day management of the Fund's investments.


Other Accounts Managed. In addition to managing the Portfolios' investments, the
portfolio  managers also manage other  investment  portfolios and accounts.  The
following table provides information regarding the other portfolios and accounts
managed  by the  portfolio  managers  as of April 30,  2005.  No  account  has a
performance-based advisory fee:


                                                        Total Assets
                             Total Assets     Other     in Other
                Registered   in Registered    Pooled    Pooled               Total Assets
                Investment   Investment      Investment Investment   Other    in Other
Portfolio       Companies     Companies      Vehicles    Vehicles    Accounts Accounts
Manager         Managed       Managed*       Managed     Managed*    Managed   Managed*

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------


Angelo Manioudakis  17     $12,011.7          6         $170.4       1      $39.1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Benjamin J. Gord    14     $11,446.9          6         $170.4       1      $39.1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Geoffrey Caan       14      $11,446.9         6       $170.4         1      $39.1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Charles Moon        14      $11,446.9         6       $170.4         1      $39.1

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Antulio N. Bomfim   14      $11,446.9         6       $170.4         1      $39.1
   *  In millions.


As indicated above,  each of the Portfolio  Managers also manage other funds and
accounts.  Potentially, at times, those responsibilities could conflict with the
interests of the Fund.  That may occur whether the investment  strategies of the
other  funds  or  accounts  are the same  as,  or  different  from,  the  Fund's
investment  objectives and  strategies.  For example the Portfolio  Managers may
need to allocate investment  opportunities  between the Fund and another fund or
account  having similar  objectives or  strategies,  or they may need to execute
transactions  for another fund or account  that could have a negative  impact on
the value of securities held by the Fund. Not all funds and accounts  advised by
the Manager have the same  management  fee. If the  management  fee structure of
another  fund or  account  is more  advantageous  to the  Manager  than  the fee
structure  of the Fund,  the Manager  could have an incentive to favor the other
fund or account. However, the Manager's compliance procedures and Code of Ethics
recognize  the  Manager's  fiduciary  obligations  to treat all of its  clients,
including  the Fund,  fairly and  equitably,  and are  designed to preclude  the
Portfolio  Managers from favoring one client over  another.  It is possible,  of
course,  that those compliance  procedures and the Code of Ethics may not always
be adequate to do so. At various times, the Fund's Portfolio Managers may manage
other funds or accounts  with  investment  objectives  and  strategies  that are
similar to those of the Fund,  or may manage funds or accounts  with  investment
objectives and strategies that are different from those of the Fund.

Compensation  of the  Portfolio  Managers.  The Fund's  Portfolio  Managers  are
employed and  compensated  by the  Manager,  not the Fund.  Under the  Manager's
compensation  program for its portfolio managers and portfolio  analysts,  their
compensation  is based  primarily on the investment  performance  results of the
funds and accounts  they  manage,  rather than on the  financial  success of the
Manager.  This is  intended  to  align  the  portfolio  managers  and  analysts'
interests with the success of the funds and accounts and their shareholders. The
Manager's  compensation  structure  is  designed  to attract  and retain  highly
qualified investment management  professionals and to reward individual and team
contributions  toward  creating  shareholder  value.  As of April 30, 2005, each
Portfolio Managers'  compensation consisted of three elements: a base salary, an
annual discretionary bonus and eligibility to participate in long-term awards of
options and  appreciation  rights in regard to the common stock of the Manager's
holding  company  parent.  Senior  portfolio  managers  may also be  eligible to
participate in the Manager's deferred compensation plan.

To help the Manager  attract and retain  talent,  the base pay component of each
portfolio  manager  is  reviewed  regularly  to  ensure  that  it  reflects  the
performance of the  individual,  is  commensurate  with the  requirements of the
particular  portfolio,  reflects  any  specific  competence  or specialty of the
individual  manager,  and is competitive  with other comparable  positions.  The
annual discretionary bonus is determined by senior management of the Manager and
is based on a number of factors,  including  a fund's  pre-tax  performance  for
periods of up to five years,  measured  against an appropriate  Lipper benchmark
selected by management.  The Lipper benchmark with respect to the Fund is Lipper
- Intermediate  Investment Grade Debt Funds.  Other factors  considered  include
management quality (such as style consistency, risk management, sector coverage,
team  leadership  and coaching) and  organizational  development.  The Portfolio
Managers'  compensation is not based on the total value of the Fund's  portfolio
assets,  although the Fund's  investment  performance may increase those assets.
The compensation structure is also intended to be internally equitable and serve
to reduce  potential  conflicts of interest between the Fund and other funds and
accounts managed by the Portfolio  Managers.  The compensation  structure of the
other funds and accounts  managed by the  Portfolio  Managers is the same as the
compensation structure of the Fund, described above.

Ownership of Fund Shares.  As of April 30, 2005, the Portfolio  Managers did not
beneficially own any shares of the Funds.


Brokerage Policies of the Fund

Brokerage Provisions of the Investment Advisory Agreement.  One of the duties of
the Manager under the investment  advisory agreement is to arrange the portfolio
transactions for the Fund. The advisory agreement contains  provisions  relating
to the employment of broker-dealers to effect the Fund's portfolio transactions.
The Manager is  authorized by the advisory  agreement to employ  broker-dealers,
including  "affiliated"  brokers,  as that  term is  defined  in the  Investment
Company Act. The Manager may employ  broker-dealers  that the Manager thinks, in
its best judgment  based on all relevant  factors,  will implement the policy of
the Fund to obtain,  at reasonable  expense,  the "best execution" of the Fund's
portfolio transactions.  "Best execution" means prompt and reliable execution at
the most  favorable  price  obtainable.  The Manager  need not seek  competitive
commission bidding.  However, it is expected to be aware of the current rates of
eligible brokers and to minimize the commissions  paid to the extent  consistent
with the  interests  and  policies  of the Fund as  established  by its Board of
Trustees.


Under  the  investment  advisory  agreement,  in  choosing  brokers  to  execute
portfolio  transactions for the Fund, the Manager may select brokers (other than
affiliates) that provide  brokerage and/or research  services to the Fund and/or
the other  accounts  over which the Manager or its  affiliates  have  investment
discretion.  The  commissions  paid to those  brokers may be higher than another
qualified broker would charge,  if the Manager makes a good faith  determination
that the commission is fair and reasonable in relation to the services provided.

Rule 12b-1 under the Investment Company Act prohibits any fund from compensating
a broker or dealer for  promoting or selling the fund's  shares by (1) directing
to that  broker or  dealer  any of the  fund's  portfolio  transactions,  or (2)
directing any other remuneration to that broker or dealer,  such as commissions,
mark-ups, mark downs or other fees from the fund's portfolio transactions,  that
were  effected  by  another  broker or dealer  (these  latter  arrangements  are
considered to be a type of "step-out"  transaction).  In other words, a fund and
its  investment  adviser  cannot use the  fund's  brokerage  for the  purpose of
rewarding broker-dealers for selling the fund's shares.

However,  the Rule permits funds to effect brokerage  transactions through firms
that also sell fund  shares,  provided  that certain  procedures  are adopted to
prevent a quid pro quo with  respect  to  portfolio  brokerage  allocations.  As
permitted by the Rule, the Manager has adopted  procedures (and the Fund's Board
of  Trustees  has  approved  those  procedures)  that  permit the Fund to direct
portfolio  securities  transactions  to brokers or dealers  that also promote or
sell  shares  of the  Fund,  subject  to  the  "best  execution"  considerations
discussed  above.  Those  procedures are designed to prevent:  (1) the Manager's
personnel who effect the Fund's portfolio  transactions from taking into account
a broker's or dealer's promotion or sales of the Fund shares when allocating the
Fund's portfolio transactions, and (2) the Fund, the Manager and the Distributor
from entering into agreements or understandings  under which the Manager directs
or is expected to direct the Fund's brokerage directly,  or through a "step-out"
arrangement,  to any  broker or  dealer in  consideration  of that  broker's  or
dealer's  promotion  or sale of the  Fund's  shares or the  shares of any of the
other Oppenheimer funds.


Brokerage Practices Followed by the Manager. The Manager allocates brokerage for
the Fund subject to the provisions of the investment  advisory agreement and the
procedures and rules described above. Generally, the Manager's portfolio traders
allocate  brokerage  based upon  recommendations  from the  Manager's  portfolio
managers. In certain instances, portfolio managers may directly place trades and
allocate  brokerage.  In either case, the Manager's executive officers supervise
the allocation of brokerage.

Transactions in securities other than those for which an exchange is the primary
market are generally done with  principals or market makers.  In transactions on
foreign exchanges,  the Fund may be required to pay fixed brokerage  commissions
and therefore would not have the benefit of negotiated  commissions available in
U.S.  markets.  Brokerage  commissions  are paid primarily for  transactions  in
listed  securities  or  for  certain  fixed-income  agency  transactions  in the
secondary market.  Otherwise,  brokerage commissions are paid only if it appears
likely  that a better  price or  execution  can be  obtained  by doing so. In an
option transaction, the Fund ordinarily uses the same broker for the purchase or
sale of the option and any  transaction  in the  securities  to which the option
relates.

Other funds advised by the Manager have investment  policies similar to those of
the Fund. Those other funds may purchase or sell the same securities as the Fund
at the same time as the Fund,  which  could  affect  the supply and price of the
securities.  If two or more  funds  advised  by the  Manager  purchase  the same
security  on the same day from the same  dealer,  the  transactions  under those
combined  orders are averaged as to price and allocated in  accordance  with the
purchase or sale orders actually placed for each account.

In an option  transaction,  the Fund  ordinarily  uses the same  broker  for the
purchase or sale of the option and any  transaction  in the  securities to which
the option  relates.  When  possible,  the Manager  tries to combine  concurrent
orders to  purchase or sell the same  security by more than one of the  accounts
managed by the Manager or its affiliates.  The transactions under those combined
orders are averaged as to price and allocated in accordance with the purchase or
sale orders actually placed for each account.

The investment  advisory agreement permits the Manager to allocate brokerage for
research services.  The research services provided by a particular broker may be
useful  only to one or more of the  advisory  accounts  of the  Manager  and its
affiliates.  The investment research received for the commissions of those other
accounts may be useful both to the Fund and one or more of the  Manager's  other
accounts. Investment research may be supplied to the Manager by a third party at
the instance of a broker through which trades are placed.

Investment  research  services  include  information  and analysis on particular
companies  and  industries  as well as market or economic  trends and  portfolio
strategy,  market  quotations for portfolio  evaluations,  information  systems,
computer hardware and similar products and services.  If a research service also
assists the Manager in a  non-research  capacity  (such as  bookkeeping or other
administrative  functions),  then only the percentage or component that provides
assistance to the Manager in the investment  decision-making process may be paid
in commission dollars.

The Board of Trustees permits the Manager to use stated commissions on secondary
fixed-income  agency trades to obtain  research if the broker  represents to the
Manager that: (i) the trade is not from or for the broker's own inventory,  (ii)
the  trade  was  executed  by the  broker  on an  agency  basis  at  the  stated
commission,  and (iii) the trade is not a riskless  principal  transaction.  The
Board  of  Trustees  permits  the  Manager  to use  commissions  on  fixed-price
offerings  to obtain  research,  in the same manner as is  permitted  for agency
transactions.

The research  services provided by brokers broaden the scope and supplements the
research activities of the Manager.  That research provides additional views and
comparisons  for   consideration,   and  helps  the  Manager  to  obtain  market
information  for the valuation of securities  that are either held in the Fund's
portfolio or are being considered for purchase. The Manager provides information
to the Board about the  commissions  paid to brokers  furnishing  such services,
together with the Manager's  representation  that the amount of such commissions
was reasonably related to the value or benefit of such services.






   ---------------------------------------------------------------------
                             Total Brokerage Commissions Paid by the
   Fiscal Year Ended 4/30:                   Fund(1)
   ---------------------------------------------------------------------
   ---------------------------------------------------------------------
           2003(2)                            $1,033
   ---------------------------------------------------------------------
   ---------------------------------------------------------------------
            2004                            $5,493(3)
   ---------------------------------------------------------------------
   ---------------------------------------------------------------------

            2005                              $7,485

   ---------------------------------------------------------------------

1. Amounts do not include spreads or commissions on principal  transactions on a
net trade basis.

2. For the fiscal period from February 21, 2003  (commencement of operations) to
April 30, 2003.

3. In the fiscal year ended April 30, 2004, the amount of transactions  directed
to brokers for research  services was $0 and amount of the  commissions  paid to
broker-dealers for those services was $0

Distribution and Service Plans

The Distributor.  Under its General  Distributor's  Agreement with the Fund, the
Distributor  acts as the Fund's principal  underwriter in the continuous  public
offering of the Fund's  classes of shares.  The  Distributor  bears the expenses
normally  attributable to sales,  including advertising and the cost of printing
and mailing prospectuses,  other than those furnished to existing  shareholders.
The Distributor is not obligated to sell a specific number of shares.

The sales charges and concessions  paid to, or retained by, the Distributor from
the sale of shares and the  contingent  deferred  sales charges  retained by the
Distributor on the redemption of shares during the Fund's two most recent fiscal
years are shown in the tables below.

-------------------------------------------
Fiscal    Aggregate        Class A
                           Front-End
Year      Front-End Sales  Sales Charges
Ended     Charges on       Retained by
4/30:     Class A Shares   Distributor(1)
-------------------------------------------
-------------------------------------------
 2003(2)      $22,204          $9,189
-------------------------------------------
-------------------------------------------
  2004        $104,718         $35,933
-------------------------------------------
-------------------------------------------

  2005        $152,109         $58,309

-------------------------------------------
1. Includes amounts retained by a broker-dealer that is an affiliate or a parent
of the distributor.

2. For the fiscal period from February 21, 2003  (commencement of operations) to
April 30, 2003.

-----------------------------------------------------------------------------
Fiscal    Concessions on   Concessions on  Concessions on   Concessions on
Year      Class A Shares   Class B Shares  Class C Shares   Class N Shares
Ended     Advanced by      Advanced by     Advanced by      Advanced by
4/30:     Distributor(1)   Distributor(1)  Distributor(1)   Distributor(1)
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
 2003(2)        $10            $9,448           $2,528            $87
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
  2004        $18,313        $1,128,383        $151,970         $34,972
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------

  2005         $3,021          $48,935         $29,456          $16,499

-----------------------------------------------------------------------------

1. The Distributor  advances concession payments to dealers for certain sales of
Class A shares and for sales of Class B, Class C and Class N shares from its own
resources at the time of sale.

2. For the fiscal period from February 21, 2003  (commencement of operations) to
April 30, 2003.

------------------------------------------------------------------------------
Fiscal        Class A          Class B          Class C          Class N
             Contingent      Contingent                         Contingent
Year       Deferred Sales  Deferred Sales     Contingent      Deferred Sales
Ended         Charges          Charges      Deferred Sales       Charges
4/30:       Retained by      Retained by   Charges Retained    Retained by
            Distributor      Distributor    by Distributor     Distributor
------------------------------------------------------------------------------
------------------------------------------------------------------------------
2003(1)          $0              $0               $0                $0
------------------------------------------------------------------------------
------------------------------------------------------------------------------
2004            $493           $6,156            $928              $927
------------------------------------------------------------------------------
------------------------------------------------------------------------------

2005             $0            $15,271          $1,143            $1,551

------------------------------------------------------------------------------
1. For the fiscal period from February 21, 2003  (commencement of operations) to
April 30, 2003.

Distribution  and Service Plans. The Fund has adopted a Service Plan for Class A
shares  and  Distribution  and  Service  Plans for Class B,  Class C and Class N
shares under Rule 12b-1 of the  Investment  Company  Act.  Under those plans the
Fund  pays  the  Distributor  for all or a  portion  of its  costs  incurred  in
connection  with  the  distribution  and/or  servicing  of  the  shares  of  the
particular  class.  Each  plan  has  been  approved  by a vote of the  Board  of
Trustees, including a majority of the Independent Trustees(1), cast in person at
a meeting called for the purpose of voting on that plan.


Under  the  Plans,  the  Manager  and  the  Distributor  may  make  payments  to
affiliates.  In their  sole  discretion,  they may also  from  time to time make
substantial  payments  from their own  resources,  which include the profits the
Manager  derives from the advisory fees it receives from the Fund, to compensate
brokers, dealers,  financial institutions and other intermediaries for providing
distribution assistance and/or administrative services or that otherwise promote
sales of the Fund's shares. These payments,  some of which may be referred to as
"revenue   sharing,"  may  relate  to  the  Fund's   inclusion  on  a  financial
intermediary's preferred list of funds offered to its clients.

Financial  intermediaries,  brokers and dealers may receive other  payments from
the  Distributor or the Manager from their own resources in connection  with the
promotion  and/or  sale of  shares  of the Fund,  including  payments  to defray
expenses  incurred in connection  with  educational  seminars and meetings.  The
Manager or Distributor may share expenses  incurred by financial  intermediaries
in conducting  training and  educational  meetings about aspects of the Fund for
employees of the  intermediaries  or for hosting client  seminars or meetings at
which the Fund is discussed.  In their sole  discretion,  the Manager and/or the
Distributor may increase or decrease the amount of payments they make from their
own resources for these purposes.

Unless a plan is terminated  as described  below,  the plan  continues in effect
from year to year but only if the Fund's Board of Trustees  and its  Independent
Trustees specifically vote annually to approve its continuance. Approval must be
by a vote  cast in  person  at a meeting  called  for the  purpose  of voting on
continuing  the  plan.  A plan  may be  terminated  at any time by the vote of a
majority  of the  Independent  Trustees  or by the  vote  of  the  holders  of a
"majority" (as defined in the Investment  Company Act) of the outstanding shares
of that class.


The Board of Trustees  and the  Independent  Trustees  must approve all material
amendments to a plan. An amendment to increase materially the amount of payments
to be made under a plan must be approved by  shareholders  of the class affected
by the amendment.  Because Class B shares of the Fund automatically convert into
Class A shares 72 months  after  purchase,  the Fund must obtain the approval of
both Class A and Class B shareholders for a proposed  material  amendment to the
Class A plan that  would  materially  increase  payments  under  the plan.  That
approval must be by a majority of the shares of each class, voting separately by
class.

While the plans are in effect,  the Treasurer of the Fund shall provide separate
written reports on the plans to the Board of Trustees at least quarterly for its
review.  The reports  shall detail the amount of all payments  made under a plan
and the purpose for which the payments  were made.  Those reports are subject to
the review and approval of the Independent Trustees.

Each plan states that while it is in effect,  the  selection  and  nomination of
those  Trustees  of the Fund  who are not  "interested  persons"  of the Fund is
committed to the discretion of the Independent  Trustees.  This does not prevent
the involvement of others in the selection and nomination process as long as the
final  decision as to selection or  nomination  is approved by a majority of the
Independent Trustees.

Under the plans for a class,  no payment  will be made to any  recipient  in any
quarter in which the  aggregate net asset value of all Fund shares of that class
held by the  recipient  for itself and its  customers  does not exceed a minimum
amount,  if  any,  that  may be set  from  time to  time  by a  majority  of the
Independent Trustees.  The Board of Trustees has set no minimum amount of assets
to qualify for payments under the plans.


Class A Service  Plan  Fees.  Under the Class A service  plan,  the  Distributor
currently  uses the fees it receives  from the Fund to pay brokers,  dealers and
other financial institutions (they are referred to as "recipients") for personal
services and account  maintenance  services they provide for their customers who
hold Class A shares.  The services  include,  among others,  answering  customer
inquiries about the Fund,  assisting in establishing and maintaining accounts in
the Fund,  making the Fund's  investment  plans  available and  providing  other
services at the request of the Fund or the Distributor. The Class A service plan
permits  reimbursements  to the  Distributor at a rate of up to 0.25% of average
annual net assets of Class A shares.  The Board has set the rate at that  level.
The Distributor  does not receive or retain the service fee on Class A shares in
accounts  for which the  Distributor  has been  listed as the  broker-dealer  of
record.  While  the  plan  permits  the  Board  to  authorize  payments  to  the
Distributor  to reimburse  itself for services under the plan, the Board has not
yet done so,  except in the case of the  special  arrangement  described  below,
regarding  grandfathered  retirement accounts. The Distributor makes payments to
recipients quarterly at an annual rate not to exceed 0.25% of the average annual
net assets  consisting of Class A shares held in the accounts of the  recipients
or their customers.


With  respect to purchases  of Class A shares  subject to a contingent  deferred
sales charge by certain  retirement  plans that  purchased  such shares prior to
March 1, 2001 ("grandfathered  retirement accounts"),  the Distributor currently
intends to pay the service fee to recipients in advance for the first year after
the shares  are  purchased.  During  the first  year the  shares  are sold,  the
Distributor  retains  the  service  fee to  reimburse  itself  for the  costs of
distributing  the  shares.  After the first  year  shares are  outstanding,  the
Distributor makes service fee payments to recipients  quarterly on those shares.
The  advance  payment  is based on the net asset  value of shares  sold.  Shares
purchased  by exchange do not qualify for the advance  service fee  payment.  If
Class A shares  purchased  by  grandfathered  retirement  accounts  are redeemed
during the first year after their purchase, the recipient of the service fees on
those shares will be obligated  to repay the  Distributor  a pro rata portion of
the advance payment of the service fee made on those shares.


For the fiscal year ended April 30, 2005 payments under the Class A plan totaled
$31,747,  of which $575 was retained by the  Distributor  under the  arrangement
described  above,  regarding  grandfathered  retirement  accounts,  and included
$3,200  paid  to  an  affiliate  of  the  Distributor's   parent  company.   Any
unreimbursed  expenses the Distributor  incurs with respect to Class A shares in
any fiscal year cannot be recovered in subsequent years. The Distributor may not
use  payments  received  under  the  Class  A plan  to pay  any of its  interest
expenses, carrying charges, or other financial costs, or allocation of overhead.



|X| Class B, Class C and Class N Service and Distribution  Plan Fees. Under each
plan, distribution and service fees are computed on the average of the net asset
value of  shares in the  respective  class,  determined  as of the close of each
regular  business day during the period.  Each plan provides for the Distributor
to be  compensated  at a  flat  rate,  whether  the  Distributor's  distribution
expenses  are more or less  than the  amounts  paid by the Fund  under  the plan
during  the  period  for  which  the fee is paid.  The  types of  services  that
recipients  provide  are  similar  to the  services  provided  under the Class A
service plan, described above.


Each plan permits the Distributor to retain both the  asset-based  sales charges
and the service fees or to pay recipients the service fee on a quarterly  basis,
without payment in advance.  However,  the Distributor  currently intends to pay
the service fee to recipients in advance for the first year after Class B, Class
C and Class N shares  are  purchased.  After the first  year Class B, Class C or
Class N shares are  outstanding,  after their purchase,  the  Distributor  makes
service fee payments  quarterly on those shares. The advance payment is based on
the net asset value of shares sold.  Shares purchased by exchange do not qualify
for the advance  service fee payment.  If Class B, Class C or Class N shares are
redeemed  during the first year  after  their  purchase,  the  recipient  of the
service fees on those shares will be  obligated to repay the  Distributor  a pro
rata  portion of the advance  payment of the  service fee made on those  shares.
Class B, Class C or Class N shares may not be purchased by an investor  directly
from  the  Distributor  without  the  investor  designating  another  registered
broker-dealer. If the investor no longer has another broker-dealer of record for
an  existing  account,  the  Distributor  is  automatically  designated  as  the
broker-dealer of record,  but solely for the purpose of acting as the investor's
agent to purchase  the  shares.  In those  cases,  the  Distributor  retains the
asset-based  sales charge paid on Class B, Class C and Class N shares,  but does
not retain any service fees as to the assets represented by that account.

The  asset-based  sales  charge and service  fees  increase  Class B and Class C
expenses by 1.00% and the  asset-based  sales charge and service  fees  increase
Class N expenses by 0.50% of the net assets per year of the respective classes.


The  Distributor  retains the  asset-based  sales  charge on Class B and Class N
shares.  The Distributor  retains the asset-based sales charge on Class C shares
during the first year the shares are outstanding.  It pays the asset-based sales
charge as an ongoing  concession to the recipient on Class C shares  outstanding
for a year or more. If a dealer has a special  agreement  with the  Distributor,
the  Distributor  will pay the Class B,  Class C or Class N service  fee and the
asset-based  sales  charge to the dealer  quarterly  in lieu of paying the sales
concession and service fee in advance at the time of purchase.

The  asset-based  sales  charge  on Class B,  Class C and  Class N shares  allow
investors to buy shares  without a front-end  sales  charge  while  allowing the
Distributor  to  compensate  dealers that sell those  shares.  The Fund pays the
asset-based  sales  charge  to the  Distributor  for its  services  rendered  in
distributing  Class B, Class C and Class N shares.  The payments are made to the
Distributor in recognition  that the  Distributor:  o pays sales  concessions to
authorized  brokers  and  dealers at the time of sale and pays  service  fees as
described above, o may finance payment of sales  concessions  and/or the advance
of the service fee payment to  recipients  under the plans,  or may provide such
financing  from its own  resources  or from the  resources  of an  affiliate,  o
employs  personnel  to  support  distribution  of Class B,  Class C and  Class N
shares,  o bears the costs of sales  literature,  advertising  and  prospectuses
(other  than those  furnished  to  current  shareholders)  and state  "blue sky"
registration fees and certain other distribution  expenses, o may not be able to
adequately  compensate  dealers  that sell  Class B,  Class C and Class N shares
without receiving payment under the plans and therefore may not be able to offer
such  Classes for sale  absent the plans,  o receives  payments  under the plans
consistent  with the service fees and  asset-based  sales  charges paid by other
non-proprietary  funds that charge 12b-1 fees, o may use the payments  under the
plan to include the Fund in various third-party  distribution  programs that may
increase sales of Fund shares, o may experience increased difficulty selling the
Fund's  shares  if  payments  under  the  plan  are  discontinued  because  most
competitor funds have plans that pay dealers for rendering distribution services
as much or more than the amounts currently being paid by the Fund, and o may not
be able to continue providing, at the same or at a lesser cost, the same quality
distribution sales efforts and services, or to obtain such services from brokers
and dealers, if the plan payments were to be discontinued.

The Distributor's actual expenses in selling Class B, Class C and Class N shares
may be more than the payments it receives  from the  contingent  deferred  sales
charges  collected  on  redeemed  shares and from the Fund  under the plans.  If
either the Class B, Class C or Class N plan is terminated by the Fund, the Board
of Trustees  may allow the Fund to continue  payments of the  asset-based  sales
charge  to  the  Distributor  for  distributing   shares  before  the  plan  was
terminated.


---------------------------------------------------------------------------------

   Distribution Fees Paid to the Distributor in the Fiscal Year Ended 4/30/05

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

                                             Distributor's
                                             Aggregate         Distributor's
                 Total        Amount         Unreimbursed      Unreimbursed
                 Payments     Retained by    Expenses Under    Expenses as % of
Class:           Under Plan   Distributor    Plan              Net Assets of
                                                               Class
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Class B Plan     $35,992      $29,302(1)     $106,487          2.51%

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Class C Plan     $46,234      $24,506(2)     $79,904           1.18%

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Class N Plan     $8,964       $5,800(3)      $59,930           2.13%

---------------------------------------------------------------------------------

1.    Includes $277 paid to an affiliate of the Distributor's parent company.
2.    Includes $728 paid to an affiliate of the Distributor's parent company.
3.    Includes $71 paid to an affiliate of the Distributor's parent company.


All payments under the Class B, Class C and Class N plans are subject to the
limitations imposed by the Conduct Rules of the National Association of Securities
Dealers, Inc. on payments of asset-based sales charges and service fees.

Performance of the Fund

Explanation  of  Performance  Terminology.  The Fund uses a variety  of terms to
illustrate its investment  performance.  Those terms include  "cumulative  total
return,"  "average  annual total  return,"  "average  annual total return at net
asset value" and "total return at net asset value." An  explanation of how total
returns are  calculated  is set forth  below.  The charts  below show the Fund's
performance as of the Fund's most recent fiscal year end. You can obtain current
performance  information by calling the Fund's Transfer Agent at  1.800.225.5677
or    by    visiting     the     OppenheimerFunds     Internet     website    at
www.oppenheimerfunds.com.

The Fund's  illustrations of its performance data in advertisements  must comply
with rules of the SEC. Those rules  describe the types of performance  data that
may be used and how it is to be calculated. In general, any advertisement by the
Fund of its  performance  data must include the average annual total returns for
the advertised class of shares of the Fund.

Use of standardized  performance calculations enables an investor to compare the
Fund's  performance  to the  performance  of other  funds for the same  periods.
However,  a number of  factors  should be  considered  before  using the  Fund's
performance information as a basis for comparison with other investments:

o Yields and total returns measure the performance of a hypothetical  account in
the  Fund  over  various  periods  and do  not  show  the  performance  of  each
shareholder's  account.  Your  account's  performance  will  vary from the model
performance  data if your  dividends  are  received in cash,  or you buy or sell
shares  during the period,  or you bought  your  shares at a different  time and
price than the shares used in the model.

o The  Fund's  performance  returns  may not  reflect  the  effect  of  taxes on
dividends and capital gains distributions.

o An investment  in the Fund is not insured by the FDIC or any other  government
agency.

o The principal value of the Fund's shares, its yields and total returns are not
guaranteed and normally will fluctuate on a daily basis.

o When an investor's  shares are  redeemed,  they may be worth more or less than
their original cost.

o Yields  and total  returns  for any given  past  period  represent  historical
performance information and are not, and should not be considered,  a prediction
of future yields or returns.

The  performance  of each  class of  shares  is shown  separately,  because  the
performance  of each class of shares will usually be different.  That is because
of the  different  kinds of  expenses  each  class  bears.  The yields and total
returns of each class of shares of the Fund are  affected by market  conditions,
the quality of the Fund's  investments,  the maturity of debt  investments,  the
types of  investments  the  Fund  holds,  and its  operating  expenses  that are
allocated to the particular class.

|X|  Yields.  The Fund uses a variety  of  different  yields to  illustrate  its
current returns. Each class of shares calculates its yield separately because of
the different expenses that affect each class.

o Standardized  Yield. The "standardized  yield" (sometimes  referred to just as
"yield") is shown for a class of shares for a stated  30-day  period.  It is not
based on actual  distributions  paid by the Fund to  shareholders  in the 30-day
period,  but is a hypothetical  yield based upon the net investment  income from
the Fund's portfolio  investments for that period.  It may therefore differ from
the "dividend yield" for the same class of shares, described below.

Standardized  yield is calculated using the following formula set forth in rules
adopted  by the SEC,  designed  to assure  uniformity  in the way that all funds
calculate their yields:


Standardized Yield  = 2[( a - b +1)(6) -1 ]
                          ------
                           cd

The symbols above represent the following factors:

a = dividends and interest earned during the 30-day period.

b = expenses accrued for the period (net of any expense assumptions).

c = the  average  daily  number of shares of that class  outstanding  during the
30-day period that were entitled to receive dividends.

d = the  maximum  offering  price per share of that class on the last day of the
period, adjusted for undistributed net investment income.

The standardized  yield for a particular 30-day period may differ from the yield
for other periods.  The SEC formula  assumes that the  standardized  yield for a
30-day period occurs at a constant rate for a six-month period and is annualized
at the end of the six-month period.  Additionally,  because each class of shares
is subject to different  expenses,  it is likely that the standardized yields of
the Fund's classes of shares will differ for any 30-day period.

o Dividend  Yield.  The Fund may quote a "dividend  yield" for each class of its
shares.  Dividend  yield  is based on the  dividends  paid on a class of  shares
during the actual dividend period. To calculate dividend yield, the dividends of
a class  declared  during a stated  period  are added  together,  and the sum is
multiplied by 12 (to  annualize  the yield) and divided by the maximum  offering
price on the last day of the dividend period. The formula is shown below:

     Dividend Yield = dividends paid x 12/maximum offering price (payment date)

The maximum  offering  price for Class A shares  includes  the  current  maximum
initial sales charge.  The maximum offering price for Class B, Class C and Class
N shares is the net asset  value per share,  without  considering  the effect of
contingent  deferred sales charges.  There is no sales charge on Class Y shares.
The Class A dividend  yield may also be quoted  without  deducting  the  maximum
initial sales charge.





--------------------------------------------------------------------

      The Fund's Yields for the 30-Day Periods Ended 4/30/05

--------------------------------------------------------------------
--------------------------------------------------------------------
Class of        Standardized Yield            Dividend Yield
Shares
--------------------------------------------------------------------
--------------------------------------------------------------------
               Without       After        Without         After
                Sales        Sales         Sales          Sales
               Charge        Charge        Charge        Charge
--------------------------------------------------------------------
--------------------------------------------------------------------

Class A         4.34%        4.13%         3.94%          3.76%

--------------------------------------------------------------------
--------------------------------------------------------------------

Class B         3.48%         N/A          3.08%           N/A

--------------------------------------------------------------------
--------------------------------------------------------------------

Class C         3.48%         N/A          3.09%           N/A

--------------------------------------------------------------------
--------------------------------------------------------------------

Class N         3.98%         N/A          3.59%           N/A

--------------------------------------------------------------------
--------------------------------------------------------------------
Class Y          N/A          N/A           N/A            N/A
--------------------------------------------------------------------

|X| Total Return  Information.  There are different  types of "total returns" to
measure  the  Fund's  performance.  Total  return  is the  change  in value of a
hypothetical  investment  in the Fund  over a given  period,  assuming  that all
dividends and capital gains  distributions  are reinvested in additional  shares
and that  the  investment  is  redeemed  at the end of the  period.  Because  of
differences  in expenses  for each class of shares,  the total  returns for each
class are separately  measured.  The cumulative total return measures the change
in value over the entire  period (for  example,  ten years).  An average  annual
total  return  shows the  average  rate of return for each year in a period that
would  produce the  cumulative  total  return over the entire  period.  However,
average annual total returns do not show actual  year-by-year  performance.  The
Fund uses  standardized  calculations for its total returns as prescribed by the
SEC. The methodology is discussed below.

In  calculating  total  returns for Class A shares,  the current  maximum  sales
charge of 4.75%(as a  percentage  of the  offering  price) is deducted  from the
initial  investment  ("P" in the  formula  below)  (unless  the  return is shown
without sales charge,  as described below).  For Class B shares,  payment of the
applicable contingent deferred sales charge is applied,  depending on the period
for which the return is shown:  5.0% in the first year, 4.0% in the second year,
3.0% in the third and fourth  years,  2.0% in the fifth year,  1.0% in the sixth
year and none thereafter. For Class C shares, the 1.0% contingent deferred sales
charge is deducted for returns for the one-year period.  For Class C shares, the
1%  contingent  deferred  sales  charge is  deducted  for returns for the 1-year
period.  For  Class N  shares,  the 1.0%  contingent  deferred  sales  charge is
deducted for returns for the one-year period.  There is no sales charge on Class
Y shares.


o Average Annual Total Return.  The "average  annual total return" of each class
is an average  annual  compounded  rate of return  for each year in a  specified
number of  years.  It is the rate of  return  based on the  change in value of a
hypothetical  initial investment of $1,000 ("P" in the formula below) held for a
number of years  ("n" in the  formula)  to achieve  an Ending  Redeemable  Value
("ERV" in the formula) of that investment, according to the following formula:

ERV   l/n - 1  Average Annual Total
               Return
  P

o Average  Annual Total  Return  (After  Taxes on  Distributions).  The "average
annual total  return  (after  taxes on  distributions)"  of Class A shares is an
average annual  compounded rate of return for each year in a specified number of
years,  adjusted  to show the  effect of  federal  taxes  (calculated  using the
highest  individual   marginal  federal  income  tax  rates  in  effect  on  any
reinvestment  date) on any  distributions  made by the Fund during the specified
period.  It is the rate of return based on the change in value of a hypothetical
initial  investment  of $1,000 ("P" in the  formula  below) held for a number of
years ("n" in the formula) to achieve an ending value ("ATVD" in the formula) of
that  investment,  after  taking  into  account  the  effect  of  taxes  on Fund
distributions,  but not on the  redemption  of  Fund  shares,  according  to the
following formula:

           - 1 = Average Annual Total Return (After Taxes on
ATVD   l/n     Distributions)
---
  P

o Average Annual Total Return (After Taxes on  Distributions  and  Redemptions).
The "average annual total return (after taxes on distributions and redemptions)"
of Class A shares is an average annual  compounded  rate of return for each year
in a specified  number of years,  adjusted  to show the effect of federal  taxes
(calculated  using the highest  individual  marginal federal income tax rates in
effect on any reinvestment  date) on any  distributions  made by the Fund during
the  specified  period and the effect of capital gains taxes or capital loss tax
benefits (each calculated using the highest federal individual capital gains tax
rate in effect on the  redemption  date)  resulting  from the  redemption of the
shares at the end of the period. It is the rate of return based on the change in
value of a hypothetical  initial investment of $1,000 ("P" in the formula below)
held for a number of years  ("n" in the  formula)  to  achieve  an ending  value
("ATVDR"  in the  formula) of that  investment,  after  taking into  account the
effect of taxes on Fund  distributions  and on the  redemption  of Fund  shares,
according to the following formula:

ATVDR       - 1  = Average Annual Total Return (After Taxes on Distributions
---
l/n              and Redemptions)
  P

o Cumulative Total Return.  The "cumulative total return"  calculation  measures
the change in value of a hypothetical investment of $1,000 over an entire period
of years.  Its calculation uses some of the same factors as average annual total
return,  but it  does  not  average  the  rate of  return  on an  annual  basis.
Cumulative total return is determined as follows:

 ERV - P   = Total Return
-----------
    P

o Total Returns at Net Asset Value.  From time to time the Fund may also quote a
cumulative  or an average  annual  total  return "at net asset  value"  (without
deducting sales charges) for Class A, Class B, Class C or Class N shares.  There
is no sales  charge on Class Y shares.  Each is based on the  difference  in net
asset  value  per  share  at the  beginning  and  the  end of the  period  for a
hypothetical  investment in that class of shares (without considering  front-end
or  contingent   deferred  sales  charges)  and  takes  into  consideration  the
reinvestment of dividends and capital gains distributions.

-------------------------------------------------------------------------------

            The Fund's Total Returns for the Periods Ended 4/30/05

-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Class of     Cumulative Total
                 Returns
               (10 Years or
            life-of-class, if
Shares            less)                  Average Annual Total Returns
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
                                         1-Year                 5-Year
                                                          (or life of class)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
             After    Without       After    Without       After    Without
             Sales    Sales         Sales    Sales         Sales    Sales
            Charge    Charge       Charge      Charge     Charge      Charge
           (MOP)(1)    (NAV)(2)     (MOP)      (NAV)       (MOP)      (NAV)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

Class        3.71%      8.89%      -0.09%      4.89%       1.68%      3.96%

A(3)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

Class        3.79%      6.79%      -1.00%      4.00%       1.71%      3.04%

B(4)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

Class        6.68%      6.68%       2.99%      3.99%       2.99%      2.99%

C(5)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------

Class        7.97%      7.97%       3.51%      4.51%       3.56%      3.56%

N(6)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Class         N/A        N/A         N/A        N/A         N/A        N/A
Y(7)
-------------------------------------------------------------------------------
1. Sales charge is based on maximum offering price (MOP).
2. NAV is net asset value.
3. Inception of Class A:      2/21/03
4. Inception of Class B:      2/21/03
5. Inception of Class C:      2/21/03
6. Inception of Class N:      2/21/03
7. Inception of Class Y:      N/A

-----------------------------------------------------------
  Average Annual Total Returns for Class A Shares (After
                      Sales Charge)

              For the Periods Ended 4/30/05

-----------------------------------------------------------
-----------------------------------------------------------
                                1-Year         5-Year
                                             (or life of
                                               class)
-----------------------------------------------------------
-----------------------------------------------------------

After Taxes on Distributions    -1.59%        0.41%(1)

-----------------------------------------------------------
-----------------------------------------------------------

After Taxes on                  -0.06%        0.71%(1)

Distributions and
Redemption of Fund Shares
-----------------------------------------------------------
1.    Inception of Class A: 2/21/03

Other Performance Comparisons. The Fund compares its performance annually to that
of an appropriate broadly-based market index in its Annual Report to shareholders.
You can obtain that information by contacting the Transfer Agent at the addresses
or telephone numbers shown on the cover of this Statement of Additional
Information. The Fund may also compare its performance to that of other
investments, including other mutual funds, or use rankings of its performance by
independent ranking entities. Examples of these performance comparisons are set
forth below.

|X|   Lipper Rankings. From time to time the Fund may publish the ranking of the
performance of its classes of shares by Lipper, Inc. ("Lipper"). Lipper is a
widely-recognized independent mutual fund monitoring service. Lipper monitors the
performance of regulated investment companies, including the Fund, and ranks their
performance for various periods in categories based on investment styles. The
Lipper performance rankings are based on total returns that include the
reinvestment of capital gain distributions and income dividends but do not take
sales charges or taxes into consideration. Lipper also publishes "peer-group"
indices of the performance of all mutual funds in a category that it monitors and
averages of the performance of the funds in particular categories.

|X|   Morningstar Ratings. From time to time the Fund may publish the star rating
of the performance of its classes of shares by Morningstar, Inc., an independent
mutual fund monitoring service. Morningstar rates mutual funds in their specialized
market sector. The Fund is rated in the Intermediate-Term Bond category.

      Morningstar proprietary star ratings reflect historical risk-adjusted total
investment return. For each fund with at least a three-year history, Morningstar
calculates a Morningstar Rating(TM)based on a Morningstar Risk-Adjusted Return
measure that accounts for variation in a fund's monthly performance (including the
effects of sales charges, loads, and redemption fees), placing more emphasis on
downward variations and rewarding consistent performance.  The top 10% of funds in
each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive
3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. (Each
share class is counted as a fraction of one fund within this scale and rated
separately, which may cause slight variations in the distribution percentages.) The
Overall Morningstar Rating for a fund is derived from a weighted average of the
performance figures associated with its three-, five-and ten-year (if applicable)
Morningstar Rating metrics.


|X|   Performance Rankings and Comparisons by Other Entities and Publications. From
time to time the Fund may include in its advertisements and sales literature
performance information about the Fund cited in newspapers and other periodicals
such as The New York Times, The Wall Street Journal, Barron's, or similar
publications. That information may include performance quotations from other
sources, including Lipper and Morningstar. The performance of the Fund's classes of
shares may be compared in publications to the performance of various market indices
or other investments, and averages, performance rankings or other benchmarks
prepared by recognized mutual fund statistical services

      Investors may also wish to compare the returns on the Fund's share classes to
the return on fixed-income investments available from banks and thrift
institutions. Those include certificates of deposit, ordinary interest-paying
checking and savings accounts, and other forms of fixed or variable time deposits,
and various other instruments such as Treasury bills. However, the Fund's returns
and share price are not guaranteed or insured by the FDIC or any other agency and
will fluctuate daily, while bank depository obligations may be insured by the FDIC
and may provide fixed rates of return. Repayment of principal and payment of
interest on Treasury securities is backed by the full faith and credit of the U.S.
government.

      From time to time, the Fund may publish rankings or ratings of the Manager or
Transfer Agent, and of the investor services provided by them to shareholders of
the Oppenheimer funds, other than performance rankings of the Oppenheimer funds
themselves. Those ratings or rankings of shareholder and investor services by third
parties may include comparisons of their services to those provided by other mutual
fund families selected by the rating or ranking services. They may be based upon
the opinions of the rating or ranking service itself, using its research or
judgment, or based upon surveys of investors, brokers, shareholders or others.

      From time to time the Fund may include in its advertisements and sales
literature the total return performance of a hypothetical investment account that
includes shares of the Fund and other Oppenheimer funds. The combined account may
be part of an illustration of an asset allocation model or similar presentation.
The account performance may combine total return performance of the Fund and the
total return performance of other Oppenheimer funds included in the account.
Additionally, from time to time, the Fund's advertisements and sales literature may
include, for illustrative or comparative purposes, statistical data or other
information about general or specific market and economic conditions. That may
include, for example,
o     information about the performance of certain securities or commodities
         markets or segments of those markets,
o     information about the performance of the economies of particular countries or
         regions,
o     the earnings of companies included in segments of particular industries,
         sectors, securities markets, countries or regions,
o     the availability of different types of securities or offerings of securities,
o     information relating to the gross national or gross domestic product of the
         United States or other countries or regions,
o     comparisons of various market sectors or indices to demonstrate performance,
         risk, or other characteristics of the Fund.

ABOUT YOUR ACCOUNT

How to Buy Shares

Additional information is presented below about the methods that can be used to buy
shares of the Fund. Appendix C contains more information about the special sales
charge arrangements offered by the Fund, and the circumstances in which sales
charges may be reduced or waived for certain classes of investors.


When you purchase shares of the Fund, your ownership interest in the shares of the
Fund will be recorded as a book entry on the records of the Fund.  The Fund will
not issue or re-register physical share certificates.


AccountLink. When shares are purchased through AccountLink, each purchase must be
at least $50 and shareholders must invest at least $500 before an Asset Builder
             ---
Plan (described below) can be established on a new account. Accounts established
prior to November 1, 2002 will remain at $25 for additional purchases. Shares will
be purchased on the regular business day the Distributor is instructed to initiate
the Automated Clearing House ("ACH") transfer to buy the shares. Dividends will
begin to accrue on shares purchased with the proceeds of ACH transfers on the
business day the Fund receives Federal Funds for the purchase through the ACH
system before the close of The New York Stock Exchange ("the Exchange"). The
Exchange normally closes at 4:00 P.M., but may close earlier on certain days. If
Federal Funds are received on a business day after the close of the Exchange, the
shares will be purchased and dividends will begin to accrue on the next regular
business day. The proceeds of ACH transfers are normally received by the Fund three
days after the transfers are initiated. If the proceeds of the ACH transfer are not
received on a timely basis, the Distributor reserves the right to cancel the
purchase order. The Distributor and the Fund are not responsible for any delays in
purchasing shares resulting from delays in ACH transmissions.

Reduced Sales Charges. As discussed in the Prospectus, a reduced sales charge rate
may be obtained for Class A shares under Right of Accumulation and Letters of
Intent because of the economies of sales efforts and reduction in expenses realized
by the Distributor, dealers and brokers making such sales. No sales charge is
imposed in certain other circumstances described in Appendix C to this Statement of
Additional Information because the Distributor or dealer or broker incurs little or
no selling expenses.

      A fiduciary can count all shares purchased for a trust, estate or other
fiduciary account (including one or more employee benefit plans of the same
employer) that has multiple accounts. The Distributor will add the value, at
current offering price, of the shares you previously purchased and currently own to
the value of current purchases to determine the sales charge rate that applies. The
reduced sales charge will apply only to current purchases. You must request it when
you buy shares.

The Oppenheimer Funds. The Oppenheimer funds are those mutual funds for which the
Distributor acts as the distributor and currently include the following:


Oppenheimer AMT-Free Municipals           Oppenheimer Limited Term Municipal Fund
Oppenheimer AMT-Free New York Municipals  Oppenheimer Main Street Fund
Oppenheimer Bond Fund                     Oppenheimer Main Street Opportunity Fund
Oppenheimer California Municipal Fund     Oppenheimer Main Street Small Cap Fund
Oppenheimer Capital Appreciation Fund     Oppenheimer Multiple Strategies Fund
Oppenheimer Capital Preservation Fund     Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Income Fund           Oppenheimer Pennsylvania Municipal Fund
                                          Oppenheimer   Principal  Protected  Main
Oppenheimer Champion Income Fund          Street Fund
                                          Oppenheimer   Principal  Protected  Main
Oppenheimer Convertible Securities Fund   Street Fund II
Oppenheimer Developing Markets Fund       Oppenheimer Quest Balanced Value Fund
                                          Oppenheimer  Quest  Capital  Value Fund,
Oppenheimer Disciplined Allocation Fund   Inc.
                                          Oppenheimer  Quest  International  Value
Oppenheimer Discovery Fund                Fund, Inc.

Oppenheimer Dividend Growth Fund          Oppenheimer Quest Opportunity Value Fund
Oppenheimer Emerging Growth Fund          Oppenheimer Quest Value Fund, Inc.
Oppenheimer Emerging Technologies Fund    Oppenheimer Real Asset Fund
Oppenheimer Enterprise Fund               Oppenheimer Real Estate Fund

                                          Oppenheimer      Rochester      National

Oppenheimer Equity Fund, Inc.             Municipals
Oppenheimer Global Fund                   Oppenheimer Senior Floating Rate Fund
Oppenheimer Global Opportunities Fund     Oppenheimer Small- & Mid- Cap Value Fund
Oppenheimer Gold & Special Minerals Fund  Oppenheimer Strategic Income Fund
Oppenheimer Growth Fund                   Oppenheimer Total Return Bond Fund
Oppenheimer High Yield Fund               Oppenheimer U.S. Government Trust
Oppenheimer International Bond Fund       Oppenheimer Value Fund
Oppenheimer International Growth Fund     Limited-Term New York Municipal Fund
Oppenheimer  International  Small Company
Fund                                      Rochester Fund Municipals
Oppenheimer Limited-Term Government Fund
Oppenheimer MidCap Fund
And the following money market funds:


Oppenheimer Cash Reserves                 Centennial Government Trust
Oppenheimer Money Market Fund, Inc.       Centennial Money Market Trust
Centennial America Fund, L. P.            Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust    Centennial Tax Exempt Trust

      There is an initial sales charge on the purchase of Class A shares of each of
the Oppenheimer funds described above except the money market funds. Under certain
circumstances described in this Statement of Additional Information, redemption
proceeds of certain money market fund shares may be subject to a contingent
deferred sales charge.


Letters of Intent. Under a Letter of Intent ("Letter"), you can reduce the sales
charge rate that applies to your purchases of Class A shares if you purchase Class
A, Class B or Class C shares of the Fund or other Oppenheimer funds during a
13-month period. The total amount of your purchases of Class A, Class B and Class C
shares will determine the sales charge rate that applies to your Class A share
purchases during that period. You can choose to include purchases that you made up
to 90 days before the date of the Letter. Class A shares of Oppenheimer Money
Market Fund and Oppenheimer Cash Reserves on which you have not paid a sales charge
and any Class N shares you purchase, or may have purchased, will not be counted
towards satisfying the purchases specified in a Letter.

      A Letter is an investor's statement in writing to the Distributor of his or
her intention to purchase a specified value of Class A, Class B and Class C shares
of the Fund and other Oppenheimer funds during a 13-month period (the "Letter
period"). At the investor's request, this may include purchases made up to 90 days
prior to the date of the Letter. The Letter states the investor's intention to make
the aggregate amount of purchases of shares which will equal or exceed the amount
specified in the Letter. Purchases made by reinvestment of dividends or capital
gains distributions and purchases made at net asset value (i.e. without a sales
charge) do not count toward satisfying the amount of the Letter.

      Each purchase of Class A shares under the Letter will be made at the offering
price (including the sales charge) that would apply to a single lump-sum purchase
of shares in the amount intended to be purchased under the Letter.


      In submitting a Letter, the investor makes no commitment to purchase shares.
However, if the investor's purchases of shares within the Letter period, when added
to the value (at offering price) of the investor's holdings of shares on the last
day of that period, do not equal or exceed the intended purchase amount, the
investor agrees to pay the additional amount of sales charge applicable to such
purchases. That amount is described in "Terms of Escrow," below (those terms may be
amended by the Distributor from time to time). The investor agrees that shares
equal in value to 5% of the intended purchase amount will be held in escrow by the
Transfer Agent subject to the Terms of Escrow. Also, the investor agrees to be
bound by the terms of the Prospectus, this Statement of Additional Information and
the application used for a Letter. If those terms are amended, as they may be from
time to time by the Fund, the investor agrees to be bound by the amended terms and
that those amendments will apply automatically to existing Letters.

      If the total eligible purchases made during the Letter period do not equal or
exceed the intended purchase amount, the concessions previously paid to the dealer
of record for the account and the amount of sales charge retained by the
Distributor will be adjusted to the rates applicable to actual total purchases. If
total eligible purchases during the Letter period exceed the intended purchase
amount and exceed the amount needed to qualify for the next sales charge rate
reduction set forth in the Prospectus, the sales charges paid will be adjusted to
the lower rate. That adjustment will be made only if and when the dealer returns to
the Distributor the excess of the amount of concessions allowed or paid to the
dealer over the amount of concessions that apply to the actual amount of purchases.
The excess concessions returned to the Distributor will be used to purchase
additional shares for the investor's account at the net asset value per share in
effect on the date of such purchase, promptly after the Distributor's receipt
thereof.

      The  Transfer  Agent will not hold shares in escrow for  purchases of shares of
the Fund and other  Oppenheimer  funds by  OppenheimerFunds  prototype  401(k)  plans
under a Letter.  If the intended  purchase  amount under a Letter  entered into by an
OppenheimerFunds  prototype  401(k) plan is not  purchased  by the plan by the end of
the  Letter  period,  there  will  be  no  adjustment  of  concessions  paid  to  the
broker-dealer  or financial  institution  of record for accounts  held in the name of
that plan.

      In determining the total amount of purchases made under a Letter, shares
redeemed by the investor prior to the termination of the Letter period will be
deducted. It is the responsibility of the dealer of record and/or the investor to
advise the Distributor about the Letter when placing any purchase orders for the
investor during the Letter period. All of such purchases must be made through the
Distributor.

      |X|   Terms of Escrow That Apply to Letters of Intent.

      1. Out of the initial purchase (or subsequent purchases if necessary) made
pursuant to a Letter, shares of the Fund equal in value up to 5% of the intended
purchase amount specified in the Letter shall be held in escrow by the Transfer
Agent. For example, if the intended purchase amount is $50,000, the escrow shall be
shares valued in the amount of $2,500 (computed at the offering price adjusted for
a $50,000 purchase). Any dividends and capital gains distributions on the escrowed
shares will be credited to the investor's account.

      2. If the total minimum investment specified under the Letter is completed
within the 13-month Letter period, the escrowed shares will be promptly released to
the investor.

      3. If, at the end of the 13-month Letter period the total purchases pursuant
to the Letter are less than the intended purchase amount specified in the Letter,
the investor must remit to the Distributor an amount equal to the difference
between the dollar amount of sales charges actually paid and the amount of sales
charges which would have been paid if the total amount purchased had been made at a
single time. That sales charge adjustment will apply to any shares redeemed prior
to the completion of the Letter. If the difference in sales charges is not paid
within twenty days after a request from the Distributor or the dealer, the
Distributor will, within sixty days of the expiration of the Letter, redeem the
number of escrowed shares necessary to realize such difference in sales charges.
Full and fractional shares remaining after such redemption will be released from
escrow. If a request is received to redeem escrowed shares prior to the payment of
such additional sales charge, the sales charge will be withheld from the redemption
proceeds.

      4. By signing the Letter, the investor irrevocably constitutes and appoints
the Transfer Agent as attorney-in-fact to surrender for redemption any or all
escrowed shares.

5.    The shares eligible for purchase under the Letter (or the holding of which
may be counted toward completion of a Letter) include:
(a)   Class A shares sold with a front-end sales charge or subject to a Class A
            contingent deferred sales charge,
(b)   Class B shares of other Oppenheimer funds acquired subject to a contingent
            deferred sales charge, and
(c)   Class A or Class B shares acquired by exchange of either (1) Class A shares
            of one of the other Oppenheimer funds that were acquired subject to a
            Class A initial or contingent deferred sales charge or (2) Class B
            shares of one of the other Oppenheimer funds that were acquired subject
            to a contingent deferred sales charge.

      6. Shares held in escrow hereunder will automatically be exchanged for shares
of another fund to which an exchange is requested, as described in the section of
the Prospectus entitled "How to Exchange Shares" and the escrow will be transferred
to that other fund.

Asset Builder Plans. As explained in the Prospectus, you must initially establish
your account with $500. Subsequently, you can establish an Asset Builder Plan to
automatically purchase additional shares directly from a bank account for as little
as $50. For those accounts established prior to November 1, 2002 and which have
previously established Asset Builder Plans, additional purchases will remain at
$25. Shares purchased by Asset Builder Plan payments from bank accounts are subject
to the redemption restrictions for recent purchases described in the Prospectus.
Asset Builder Plans are available only if your bank is an ACH member. Asset Builder
Plans may not be used to buy shares for OppenheimerFunds employer-sponsored
qualified retirement accounts.

      If you make payments from your bank account to purchase shares of the Fund,
your bank account will be debited automatically. Normally the debit will be made
two business days prior to the investment dates you selected on your application.
Neither the Distributor, the Transfer Agent nor the Fund shall be responsible for
any delays in purchasing shares that result from delays in ACH transmissions.

      Before you establish Asset Builder payments, you should obtain a prospectus
of the selected fund(s) from your financial advisor (or the Distributor) and
request an application from the Distributor. Complete the application and return
it. You may change the amount of your Asset Builder payment or you can terminate
these automatic investments at any time by writing to the Transfer Agent. The
Transfer Agent requires a reasonable period (approximately 10 days) after receipt
of your instructions to implement them. The Fund reserves the right to amend,
suspend or discontinue offering Asset Builder plans at any time without prior
notice.


Retirement Plans. Certain types of retirement plans are entitled to purchase shares
of the Fund without sales charge or at reduced sales charge rates, as described in
Appendix C to this Statement of Additional Information. Certain special sales
charge arrangements described in that Appendix apply to retirement plans whose
records are maintained on a daily valuation basis by Merrill Lynch Pierce Fenner &
Smith, Inc. ("Merrill Lynch") or an independent record keeper that has a contract
or special arrangement with Merrill Lynch. If on the date the plan sponsor signed
the Merrill Lynch record keeping service agreement the plan has less than $1
million in assets invested in applicable investments (other than assets invested in
money market funds), then the retirement plan may purchase only Class C shares of
the Oppenheimer funds. If on the date the plan sponsor signed the Merrill Lynch
record keeping service agreement the plan has $1 million or more in assets but less
than $5 million in assets invested in applicable investments (other than assets
invested in money market funds), then the retirement plan may purchase only Class N
shares of the Oppenheimer funds. If on the date the plan sponsor signed the Merrill
Lynch record keeping service agreement the plan has $5 million or mor in assts
invested in applicable investments (other than money market funds), then the
retirement plan may purchase only Class A shares of the Oppenheimer funds.


Cancellation of Purchase Orders. Cancellation of purchase orders for the Fund's
shares (for example, when a purchase check is returned to the Fund unpaid) causes a
loss to be incurred when the net asset values of the Fund's shares on the
cancellation date is less than on the purchase date. That loss is equal to the
amount of the decline in the net asset value per share multiplied by the number of
shares in the purchase order. The investor is responsible for that loss. If the
investor fails to compensate the Fund for the loss, the Distributor will do so. The
Fund may reimburse the Distributor for that amount by redeeming shares from any
account registered in that investor's name, or the Fund or the Distributor may seek
other redress.

Classes of Shares. Each class of shares of the Fund represents an interest in the
same portfolio of investments of the Fund. However, each class has different
shareholder privileges and features. The net income attributable to Class B, Class
C or Class N shares and the dividends payable on Class B, Class C or Class N shares
will be reduced by incremental expenses borne solely by that class. Those expenses
include the asset-based sales charges to which Class B, Class C and Class N shares
are subject.

      The availability of different classes of shares permits an investor to choose
the method of purchasing shares that is more appropriate for the investor. That may
depend on the amount of the purchase, the length of time the investor expects to
hold shares, and other relevant circumstances. Class A shares normally are sold
subject to an initial sales charge. While Class B, Class C and Class N shares have
no initial sales charge, the purpose of the deferred sales charge and asset-based
sales charge on Class B, Class C and Class N shares is the same as that of the
initial sales charge on Class A shares - to compensate the Distributor and brokers,
dealers and financial institutions that sell shares of the Fund. A salesperson who
is entitled to receive compensation from his or her firm for selling Fund shares
may receive different levels of compensation for selling one class of shares rather
than another.


      The Distributor will not accept any order in an amount greater than $250,000
to purchase Class B shares or more than $1 million to purchase Class C shares on
behalf of a single investor (not including dealer "street name" or omnibus
accounts). Effective July 15, 2004, the Distributor will not accept an order in an
amount greater than $100,000 to purchase Class B shares on behalf of a single
investor (not including dealer "street name" or omnibus accounts).

Class B, Class C or Class N shares may not be purchased by an investor directly
from the Distributor without the investor designating another registered
broker-dealer.


      Class A Shares Subject to a Contingent Deferred Sales Charge. For purchases
of Class A shares at net asset value whether or not subject to a contingent
deferred sales charge as described in the Prospectus, no sales concessions will be
paid to the broker-dealer of record, as described in the Prospectus, on sales of
Class A shares purchased with the redemption proceeds of shares of another mutual
fund offered as an investment option in a retirement plan in which Oppenheimer
funds are also offered as investment options under a special arrangement with the
Distributor, if the purchase occurs more than 30 days after the Oppenheimer funds
are added as an investment option under that plan. Additionally, that concession
will not be paid on purchases of Class A shares by a retirement plan made with the
redemption proceeds of Class N shares of one or more Oppenheimer funds held by the
plan for more than 18 months.

      |X|   Class B Conversion. Under current interpretations of applicable federal
income tax law by the Internal Revenue Service, the conversion of Class B shares to
Class A shares 72 months after purchase is not treated as a taxable event for the
shareholder. If those laws or the IRS interpretation of those laws should change,
the automatic conversion feature may be suspended. In that event, no further
conversions of Class B shares would occur while that suspension remained in effect.
Although Class B shares could then be exchanged for Class A shares on the basis of
relative net asset value of the two classes, without the imposition of a sales
charge or fee, such exchange could constitute a taxable event for the shareholder,
and absent such exchange, Class B shares might continue to be subject to the
asset-based sales charge for longer than six years.

      |X|   Availability of Class N Shares. In addition to the description of the
types of retirement plans which may purchase Class N shares contained in the
prospectus, Class N shares also are offered to the following:
o     to all rollover IRAs (including SEP IRAs and SIMPLE IRAs),
o     to all rollover contributions made to Individual 401(k) plans, Profit-Sharing
            Plans and Money Purchase Pension Plans,
o     to all direct rollovers from OppenheimerFunds-sponsored Pinnacle and Ascender
            retirement plans,
o     to all trustee-to-trustee IRA transfers,
o     to all 90-24 type 403(b) transfers,
o     to Group Retirement Plans (as defined in Appendix C to this Statement of
            Additional Information) which have entered into a special agreement
            with the Distributor for that purpose,
o     to Retirement Plans qualified under Sections 401(a) or 401(k) of the Internal
            Revenue Code, the recordkeeper or the plan sponsor for which has
            entered into a special agreement with the Distributor,
o     to Retirement Plans of a plan sponsor where the aggregate assets of all such
            plans invested in the Oppenheimer funds is $500,000 or more,
o     to OppenheimerFunds-sponsored Ascender 401(k) plans that pay for the purchase
            with the redemption proceeds of Class A shares of one or more
            Oppenheimer funds, and
o     to certain customers of broker-dealers and financial advisors that are
            identified in a special agreement between the broker-dealer or
            financial advisor and the Distributor for that purpose.

      The sales concession and the advance of the service fee, as described in the
Prospectus, will not be paid to dealers of record on sales of Class N shares on:
o     purchases of Class N shares in amounts of $500,000 or more by a retirement
               plan that pays for the purchase with the redemption proceeds of
               Class A shares of one or more Oppenheimer funds (other than
               rollovers from an OppenheimerFunds-sponsored Pinnacle or Ascender
               401(k) plan to any IRA invested in the Oppenheimer funds),
o     purchases of Class N shares in amounts of $500,000 or more by a retirement
               plan that pays for the purchase with the redemption proceeds of
               Class C shares of one or more Oppenheimer funds held by the plan for
               more than one year (other than rollovers from an
               OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan to any
               IRA invested in the Oppenheimer funds), and
o     on purchases of Class N shares by an OppenheimerFunds-sponsored Pinnacle or
               Ascender 401(k) plan made with the redemption proceeds of Class A
               shares of one or more Oppenheimer funds.

      No sales concessions will be paid to the broker-dealer of record, as
described in the Prospectus, on sales of Class N shares purchased with the
redemption proceeds of shares of another mutual fund offered as an investment
option in a retirement plan in which Oppenheimer funds are also offered as
investment options under a special arrangement with the Distributor, if the
purchase occurs more than 30 days after the Oppenheimer funds are added as an
investment option under that plan.

      |X|   Allocation of Expenses. The Fund pays expenses related to its daily
operations, such as custodian fees, Trustees' fees, transfer agency fees, legal
fees and auditing costs. Those expenses are paid out of the Fund's assets and are
not paid directly by shareholders. However, those expenses reduce the net asset
values of shares, and therefore are indirectly borne by shareholders through their
investment.

      The methodology for calculating the net asset value, dividends and
distributions of the Fund's share classes recognizes two types of expenses. General
expenses that do not pertain specifically to any one class are allocated pro rata
to the shares of all classes. The allocation is based on the percentage of the
Fund's total assets that is represented by the assets of each class, and then
equally to each outstanding share within a given class. Such general expenses
include management fees, legal, bookkeeping and audit fees, printing and mailing
costs of shareholder reports, Prospectuses, Statements of Additional Information
and other materials for current shareholders, fees to unaffiliated Trustees,
custodian expenses, share issuance costs, organization and start-up costs,
interest, taxes and brokerage commissions, and non-recurring expenses, such as
litigation costs.

      Other expenses that are directly attributable to a particular class are
allocated equally to each outstanding share within that class. Examples of such
expenses include distribution and  service plan (12b-1) fees, transfer and
shareholder servicing agent fees and expenses, and shareholder meeting expenses (to
the extent that such expenses pertain only to a specific class).


Fund Account Fees. As stated in the Prospectus, a $12 annual "Minimum Balance Fee"
is assessed on each Fund account with a share balance valued under $500. The
Minimum Balance Fee is automatically deducted from each such Fund account on or
about the second to last business day of September.

      Listed below are certain cases in which the Fund has elected, in its
discretion, not to assess the Fund Account Fees.  These exceptions are subject to
change:
         A fund account whose shares were acquired after September 30th of the
            prior year;
o     A fund account that has a balance below $500 due to the automatic conversion
            of shares from Class B to Class A shares. However, once all Class B
            shares held in the account have been converted to Class A shares the
            new account balance may become subject to the Minimum Balance Fee;
o     Accounts of shareholders who elect to access their account documents
            electronically via eDoc Direct;
o     A fund account that has only certificated shares and, has a balance below
            $500 and is being escheated;
o     Accounts of shareholders that are held by broker-dealers under the NSCC
            Fund/SERV system;
o     Accounts held under the Oppenheimer Legacy Program and/or holding certain
            Oppenheimer Variable Account Funds;
o     Omnibus accounts holding shares pursuant to the Pinnacle, Ascender, Custom
            Plus, Recordkeeper Pro and Pension Alliance Retirement Plan programs;
            and
o     A fund account that falls below the $500 minimum solely due to market
            fluctuations within the 12-month period preceding the date the fee is
            deducted.


To access account documents  electronically  via eDocs Direct,  please visit the
Service Center on our website at www.oppenheimerfunds.com or call 1.888.470.0862
for instructions.


The Fund reserves the authority to modify Fund Account Fees in its discretion.

Determination of Net Asset Values Per Share. The net asset values per share of each
class of shares of the Fund are determined as of the close of business of the
Exchange on each day that the Exchange is open. The calculation is done by dividing
the value of the Fund's net assets attributable to a class by the number of shares
of that class that are outstanding. The Exchange normally closes at 4:00 p.m.,
Eastern Time, but may close earlier on some other days (for example, in case of
weather emergencies or on days falling before a U.S. holiday). All references to
time in this Statement of Additional Information mean "Eastern time." The
Exchange's most recent annual announcement (which is subject to change) states that
it will close on New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good
Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas
Day. It may also close on other days.


      Dealers other than Exchange members may conduct trading in certain securities
on days on which the Exchange is closed (including weekends and holidays) or after
4:00 P.M. on a regular business day. Because the Fund's net asset values will not
be calculated on those days, the Fund's net asset values per share may be
significantly affected on such days when shareholders may not purchase or redeem
shares. Additionally, trading on European and Asian stock exchanges and
over-the-counter markets normally is completed before the close of the Exchange.

      Changes in the values of securities traded on foreign exchanges or markets as
a result of events that occur after the prices of those securities are determined,
but before the close of the Exchange, will not be reflected in the Fund's
calculation of its net asset values that day unless the Manager determines that the
event is likely to effect a material change in the value of the security. The
Manager, or an internal valuation committee established by the Manager, as
applicable, may establish a valuation, under procedures established by the Board
and subject to the approval, ratification and confirmation by the Board at its next
ensuing meeting.

      |X|   Securities Valuation. The Fund's Board of Trustees has established
procedures for the valuation of the Fund's securities. In general those procedures
are as follows:
o     Equity securities traded on a U.S. securities exchange or on Nasdaq(R)are
valued as follows:
(1)   if last sale information is regularly reported, they are valued at the last

               reported sale price on the principal exchange on which they are
               traded or on Nasdaq(R), as applicable, on that day, or

(2)   if last sale information is not available on a valuation date, they are
               valued at the last reported sale price preceding the valuation date
               if it is within the spread of the closing "bid" and "asked" prices
               on the valuation date or, if not,  at the closing "bid" price on the
               valuation date.
o     Equity securities traded on a foreign securities exchange generally are
valued in one of the following ways:
(1)   at the last sale price available to the pricing service approved by the Board
               of Trustees, or
(2)   at the last sale price obtained by the Manager from the report of the
               principal exchange on which the security is traded at its last
               trading session on or immediately before the valuation date, or
(3)   at the mean between the "bid" and "asked" prices obtained from the principal
               exchange on which the security is traded or, on the basis of
               reasonable inquiry, from two market makers in the security.
o     Long-term debt securities having a remaining maturity in excess of 60 days
are valued based on the mean between the "bid" and "asked" prices determined by a
portfolio pricing service approved by the Fund's Board of Trustees or obtained by
the Manager from two active market makers in the security on the basis of
reasonable inquiry.
o     The following securities are valued at the mean between the "bid" and "asked"
prices determined by a pricing service approved by the Fund's Board of Trustees or
obtained by the Manager from two active market makers in the security on the basis
of reasonable inquiry:
(1)   debt instruments that have a maturity of more than 397 days when issued,
(2)   debt instruments that had a maturity of 397 days or less when issued and have
               a remaining maturity of more than 60 days, and
(3)   non-money market debt instruments that had a maturity of 397 days or less
               when issued and which have a remaining maturity of 60 days or less.
o     The following securities are valued at cost, adjusted for amortization of
premiums and accretion of discounts:
(1)   money market debt securities held by a non-money market fund that had a
               maturity of less than 397 days when issued that have a remaining
               maturity of 60 days or less, and
(2)   debt instruments held by a money market fund that have a remaining maturity
               of 397 days or less.
o     Securities (including restricted securities) not having readily-available
market quotations are valued at fair value determined under the Board's procedures.
If the Manager is unable to locate two market makers willing to give quotes, a
security may be priced at the mean between the "bid" and "asked" prices provided by
a single active market maker (which in certain cases may be the "bid" price if no
"asked" price is available).

      In the case of U.S. government securities, mortgage-backed securities,
corporate bonds and foreign government securities, when last sale information is
not generally available, the Manager may use pricing services approved by the Board
of Trustees. The pricing service may use "matrix" comparisons to the prices for
comparable instruments on the basis of quality, yield and maturity. Other special
factors may be involved (such as the tax-exempt status of the interest paid by
municipal securities). The Manager will monitor the accuracy of the pricing
services. That monitoring may include comparing prices used for portfolio valuation
to actual sales prices of selected securities.


      The closing prices in the New York foreign exchange market on a particular
business day that are provided to the Manager by a bank, dealer or pricing service
that the Manager has determined to be reliable are used to value foreign currency,
including forward contracts, and to convert to U.S. dollars securities that are
denominated in foreign currency.

      Puts, calls, and futures are valued at the last sale price on the principal
exchange on which they are traded or on Nasdaq(R), as applicable, as determined by a
pricing service approved by the Board of Trustees or by the Manager. If there were
no sales that day, they shall be valued at the last sale price on the preceding
trading day if it is within the spread of the closing "bid" and "asked" prices on
the principal exchange or on Nasdaq(R)on the valuation date. If not, the value shall
be the closing bid price on the principal exchange or on Nasdaq(R)on the valuation
date. If the put, call or future is not traded on an exchange or on Nasdaq(R), it
shall be valued by the mean between "bid" and "asked" prices obtained by the
Manager from two active market makers. In certain cases that may be at the "bid"
price if no "asked" price is available.


      When the Fund writes an option, an amount equal to the premium received is
included in the Fund's Statement of Assets and Liabilities as an asset. An
equivalent credit is included in the liability section. The credit is adjusted
("marked-to-market") to reflect the current market value of the option. In
determining the Fund's gain on investments, if a call or put written by the Fund is
exercised, the proceeds are increased by the premium received. If a call or put
written by the Fund expires, the Fund has a gain in the amount of the premium. If
the Fund enters into a closing purchase transaction, it will have a gain or loss,
depending on whether the premium received was more or less than the cost of the
closing transaction. If the Fund exercises a put it holds, the amount the Fund
receives on its sale of the underlying investment is reduced by the amount of
premium paid by the Fund.

How to Sell Shares

The information below supplements the terms and conditions for redeeming shares set
forth in the Prospectus.

Checkwriting. When a check is presented to United Missouri Bank (the "Bank") for
clearance, the Bank will ask the Fund to redeem a sufficient number of full and
fractional shares in the shareholder's account to cover the amount of the check.
This enables the shareholder to continue receiving dividends on those shares until
the check is presented to the Fund. Checks may not be presented for payment at the
offices of the Bank or the Fund's custodian bank. This limitation does not affect
the use of checks for the payment of bills or to obtain cash at other banks. The
Fund reserves the right to amend, suspend or discontinue offering checkwriting
privileges at any time. The Fund will provide you notice whenever it is required to
do so by applicable law.

      In choosing to take advantage of the Checkwriting privilege, by signing the
account application or by completing a Checkwriting card, each individual who signs:
(1)   for individual accounts, represents that they are the registered owner(s) of
         the shares of the Fund in that account;
(2)   for accounts for corporations, partnerships, trusts and other entities,
         represents that they are an officer, general partner, trustee or other
         fiduciary or agent, as applicable, duly authorized to act on behalf of the
         registered owner(s);
(3)   authorizes the Fund, its Transfer Agent and any bank through which the Fund's
         drafts (checks) are payable to pay all checks drawn on the Fund account of
         such person(s) and to redeem a sufficient amount of shares from that
         account to cover payment of each check;
(4)   specifically acknowledges that if they choose to permit checks to be honored
         if there is a single signature on checks drawn against joint accounts, or
         accounts for corporations, partnerships, trusts or other entities, the
         signature of any one signatory on a check will be sufficient to authorize
         payment of that check and redemption from the account, even if that
         account is registered in the names of more than one person or more than
         one authorized signature appears on the Checkwriting card or the
         application, as applicable;
(5)   understands that the Checkwriting privilege may be terminated or amended at
         any time by the Fund and/or the Fund's bank; and
(6)   acknowledges and agrees that neither the Fund nor its bank shall incur any
         liability for that amendment or termination of checkwriting privileges or
         for redeeming shares to pay checks reasonably believed by them to be
         genuine, or for returning or not paying checks that have not been accepted
         for any reason.


Sending Redemption Proceeds by Federal Funds Wire. The Federal Funds wire of
redemption proceeds may be delayed if the Fund's custodian bank is not open for
business on a day when the Fund would normally authorize the wire to be made, which
is usually the Fund's next regular business day following the redemption. In those
circumstances, the wire will not be transmitted until the next bank business day on
which the Fund is open for business. No dividends will be paid on the proceeds of
redeemed shares awaiting transfer by Federal Funds wire.


Reinvestment Privilege. Within six months of a redemption, a shareholder may
reinvest all or part of the redemption proceeds of:
o     Class A shares purchased subject to an initial sales charge or Class A shares
         on which a contingent deferred sales charge was paid, or
o     Class B shares that were subject to the Class B contingent deferred sales
         charge when redeemed.

      The reinvestment may be made without sales charge only in Class A shares of
the Fund or any of the other Oppenheimer funds into which shares of the Fund are
exchangeable as described in "How to Exchange Shares" below. Reinvestment will be
at the net asset value next computed after the Transfer Agent receives the
reinvestment order. The shareholder must ask the Transfer Agent for that privilege
at the time of reinvestment. This privilege does not apply to Class C, and Class N
or Class Y shares. The Fund may amend, suspend or cease offering this reinvestment
privilege at any time as to shares redeemed after the date of such amendment,
suspension or cessation.

      Any capital gain that was realized when the shares were redeemed is taxable,
and reinvestment will not alter any capital gains tax payable on that gain. If
there has been a capital loss on the redemption, some or all of the loss may not be
tax deductible, depending on the timing and amount of the reinvestment. Under the
Internal Revenue Code, if the redemption proceeds of Fund shares on which a sales
charge was paid are reinvested in shares of the Fund or another of the Oppenheimer
funds within 90 days of payment of the sales charge, the shareholder's basis in the
shares of the Fund that were redeemed may not include the amount of the sales
charge paid. That would reduce the loss or increase the gain recognized from the
redemption. However, in that case the sales charge would be added to the basis of
the shares acquired by the reinvestment of the redemption proceeds.

Payments "In Kind". The Prospectus states that payment for shares tendered for
redemption is ordinarily made in cash. However, under certain circumstances, the
Board of Trustees of the Fund may determine that it would be detrimental to the
best interests of the remaining shareholders of the Fund to make payment of a
redemption order wholly or partly in cash. In that case, the Fund may pay the
redemption proceeds in whole or in part by a distribution "in kind" of liquid
securities from the portfolio of the Fund, in lieu of cash.

      The Fund has elected to be governed by Rule 18f-1 under the Investment
Company Act. Under that rule, the Fund is obligated to redeem shares solely in cash
up to the lesser of $250,000 or 1% of the net assets of the Fund during any 90-day
period for any one shareholder. If shares are redeemed in kind, the redeeming
shareholder might incur brokerage or other costs in selling the securities for
cash. The Fund will value securities used to pay redemptions in kind using the same
method the Fund uses to value its portfolio securities described above under
"Determination of Net Asset Values Per Share." That valuation will be made as of the
time the redemption price is determined.

Involuntary Redemptions. The Fund's Board of Trustees has the right to cause the
involuntary redemption of the shares held in any account if the aggregate net asset
value of those shares is less than $500 or such lesser amount as the Board may fix.
The Board will not cause the involuntary redemption of shares in an account if the
aggregate net asset value of such shares has fallen below the stated minimum solely
as a result of market fluctuations. If the Board exercises this right, it may also
fix the requirements for any notice to be given to the shareholders in question
(not less than 30 days). The Board may alternatively set requirements for the
shareholder to increase the investment, or set other terms and conditions so that
the shares would not be involuntarily redeemed.

Transfers of Shares. A transfer of shares to a different registration is not an
event that triggers the payment of sales charges. Therefore, shares are not subject
to the payment of a contingent deferred sales charge of any class at the time of
transfer to the name of another person or entity. It does not matter whether the
transfer occurs by absolute assignment, gift or bequest, as long as it does not
involve, directly or indirectly, a public sale of the shares. When shares subject
to a contingent deferred sales charge are transferred, the transferred shares will
remain subject to the contingent deferred sales charge. It will be calculated as if
the transferee shareholder had acquired the transferred shares in the same manner
and at the same time as the transferring shareholder.

      If less than all shares held in an account are transferred, and some but not
all shares in the account would be subject to a contingent deferred sales charge if
redeemed at the time of transfer, the priorities described in the Prospectus under
"How to Buy Shares" for the imposition of the Class B, Class C and Class N
contingent deferred sales charge will be followed in determining the order in which
shares are transferred.

Distributions From Retirement Plans. Requests for distributions from
OppenheimerFunds-sponsored IRAs, SEP-IRAs, SIMPLE IRAs, 403(b)(7) custodial plans,
401(k) plans or pension or profit-sharing plans should be addressed to "Trustee,
OppenheimerFunds Retirement Plans," c/o the Transfer Agent at its address listed in
"How To Sell Shares" in the Prospectus or on the back cover of this Statement of
Additional Information. The request must:
(1)   state the reason for the distribution;
(2)   state the owner's awareness of tax penalties if the distribution is
         premature; and
(3)   conform to the requirements of the plan and the Fund's other redemption
         requirements.

      Participants (other than self-employed plan sponsors) in
OppenheimerFunds-sponsored pension or profit-sharing plans with shares of the Fund
held in the name of the plan or its fiduciary may not directly request redemption
of their accounts. The plan administrator or fiduciary must sign the request.

      Distributions from pension and profit sharing plans are subject to special
requirements under the Internal Revenue Code and certain documents (available from
the Transfer Agent) must be completed and submitted to the Transfer Agent before
the distribution may be made. Distributions from retirement plans are subject to
withholding requirements under the Internal Revenue Code, and IRS Form W-4P
(available from the Transfer Agent) must be submitted to the Transfer Agent with
the distribution request, or the distribution may be delayed. Unless the
shareholder has provided the Transfer Agent with a certified tax identification
number, the Internal Revenue Code requires that tax be withheld from any
distribution even if the shareholder elects not to have tax withheld. The Fund, the
Manager, the Distributor, and the Transfer Agent assume no responsibility to
determine whether a distribution satisfies the conditions of applicable tax laws
and will not be responsible for any tax penalties assessed in connection with a
distribution.


Special Arrangements for Repurchase of Shares from Dealers and Brokers. The
Distributor is the Fund's agent to repurchase its shares from authorized dealers or
brokers on behalf of their customers. Shareholders should contact their broker or
dealer to arrange this type of redemption. The repurchase price per share will be
the net asset value next computed after the Distributor receives an order placed by
the dealer or broker. However, if the Distributor receives a repurchase order from
a dealer or broker after the close of the Exchange on a regular business day, it
will be processed at that day's net asset value if the order was received by the
dealer or broker from its customers prior to the time the Exchange closes.
Normally, the Exchange closes at 4:00 p.m., but may do so earlier on some days.
Additionally, the order must have been transmitted to and received by the
Distributor prior to its close of business that day (normally 5:00 p.m.).


      Ordinarily, for accounts redeemed by a broker-dealer under this procedure,
payment will be made within three business days after the shares have been redeemed
upon the Distributor's receipt of the required redemption documents in proper form.
The signature(s) of the registered owners on the redemption documents must be
guaranteed as described in the Prospectus.

Automatic Withdrawal and Exchange Plans. Investors owning shares of the Fund valued
at $5,000 or more can authorize the Transfer Agent to redeem shares (having a value
of at least $50) automatically on a monthly, quarterly, semi-annual or annual basis
under an Automatic Withdrawal Plan. Shares will be redeemed three business days
prior to the date requested by the shareholder for receipt of the payment.
Automatic withdrawals of up to $1,500 per month may be requested by telephone if
payments are to be made by check payable to all shareholders of record. Payments
must also be sent to the address of record for the account and the address must not
have been changed within the prior 30 days. Required minimum distributions from
OppenheimerFunds-sponsored retirement plans may not be arranged on this basis.

      Payments are normally made by check, but shareholders having AccountLink
privileges (see "How To Buy Shares") may arrange to have Automatic Withdrawal Plan
payments transferred to the bank account designated on the account application or
by signature-guaranteed instructions sent to the Transfer Agent. Shares are
normally redeemed pursuant to an Automatic Withdrawal Plan three business days
before the payment transmittal date you select in the account application. If a
contingent deferred sales charge applies to the redemption, the amount of the check
or payment will be reduced accordingly.

      The Fund cannot guarantee receipt of a payment on the date requested. The
Fund reserves the right to amend, suspend or discontinue offering these plans at
any time without prior notice. Because of the sales charge assessed on Class A
share purchases, shareholders should not make regular additional Class A share
purchases while participating in an Automatic Withdrawal Plan. Class B, Class C and
Class N shareholders should not establish automatic withdrawal plans, because of
the potential imposition of the contingent deferred sales charge on such
withdrawals (except where the Class B, Class C or Class N contingent deferred sales
charge is waived as described in Appendix C to this Statement of Additional
Information).

      By requesting an Automatic Withdrawal or Exchange Plan, the shareholder
agrees to the terms and conditions that apply to such plans, as stated below. These
provisions may be amended from time to time by the Fund and/or the Distributor.
When adopted, any amendments will automatically apply to existing Plans.


      |X|   Automatic Exchange Plans. Shareholders can authorize the Transfer Agent
to exchange a pre-determined amount of shares of the Fund for shares (of the same
class) of other Oppenheimer funds automatically on a monthly, quarterly,
semi-annual or annual basis under an Automatic Exchange Plan. The minimum amount
that may be exchanged to each other fund account is $50. Instructions should be
provided on the OppenheimerFunds application or signature-guaranteed instructions.
Exchanges made under these plans are subject to the restrictions that apply to
exchanges as set forth in "How to Exchange Shares" in the Prospectus and below in
this Statement of Additional Information.


Automatic Withdrawal Plans. Fund shares will be redeemed as necessary to meet
withdrawal payments. Shares acquired without a sales charge will be redeemed first.
Shares acquired with reinvested dividends and capital gains distributions will be
redeemed next, followed by shares acquired with a sales charge, to the extent
necessary to make withdrawal payments. Depending upon the amount withdrawn, the
investor's principal may be depleted. Payments made under these plans should not be
considered as a yield or income on your investment.

      The Transfer Agent will administer the investor's Automatic Withdrawal Plan
as agent for the shareholder(s) (the "Planholder") who executed the plan
authorization and application submitted to the Transfer Agent. Neither the Fund nor
the Transfer Agent shall incur any liability to the Planholder for any action taken
or not taken by the Transfer Agent in good faith to administer the plan. Share
certificates will not be issued for shares of the Fund purchased for and held under
the plan, but the Transfer Agent will credit all such shares to the account of the
Planholder on the records of the Fund. Any share certificates held by a Planholder
may be surrendered unendorsed to the Transfer Agent with the plan application so
that the shares represented by the certificate may be held under the plan.

      For accounts subject to Automatic Withdrawal Plans, distributions of capital
gains must be reinvested in shares of the Fund, which will be done at net asset
value without a sales charge. Dividends on shares held in the account may be paid
in cash or reinvested.

      Shares will be redeemed to make withdrawal payments at the net asset value
per share determined on the redemption date. Checks or AccountLink payments
representing the proceeds of Plan withdrawals will normally be transmitted three
business days prior to the date selected for receipt of the payment, according to
the choice specified in writing by the Planholder. Receipt of payment on the date
selected cannot be guaranteed.

      The amount and the interval of disbursement payments and the address to which
checks are to be mailed or AccountLink payments are to be sent may be changed at
any time by the Planholder by writing to the Transfer Agent. The Planholder should
allow at least two weeks' time after mailing such notification for the requested
change to be put in effect. The Planholder may, at any time, instruct the Transfer
Agent by written notice to redeem all, or any part of, the shares held under the
plan. That notice must be in proper form in accordance with the requirements of the
then-current Prospectus of the Fund. In that case, the Transfer Agent will redeem
the number of shares requested at the net asset value per share in effect and will
mail a check for the proceeds to the Planholder.

      The Planholder may terminate a plan at any time by writing to the Transfer
Agent. The Fund may also give directions to the Transfer Agent to terminate a plan.
The Transfer Agent will also terminate a plan upon its receipt of evidence
satisfactory to it that the Planholder has died or is legally incapacitated. Upon
termination of a plan by the Transfer Agent or the Fund, shares that have not been
redeemed will be held in uncertificated form in the name of the Planholder. The
account will continue as a dividend-reinvestment, uncertificated account unless and
until proper instructions are received from the Planholder, his or her executor or
guardian, or another authorized person.

      If the Transfer Agent ceases to act as transfer agent for the Fund, the
Planholder will be deemed to have appointed any successor transfer agent to act as
agent in administering the plan.
How to Exchange Shares

As stated in the Prospectus, shares of a particular class of Oppenheimer funds
having more than one class of shares may be exchanged only for shares of the same
class of other Oppenheimer funds. Shares of Oppenheimer funds that have a single
class without a class designation are deemed "Class A" shares for this purpose. You
can obtain a current list showing which funds offer which classes of shares by
calling the Distributor.

o     All of the Oppenheimer funds currently offer Class A, B, C, N and Y shares
      with the following exceptions:

   The following funds only offer Class A shares:

   Centennial California Tax Exempt Trust    Centennial New York Tax Exempt
                                             Trust
   Centennial Government Trust               Centennial Tax Exempt Trust
   Centennial Money Market Trust



The following funds do not offer Class N shares:

Limited Term New York Municipal Fund         Oppenheimer New Jersey Municipal Fund
Oppenheimer AMT-Free Municipals             Oppenheimer Principal Protected Main
                                            Street Fund II
Oppenheimer AMT-Free New York Municipals    Oppenheimer Pennsylvania Municipal Fund
Oppenheimer California Municipal Fund       Oppenheimer Rochester National Municipals
Oppenheimer International Value Fund        Oppenheimer Senior Floating Rate Fund
Oppenheimer Limited Term California         Rochester Fund Municipals
Municipal Fund
Oppenheimer Limited Term Municipal Fund
Oppenheimer Money Market Fund, Inc.


 The following funds do not offer Class Y shares:

 Limited Term New York Municipal Fund      Oppenheimer International Small Company
                                           Fund
 Oppenheimer AMT-Free Municipals          Oppenheimer Limited Term Municipal Fund
 Oppenheimer AMT-Free New York Municipals Oppenheimer New Jersey Municipal Fund
 Oppenheimer Balanced Fund                Oppenheimer Pennsylvania Municipal Fund
 Oppenheimer California Municipal Fund    Oppenheimer Principal Protected Main
                                          Street Fund
 Oppenheimer Capital Income Fund          Oppenheimer Principal Protected Main
                                          Street Fund II
 Oppenheimer Cash Reserves                Oppenheimer Principal Protected Main
                                          Street Fund III
 Oppenheimer Champion Income Fund         Oppenheimer Quest Capital Value Fund, Inc.
 Oppenheimer Convertible Securities Fund  Oppenheimer Quest International Value

                                          Fund, Inc.

 Oppenheimer Disciplined Allocation Fund  Oppenheimer Rochester National Municipals
 Oppenheimer Developing Markets Fund      Oppenheimer Senior Floating Rate Fund
 Oppenheimer Gold & Special Minerals Fund Oppenheimer Small Cap Value Fund
 Oppenheimer International Growth Fund


o     Oppenheimer Money Market Fund, Inc. only offers Class A and Class Y shares.
o     Class Y shares of Oppenheimer Real Asset Fund may not be exchanged for shares

      of any other fund.
o     Class B, Class C and Class N shares of Oppenheimer Cash Reserves are
      generally available only by exchange from the same class of shares of other
      Oppenheimer funds or through OppenheimerFunds-sponsored 401(k) plans.
o     Class M shares of Oppenheimer Convertible Securities Fund may be exchanged
      only for Class A shares of other Oppenheimer funds. They may not be acquired
      by exchange of shares of any class of any other Oppenheimer funds except
      Class A shares of Oppenheimer Money Market Fund or Oppenheimer Cash Reserves
      acquired by exchange of Class M shares.
   o  Class A shares of Oppenheimer funds may be exchanged at net asset value for
      shares of any money market fund offered by the Distributor. Shares of any
      money market fund purchased without a sales charge may be exchanged for
      shares of Oppenheimer funds offered with a sales charge upon payment of the
      sales charge. They may also be used to purchase shares of Oppenheimer funds
      subject to an early withdrawal charge or contingent deferred sales charge.
   o  Shares of the Fund acquired by reinvestment of dividends or distributions
      from any of the other Oppenheimer funds or from any unit investment trust for
      which reinvestment arrangements have been made with the Distributor may be
      exchanged at net asset value for shares of any of the Oppenheimer funds.
o     Shares of Oppenheimer Principal Protected Main Street Fund may be exchanged
      at net asset value for shares of any of the Oppenheimer funds. However,
      shareholders are not permitted to exchange shares of other Oppenheimer funds
      for shares of Oppenheimer Principal Protected Main Street Fund until after
      the expiration of the warranty period (8/5/2010).
o     Shares of Oppenheimer Principal Protected Main Street Fund II may be
      exchanged at net asset value for shares of any of the Oppenheimer funds.
      However, shareholders are not permitted to exchange shares of other
      Oppenheimer funds for shares of Oppenheimer Principal Protected Main Street
      Fund II until after the expiration of the warranty period (2/4/2011).

o     Shares of Oppenheimer Principal Protected Main Street Fund III may be
      exchanged at net asset value for shares of any of the Oppenheimer funds.
      However, shareholders are not permitted to exchange shares of other
      Oppenheimer funds for shares of Oppenheimer Principal Protected Main Street
      Fund III until after the expiration of the warranty period (12/6/2011).


      The Fund may amend, suspend or terminate the exchange privilege at any time.
Although the Fund may impose these changes at any time, it will provide you with
notice of those changes whenever it is required to do so by applicable law. It may
be required to provide 60 days' notice prior to materially amending or terminating
the exchange privilege. That 60 day notice is not required in extraordinary
circumstances.

      |X|   How Exchanges Affect Contingent Deferred Sales Charges. No contingent
deferred sales charge is imposed on exchanges of shares of any class purchased
subject to a contingent deferred sales charge, with the following exceptions:

o     When Class A shares of any Oppenheimer fund (other than Rochester National
Municipals and Rochester Fund Municipals) acquired by exchange of Class A shares of
any Oppenheimer fund purchased subject to a Class A contingent deferred sales
charge are redeemed within 18 months measured from the beginning of the calendar
month of the initial purchase of the exchanged Class A shares, the Class A
contingent deferred sales charge is imposed on the redeemed shares.

o     When Class A shares of Rochester National Municipals and Rochester Fund
Municipals acquired by exchange of Class A shares of any Oppenheimer fund purchased
subject to a Class A contingent deferred sales charge are redeemed within 24 months
of the beginning of the calendar month of the initial purchase of the exchanged
Class A shares, the Class A contingent deferred sales charge is imposed on the
redeemed shares.

o     If any Class A shares of another Oppenheimer fund that are exchanged for
Class A shares of Oppenheimer Senior Floating Rate Fund are subject to the Class A
contingent deferred sales charge of the other Oppenheimer fund at the time of
exchange, the holding period for that Class A contingent deferred sales charge will
carry over to the Class A shares of Oppenheimer Senior Floating Rate Fund acquired
in the exchange. The Class A shares of Oppenheimer Senior Floating Rate Fund
acquired in that exchange will be subject to the Class A Early Withdrawal Charge of
Oppenheimer Senior Floating Rate Fund if they are repurchased before the expiration
of the holding period.

o     When Class A shares of Oppenheimer Cash Reserves and Oppenheimer Money Market
Fund, Inc. acquired by exchange of Class A shares of any Oppenheimer fund purchased
subject to a Class A contingent deferred sales charge are redeemed within the Class
A holding period of the fund from which the shares were exchanged, the Class A
contingent deferred sales charge of the fund from which the shares were exchanged
is imposed on the redeemed shares.


         Except with respect to the Class B shares described in the next two
paragraphs, the contingent deferred sales charge is imposed on Class B shares
acquired by exchange if they are redeemed within six years of the initial purchase
of the exchanged Class B shares.

o     With respect to Class B shares of Limited-Term Government Fund, Limited Term
Municipal Fund, Limited Term New York Municipal Fund and Oppenheimer Senior
Floating Rate Fund, the Class B contingent deferred sales charge is imposed on the
acquired shares if they are redeemed within five years of the initial purchase of
the exchanged Class B shares.

o     With respect to Class B shares of Cash Reserves that were acquired through
the exchange of Class B shares initially purchased in the Oppenheimer Capital
Preservation Fund, the Class B contingent deferred sales charge is imposed on the
acquired shares if they are redeemed within five years of that initial purchase.


o     With respect to Class C shares, the Class C contingent deferred sales charge
is imposed on Class C shares acquired by exchange if they are redeemed within 12
months of the initial purchase of the exchanged Class C shares.

o     With respect to Class N shares, a 1% contingent deferred sales charge will be
imposed if the retirement plan (not including IRAs and 403(b) plans) is terminated
or Class N shares of all Oppenheimer funds are terminated as an investment option
of the plan and Class N shares are redeemed within 18 months after the plan's first
purchase of Class N shares of any Oppenheimer fund or with respect to an individual
retirement plan or 403(b) plan, Class N shares are redeemed within 18 months of the
plan's first purchase of Class N shares of any Oppenheimer fund.

o     When Class B, Class C or Class N shares are redeemed to effect an exchange,
the priorities described in "How To Buy Shares" in the Prospectus for the
imposition of the Class B, Class C or Class N contingent deferred sales charge will
be followed in determining the order in which the shares are exchanged. Before
exchanging shares, shareholders should take into account how the exchange may
affect any contingent deferred sales charge that might be imposed in the subsequent
redemption of remaining shares.

      Shareholders owning shares of more than one class must specify which class of
shares they wish to exchange.


      |X|   Limits on Multiple Exchange Orders. The Fund reserves the right to
reject telephone or written exchange requests submitted in bulk by anyone on behalf
of more than one account.

      |X|   Telephone Exchange Requests. When exchanging shares by telephone, a
shareholder must have an existing account in the fund to which the exchange is to
be made. Otherwise, the investors must obtain a prospectus of that fund before the
exchange request may be submitted. If all telephone lines are busy (which might
occur, for example, during periods of substantial market fluctuations),
shareholders might not be able to request exchanges by telephone and would have to
submit written exchange requests.

Processing Exchange Requests. Shares to be exchanged are redeemed on the regular
business day the Transfer Agent receives an exchange request in proper form (the
"Redemption Date"). Normally, shares of the fund to be acquired are purchased on the
Redemption Date, but such purchases may be delayed by either fund up to five
business days if it determines that it would be disadvantaged by an immediate
transfer of the redemption proceeds. The Fund reserves the right, in its
discretion, to refuse any exchange request that may disadvantage it. For example,
if the receipt of multiple exchange requests from a dealer might require the
disposition of portfolio securities at a time or at a price that might be
disadvantageous to the Fund, the Fund may refuse the request.

      When you exchange some or all of your shares from one fund to another, any
special account feature such as an Asset Builder Plan or Automatic Withdrawal Plan,
will be switched to the new fund account unless you tell the Transfer Agent not to
do so. However, special redemption and exchange features such as Automatic Exchange
Plans and Automatic Withdrawal Plans cannot be switched to an account in
Oppenheimer Senior Floating Rate Fund.

      In connection with any exchange request, the number of shares exchanged may
be less than the number requested if the exchange or the number requested would
include shares subject to a restriction cited in the Prospectus or this Statement
of Additional Information, or would include shares covered by a share certificate
that is not tendered with the request. In those cases, only the shares available
for exchange without restriction will be exchanged.

      The different Oppenheimer funds available for exchange have different
investment objectives, policies and risks. A shareholder should assure that the
fund selected is appropriate for his or her investment and should be aware of the
tax consequences of an exchange. For federal income tax purposes, an exchange
transaction is treated as a redemption of shares of one fund and a purchase of
shares of another. "Reinvestment Privilege," above, discusses some of the tax
consequences of reinvestment of redemption proceeds in such cases. The Fund, the
Distributor, and the Transfer Agent are unable to provide investment, tax or legal
advice to a shareholder in connection with an exchange request or any other
investment transaction.

Dividends, Capital Gains and Taxes

Dividends and Distributions. The Fund has no fixed dividend rate and there can be
no assurance as to the payment of any dividends or the realization of any capital
gains. The dividends and distributions paid by a class of shares will vary from
time to time depending on market conditions, the composition of the Fund's
portfolio, and expenses borne by the Fund or borne separately by a class. Dividends
are calculated in the same manner, at the same time, and on the same day for each
class of shares. However, dividends on Class B, Class C and Class N shares are
expected to be lower than dividends on Class A and Class Y shares. That is because
of the effect of the asset-based sales charge on Class B, Class C and Class N
shares. Those dividends will also differ in amount as a consequence of any
difference in the net asset values of the different classes of shares.

      Dividends, distributions and proceeds of the redemption of Fund shares
represented by checks returned to the Transfer Agent by the Postal Service as
undeliverable will be invested in shares of Oppenheimer Money Market Fund, Inc.
Reinvestment will be made as promptly as possible after the return of such checks
to the Transfer Agent, to enable the investor to earn a return on otherwise idle
funds. Unclaimed accounts may be subject to state escheatment laws, and the Fund
and the Transfer Agent will not be liable to shareholders or their representatives
for compliance with those laws in good faith.

Tax Status of the Fund's Dividends, Distributions and Redemptions of Shares. The
federal tax treatment of the Fund's dividends and capital gains distributions is
briefly highlighted in the Prospectus. The following is only a summary of certain
additional tax considerations generally affecting the Fund and its shareholders.

      The tax discussion in the Prospectus and this Statement of Additional
Information is based on tax law in effect on the date of the Prospectus and this
Statement of Additional Information. Those laws and regulations may be changed by
legislative, judicial, or administrative action, sometimes with retroactive effect.
State and local tax treatment of ordinary income dividends and capital gain
dividends from regulated investment companies may differ from the treatment under
the Internal Revenue Code described below. Potential purchasers of shares of the
Fund are urged to consult their tax advisers with specific reference to their own
tax circumstances as well as the consequences of federal, state and local tax rules
affecting an investment in the Fund.

|X|   Qualification as a Regulated Investment Company. The Fund has elected to be
taxed as a regulated investment company under Subchapter M of the Internal Revenue
Code of 1986, as amended. As a regulated investment company, the Fund is not
subject to federal income tax on the portion of its net investment income (that is,
taxable interest, dividends, and other taxable ordinary income, net of expenses)
and capital gain net income (that is, the excess of net long-term capital gains
over net short-term capital losses) that it distributes to shareholders. That
qualification enables the Fund to "pass through" its income and realized capital
gains to shareholders without having to pay tax on them. This avoids a "double tax"
on that income and capital gains, since shareholders normally will be taxed on the
dividends and capital gains they receive from the Fund (unless their Fund shares
are held in a retirement account or the shareholder is otherwise exempt from tax).

      The Internal Revenue Code contains a number of complex tests relating to
qualification that the Fund might not meet in a particular year. If it did not
qualify as a regulated investment company, the Fund would be treated for tax
purposes as an ordinary corporation and would receive no tax deduction for payments
made to shareholders.

      To qualify as a regulated investment company, the Fund must distribute at
least 90% of its investment company taxable income (in brief, net investment income
and the excess of net short-term capital gain over net long-term capital loss) for
the taxable year. The Fund must also satisfy certain other requirements of the
Internal Revenue Code, some of which are described below. Distributions by the Fund
made during the taxable year or, under specified circumstances, within 12 months
after the close of the taxable year, will be considered distributions of income and
gains for the taxable year and will therefore count toward satisfaction of the
above-mentioned requirement.

      To qualify as a regulated investment company, the Fund must derive at least
90% of its gross income from dividends, interest, certain payments with respect to
securities loans, gains from the sale or other disposition of stock or securities
or foreign currencies (to the extent such currency gains are directly related to
the regulated investment company's principal business of investing in stock or
securities) and certain other income.

      In addition to satisfying the requirements described above, the Fund must
satisfy an asset diversification test in order to qualify as a regulated investment
company. Under that test, at the close of each quarter of the Fund's taxable year,
at least 50% of the value of the Fund's assets must consist of cash and cash items
(including receivables), U.S. government securities, securities of other regulated
investment companies, and securities of other issuers. As to each of those issuers,
the Fund must not have invested more than 5% of the value of the Fund's total
assets in securities of each such issuer and the Fund must not hold more than 10%
of the outstanding voting securities of each such issuer. No more than 25% of the
value of its total assets may be invested in the securities of any one issuer
(other than U.S. government securities and securities of other regulated investment
companies), or in two or more issuers which the Fund controls and which are engaged
in the same or similar trades or businesses. For purposes of this test, obligations
issued or guaranteed by certain agencies or instrumentalities of the U.S.
government are treated as U.S. government securities.

|X|   Excise Tax on Regulated Investment Companies. Under the Internal Revenue
Code, by December 31 each year, the Fund must distribute 98% of its taxable
investment income earned from January 1 through December 31 of that year and 98% of
its capital gains realized in the period from November 1 of the prior year through
October 31 of the current year. If it does not, the Fund must pay an excise tax on
the amounts not distributed. It is presently anticipated that the Fund will meet
those requirements. To meet this requirement, in certain circumstances the Fund
might be required to liquidate portfolio investments to make sufficient
distributions to avoid excise tax liability. However, the Board of Trustees and the
Manager might determine in a particular year that it would be in the best interests
of shareholders for the Fund not to make such distributions at the required levels
and to pay the excise tax on the undistributed amounts. That would reduce the
amount of income or capital gains available for distribution to shareholders.

|X|   Taxation of Fund Distributions. The Fund anticipates distributing
substantially all of its investment company taxable income for each taxable year.
Those distributions will be taxable to shareholders as ordinary income and treated
as dividends for federal income tax purposes.

      Special provisions of the Internal Revenue Code govern the eligibility of the
Fund's dividends for the dividends-received deduction for corporate shareholders.
Long-term capital gains distributions are not eligible for the deduction. The
amount of dividends paid by the Fund that may qualify for the deduction is limited
to the aggregate amount of qualifying dividends that the Fund derives from
portfolio investments that the Fund has held for a minimum period, usually 46 days.
A corporate shareholder will not be eligible for the deduction on dividends paid on
Fund shares held for 45 days or less. To the extent the Fund's dividends are
derived from gross income from option premiums, interest income or short-term gains
from the sale of securities or dividends from foreign corporations, those dividends
will not qualify for the deduction.

      The Fund may either retain or distribute to shareholders its net capital gain
for each taxable year. The Fund currently intends to distribute any such amounts.
If net long term capital gains are distributed and designated as a capital gain
distribution, it will be taxable to shareholders as a long-term capital gain and
will be properly identified in reports sent to shareholders in January of each
year. Such treatment will apply no matter how long the shareholder has held his or
her shares or whether that gain was recognized by the Fund before the shareholder
acquired his or her shares.

      If the Fund elects to retain its net capital gain, the Fund will be subject
to tax on it at the 35% corporate tax rate. If the Fund elects to retain its net
capital gain, the Fund will provide to shareholders of record on the last day of
its taxable year information regarding their pro rata share of the gain and tax
paid. As a result, each shareholder will be required to report his or her pro rata
share of such gain on their tax return as long-term capital gain, will receive a
refundable tax credit for his/her pro rata share of tax paid by the Fund on the
gain, and will increase the tax basis for his/her shares by an amount equal to the
deemed distribution less the tax credit.

      Investment income that may be received by the Fund from sources within
foreign countries may be subject to foreign taxes withheld at the source. The
United States has entered into tax treaties with many foreign countries which
entitle the Fund to a reduced rate of, or exemption from, taxes on such income.

      Distributions by the Fund that do not constitute ordinary income dividends or
capital gain distributions will be treated as a return of capital to the extent of
the shareholder's tax basis in their shares. Any excess will be treated as gain
from the sale of those shares, as discussed below. Shareholders will be advised
annually as to the U.S. federal income tax consequences of distributions made (or
deemed made) during the year. If prior distributions made by the Fund must be
re-characterized as a non-taxable return of capital at the end of the fiscal year
as a result of the effect of the Fund's investment policies, they will be
identified as such in notices sent to shareholders.

      Distributions by the Fund will be treated in the manner described above
regardless of whether the distributions are paid in cash or reinvested in
additional shares of the Fund (or of another fund). Shareholders receiving a
distribution in the form of additional shares will be treated as receiving a
distribution in an amount equal to the fair market value of the shares received,
determined as of the reinvestment date.


The Fund will be required in certain  cases to withhold  28% of ordinary  income
dividends,  capital gains  distributions  and the proceeds of the  redemption of
shares, paid to any shareholder (1) who has failed to provide a correct taxpayer
identification number or to properly certify that number when required,  (2) who
is subject to backup  withholding  for failure to report the receipt of interest
or dividend income  properly,  or (3) who has failed to certify to the Fund that
the shareholder is not subject to backup withholding or is an "exempt recipient"
(such as a corporation). All income and any tax withheld by the Fund is remitted
by the  Fund to the  U.S.  Treasury  and is  identified  in  reports  mailed  to
shareholders in January of each year with a copy sent to the IRS.


Tax Effects of Redemptions of Shares. If a shareholder  redeems all or a portion
of his/her shares, the shareholder will recognize a gain or loss on the redeemed
shares in an amount equal to the difference between the proceeds of the redeemed
shares and the shareholder's  adjusted tax basis in the shares. All or a portion
of any loss  recognized  in that  manner may be  disallowed  if the  shareholder
purchases  other  shares  of the  Fund  within  30  days  before  or  after  the
redemption.

      In general, any gain or loss arising from the redemption of shares of the
Fund will be considered capital gain or loss, if the shares were held as a capital
asset. It will be long-term capital gain or loss if the shares were held for more
than one year. However, any capital loss arising from the redemption of shares held
for six months or less will be treated as a long-term capital loss to the extent of
the amount of capital gain dividends received on those shares. Special holding
period rules under the Internal Revenue Code apply in this case to determine the
holding period of shares and there are limits on the deductibility of capital
losses in any year.

      Foreign Shareholders. Under U.S. tax law, taxation of a shareholder who is a
foreign person (to include, but not limited to, a nonresident alien individual, a
foreign trust, a foreign estate, a foreign corporation, or a foreign partnership)
primarily depends on whether the foreign person's income from the Fund is
effectively connected with the conduct of a U.S. trade or business. Typically,
ordinary income dividends paid from a mutual fund are not considered "effectively
connected" income.


      Ordinary income dividends that are paid by the Fund (and are deemed not
"effectively connected income") to foreign persons will be subject to a U.S. tax
withheld by the Fund at a rate of 30%, provided the Fund obtains a properly
completed and signed Certificate of Foreign Status. The tax rate may be reduced if
the foreign person's country of residence has a tax treaty with the U.S. allowing
for a reduced tax rate on ordinary income dividends paid by the Fund. Any tax
withheld by the Fund is remitted by the Fund to the U.S. Treasury and all income
and any tax withheld is identified in reports mailed to shareholders in March of
each year with a copy sent to the IRS.

If the ordinary income  dividends from the Fund are  effectively  connected with
the conduct of a U.S.  trade or business,  then the foreign  person may claim an
exemption from the U.S. tax described above provided the Fund obtains a properly
completed and signed  Certificate of Foreign Status. If the foreign person fails
to provide a certification of his/her foreign status,  the Fund will be required
to withhold  U.S.  tax at a rate of 28% on ordinary  income  dividends,  capital
gains  distributions  and the proceeds of the redemption of shares,  paid to any
foreign person. Any tax withheld by the Fund is remitted by the Fund to the U.S.
Treasury and all income and any tax withheld is identified in reports  mailed to
shareholders in January of each year with a copy sent to the IRS.


      The tax consequences to foreign persons entitled to claim the benefits of an
applicable tax treaty may be different from those described herein. Foreign
shareholders are urged to consult their own tax advisors or the U.S. Internal
Revenue Service with respect to the particular tax consequences to them of an
investment in the Fund, including the applicability of the U.S. withholding taxes
described above.

Dividend Reinvestment in Another Fund. Shareholders of the Fund may elect to
reinvest all dividends and/or capital gains distributions in shares of the same
class of any of the other Oppenheimer funds listed above. Reinvestment will be made
without sales charge at the net asset value per share in effect at the close of
business on the payable date of the dividend or distribution. To elect this option,
the shareholder must notify the Transfer Agent in writing and must have an existing
account in the fund selected for reinvestment. Otherwise the shareholder first must
obtain a prospectus for that fund and an application from the Distributor to
establish an account. Dividends and/or distributions from shares of certain other
Oppenheimer funds (other than Oppenheimer Cash Reserves) may be invested in shares
of this Fund on the same basis.

Additional Information About the Fund

The Distributor. The Fund's shares are sold through dealers, brokers and other
financial institutions that have a sales agreement with OppenheimerFunds
Distributor, Inc., a subsidiary of the Manager that acts as the Fund's Distributor.
The Distributor also distributes shares of the other Oppenheimer funds and is
sub-distributor for funds managed by a subsidiary of the Manager.

The Transfer Agent. OppenheimerFunds Services, the Fund's Transfer Agent, is a
division of the Manager. It is responsible for maintaining the Fund's shareholder
registry and shareholder accounting records, and for paying dividends and
distributions to shareholders. It also handles shareholder servicing and
administrative functions. It serves as the Transfer Agent for an annual per account
fee. It also acts as shareholder servicing agent for the other Oppenheimer funds.
Shareholders should direct inquiries about their accounts to the Transfer Agent at
the address and toll-free numbers shown on the back cover.

The Custodian. Citibank, N.A. is the custodian of the Fund's assets. The
custodian's responsibilities include safeguarding and controlling the Fund's
portfolio securities and handling the delivery of such securities to and from the
Fund. It is the practice of the Fund to deal with the custodian in a manner
uninfluenced by any banking relationship the custodian may have with the Manager
and its affiliates. The Fund's cash balances with the custodian in excess of
$100,000 are not protected by federal deposit insurance. Those uninsured balances
at times may be substantial.


Independent Auditors. ______________ are the independent auditors of the Fund. They
audit the Fund's financial statements and perform other related audit services.
They also act as auditors for certain other funds advised by the Manager and its
affiliates.




                                     Appendix A

                                 RATINGS DEFINITIONS
                                 -------------------

Below are summaries of the rating definitions used by the nationally-recognized
rating agencies listed below. Those ratings represent the opinion of the agency as
to the credit quality of issues that they rate. The summaries below are based upon
publicly available information provided by the rating organizations.

Moody's Investors Service, Inc. ("Moody's")

LONG-TERM RATINGS: BONDS AND PREFERRED STOCK ISSUER RATINGS

Aaa: Bonds and preferred stock rated "Aaa" are judged to be the best quality. They
carry the smallest degree of investment risk.  Interest payments are protected by a
large or by an exceptionally stable margin and principal is secure.  While the
various protective elements are likely to change, the changes that can be expected
are most unlikely to impair the fundamentally strong position of such issues.

Aa: Bonds and preferred stock rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group, they comprise what are generally known as
high-grade bonds.  They are rated lower than the best bonds because margins of
protection may not be as large as with "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other elements
present which make the long-term risk appear somewhat larger than that of "Aaa"
securities.

A: Bonds and preferred stock rated "A" possess many favorable investment attributes
and are to be considered as upper-medium grade obligations.  Factors giving
security to principal and interest are considered adequate but elements may be
present which suggest a susceptibility to impairment some time in the future.

Baa: Bonds and preferred stock rated "Baa" are considered medium-grade obligations;
that is, they are neither highly protected nor poorly secured.  Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and have
speculative characteristics as well.

Ba: Bonds and preferred stock rated "Ba" are judged to have speculative elements.
Their future cannot be considered well-assured.  Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded during
both good and bad times over the future.  Uncertainty of position characterizes
bonds in this class.

B: Bonds and preferred stock rated "B" generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may be
small.

Caa: Bonds and preferred stock rated "Caa" are of poor standing. Such issues may be
in default or there may be present elements of danger with respect to principal or
interest.
Ca: Bonds and preferred stock rated "Ca" represent obligations which are
speculative in a high degree. Such issues are often in default or have other marked
shortcomings.

C:  Bonds and preferred stock rated "C" are the lowest class of rated bonds and can
be regarded as having extremely poor prospects of ever attaining any real
investment standing.

Moody's applies numerical modifiers 1, 2, and 3 in each generic rating
classification from "Aa" through "Caa." The modifier "1" indicates that the
obligation ranks in the higher end of its generic rating category; the modifier "2"
indicates a mid-range ranking; and the modifier "3" indicates a ranking in the
lower end of that generic rating category. Advanced refunded issues that are
secured by certain assets are identified with a # symbol.

PRIME RATING SYSTEM (SHORT-TERM RATINGS - TAXABLE DEBT)
These ratings are opinions of the ability of issuers to honor senior financial
obligations and contracts. Such obligations generally have an original maturity not
exceeding one year, unless explicitly noted.

Prime-1: Issuer has a superior ability for repayment of senior short-term debt
obligations.

Prime-2: Issuer has a strong ability for repayment of senior short-term debt
obligations. Earnings trends and coverage ratios, while sound, may be more subject
to variation. Capitalization characteristics, while appropriate, may be more
affected by external conditions. Ample alternate liquidity is maintained.

Prime-3: Issuer has an acceptable ability for repayment of senior short-term
obligations. The effect of industry characteristics and market compositions may be
more pronounced. Variability in earnings and profitability may result in changes in
the level of debt protection measurements and may require relatively high financial
leverage. Adequate alternate liquidity is maintained.

Not Prime: Issuer does not fall within any Prime rating category.

Standard & Poor's Ratings Services ("Standard & Poor's"), a division of The
McGraw-Hill Companies, Inc.

LONG-TERM ISSUE CREDIT RATINGS
Issue credit ratings are based in varying degrees, on the following considerations:
o     Likelihood of payment-capacity and willingness of the obligor to meet its
      financial commitment on an obligation in accordance with the terms of the
      obligation;
o     Nature of and provisions of the obligation; and
o     Protection afforded by, and relative position of, the obligation in the event
      of bankruptcy, reorganization, or other arrangement under the laws of
      bankruptcy and other laws affecting creditors' rights.
   The issue ratings definitions are expressed in terms of default risk. As such,
they pertain to senior obligations of an entity. Junior obligations are typically
rated lower than senior obligations, to reflect the lower priority in bankruptcy,
as noted above.

AAA:  An  obligation  rated  "AAA" have the  highest  rating  assigned  by Standard &
Poor's. The obligor's capacity to meet its financial  commitment on the obligation is
extremely strong.

AA: An  obligation  rated "AA"  differ  from the highest  rated  obligations  only in
small  degree.  The  obligor's  capacity  to meet  its  financial  commitment  on the
obligation is very strong.

A: An obligation  rated "A" are somewhat more  susceptible to the adverse  effects of
changes in  circumstances  and economic  conditions than  obligations in higher-rated
categories.  However,  the obligor's capacity to meet its financial commitment on the
obligation is still strong.

BBB: An  obligation  rated "BBB" exhibit  adequate  protection  parameters.  However,
adverse economic  conditions or changing  circumstances  are more likely to lead to a
weakened   capacity  of  the  obligor  to  meet  its  financial   commitment  on  the
obligation.

BB, B, CCC, CC, and C
An obligation rated `BB', `B', `CCC', `CC', and `C' are regarded as having
significant speculative characteristics. `BB' indicates the least degree of
speculation and `C' the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.

BB:  An  obligation   rated  "BB"  are  less  vulnerable  to  nonpayment  than  other
speculative  issues.  However,  they face major ongoing  uncertainties or exposure to
adverse  business,  financial,  or  economic  conditions  which  could  lead  to  the
obligor's inadequate capacity to meet its financial commitment on the obligation.

B: An obligation rated "B" are more vulnerable to nonpayment than  obligations  rated
"BB",  but the obligor  currently has the capacity to meet its  financial  commitment
on the obligation.  Adverse business,  financial,  or economic conditions will likely
impair the obligor's  capacity or  willingness  to meet its  financial  commitment on
the obligation.

CCC: An  obligation  rated "CCC" are  currently  vulnerable  to  nonpayment,  and are
dependent  upon  favorable  business,  financial,  and  economic  conditions  for the
obligor to meet its financial  commitment on the obligation.  In the event of adverse
business,  financial,  or economic conditions,  the obligor is not likely to have the
capacity to meet its financial commitment on the obligation.

CC: An obligation rated "CC" are currently highly vulnerable to nonpayment.

C:  Subordinated  debt or preferred stock  obligations rated "C" are currently highly
vulnerable  to  nonpayment.  The "C" rating may be used to cover a situation  where a
bankruptcy  petition  has been filed or similar  action  taken,  but payments on this
obligation  are being  continued.  A "C" also will be assigned  to a preferred  stock
issue in arrears  on  dividends  or  sinking  fund  payments,  but that is  currently
paying.

D: An obligation  rated "D" are in payment  default.  The "D" rating category is used
when  payments on an obligation  are not made on the date due even if the  applicable
grace period has not expired,  unless  Standard & Poor's  believes that such payments
will be made  during  such grace  period.  The "D" rating  also will be used upon the
filing of a bankruptcy  petition or the taking of a similar  action if payments on an
obligation are jeopardized.

The ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within the major rating categories.

c: The `c' subscript is used to provide additional information to investors that
the bank may terminate its obligation to purchase tendered bonds if the long-term
credit rating of the issuer is below an investment-grade level and/or the issuer's
bonds are deemed taxable.

p: The letter `p' indicates that the rating is provisional. A provisional rating
assumes the successful completion of the project financed by the debt being rated
and indicates that payment of debt service requirements is largely or entirely
dependent upon the successful, timely completion of the project. This rating,
however, while addressing credit quality subsequent to completion of the project,
makes no comment on the likelihood of or the risk of default upon failure of such
completion. The investor should exercise his own judgment with respect to such
likelihood and risk.

Continuance of the ratings is contingent upon Standard & Poor's receipt of an
executed copy of the escrow agreement or closing documentation confirming
investments and cash flows.

r: The `r' highlights derivative, hybrid, and certain other obligations that
Standard & Poor's believes may experience high volatility or high variability in
expected returns as a result of noncredit risks. Examples of such obligations are
securities with principal or interest return indexed to equities, commodities, or
currencies; certain swaps and options; and interest-only and principal-only
mortgage securities. The absence of an `r' symbol should not be taken as an
indication that an obligation will exhibit no volatility or variability in total
return.

N.R. Not rated.

Debt obligations of issuers outside the United States and its territories are rated
on the same basis as domestic corporate and municipal issues. The ratings measure
the creditworthiness of the obligor but do not take into account currency exchange
and related uncertainties.

Bond Investment Quality Standards

Under present commercial bank regulations issued by the Comptroller of the
Currency, bonds rated in the top four categories (`AAA', `AA', `A', `BBB', commonly
known as investment-grade ratings) generally are regarded as eligible for bank
investment. Also, the laws of various states governing legal investments impose
certain rating or other standards for obligations eligible for investment by
savings banks, trust companies, insurance companies, and fiduciaries in general

SHORT-TERM ISSUE CREDIT RATINGS
Short-term ratings are generally assigned to those obligations considered
short-term in the relevant market. In the U.S., for example, that means obligations
with an original maturity of no more than 365 days-including commercial paper.

A-1: A short-term obligation rated "A-1" is rated in the highest category by
Standard & Poor's. The obligor's capacity to meet its financial commitment on the
obligation is strong. Within this category, certain obligations are designated with
a plus sign (+). This indicates that the obligor's capacity to meet its financial
commitment on these obligations is extremely strong.

A-2: A short-term obligation rated "A-2" is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to meet
its financial commitment on the obligation is satisfactory.
A-3: A short-term obligation rated "A-3" exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely to
lead to a weakened capacity of the obligor to meet its financial commitment on the
obligation.

B: A short-term obligation rated "B" is regarded as having significant speculative
characteristics. The obligor currently has the capacity to meet its financial
commitment on the obligation; however, it faces major ongoing uncertainties which
could lead to the obligor's inadequate capacity to meet its financial commitment on
the obligation.

C: A short-term obligation rated "C" is currently vulnerable to nonpayment and is
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation.

D: A short-term obligation rated "D" is in payment default. The "D" rating category
is used when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes that
such payments will be made during such grace period. The "D" rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action if
payments on an obligation are jeopardized.

NOTES:
A Standard & Poor's note rating reflects the liquidity factors and market access
risks unique to notes. Notes due in three years or less will likely receive a note
rating. Notes maturing beyond three years will most likely receive a long-term debt
rating. The following criteria will be used in making that assessment:
o     Amortization schedule-the larger the final maturity relative to other
      maturities, the more likely it will
      be treated as a note; and
o     Source of payment-the more dependent the issue is on the market for its
      refinancing, the more likely
      it will be treated as a note.

SP-1: Strong capacity to pay principal and interest. An issue with a very strong
capacity to pay debt service is given a (+) designation.

SP-2: Satisfactory capacity to pay principal and interest, with some vulnerability
to adverse financial and economic changes over the term of the notes.

SP-3: Speculative capacity to pay principal and interest.

Fitch, Inc.
International credit ratings assess the capacity to meet foreign currency or local
currency commitments. Both "foreign currency" and "local currency" ratings are
internationally comparable assessments. The local currency rating measures the
probability of payment within the relevant sovereign state's currency and
jurisdiction and therefore, unlike the foreign currency rating, does not take
account of the possibility of foreign exchange controls limiting transfer into
foreign currency.

INTERNATIONAL LONG-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings.

Investment Grade:

AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of credit
risk. They are assigned only in the case of exceptionally strong capacity for
timely payment of financial commitments. This capacity is highly unlikely to be
adversely affected by foreseeable events.
AA: Very High Credit Quality. "AA" ratings denote a very low expectation of credit
risk. They indicate a very strong capacity for timely payment of financial
commitments. This capacity is not significantly vulnerable to foreseeable events.

A: High Credit Quality. "A" ratings denote a low expectation of credit risk. The
capacity for timely payment of financial commitments is considered strong. This
capacity may, nevertheless, be more vulnerable to changes in circumstances or in
economic conditions than is the case for higher ratings.

BBB: Good Credit Quality. "BBB" ratings indicate that there is currently a low
expectation of credit risk. The capacity for timely payment of financial
commitments is considered adequate, but adverse changes in circumstances and in
economic conditions are more likely to impair this capacity. This is the lowest
investment-grade category.

Speculative Grade:

BB: Speculative. "BB" ratings indicate that there is a possibility of credit risk
developing, particularly as the result of adverse economic change over time.
However, business or financial alternatives may be available to allow financial
commitments to be met. Securities rated in this category are not investment grade.


B: Highly Speculative. "B" ratings indicate that significant credit risk is
present, but a limited margin of safety remains. Financial commitments are
currently being met. However, capacity for continued payment is contingent upon a
sustained, favorable business and economic environment.

CCC, CC C: High Default Risk.  Default is a real possibility. Capacity for meeting
financial commitments is solely reliant upon sustained, favorable business or
economic developments. A "CC" rating indicates that default of some kind appears
probable. "C" ratings signal imminent default.

DDD, DD, and D: Default. The ratings of obligations in this category are based on
their prospects for achieving partial or full recovery in a reorganization or
liquidation of the obligor. While expected recovery values are highly speculative
and cannot be estimated with any precision, the following serve as general
guidelines. "DDD" obligations have the highest potential for recovery, around
90%-100% of outstanding amounts and accrued interest. "DD" indicates potential
recoveries in the range of 50%-90%, and "D" the lowest recovery potential, i.e.,
below 50%.

Entities rated in this category have defaulted on some or all of their obligations.
Entities rated "DDD" have the highest prospect for resumption of performance or
continued operation with or without a formal reorganization process. Entities rated
"DD" and "D" are generally undergoing a formal reorganization or liquidation
process; those rated "DD" are likely to satisfy a higher portion of their
outstanding obligations, while entities rated "D" have a poor prospect for repaying
all obligations.

Plus (+) and minus (-) signs may be appended to a rating symbol to denote relative
status within the major rating categories.  Plus and minus signs are not added to
the "AAA" category or to categories below "CCC," nor to short-term ratings other
than "F1" (see below).

INTERNATIONAL SHORT-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings.
A short-term rating has a time horizon of less than 12 months for most obligations,
or up to three years for U.S. public finance securities, and thus places greater
emphasis on the liquidity necessary to meet financial commitments in a timely
manner.

F1: Highest credit quality. Strongest capacity for timely payment of financial
commitments. May have an added "+" to denote any exceptionally strong credit
feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial
commitments, but the margin of safety is not as great as in the case of higher
ratings.

F3: Fair credit quality. Capacity for timely payment of financial commitments is
adequate. However, near-term adverse changes could result in a reduction to
non-investment grade.

B: Speculative. Minimal capacity for timely payment of financial commitments, plus
vulnerability to near-term adverse changes in financial and economic conditions.

C: High default risk. Default is a real possibility. Capacity for meeting financial
commitments is solely reliant upon a sustained, favorable business and economic
environment.

D: Default. Denotes actual or imminent payment default.



                                     Appendix B

                              Industry Classifications

Aerospace & Defense                  Household Products
Air Freight & Couriers               Industrial Conglomerates
Airlines                             Insurance
Auto Components                      Internet & Catalog Retail
Automobiles                          Internet Software & Services
Beverages                            IT Services
Biotechnology                        Leisure Equipment & Products
Building Products                    Machinery
Chemicals                            Marine
Consumer Finance                     Media
Commercial Banks                     Metals & Mining
Commercial Services & Supplies       Multiline Retail
Communications Equipment             Multi-Utilities
Computers & Peripherals              Office Electronics
Construction & Engineering           Oil & Gas
Construction Materials               Paper & Forest Products
Containers & Packaging               Personal Products
Distributors                         Pharmaceuticals
Diversified Financial Services       Real Estate
Diversified Telecommunication        Road & Rail
Services
Electric Utilities                   Semiconductors and Semiconductor
                                     Equipment
Electrical Equipment                 Software
Electronic Equipment & Instruments   Specialty Retail
Energy Equipment & Services          Textiles, Apparel & Luxury Goods
Food & Staples Retailing             Thrifts & Mortgage Finance
Food Products                        Tobacco
Gas Utilities                        Trading Companies & Distributors
Health Care Equipment & Supplies     Transportation Infrastructure
Health Care Providers & Services     Water Utilities
Hotels Restaurants & Leisure         Wireless Telecommunication Services
Household Durables








                                     Appendix C
                                     ----------

           OppenheimerFunds Special Sales Charge Arrangements and Waivers
           --------------------------------------------------------------

In certain cases, the initial sales charge that applies to purchases of Class A
shares(2) of the Oppenheimer funds or the contingent deferred sales charge that may
apply to Class A, Class B or Class C shares may be waived.(3)  That is because of
the economies of sales efforts realized by OppenheimerFunds Distributor, Inc.,
(referred to in this document as the "Distributor"), or by dealers or other
financial institutions that offer those shares to certain classes of investors.

Not all waivers apply to all funds. For example, waivers relating to Retirement
Plans do not apply to Oppenheimer municipal funds, because shares of those funds
are not available for purchase by or on behalf of retirement plans. Other waivers
apply only to shareholders of certain funds.

For the purposes of some of the waivers described below and in the Prospectus and
Statement of Additional Information of the applicable Oppenheimer funds, the term
"Retirement Plan" refers to the following types of plans:
         1) plans qualified under Sections 401(a) or 401(k) of the Internal Revenue
            Code,
         2) non-qualified deferred compensation plans,
         3) employee benefit plans(4)
         4) Group Retirement Plans(5)
         5) 403(b)(7) custodial plan accounts
         6) Individual Retirement Accounts ("IRAs"), including traditional IRAs,
            Roth IRAs, SEP-IRAs, SARSEPs or SIMPLE plans

The interpretation of these provisions as to the applicability of a special
arrangement or waiver in a particular case is in the sole discretion of the
Distributor or the transfer agent (referred to in this document as the "Transfer
Agent") of the particular Oppenheimer fund. These waivers and special arrangements
may be amended or terminated at any time by a particular fund, the Distributor,
and/or OppenheimerFunds, Inc. (referred to in this document as the "Manager").

Waivers that apply at the time shares are redeemed must be requested by the
shareholder and/or dealer in the redemption request.

I.      Applicability of Class A Contingent Deferred Sales Charges in Certain Cases
-------------------------------------------------------------------------------------

Purchases of Class A Shares of Oppenheimer Funds That Are Not Subject to Initial
Sales Charge but May Be Subject to the Class A Contingent Deferred Sales Charge
(unless a waiver applies).

      There is no initial sales charge on purchases of Class A shares of any of the
Oppenheimer funds in the cases listed below. However, these purchases may be
subject to the Class A contingent deferred sales charge if redeemed within 18
months (24 months in the case of Oppenheimer Rochester National Municipals and
Rochester Fund Municipals) of the beginning of the calendar month of their
purchase, as described in the Prospectus (unless a waiver described elsewhere in
this Appendix applies to the redemption). Additionally, on shares purchased under
these waivers that are subject to the Class A contingent deferred sales charge, the
Distributor will pay the applicable concession described in the Prospectus under
"Class A Contingent Deferred Sales Charge."(6) This waiver provision applies to:
|_|   Purchases of Class A shares aggregating $1 million or more.
|_|   Purchases of Class A shares by a Retirement Plan that was permitted to
         purchase such shares at net asset value but subject to a contingent
         deferred sales charge prior to March 1, 2001. That included plans (other
         than IRA or 403(b)(7) Custodial Plans) that: 1) bought shares costing
         $500,000 or more, 2) had at the time of purchase 100 or more eligible
         employees or total plan assets of $500,000 or more, or 3) certified to the
         Distributor that it projects to have annual plan purchases of $200,000 or
         more.
|_|   Purchases by an OppenheimerFunds-sponsored Rollover IRA, if the purchases are
         made:
         1) through a broker, dealer, bank or registered investment adviser that
            has made special arrangements with the Distributor for those purchases,
            or
         2) by a direct rollover of a distribution from a qualified Retirement Plan
            if the administrator of that Plan has made special arrangements with
            the Distributor for those purchases.
|_|   Purchases of Class A shares by Retirement Plans that have any of the
         following record-keeping arrangements:
         1) The record keeping is performed by Merrill Lynch Pierce Fenner & Smith,
            Inc. ("Merrill Lynch") on a daily valuation basis for the Retirement
            Plan. On the date the plan sponsor signs the record-keeping service
            agreement with Merrill Lynch, the Plan must have $3 million or more of
            its assets invested in (a) mutual funds, other than those advised or
            managed by Merrill Lynch Investment Management, L.P. ("MLIM"), that are
            made available under a Service Agreement between Merrill Lynch and the
            mutual fund's principal underwriter or distributor, and  (b)  funds
            advised or managed by MLIM (the funds described in (a) and (b) are
            referred to as "Applicable Investments").
         2) The record keeping for the Retirement Plan is performed on a daily
            valuation basis by a record keeper whose services are provided under a
            contract or arrangement between the Retirement Plan and Merrill Lynch.
            On the date the plan sponsor signs the record keeping service agreement
            with Merrill Lynch, the Plan must have $3 million or more of its assets
            (excluding assets invested in money market funds) invested in
            Applicable Investments.
         3) The record keeping for a Retirement Plan is handled under a service
            agreement with Merrill Lynch and on the date the plan sponsor signs
            that agreement, the Plan has 500 or more eligible employees (as
            determined by the Merrill Lynch plan conversion manager).

II.                Waivers of Class A Sales Charges of Oppenheimer Funds
-------------------------------------------------------------------------------------

A. Waivers of Initial and Contingent Deferred Sales Charges for Certain Purchasers.

Class A shares purchased by the following investors are not subject to any Class A
sales charges (and no concessions are paid by the Distributor on such purchases):
|_|   The Manager or its affiliates.

|_|   Present or former officers, directors, trustees and employees (and their
         "immediate families") of the Fund, the Manager and its affiliates, and
         retirement plans established by them for their employees. The term
         "immediate family" refers to one's spouse, children, grandchildren,
         grandparents, parents, parents-in-law, brothers and sisters, sons- and
         daughters-in-law, a sibling's spouse, a spouse's siblings, aunts, uncles,
         nieces and nephews; relatives by virtue of a remarriage (step-children,
         step-parents, etc.) are included.

|_|   Registered management investment companies, or separate accounts of insurance
         companies having an agreement with the Manager or the Distributor for that
         purpose.
|_|   Dealers or brokers that have a sales agreement with the Distributor, if they
         purchase shares for their own accounts or for retirement plans for their
         employees.
|_|   Employees and registered representatives (and their spouses) of dealers or
         brokers described above or financial institutions that have entered into
         sales arrangements with such dealers or brokers (and which are identified
         as such to the Distributor) or with the Distributor. The purchaser must
         certify to the Distributor at the time of purchase that the purchase is
         for the purchaser's own account (or for the benefit of such employee's
         spouse or minor children).
|_|   Dealers, brokers, banks or registered investment advisors that have entered
         into an agreement with the Distributor providing specifically for the use
         of shares of the Fund in particular investment products made available to
         their clients. Those clients may be charged a transaction fee by their
         dealer, broker, bank or advisor for the purchase or sale of Fund shares.
|_|   Investment advisors and financial planners who have entered into an agreement
         for this purpose with the Distributor and who charge an advisory,
         consulting or other fee for their services and buy shares for their own
         accounts or the accounts of their clients.
|_|   "Rabbi trusts" that buy shares for their own accounts, if the purchases are
         made through a broker or agent or other financial intermediary that has
         made special arrangements with the Distributor for those purchases.
|_|   Clients of investment advisors or financial planners (that have entered into
         an agreement for this purpose with the Distributor) who buy shares for
         their own accounts may also purchase shares without sales charge but only
         if their accounts are linked to a master account of their investment
         advisor or financial planner on the books and records of the broker, agent
         or financial intermediary with which the Distributor has made such special
         arrangements . Each of these investors may be charged a fee by the broker,
         agent or financial intermediary for purchasing shares.
|_|   Directors, trustees, officers or full-time employees of OpCap Advisors or its
         affiliates, their relatives or any trust, pension, profit sharing or other
         benefit plan which beneficially owns shares for those persons.
|_|   Accounts for which Oppenheimer Capital (or its successor) is the investment
         advisor (the Distributor must be advised of this arrangement) and persons
         who are directors or trustees of the company or trust which is the
         beneficial owner of such accounts.
|_|   A unit investment trust that has entered into an appropriate agreement with
         the Distributor.
|_|   Dealers, brokers, banks, or registered investment advisers that have entered
         into an agreement with the Distributor to sell shares to defined
         contribution employee retirement plans for which the dealer, broker or
         investment adviser provides administration services.
|_|   Retirement Plans and deferred compensation plans and trusts used to fund
         those plans (including, for example, plans qualified or created under
         sections 401(a), 401(k), 403(b) or 457 of the Internal Revenue Code), in
         each case if those purchases are made through a broker, agent or other
         financial intermediary that has made special arrangements with the
         Distributor for those purchases.
|_|   A TRAC-2000 401(k) plan (sponsored by the former Quest for Value Advisors)
         whose Class B or Class C shares of a Former Quest for Value Fund were
         exchanged for Class A shares of that Fund due to the termination of the
         Class B and Class C TRAC-2000 program on November 24, 1995.
|_|   A qualified Retirement Plan that had agreed with the former Quest for Value
         Advisors to purchase shares of any of the Former Quest for Value Funds at
         net asset value, with such shares to be held through DCXchange, a
         sub-transfer agency mutual fund clearinghouse, if that arrangement was
         consummated and share purchases commenced by December 31, 1996.

B. Waivers of Initial and Contingent Deferred Sales Charges in Certain Transactions.

Class A shares issued or purchased in the following transactions are not subject to
sales charges (and no concessions are paid by the Distributor on such purchases):
|_|   Shares issued in plans of reorganization, such as mergers, asset acquisitions
         and exchange offers, to which the Fund is a party.
|_|   Shares purchased by the reinvestment of dividends or other distributions
         reinvested from the Fund or other Oppenheimer funds (other than
         Oppenheimer Cash Reserves) or unit investment trusts for which
         reinvestment arrangements have been made with the Distributor.
      |_|   Shares purchased by the reinvestment of loan repayments by a
         participant in a Retirement Plan for which the Manager or an affiliate
         acts as sponsor.

|_|   Shares purchased in amounts of less than $5.


C. Waivers of the Class A Contingent Deferred Sales Charge for Certain Redemptions.

The Class A contingent deferred sales charge is also waived if shares that would
otherwise be subject to the contingent deferred sales charge are redeemed in the
following cases:
|_|   To make Automatic Withdrawal Plan payments that are limited annually to no
         more than 12% of the account value adjusted annually.
|_|   Involuntary redemptions of shares by operation of law or involuntary
         redemptions of small accounts (please refer to "Shareholder Account Rules
         and Policies," in the applicable fund Prospectus).
|_|   For distributions from Retirement Plans, deferred compensation plans or other
         employee benefit plans for any of the following purposes:
         1) Following the death or disability (as defined in the Internal Revenue

            Code) of the participant or beneficiary. The death or disability must
            occur after the participant's account was established.

         2) To return excess contributions.
         3) To return contributions made due to a mistake of fact.
         Hardship withdrawals, as defined in the plan.(7)
         5) Under a Qualified Domestic Relations Order, as defined in the Internal
            Revenue Code, or, in the case of an IRA, a divorce or separation
            agreement described in Section 71(b) of the Internal Revenue Code.
         6) To meet the minimum distribution requirements of the Internal Revenue
            Code.
         7) To make "substantially equal periodic payments" as described in Section
            72(t) of the Internal Revenue Code.
         8) For loans to participants or beneficiaries.
         9) Separation from service.(8)
         10)      Participant-directed redemptions to purchase shares of a mutual
            fund (other than a fund managed by the Manager or a subsidiary of the
            Manager) if the plan has made special arrangements with the
            Distributor.
         11)      Plan termination or "in-service distributions," if the redemption
            proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA.
|_|   For distributions from 401(k) plans sponsored by broker-dealers that have
         entered into a special agreement with the Distributor allowing this waiver.
|_|   For distributions from retirement plans that have $10 million or more in plan
         assets and that have entered into a special agreement with the Distributor.
|_|   For distributions from retirement plans which are part of a retirement plan
         product or platform offered by certain banks, broker-dealers, financial
         advisors, insurance companies or record keepers which have entered into a
         special agreement with the Distributor.
III.    Waivers of Class B, Class C and Class N Sales Charges of Oppenheimer Funds
-------------------------------------------------------------------------------------

The Class B, Class C and Class N contingent deferred sales charges will not be
applied to shares purchased in certain types of transactions or redeemed in certain
circumstances described below.

A. Waivers for Redemptions in Certain Cases.

The Class B, Class C and Class N contingent deferred sales charges will be waived
for redemptions of shares in the following cases:
|_|   Shares redeemed involuntarily, as described in "Shareholder Account Rules and
         Policies," in the applicable Prospectus.
|_|   Redemptions from accounts other than Retirement Plans following the death or
         disability of the last surviving shareholder. The death or disability must
         have occurred after the account was established, and for disability you
         must provide evidence of a determination of disability by the Social
         Security Administration.
|_|   The contingent deferred sales charges are generally not waived following the
         death or disability of a grantor or trustee for a trust account. The
         contingent deferred sales charges will only be waived in the limited case
         of the death of the trustee of a grantor trust or revocable living trust
         for which the trustee is also the sole beneficiary. The death or
         disability must have occurred after the account was established, and for
         disability you must provide evidence of a determination of disability by
         the Social Security Administration.
|_|   Distributions from accounts for which the broker-dealer of record has entered
         into a special agreement with the Distributor allowing this waiver.
|_|   Redemptions of Class B shares held by Retirement Plans whose records are
         maintained on a daily valuation basis by Merrill Lynch or an independent
         record keeper under a contract with Merrill Lynch.
|_|   Redemptions of Class C shares of Oppenheimer U.S. Government Trust from
         accounts of clients of financial institutions that have entered into a
         special arrangement with the Distributor for this purpose.

|_|   Redemptions of Class C shares of an Oppenheimer fund in amounts of $1 million
         or more requested in writing by a Retirement Plan sponsor and submitted
         more than 12 months after the Retirement Plan's first purchase of Class C
         shares, if the redemption proceeds are invested to purchase Class N shares
         of one or more Oppenheimer funds.

|_|   Distributions(9) from Retirement Plans or other employee benefit plans for
         any of the following purposes:
         1) Following the death or disability (as defined in the Internal Revenue
            Code) of the participant or beneficiary. The death or disability must
            occur after the participant's account was established in an Oppenheimer
            fund.
         2) To return excess contributions made to a participant's account.
         3) To return contributions made due to a mistake of fact.
         4) To make hardship withdrawals, as defined in the plan.(10)
         5) To make distributions required under a Qualified Domestic Relations
            Order or, in the case of an IRA, a divorce or separation agreement
            described in Section 71(b) of the Internal Revenue Code.
         6) To meet the minimum distribution requirements of the Internal Revenue
            Code.
         7) To make "substantially equal periodic payments" as described in Section
            72(t) of the Internal Revenue Code.
         8) For loans to participants or beneficiaries.(11)
         9) On account of the participant's separation from service.(12)
         10)      Participant-directed redemptions to purchase shares of a mutual
            fund (other than a fund managed by the Manager or a subsidiary of the
            Manager) offered as an investment option in a Retirement Plan if the
            plan has made special arrangements with the Distributor.
         11)      Distributions made on account of a plan termination or
            "in-service" distributions, if the redemption proceeds are rolled over
            directly to an OppenheimerFunds-sponsored IRA.

         12)      For distributions from a participant's account under an Automatic
            Withdrawal Plan after the participant reaches age 59 1/2, as long as the
            aggregate value of the distributions does not exceed 10% of the
            account's value, adjusted annually.

         13)      Redemptions of Class B shares under an Automatic Withdrawal Plan
            for an account other than a Retirement Plan, if the aggregate value of
            the redeemed shares does not exceed 10% of the account's value,
            adjusted annually.
         14)      For distributions from 401(k) plans sponsored by broker-dealers
            that have entered into a special arrangement with the Distributor
            allowing this waiver.

|_|   Redemptions of Class B shares or Class C shares under an Automatic Withdrawal
         Plan from an account other than a Retirement Plan if the aggregate value
         of the redeemed shares does not exceed 10% of the account's value annually.


B. Waivers for Shares Sold or Issued in Certain Transactions.

The contingent deferred sales charge is also waived on Class B and Class C shares
sold or issued in the following cases:
|_|   Shares sold to the Manager or its affiliates.
|_|   Shares sold to registered management investment companies or separate
         accounts of insurance companies having an agreement with the Manager or
         the Distributor for that purpose.
|_|   Shares issued in plans of reorganization to which the Fund is a party.
|_|   Shares sold to present or former officers, directors, trustees or employees
         (and their "immediate families" as defined above in Section I.A.) of the
         Fund, the Manager and its affiliates and retirement plans established by
         them for their employees.

IV.      Special Sales Charge Arrangements for Shareholders of Certain Oppenheimer
               Funds Who Were Shareholders of Former Quest for Value Funds
--------------------------------------------------------------------------------------


The initial and contingent deferred sales charge rates and waivers for Class A,
Class B and Class C shares described in the Prospectus or Statement of Additional
Information of the Oppenheimer funds are modified as described below for certain
persons who were shareholders of the former Quest for Value Funds.  To be eligible,
those persons must have been shareholders on November 24, 1995, when
OppenheimerFunds, Inc. became the investment advisor to those former Quest for
Value Funds.  Those funds include:

   Oppenheimer Quest Value Fund, Inc.           Oppenheimer Small Cap Value Fund
   Oppenheimer Quest Balanced Fund              Oppenheimer Quest International Value
   Fund, Inc.
   Oppenheimer Quest Opportunity Value Fund

      These arrangements also apply to shareholders of the following funds when
they merged (were reorganized) into various Oppenheimer funds on November 24, 1995:

   Quest for Value U.S. Government Income Fund  Quest for Value New York Tax-Exempt
   Fund
   Quest for Value Investment Quality Income Fund     Quest for Value National
   Tax-Exempt Fund
   Quest for Value Global Income Fund     Quest for Value California Tax-Exempt Fund

      All of the funds listed above are referred to in this Appendix as the "Former
Quest for Value Funds."  The waivers of initial and contingent deferred sales
charges described in this Appendix apply to shares of an Oppenheimer fund that are
either:
|_|   acquired by such shareholder pursuant to an exchange of shares of an
         Oppenheimer fund that was one of the Former Quest for Value Funds, or
|_|   purchased by such shareholder by exchange of shares of another Oppenheimer
         fund that were acquired pursuant to the merger of any of the Former Quest
         for Value Funds into that other Oppenheimer fund on November 24, 1995.

A. Reductions or Waivers of Class A Sales Charges.

|X|   Reduced Class A Initial Sales Charge Rates for Certain Former Quest for Value
Funds Shareholders.


Purchases by Groups and Associations.  The following table sets forth the initial
sales charge rates for Class A shares purchased by members of "Associations" formed
for any purpose other than the purchase of securities. The rates in the table apply
if that Association purchased shares of any of the Former Quest for Value Funds or
received a proposal to purchase such shares from OCC Distributors prior to November
24, 1995.


--------------------------------------------------------------------------------
                      Initial Sales       Initial Sales Charge   Concession as
Number of Eligible    Charge as a % of    as a % of Net Amount   % of Offering
Employees or Members  Offering Price      Invested               Price
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
9 or Fewer                   2.50%                2.56%              2.00%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
At  least  10 but not        2.00%                2.04%              1.60%
more than 49
--------------------------------------------------------------------------------

-------------------------------------------------------------------------------------
      For purchases by Associations having 50 or more eligible employees or
members, there is no initial sales charge on purchases of Class A shares, but those
shares are subject to the Class A contingent deferred sales charge described in the
applicable fund's Prospectus.

      Purchases made under this arrangement qualify for the lower of either the
sales charge rate in the table based on the number of members of an Association, or
the sales charge rate that applies under the Right of Accumulation described in the
applicable fund's Prospectus and Statement of Additional Information. Individuals
who qualify under this arrangement for reduced sales charge rates as members of
Associations also may purchase shares for their individual or custodial accounts at
these reduced sales charge rates, upon request to the Distributor.


|X|   Waiver of Class A Sales Charges for Certain Shareholders.  Class A shares
purchased by the following investors are not subject to any Class A initial or
contingent deferred sales charges:

o     Shareholders who were shareholders of the AMA Family of Funds on February 28,
            1991 and who acquired shares of any of the Former Quest for Value Funds
            by merger of a portfolio of the AMA Family of Funds.
o     Shareholders who acquired shares of any Former Quest for Value Fund by merger
            of any of the portfolios of the Unified Funds.

|X|   Waiver of Class A Contingent Deferred Sales Charge in Certain Transactions.
The Class A contingent deferred sales charge will not apply to redemptions of Class
A shares purchased by the following investors who were shareholders of any Former
Quest for Value Fund:

      Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a shareholder with
whom that dealer has a fiduciary relationship, under the Employee Retirement Income
Security Act of 1974 and regulations adopted under that law.

B. Class A, Class B and Class C Contingent Deferred Sales Charge Waivers.


|X|   Waivers for Redemptions of Shares Purchased Prior to March 6, 1995.  In the
following cases, the contingent deferred sales charge will be waived for
redemptions of Class A, Class B or Class C shares of an Oppenheimer fund. The
shares must have been acquired by the merger of a Former Quest for Value Fund into
the fund or by exchange from an Oppenheimer fund that was a Former Quest for Value
Fund or into which such fund merged. Those shares must have been purchased prior to
March 6, 1995 in connection with:

o     withdrawals under an automatic withdrawal plan holding only either Class B or
            Class C shares if the annual withdrawal does not exceed 10% of the
            initial value of the account value, adjusted annually, and
o     liquidation of a shareholder's account if the aggregate net asset value of
            shares held in the account is less than the required minimum value of
            such accounts.

|X|   Waivers for Redemptions of Shares Purchased on or After March 6, 1995 but
Prior to November 24, 1995. In the following cases, the contingent deferred sales
charge will be waived for redemptions of Class A, Class B or Class C shares of an
Oppenheimer fund. The shares must have been acquired by the merger of a Former
Quest for Value Fund into the fund or by exchange from an Oppenheimer fund that was
a Former Quest For Value Fund or into which such Former Quest for Value Fund
merged. Those shares must have been purchased on or after March 6, 1995, but prior
to November 24, 1995:
o     redemptions following the death or disability of the shareholder(s) (as
            evidenced by a determination of total disability by the U.S. Social
            Security Administration);
o     withdrawals under an automatic withdrawal plan (but only for Class B or Class
            C shares) where the annual withdrawals do not exceed 10% of the initial
            value of the account value; adjusted annually, and

o     liquidation of a shareholder's account if the aggregate net asset value of
            shares held in the account is less than the required minimum account
            value.

      A shareholder's account will be credited with the amount of any contingent
deferred sales charge paid on the redemption of any Class A, Class B or Class C
shares of the Oppenheimer fund described in this section if the proceeds are
invested in the same Class of shares in that fund or another Oppenheimer fund
within 90 days after redemption.
V.       Special Sales Charge Arrangements for Shareholders of Certain Oppenheimer
      Funds Who Were Shareholders of Connecticut Mutual Investment Accounts, Inc.
----------------------------------------------------------------------------------

The initial and contingent deferred sale charge rates and waivers for Class A and
Class B shares described in the respective Prospectus (or this Appendix) of the
following Oppenheimer funds (each is referred to as a "Fund" in this section):

   Oppenheimer U. S. Government Trust,
   Oppenheimer Core Bond Fund,
   Oppenheimer Value Fund and
   Oppenheimer Disciplined Allocation Fund

are modified as described below for those Fund shareholders who were shareholders
of the following funds (referred to as the "Former Connecticut Mutual Funds") on
March 1, 1996, when OppenheimerFunds, Inc. became the investment adviser to the
Former Connecticut Mutual Funds:
   Connecticut Mutual Liquid Account         Connecticut Mutual Total Return Account
   Connecticut Mutual Government Securities Account   CMIA LifeSpan Capital
   Appreciation Account
   Connecticut Mutual Income Account         CMIA LifeSpan Balanced Account
   Connecticut Mutual Growth Account         CMIA Diversified Income Account

A. Prior Class A CDSC and Class A Sales Charge Waivers.

|X|   Class A Contingent Deferred Sales Charge. Certain shareholders of a Fund and
the other Former Connecticut Mutual Funds are entitled to continue to make
additional purchases of Class A shares at net asset value without a Class A initial
sales charge, but subject to the Class A contingent deferred sales charge that was
in effect prior to March 18, 1996 (the "prior Class A CDSC"). Under the prior Class
A CDSC, if any of those shares are redeemed within one year of purchase, they will
be assessed a 1% contingent deferred sales charge on an amount equal to the current
market value or the original purchase price of the shares sold, whichever is
smaller (in such redemptions, any shares not subject to the prior Class A CDSC will
be redeemed first).

      Those shareholders who are eligible for the prior Class A CDSC are:
         1) persons whose purchases of Class A shares of a Fund and other Former
            Connecticut Mutual Funds were $500,000 prior to March 18, 1996, as a
            result of direct purchases or purchases pursuant to the Fund's policies
            on Combined Purchases or Rights of Accumulation, who still hold those
            shares in that Fund or other Former Connecticut Mutual Funds, and
         2) persons whose intended purchases under a Statement of Intention entered
            into prior to March 18, 1996, with the former general distributor of
            the Former Connecticut Mutual Funds to purchase shares valued at
            $500,000 or more over a 13-month period entitled those persons to
            purchase shares at net asset value without being subject to the Class A
            initial sales charge

      Any of the Class A shares of a Fund and the other Former Connecticut Mutual
Funds that were purchased at net asset value prior to March 18, 1996, remain
subject to the prior Class A CDSC, or if any additional shares are purchased by
those shareholders at net asset value pursuant to this arrangement they will be
subject to the prior Class A CDSC.

|X|   Class A Sales Charge Waivers. Additional Class A shares of a Fund may be
purchased without a sales charge, by a person who was in one (or more) of the
categories below and acquired Class A shares prior to March 18, 1996, and still
holds Class A shares:
         1) any purchaser, provided the total initial amount invested in the Fund
            or any one or more of the Former Connecticut Mutual Funds totaled
            $500,000 or more, including investments made pursuant to the Combined
            Purchases, Statement of Intention and Rights of Accumulation features
            available at the time of the initial purchase and such investment is
            still held in one or more of the Former Connecticut Mutual Funds or a
            Fund into which such Fund merged;
         2) any participant in a qualified plan, provided that the total initial
            amount invested by the plan in the Fund or any one or more of the
            Former Connecticut Mutual Funds totaled $500,000 or more;
         3) Directors of the Fund or any one or more of the Former Connecticut
            Mutual Funds and members of their immediate families;
         4) employee benefit plans sponsored by Connecticut Mutual Financial
            Services, L.L.C. ("CMFS"), the prior distributor of the Former
            Connecticut Mutual Funds, and its affiliated companies;
         5) one or more members of a group of at least 1,000 persons (and persons
            who are retirees from such group) engaged in a common business,
            profession, civic or charitable endeavor or other activity, and the
            spouses and minor dependent children of such persons, pursuant to a
            marketing program between CMFS and such group; and
         6) an institution acting as a fiduciary on behalf of an individual or
            individuals, if such institution was directly compensated by the
            individual(s) for recommending the purchase of the shares of the Fund
            or any one or more of the Former Connecticut Mutual Funds, provided the
            institution had an agreement with CMFS.

      Purchases of Class A shares made pursuant to (1) and (2) above may be subject
to the Class A CDSC of the Former Connecticut Mutual Funds described above.

      Additionally, Class A shares of a Fund may be purchased without a sales
charge by any holder of a variable annuity contract issued in New York State by
Connecticut Mutual Life Insurance Company through the Panorama Separate Account
which is beyond the applicable surrender charge period and which was used to fund a
qualified plan, if that holder exchanges the variable annuity contract proceeds to
buy Class A shares of the Fund.

B. Class A and Class B Contingent Deferred Sales Charge Waivers.

In addition to the waivers set forth in the Prospectus and in this Appendix, above,
the contingent deferred sales charge will be waived for redemptions of Class A and
Class B shares of a Fund and exchanges of Class A or Class B shares of a Fund into
Class A or Class B shares of a Former Connecticut Mutual Fund provided that the
Class A or Class B shares of the Fund to be redeemed or exchanged were (i) acquired
prior to March 18, 1996 or (ii) were acquired by exchange from an Oppenheimer fund
that was a Former Connecticut Mutual Fund. Additionally, the shares of such Former
Connecticut Mutual Fund must have been purchased prior to March 18, 1996:
   1) by the estate of a deceased shareholder;
   2) upon the disability of a shareholder, as defined in Section 72(m)(7) of the
      Internal Revenue Code;
   3) for retirement distributions (or loans) to participants or beneficiaries from
      retirement plans qualified under Sections 401(a) or 403(b)(7)of the Code, or
      from IRAs, deferred compensation plans created under Section 457 of the Code,
      or other employee benefit plans;
   as tax-free returns of excess contributions to such retirement or employee
      benefit plans;
   5) in whole or in part, in connection with shares sold to any state, county, or
      city, or any instrumentality, department, authority, or agency thereof, that
      is prohibited by applicable investment laws from paying a sales charge or
      concession in connection with the purchase of shares of any registered
      investment management company;
   6) in connection with the redemption of shares of the Fund due to a combination
      with another investment company by virtue of a merger, acquisition or similar
      reorganization transaction;
   7) in connection with the Fund's right to involuntarily redeem or liquidate the
      Fund;
   8) in connection with automatic redemptions of Class A shares and Class B shares
      in certain retirement plan accounts pursuant to an Automatic Withdrawal Plan
      but limited to no more than 12% of the original value annually; or

   9) as involuntary redemptions of shares by operation of law, or under procedures
      set forth in the Fund's Articles of Incorporation, or as adopted by the Board
      of Directors of the Fund.

VI.       Special Reduced Sales Charge for Former Shareholders of Advance America
                                        Funds, Inc.
-------------------------------------------------------------------------------------

Shareholders of Oppenheimer AMT-Free Municipals, Oppenheimer U.S. Government Trust,
Oppenheimer Strategic Income Fund and Oppenheimer Capital Income Fund who acquired
(and still hold) shares of those funds as a result of the reorganization of series
of Advance America Funds, Inc. into those Oppenheimer funds on October 18, 1991,
and who held shares of Advance America Funds, Inc. on March 30, 1990, may purchase
Class A shares of those four Oppenheimer funds at a maximum sales charge rate of
4.50%.
VII.        Sales Charge Waivers on Purchases of Class M Shares of Oppenheimer
                                Convertible Securities Fund
-------------------------------------------------------------------------------------

Oppenheimer Convertible Securities Fund (referred to as the "Fund" in this section)
may sell Class M shares at net asset value without any initial sales charge to the
classes of investors listed below who, prior to March 11, 1996, owned shares of the
Fund's then-existing Class A and were permitted to purchase those shares at net
asset value without sales charge:
|_|   the Manager and its affiliates,
|_|   present or former officers, directors, trustees and employees (and their
         "immediate families" as defined in the Fund's Statement of Additional
         Information) of the Fund, the Manager and its affiliates, and retirement
         plans established by them or the prior investment advisor of the Fund for
         their employees,
|_|   registered management investment companies or separate accounts of insurance
         companies that had an agreement with the Fund's prior investment advisor
         or distributor for that purpose,
|_|   dealers or brokers that have a sales agreement with the Distributor, if they
         purchase shares for their own accounts or for retirement plans for their
         employees,
|_|   employees and registered representatives (and their spouses) of dealers or
         brokers described in the preceding section or financial institutions that
         have entered into sales arrangements with those dealers or brokers (and
         whose identity is made known to the Distributor) or with the Distributor,
         but only if the purchaser certifies to the Distributor at the time of
         purchase that the purchaser meets these qualifications,
|_|   dealers, brokers, or registered investment advisors that had entered into an
         agreement with the Distributor or the prior distributor of the Fund
         specifically providing for the use of Class M shares of the Fund in
         specific investment products made available to their clients, and
|_|   dealers, brokers or registered investment advisors that had entered into an
         agreement with the Distributor or prior distributor of the Fund's shares
         to sell shares to defined contribution employee retirement plans for which
         the dealer, broker, or investment advisor provides administrative
         services.

(1) In accordance with Rule 12b-1 of the Investment Company Act, the term
"Independent Trustees/Directors" in this Statement of Additional Information refers
to those Trustees who are not "interested persons" of the Fund and who do not have
any direct or indirect financial interest in the operation of the distribution plan
or any agreement under the plan.
(2) Certain waivers also apply to Class M shares of Oppenheimer Convertible
Securities Fund.
(3) In the case of Oppenheimer Senior Floating Rate Fund, a continuously-offered
closed-end fund, references to contingent deferred sales charges mean the Fund's
Early Withdrawal Charges and references to "redemptions" mean "repurchases" of
shares.
(4) An "employee benefit plan" means any plan or arrangement, whether or not it is
"qualified" under the Internal Revenue Code, under which Class N shares of an
Oppenheimer fund or funds are purchased by a fiduciary or other administrator for
the account of participants who are employees of a single employer or of affiliated
employers. These may include, for example, medical savings accounts, payroll
deduction plans or similar plans. The fund accounts must be registered in the name
of the fiduciary or administrator purchasing the shares for the benefit of
participants in the plan.
(5) The term "Group Retirement Plan" means any qualified or non-qualified
retirement plan for employees of a corporation or sole proprietorship, members and
employees of a partnership or association or other organized group of persons (the
members of which may include other groups), if the group has made special
arrangements with the Distributor and all members of the group participating in (or
who are eligible to participate in) the plan purchase shares of an Oppenheimer fund
or funds through a single investment dealer, broker or other financial institution
designated by the group. Such plans include 457 plans, SEP-IRAs, SARSEPs, SIMPLE
plans and 403(b) plans other than plans for public school employees. The term
"Group Retirement Plan" also includes qualified retirement plans and non-qualified
deferred compensation plans and IRAs that purchase shares of an Oppenheimer fund or
funds through a single investment dealer, broker or other financial institution
that has made special arrangements with the Distributor.
(6) However, that concession will not be paid on purchases of shares in amounts of
$1 million or more (including any right of accumulation) by a Retirement Plan that
pays for the purchase with the redemption proceeds of Class C shares of one or more
Oppenheimer funds held by the Plan for more than one year.
(7) This provision does not apply to IRAs.

(8) This provision only applies to qualified retirement plans and 403(b)(7)
custodial plans after your separation from service in or after the year you reached
age 55.

(9) The distribution must be requested prior to Plan termination or the elimination
of the Oppenheimer funds as an investment option under the Plan.
(10) This provision does not apply to IRAs.
(11) This provision does not apply to loans from 403(b)(7) custodial plans and
loans from the OppenheimerFunds-sponsored Single K retirement plan.
(12) This provision does not apply to 403(b)(7) custodial plans if the participant
is less than age 55, nor to IRAs.



Oppenheimer Total Return Bond Fund

Internet Website
      www.oppenheimerfunds.com
      ------------------------

Investment Advisor
      OppenheimerFunds, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Distributor
      OppenheimerFunds Distributor, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Transfer Agent
      OppenheimerFunds Services
      P.O. Box 5270
      Denver, Colorado 80217
      1.800.CALL OPP(225.5677)

Custodian Bank
      Citibank, N.A.
      388 Greenwich Street
      New York, New York 10013


Independent Registered Public Accounting Firm

      Ernst & Young LLP
      5 Times Square
      New York, New York 10036

Legal Counsel
      Mayer, Brown, Rowe & Maw LLP
      1675 Broadway
      New York, New York 10019


(OppenheimerFunds logo)



PX535.0605







                       OPPENHEIMER TOTAL RETURN BOND FUND

                                   FORM N-1A

                                     PART C

                               OTHER INFORMATION

Item 23. - Exhibits
-------------------

(a)   Declaration  of Trust  dated  November  4,  2002:  Previously  filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

(b)   By-Laws:   Previously  filed  with   Registrant's   Initial   Registration
Statement  (Reg.  No.   333-101878),   12/16/02,   and  incorporated  herein  by
reference.

(c)   (i)   Specimen   Class  A  Share   Certificate:   Previously   filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

      (ii)  Specimen   Class  B  Share   Certificate:   Previously   filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

      (iii)  Specimen  Class  C  Share   Certificate:   Previously   filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

      (iv)  Specimen   Class  N  Share   Certificate:   Previously   filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

      (v)   Specimen   Class  Y  Share   Certificate:   Previously   filed  with
Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),  12/16/02,
and incorporated herein by reference.

(d)   Amended Investment  Advisory Agreement dated February 5, 2003:  Previously
Filed with  Registrant's  Pre-Effective  Amendment No. 1 (Reg. No.  333-101878),
2/11/03, and incorporated herein by reference.

(e)   (i) General  Distributor's  Agreement  dated December 5, 2002:  Previously
filed with Registrant's  Initial  Registration  Statement (Reg. No. 333-101878),
12/16/02, and incorporated herein by reference.

      (ii) Form of  Dealer  Agreement  of  OppenheimerFunds  Distributor,  Inc.:
Previously  filed  with  Post-Effective  Amendment  No.  45 to the  Registration
Statement of  Oppenheimer  High Yield Fund (Reg.  No.  2-62076),  10/26/01,  and
incorporated herein by reference.

      (iii) Form of Broker  Agreement  of  OppenheimerFunds  Distributor,  Inc.:
Previously  filed  with  Post-Effective  Amendment  No.  45 to the  Registration
Statement of  Oppenheimer  High Yield Fund (Reg.  No.  2-62076),  10/26/01,  and
incorporated herein by reference.

      (iv) Form of  Agency  Agreement  of  OppenheimerFunds  Distributor,  Inc.:
Previously  filed  with  Post-Effective  Amendment  No.  45 to the  Registration
Statement of  Oppenheimer  High Yield Fund (Reg.  No.  2-62076),  10/26/01,  and
incorporated herein by reference.

      (v)   Form   of   Trust   Company   Fund/SERV    Purchase   Agreement   of
OppenheimerFunds   Distributor,   Inc.:  Previously  filed  with  Post-Effective
Amendment No. 45 to the  Registration  Statement of Oppenheimer  High Yield Fund
(Reg. No. 2-62076), 10/26/01, and incorporated herein by reference.

      (vi)  Form  of  Trust  Company   Agency   Agreement  of   OppenheimerFunds
Distributor,  Inc.: Previously filed with Post-Effective Amendment No. 45 to the
Registration  Statement  of  Oppenheimer  High Yield Fund  (Reg.  No.  2-62076),
10/26/01, and incorporated herein by reference.

(f)   Not applicable.


(g)   (i) Global  Custodial  Services  Agreement  dated July 15, 2003 as amended
June 9, 2005, between Registrant and Citibank,  N.A.:  Previously filed with the
Initial  Registration  Statement of Oppenheimer  International  Diversified Fund
(Reg. No. 333-125805), 6/14/05, and incorporated herein by reference.


      (ii) Amended and Restated Foreign Custody Manager  Agreement dated May 31,
2001,  as  amended  July  15,  2003,  between  Registrant  and  Citibank,   N.A:
Previously  filed with the  Pre-Effective  Amendment  No. 1 to the  Registration
Statement  of   Oppenheimer   International   Large-Cap  Core  Trust  (Reg.  No.
333-106014), 8/5/03, and incorporated herein by reference.

(g)   Not applicable.

(h)   Opinion  and  Consent  of Counsel  dated  2/10/03:  Previously  Filed with
Registrant's  Pre-Effective Amendment No. 1 (Reg. No. 333-101878),  2/11/03, and
incorporated herein by reference.


(j)   Independent  Registered Public  Accounting Firm's Consent:  To be filed by
Amendment.


(k)   Not applicable.

(l)   Investment Letter from OppenheimerFunds,  Inc. to Registrant dated 2/6/03:
      Previously  Filed with  Registrant's  Pre-Effective  Amendment No. 1 (Reg.
      No. 333-101878), 2/11/03, and incorporated herein by reference.


(m)   (i) Amended and  Restated  Service Plan and  Agreement  for Class A shares
dated 6/2/04: Filed herewith.


      (ii)  Distribution and Service Plan and Agreement for Class B shares dated
12/5/02:  Previously  filed with  Registrant's  Initial  Registration  Statement
(Reg. No. 333-101878), 12/16/02, and incorporated herein by reference.


      (iii)  Amended and Restated  Distribution  and Service Plan and  Agreement
for  Class  C  shares  dated  2/19/04:   Previously   filed  with   Registrant's
Post-Effective  Amendment No. 2 (Reg. 333-101878),  6/25/04, and incorporated by
reference.


      (iv)  Distribution and Service Plan and Agreement for Class N shares dated
12/5/02:  Previously  filed with  Registrant's  Initial  Registration  Statement
(Reg. No. 333-101878), 12/16/02, and incorporated herein by reference.


(n)   Oppenheimer  Funds  Multiple  Class Plan under Rule 18f-3 updated  through
6/09/05:   Previously   filed  with  the  Initial   Registration   Statement  of
Oppenheimer International  Diversified Fund (Reg. No. 333-125805),  6/14/05, and
incorporated herein by reference.

(o)   Powers of Attorney  for all Trustees and  Principal  Officers:  Previously
filed with the  Initial  Registration  Statement  of  Oppenheimer  International
Diversified Fund (Reg. No.  333-125805),  6/14/05,  and  incorporated  herein by
reference.

(p)   Amended  and  Restated  Code of  Ethics  of the  Oppenheimer  Funds  dated
February  1,  2005  under  Rule  17j-1 of the  Investment  Company  Act of 1940:
Previously  filed  with  the  Initial  Registration   Statement  of  Oppenheimer
Dividend Growth Fund (Reg. No. 333-125805),  2/18/05, and incorporated herein by
reference.


Item 24. - Persons Controlled by or Under Common Control with the Fund
----------------------------------------------------------------------

None.

Item 25. - Indemnification
--------------------------

Reference is made to the  provisions  of Article Seven of  Registrant's  Amended
and Restated  Declaration  of Trust filed as Exhibit 23(a) to this  Registration
Statement, and incorporated herein by reference.

Insofar as indemnification  for liabilities  arising under the Securities Act of
1933  may  be  permitted  to  trustees,  officers  and  controlling  persons  of
Registrant  pursuant to the foregoing  provisions or otherwise,  Registrant  has
been advised that in the opinion of the Securities and Exchange  Commission such
indemnification  is against  public policy as expressed in the Securities Act of
1933  and  is,  therefore,   unenforceable.  In  the  event  that  a  claim  for
indemnification  against such liabilities  (other than the payment by Registrant
of expenses  incurred  or paid by a trustee,  officer or  controlling  person of
Registrant  in the  successful  defense of any action,  suit or  proceeding)  is
asserted  by such  trustee,  officer or  controlling  person,  Registrant  will,
unless in the opinion of its counsel the matter has been settled by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification  by it is  against  public  policy  as  expressed  in  the
Securities  Act of 1933 and will be governed by the final  adjudication  of such
issue.

Item 26. - Business and Other Connections of the Investment Adviser
-------------------------------------------------------------------

(a)   OppenheimerFunds,  Inc. is the investment  adviser of the  Registrant;  it
and  certain  subsidiaries  and  affiliates  act in the same  capacity  to other
investment  companies,  including without  limitation those described in Parts A
and B hereof and listed in Item 26(b) below.

 (b)  There  is  set  forth  below   information  as  to  any  other   business,
profession,  vocation  or  employment  of a  substantial  nature  in which  each
officer and  director of  OppenheimerFunds,  Inc.  is, or at any time during the
past two  fiscal  years has been,  engaged  for  his/her  own  account or in the
capacity of director, officer, employee, partner or trustee.

---------------------------------------------------------------------------------
Name  and   Current   Position
with OppenheimerFunds, Inc.    Other Business and Connections During the Past
                               Two Years
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Timothy L. Abbuhl,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Emeline S. Adwers,             None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Agan,                   Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.,  Shareholder Financial Services,  Inc., OFI
                               Private  Investments,  Inc. and Centennial  Asset
                               Management Corporation;  Senior Vice President of
                               Shareholders Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Carl Algermissen,              Formerly  Associate  Counsel and Legal Compliance
Vice President & Associate     Officer at Great  West-Life  & Annuity  Insurance
Counsel                        Co.  (February  2004-October  2004);   previously
                               with   INVESCO    Funds   Group,    Inc.    (June
                               1993-December  2003),  most  recently  as  Senior
                               Staff Attorney.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Amato,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik Anderson,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Janette Aprilante,             Secretary     (since     December    2001)    of:
Vice President & Secretary     OppenheimerFunds  Distributor,  Inc.,  Centennial
                               Asset   Management    Corporation,    Oppenheimer
                               Partnership  Holdings,   Inc.,  Oppenheimer  Real
                               Asset  Management,  Inc.,  Shareholder  Financial
                               Services,  Inc.,  Shareholder Services,  Inc. and
                               OppenheimerFunds   Legacy   Program.    Secretary
                               (since   June   2003)   of:   HarbourView   Asset
                               Management Corporation,  OFI Private Investments,
                               Inc.  and  OFI  Institutional  Asset  Management,
                               Inc.  Assistant  Secretary  (since December 2001)
                               of OFI Trust Company.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hany S. Ayad,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Baker,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Michael Banta,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joanne Bardell,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin Baum,                    None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeff Baumgartner,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Connie Bechtolt,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lalit K. Behal                 Assistant    Secretary   of   HarbourView   Asset
Assistant Vice President       Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen Beichert,             Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gerald Bellamy,                Assistant  Vice  President  of OFI  Institutional
Assistant Vice President       Asset Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik S. Berg,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Victoria Best,                 Vice   President  of  OFI   Institutional   Asset
Vice President                 Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rajeev Bhaman,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig Billings,                Formerly  President of Lorac  Technologies,  Inc.
Assistant Vice President       (June 1997-July 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Binning,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert J. Bishop,              Treasurer     (since     October     2003)     of
Vice President                 OppenheimerFunds     Distributor,     Inc.    and
                               Centennial Asset Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Blinzer,                Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John R. Blomfield,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa I. Bloomberg,             Formerly   First  Vice  President  and  Associate
Vice President & Associate     General  Counsel of UBS  Financial  Services Inc.
Counsel                        (May 1999-May 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Veronika Boesch,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Chad Boll,                     None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Antulio N. Bomfim,             A  senior  economist  with  the  Federal  Reserve
Vice President                 Board (June 1992-October 2003).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John C. Bonnell,               Formerly a Portfolio  Manager at Strong Financial
Vice President                 Corporation (May 1999-May 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Bonomo,                 None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michelle Borre Massick,        None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lori E. Bostrom,               Formerly Vice President and Corporate  Counsel at
Vice President & Senior        Prudential   Financial   Inc.   (October  2002  -
Counsel                        November 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lisa Bourgeois,                Assistant    Vice    President   of   Shareholder
Assistant Vice President       Services, Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Boydell,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Bromberg,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lowell Scott Brooks,           Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joan Brunelle,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Buckmaster,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Burke,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Burns,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce Burroughs,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeoffrey Caan,                 Formerly  Vice  President  of ABN AMRO  NA,  Inc.
Vice President                 (June  2002 - August  2003);  Vice  President  of
                               Zurich Scudder  Investments  (January 1999 - June
                               2002)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine Carroll,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debra Casey,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brett Clark,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
H.C. Digby Clements,           None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Peter V. Cocuzza,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan Cornwell,                Vice  President of  Centennial  Asset  Management
Vice President                 Corporation and Shareholder  Financial  Services,
                               Inc.;   Senior  Vice   President  of  Shareholder
                               Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott Cottier,                 None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Coulston,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie C. Cusker,               None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George Curry,                  None.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Damian,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John M. Davis,                 Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig P. Dinsell,              None
Executive Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Randall C. Dishmon,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rebecca K. Dolan               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven D. Dombrower,           Senior    Vice    President    of   OFI   Private
Vice President                 Investments,     Inc.;    Vice    President    of
                               OppenheimerFunds Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Doyle,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce C. Dunbar,               None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Brian Dvorak,                  None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Edmiston,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel R. Engstrom,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Robert Erven             Formerly  an  Assistant   Vice   President/Senior
Assistant Vice President       Trader with Morgan Stanley Investment  Management
                               (1999-April 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George R. Evans,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward N. Everett,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathy Faber,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Falicia,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott T. Farrar,               Vice President of OFI Private Investments, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Emmanuel Ferreira,             Formerly  a  portfolio   manager   with   Lashire
Vice President                 Investments (July 1999-December 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ronald H. Fielding,            Vice President of  OppenheimerFunds  Distributor,
Senior Vice President;         Inc.;  Director of ICI Mutual Insurance  Company;
Chairman: Rochester Division   Governor of St. John's  College;  Chairman of the
                               Board of  Directors  of  International  Museum of
                               Photography at George Eastman House.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Finley,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John E. Forrest,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jordan Hayes Foster,           Vice   President  of  OFI   Institutional   Asset
Vice President                 Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Foxhoven,                Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Colleen M. Franca,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dominic Freud,                 Formerly,   a   Partner   and   European   Equity
Vice President                 Portfolio  manager  at  SLS  Management  (January
                               2002-February  2003)  prior  to which he was head
                               of  the  European   equities  desk  and  managing
                               director at SG Cowen (May 1994-January 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan Gagliardo,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hazem Gamal,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Seth Gelman,                   Formerly  an  Associate  in the Asset  Management
Vice President                 Legal   Department   at   Goldman   Sachs  &  Co.
                               (February 2003-August 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Subrata Ghose,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles W. Gilbert,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Phillip S. Gillespie,          Formerly  First Vice  President of Merrill  Lynch
Senior Vice President &        Investment Management (2001 to September 2004).
Deputy General Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alan C. Gilston,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill E. Glazerman,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bejamin J. Gord,               Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset
                               Management,   Inc.  Formerly  Executive  Director
                               with  Miller  Anderson  Sherrerd,  a division  of
                               Morgan  Stanley  Investment  Management.   (April
                               1992-March 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Granger,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert B. Grill,               None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Haley,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marilyn Hall,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kelly Haney,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Hauenstein,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas B. Hayes,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dennis Hess,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dorothy F. Hirshman,           None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel Hoelscher,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward Hrybenko,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott T. Huebl,                Assistant  Vice  President  of   OppenheimerFunds
Vice President                 Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Margaret Hui,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Huttlin,                  Senior   Vice   President    (Director   of   the
Vice President                 International  Division)  (since January 2004) of
                               OFI   Institutional   Asset   Management,   Inc.;
                               Director  (since  June 2003) of  OppenheimerFunds
                               (Asia) Limited
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James G. Hyland,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve P. Ilnitzki,             None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kelly Bridget Ireland,         Vice   President    (since   January   2004)   of
Vice President                 OppenheimerFunds   Distributor   Inc.   Formerly,
                               Director  of  INVESCO  Distributors  Inc.  (April
                               2000-December 2003).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives,              Vice   President  and   Assistant   Secretary  of
Vice President, Senior         OppenheimerFunds     Distributor,     Inc.    and
Counsel and Assistant          Shareholder  Services,  Inc.; Assistant Secretary
Secretary                      of  Centennial  Asset   Management   Corporation,
                               OppenheimerFunds  Legacy Program and  Shareholder
                               Financial Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Jaume,                 Senior  Vice  President  of   HarbourView   Asset
Vice President                 Management   Corporation  and  OFI  Institutional
                               Asset  Management,  Inc.;  Director  of OFI Trust
                               Company.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Frank V. Jennings,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Jennings,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Michael Johnson,          Formerly       Vice       President,       Senior
Assistant Vice President       Analyst/Portfolio   Manager  at  Aladdin  Capital
                               Holdings Inc. (February 2001-May 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Kandilis,              Formerly  managing  director of Kandilis  Capital
Vice President                 Management (September 1993-August 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer E. Kane,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lynn O. Keeshan,               Assistant  Treasurer of  OppenheimerFunds  Legacy
Senior Vice President          Program
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas W. Keffer,              None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cristina J. Keller,            Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Keogh,                 Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Kourkoulakos,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Kramer,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Lamentino,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jeffrey P. Lagarce,            President  and  Chief  Marketing  Officer  of OFI
Senior Vice President          Institutional   Asset  Management,   Inc.  as  of
                               January    2005.    Formerly    Executive    Vice
                               President-Head  of Fidelity  Tax-Exempt  Services
                               Business   at   Fidelity    Investments   (August
                               1996-January 2005).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Latino,                   Formerly a Senior  Trader/Portfolio  Engineer  at
Assistant Vice President       Jacobs Levy Equity  Management (June  1996-August
                               2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristina Lawrence,             Formerly     Assistant    Vice    President    of
Vice President                 OppenheimerFunds,   Inc.   (November   2002-March
                               2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Guy E. Leaf,                   Formerly  a  Vice   President  of  Merrill  Lynch
Vice President                 (January 2000-September 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher M. Leavy,          None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dina C. Lee,                   Formerly    (until   December   2003)   Assistant
Assistant Vice President &     Secretary of OppenheimerFunds Legacy Program.
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Randy Legg,                    Formerly   an   associate    with   Dechert   LLP
Vice President & Assistant     (September 1998-January 2004).
Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dana Lehrer,                   Assistant Secretary of Oppenheimer Legacy Program
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Leitzinger,              Senior Vice  President of  Shareholder  Services,
Vice President                 Inc.;  Vice  President of  Shareholder  Financial
                               Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael S. Levine,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gang Li,                       None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shanquan Li,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mitchell J. Lindauer,          None
Vice President & Assistant
General Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bill Linden,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Malissa B. Lischin,            Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David P. Lolli,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel G. Loughran             None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patricia Lovett,               Vice   President   of    Shareholder    Financial
Senior Vice President          Services,  Inc.  and  Senior  Vice  President  of
                               Shareholder Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dongyan Ma,                    Formerly  an  Assistant   Vice   President   with
Assistant Vice President       Standish   Mellon   Asset   Management   (October
                               2001-October 2003).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Macchia,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Magee,                 Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jerry Mandzij,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Angelo G. Manioudakis          Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation and of OFI  Institutional
                               Asset   Management,   Inc.   Formerly   Executive
                               Director  and   portfolio   manager  for  Miller,
                               Anderson  &   Sherrerd,   a  division  of  Morgan
                               Stanley Investment  Management (August 1993-April
                               2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan Mattisinko,              Assistant  Secretary  (as  of  January  2004)  of
Vice President & Associate     HarbourView    Asset   Management    Corporation,
Counsel                        OppenheimerFunds   Legacy  Program,  OFI  Private
                               Investments,  Inc.  and OFI  Institutional  Asset
                               Management,  Inc. Formerly an Associate at Sidley
                               Austin Brown and Wood LLP (1995 - October 2003).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elizabeth McCormack,           Vice   President  and   Assistant   Secretary  of
Vice President                 HarbourView Asset Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph McGovern,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles L. McKenzie,           As  of  May  2003:   Chief   Executive   Officer,
Senior Vice President          President,  Senior Managing Director and Director

                               of HarbourView  Asset Management  Corporation and
                               OFI   Institutional   Asset   Management,   Inc.;
                               President,   Chairman  and  Director  of  Trinity
                               Investment Management Corporation.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lucienne Mercogliano,          None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wayne Miao,                    Formerly an Associate  with Sidley Austin Brown &
Assistant Vice President and   Wood LLP (September 1999 - May 2004).
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew J. Mika,                None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Nikolaos D. Monoyios,          None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Moon,                  Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset
                               Management,  Inc. Formerly an Executive  Director
                               and  Portfolio  Manager  with  Miller  Anderson &
                               Sherrerd,    a   division   of   Morgan   Stanley
                               Investment Management (June 1999-March 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Murphy,                   President    and    Director    of    Oppenheimer
Chairman, President, Chief     Acquisition  Corp.  and  Oppenheimer  Partnership
Executive Officer & Director   Holdings,   Inc.  Director  of  Centennial  Asset
                               Management     Corporation,      OppenheimerFunds
                               Distributor,    Inc.;    Chairman   Director   of
                               Shareholder   Services,   Inc.  and   Shareholder
                               Financial Services,  Inc.; President and Director
                               f  OppenheimerFunds  Legacy Program;  Director of
                               OFI   Institutional   Asset   Management,   Inc.,
                               Trinity   Investment   Management    Corporation,
                               Tremont  Capital  Management,  Inc.,  HarbourView
                               Asset   Management   Corporation,   OFI   Private
                               Investments,  Inc.;  President  and  Director  of
                               Oppenheimer   Real   Asset   Management,    Inc.;
                               Executive Vice President of Massachusetts  Mutual
                               Life   Insurance   Company;   Director   of   DLB
                               Acquisition   Corporation;   a   member   of  the
                               Investment    Company    Institute's   Board   of
                               Governors.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Meaghan Murphy,                Formerly  Marketing  Professional,  RFP Writer at
Assistant Vice President       JP Morgan  Fleming Asset  Management  (May 2002 -
                               October 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Suzanne Murphy,                Formerly  (until December 2003) a Vice President,
Vice President                 Senior Marketing Manager with Citigroup.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas J. Murray,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth Nadler,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Nichols,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Norman,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John O'Hare,                   Formerly  Executive  Vice President and Portfolio
Vice President                 Manager  (June 2000 - August 2003) and  Portfolio
                               Manager and Senior Vice President  (August 1997 -
                               June 2000) at Geneva Capital Management, Ltd.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lerae A. Palumbo,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David P. Pellegrino,           None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Allison C. Pells,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert H. Pemble,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lori L. Penna,                 Formerly  an RFP  Manager/Associate  at  JPMorgan
Assistant Vice President       Chase & Co. (June 2001-September 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Petersen,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Marmeline Petion-Midy,         Formerly a Senior Financial  Analyst with General
Assistant Vice President       Motors,  NY Treasurer's  Office (July  2000-Augut
                               2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Pfeffer,                 Senior  Vice  President  of   HarbourView   Asset
Senior Vice President and      Management   Corporation   since  February  2004.
Chief Financial Officer        Formerly,  Director and Chief  Financial  Officer
                               at   Citigroup   Asset    Management    (February
                               2000-February 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James F. Phillips,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gary Pilc,                     None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jason Pizzorusso,              None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

David Poiesz,                  Formerly  a Senior  Portfolio  Manager at Merrill
Senior Vice President, Head    Lynch (October  2002-May 2004).  Founding partner
of Growth Equity Investments   of  RiverRock,   a  hedge  fund  product   (April
                               1999-July 2001).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jeffrey Portnoy,               None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raghaw Prasad,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

David Preuss,                  None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jane C. Putnam,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael E. Quinn,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie S. Radtke,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Norma J. Rapini,               None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian N. Reid,                 Formerly an Assistant  Vice  President with Eaton
Assistant Vice President       Vance Management (January 2000-January 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marc Reinganum,                Formerly  (until  August  2002)  Vaughn  Rauscher
Vice President                 Chair  in  Financial  Investments  and  Director,
                               Finance    Institute   of   Southern    Methodist
                               University, Texas.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Reiter,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Claire Ring,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Robertson,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Antoinette Rodriguez,          None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stacey Roode,                  Formerly,   Assistant  Vice  President  of  Human
Vice President                 Resources of OFI (200-July 2002)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey S. Rosen,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stacy Roth,                    None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James H. Ruff,                 President   and   Director  of   OppenheimerFunds
Executive Vice President       Distributor,    Inc.   and    Centennial    Asset
                               Management Corporation;  Executive Vice President
                               of OFI Private Investments, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Adrienne Ruffle,               Formerly an Associate  with Sidley Austin Brown &
Assistant Vice President and   Wood LLP (September 2002-February 2005).
Assistant Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew Ruotolo,                Vice   Chairman,   Treasurer,   Chief   Financial
Executive Vice President and   Officer and  Management  Director of  Oppenheimer
Director                       Acquisition  Corp.;  President  and  Director  of
                               Shareholder   Services,   Inc.  and   Shareholder
                               Financial  Services,  Inc.;  Director  of Trinity
                               Investment  Management  Corporation;  Chairman of
                               the Board,  Chief  Executive  Officer,  President
                               and Director of OFI Trust Company.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kim Russomanno,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Timothy Ryan,                  Formerly   a   research   analyst  in  the  large
Vice President                 equities group at Credit Suisse Asset  Management
                               (August 2001-June 2004)

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rohit Sah,                     None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Valerie Sanders,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Karen Sandler,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rudi Schadt,                   Formerly  a   consultant   for  Arthur   Andersen
Assistant Vice President       (August 2001-February 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ellen P. Schoenfeld,           None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maria Schulte,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott A. Schwegel,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Allan P. Sedmak                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer L. Sexton,            Senior    Vice    President    of   OFI   Private
Vice President                 Investments, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Navin Sharma,                  Formerly,  Manager  at BNP  Paribas  Cooper  Neff
Vice President                 Advisors (May 2001-April 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bonnie Sherman,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David C. Sitgreaves,           None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward James Sivigny           Formerly  a  Director  for  ABN  Amro  Securities
Assistant Vice President       (July 2001-July 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Enrique H. Smith,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Louis Sortino,                 None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Keith J. Spencer,              None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marco Antonio Spinar,          None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard A. Stein,              None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Arthur P. Steinmetz,           Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer Stevens,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John P. Stoma,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Stricker,              Vice President of Shareholder Services, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Deborah A. Sullivan,           Secretary  (since  December  2001)  of OFI  Trust
Assistant Vice President &     Company.
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Sussman,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan B. Switzer,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Brian C. Szilagyi,             Director of Financial  Reporting  and  Compliance
Assistant Vice President       at First Data Corporation (April 2003-June 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Martin Telles,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Temple,                   Formerly  a  Vice   President  of  Merrill  Lynch
Vice President                 (October 2001-January 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeaneen Terrio,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Toner,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Keith Tucker,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cameron Ullyat,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Angela Uttaro,                 None
Assistant Vice President:
Rochester Division

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Mark S. Vandehey,              Vice President of  OppenheimerFunds  Distributor,
Senior Vice President and      Inc.,  Centennial  Asset  Management  Corporation
Chief Compliance Officer       and Shareholder  Services,  Inc.; Chief Financial
                               Officer   of   HarbourView    Asset    Management
                               Corporation,  Oppenheimer  Partnership  Holdings,
                               Inc.,  Oppenheimer Real Asset  Management,  Inc.,
                               Shareholder     Financial     Services,     Inc.,
                               OppenheimerFunds   Legacy  Program,  OFI  Private
                               Investments,  Inc.,  OFI  Trust  Company  and OFI
                               Institutional  Asset  Management,  Inc.  Formerly
                               (until    March   2004)   Vice    President    of
                               OppenheimerFunds, Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maureen Van Norstrand,         None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Nancy Vann,                    Formerly  Assistant  General  Counsel  at Reserve
Vice President and Assistant   Management  Company,   Inc.  (April  to  December
Counsel                        2004);  attorney  at Sidley  Austin  Brown & Wood
                               LLP (October 1997 - April 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rene Vecka,                    Formerly Vice President of Shareholder  Services,
Assistant Vice President,      Inc. (September 2000-July 2003).
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Vermette,              Vice President of  OppenheimerFunds  Distributor,
Assistant Vice President       Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Phillip F. Vottiero,           None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Walsh,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Teresa M. Ward,                Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jerry A. Webman,               Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher D. Weiler,         None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Adam Weiner,                   None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Barry D. Weiss,                Vice  President of HarbourView  Asset  Management
Vice President                 Corporation
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Melissa Lynn Weiss,            Formerly an Associate  at Hoguet  Newman & Regal,
Vice President                 LLP (January 1998-May 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christine Wells,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph J. Welsh,               Vice  President of HarbourView  Asset  Management
Vice President                 Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Diederick Wermolder,           Director of  OppenheimerFunds  International Ltd.
Senior Vice President          and  OppenheimerFunds  plc; Senior Vice President
                               (Managing    Director   of   the    International
                               Division) of OFI Institutional  Asset Management,
                               Inc.;   Director   of   OppenheimerFunds   (Asia)
                               Limited.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine M. White,            Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor,   Inc.;   member  of  the   American
                               Society of Pension Actuaries (ASPA) since 1995.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Annabel Whiting,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William L. Wilby,              Formerly  Senior Vice  President  of  HarbourView
Senior Vice President          Asset   Management   Corporation  (May  1999-July
                               2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Donna M. Winn,                 President,  Chief Executive  Officer and Director
Senior Vice President          of OFI Private  Investments,  Inc.;  Director and
                               President  of  OppenheimerFunds  Legacy  Program;
                               Senior   Vice   President   of   OppenheimerFunds
                               Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Philip Witkower,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian W. Wixted,               Treasurer   of   HarbourView   Asset   Management
Senior Vice President and      Corporation;    OppenheimerFunds    International
Treasurer                      Ltd.,  Oppenheimer  Partnership  Holdings,  Inc.,
                               Oppenheimer   Real   Asset   Management,    Inc.,
                               Shareholder    Services,     Inc.,    Shareholder
                               Financial    Services,    Inc.,    OFI    Private
                               Investments,   Inc.,  OFI   Institutional   Asset
                               Management,   Inc.,   OppenheimerFunds   plc  and
                               OppenheimerFunds  Legacy  Program;  Treasurer and
                               Chief  Financial  Officer  of OFI Trust  Company;
                               Assistant  Treasurer of  Oppenheimer  Acquisition
                               Corp.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Carol Wolf,                    Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation;  serves  on the Board of
                               the Colorado Ballet.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kurt Wolfgruber,               Director  of  Tremont  Capital  Management,  Inc.
Executive Vice President,      (since  July  20012),  and of  HarbourView  Asset
Chief Investment Officer and   Management   Corporation  and  OFI  Institutional
Director                       Asset Management, Inc. (since June 2003)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Caleb C. Wong,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward C. Yoensky,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Zachman,                  None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lucy Zachman,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Zack                 General Counsel and Director of  OppenheimerFunds
Executive Vice President and   Distributor,  Inc.; General Counsel of Centennial
General Counsel                Asset   Management   Corporation;   Senior   Vice
                               President  and  General  Counsel  of  HarbourView
                               Asset    Management     Corporation    and    OFI
                               Institutional  Asset  Management,   Inc.;  Senior
                               Vice  President,  General Counsel and Director of
                               Shareholder     Financial     Services,     Inc.,
                               Shareholder    Services,    Inc.,   OFI   Private
                               Investments,  Inc.  and OFI Trust  Company;  Vice
                               President    and    Director    of    Oppenheimer
                               Partnership   Holdings,    Inc.;   Director   and
                               Assistant  Secretary  of  OppenheimerFunds   plc;
                               Secretary  and  General  Counsel  of  Oppenheimer
                               Acquisition   Corp.;   Director   and   Assistant
                               Secretary   of   OppenheimerFunds   International
                               Ltd.;   Director   of   Oppenheimer   Real  Asset
                               Management,   Inc.  and  OppenheimerFunds  (Asia)
                               Limited);   Vice  President  of  OppenheimerFunds
                               Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Neal A. Zamore,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark D. Zavanelli,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alex Zhou,                     None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Arthur J. Zimmer,              Senior  Vice  President  (since  April  1999)  of
Senior Vice President          HarbourView Asset Management Corporation.
---------------------------------------------------------------------------------


The Oppenheimer Funds include the following:

Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust

Limited Term New York Municipal Fund (Rochester Portfolio Series)
OFI Tremont Core Strategies Hedge Fund
OFI Tremont Market Neutral Hedge Fund
Oppenheimer AMT-Free Municipals
Oppenheimer AMT-Free New York Municipals
Oppenheimer Balanced Fund
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Capital Income Fund
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Convertible Securities Fund (Bond Fund Series)
Oppenheimer Core Bond Fund (a series of Oppenheimer Integrity Funds)
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Emerging Growth Fund
Oppenheimer Emerging Technologies Fund
Oppenheimer Enterprise Fund
Oppenheimer Equity Fund, Inc.

Oppenheimer Global Fund
Oppenheimer Global Opportunities Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer High Yield Fund
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer International Large-Cap Core Fund (a series of Oppenheimer
International Large-
    Cap Core Trust)
Oppenheimer International Small Company Fund
Oppenheimer International Value Fund (a series of Oppenheimer International
Value Trust)
Oppenheimer Limited Term California Municipal Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Limited Term Municipal Fund (a series of Oppenheimer Municipal Fund)
Oppenheimer Main Street Fund (a series of Oppenheimer Main Street Funds, Inc.)
Oppenheimer Main Street Opportunity Fund
Oppenheimer Main Street Small Cap Fund
Oppenheimer MidCap Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust (3 series):
     Oppenheimer New Jersey Municipal Fund
     Oppenheimer Pennsylvania Municipal Fund
     Oppenheimer Rochester National Municipals

Oppenheimer Portfolio Series (4 series)
     Active Allocation Fund
     Aggressive Investor Fund
     Conservative Investor Fund
     Moderate Investor Fund

Oppenheimer Principal Protected Main Street Fund (a series of Oppenheimer
Principal
     Protected Trust)
Oppenheimer Principal Protected Main Street Fund II (a series of Oppenheimer
     Principal Protected Trust II)

Oppenheimer Principal Protected Main Street Fund III (a series of Oppenheimer
     Principal Protected Trust III)

Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds (3 series)
     Oppenheimer Quest Balanced Fund
     Oppenheimer Quest Opportunity Value Fund
     Oppenheimer Small Cap Value Fund
Oppenheimer Quest International Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Real Asset Fund
Oppenheimer Real Estate Fund
Oppenheimer Select Value Fund
Oppenheimer Senior Floating Rate Fund
Oppenheimer Series Fund, Inc. (2 series):
     Oppenheimer Disciplined Allocation Fund
     Oppenheimer Value Fund
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Bond Fund
Oppenheimer Tremont Market Neutral Fund, LLC
Oppenheimer Tremont Opportunity Fund, LLC
Oppenheimer U.S. Government Trust

Oppenheimer Variable Account Funds (11 series):
     Oppenheimer Aggressive Growth Fund/VA
     Oppenheimer Balanced Fund/VA
     Oppenheimer Capital Appreciation Fund/VA
     Oppenheimer Core Bond Fund/VA
     Oppenheimer Global Securities Fund/VA
     Oppenheimer High Income Fund/VA
     Oppenheimer Main Street Fund/VA
     Oppenheimer Main Street Small Cap Fund/VA
     Oppenheimer Money Fund/VA
     Oppenheimer Strategic Bond Fund/VA
     Oppenheimer Value Fund/VA

Panorama Series Fund, Inc. (4 series):
     Growth Portfolio
     Government Securities Portfolio
     Oppenheimer International Growth Fund/VA
     Total Return Portfolio
Rochester Fund Municipals

The address of the Oppenheimer funds listed above, Shareholder Financial
Services, Inc., Shareholder Services, Inc., OppenheimerFunds Services,
Centennial Asset Management Corporation, Centennial Capital Corp., Oppenheimer
Real Asset Management, Inc. and OppenheimerFunds Legacy Program is 6803 South
Tucson Way, Centennial, Colorado 80112-3924.

The address of OppenheimerFunds, Inc., OppenheimerFunds Distributor, Inc.,
HarbourView Asset Management Corporation, Oppenheimer Partnership Holdings,
Inc., Oppenheimer Acquisition Corp., OFI Private Investments, Inc., OFI
Institutional Asset Management, Inc. and Oppenheimer Trust Company is 2 World
Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008.

The  address of Tremont  Advisers,  Inc. is 555  Theodore  Fremd  Avenue,  Suite
206-C, Rye, New York 10580.

The  address  of  OppenheimerFunds  International  Ltd.  is Bloc C,  Irish  Life
Center, Lower Abbey Street, Dublin 1, Ireland.

The address of Trinity  Investment  Management  Corporation  is 301 North Spring
Street, Bellefonte, Pennsylvania 16823.

Item 27. Principal Underwriter
------------------------------

(a)   OppenheimerFunds  Distributor, Inc. is the Distributor of the Registrant's
shares.  It is also the  Distributor  of each of the other  registered  open-end
investment  companies  for  which  OppenheimerFunds,   Inc.  is  the  investment
adviser, as described in Part A and B of this Registration  Statement and listed
in Item 26(b) above (except  Oppenheimer  Multi-Sector Income Trust and Panorama
Series Fund, Inc.) and for MassMutual Institutional Funds.


(b)   The directors and officers of the Registrant's principal underwriter are:


---------------------------------------------------------------------------------
Name & Principal                Position & Office         Position and Office
Business Address                with Underwriter          with Registrant
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Timothy Abbhul(1)               Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Agan(1)                  Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Janette Aprilante(1)            Secretary                 None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Barker                    Vice President            None
2901B N. Lakewood Avenue
Chicago, IL 60657
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen Beichert(1)            Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert J. Bishop(1)             Treasurer                 None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas S. Blankenship          Vice President            None
17011 Wood Bark Road
Springs, TX 77379
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Blinzler(1)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David A Borrelli                Vice President            None
105 Black Calla Ct.
San Ramon, CA 94583
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michelle Brennan                Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
L. Scott Brooks(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin E. Brosmith               Senior Vice President     None
5 Deer Path
South Natlick, MA 01760
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey W. Bryan                Vice President            None
1048 Malaga Avenue
Coral Gables, FL 33134
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Patrick Campbell(1)             Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Andrew Chonofsky                Vice President            None
300 West Fifth Street, Apt. 118
Charlotte, NC 28202

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Melissa Clayton                 Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Julian C. Curry(2)              Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jeffrey D. Damia(2)             Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey D. Damia(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Davis(2)                   Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stephen J. Demetrovits(2)       Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph A. DiMauro               Vice President            None
522 Lakeland Avenue
Grosse Pointe, MI 48230
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven Dombrower(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Ryan Drier(2)                   Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cliff H. Dunteman               Vice President            None
N 53 27761 Bantry Road
Sussex, WI 53089-45533
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Hillary Eigen                   Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Eiler(2)                   Vice President            None
---------------------------------------------------------------------------------
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Kent M. Elwell                  Vice President            None
35 Crown Terrace
Yardley, PA 19067
---------------------------------------------------------------------------------
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Gregg A. Everett                Vice President            None
4328 Auston Way
Palm Harbor, FL 34685-4017
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George R. Fahey                 Senior Vice President     None
2 Pheasant Drive
Ringoes, NJ 08551
---------------------------------------------------------------------------------
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Eric C. Fallon                  Vice President            None
10 Worth Circle
Newton, MA 02458
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph Fernandez                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark J. Ferro(2)                Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ronald H. Fielding(3)           Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Eric Fishel                     Vice President            None
3A Lawnwood Place, Apt. 1
Charlestown, MA 02129

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patrick W. Flynn (1)            Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John E. Forrest(2)              Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John ("J) Fortuna(2)            Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lucio Giliberti                 Vice President            None
6 Cyndi Court
Flemington, NJ 08822
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raquel Granahan(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ralph Grant                     Senior Vice President     None
10 Boathouse Close
Mt. Pleasant, SC 29464
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael D. Guman                Vice President            None
3913 Pleasant Avenue
Allentown, PA 18103
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

James E. Gunther(2)             Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kevin J. Healy(2)               Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kevin Hennessey                 Vice President            None
10206 Emerald Woods Avenue
Orlando, FL 32836

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elyse R. Jurman Herman          Vice President            None
3150 Equestrian Drive
Boca Raton, FL 33496
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Suzanne Heske                   Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy G. Hetson                 Vice President            None
4 Craig Street
Jericho, NY 11753
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William E. Hortz(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward Hrybenko(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian F. Husch(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Stephen Ilnitzki(2)             Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives(1)             Vice President &          Assistant Secretary
                                Assistant Secretary
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Nivan Jaleeli                   Vice President            None
13622 E. Geronimo Rd.
Scottsdale, AZ 85259

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric K. Johnson(1)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark D. Johnson                 Vice President            None
15792 Scenic Green Court
Chesterfield, MO 63017
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina J. Keller(2)          Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Keogh(2)                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Klassen(1)                 Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Klein                   Senior Vice President     None
4820 Fremont Avenue So.
Minneapolis, MN 55409
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Knott(1)                Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dean Kopperud(2)                Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brent A. Krantz                 Senior Vice President     None
P. O. Box 1313
Seahurst, WA 98062
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David T. Kuzia                  Vice President            None
19102 Miranda Circle
Omaha, NE 68130
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul R. LeMire                  Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric J. Liberman                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Malissa Lischin(2)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James V. Loehle                 Vice President            None
30 Wesley Hill Lane
Warwick, NY 10990
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Thomas Loncar(1)                Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Montana Low                     Vice President            None
1636 N. Wells Street, Apt. 3411
Chicago, IL 60614
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig Lyman                     Vice President            None
7578 Massachusetts Pl
Rancho Cucamonga, CA 91730
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John J. Lynch                   Vice President            None
6325 Bryan Parkway
Dallas, TX 75214
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Michael Malik                   Vice President            None
126 Bernard Street
San Francisco, CA 94109

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven C. Manns                 Vice President            None
1627 N. Hermitage Avenue
Chicago, IL 60622
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Todd A. Marion                  Vice President            None
24 Midland Avenue
Cold Spring Harbor, NY 11724
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Sandie Massaro                  Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Theresa-Marie Maynier           Vice President            None
2421 Charlotte Drive
Charlotte, NC 28203
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John C. McDonough               Vice President            None
3812 Leland Street
Chevy Chase, MD 20815
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kent C. McGowan                 Vice President            None
9510 190th Place SE
Edmonds, WA 98020
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Brian F. Medina(1)              Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel Melehan                  Vice President            None
906 Bridgeport Court
San Marcos, CA 92069
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Mezzanotte                 Vice President            None
16 Cullen Way
Exeter, NH 03833
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Clint Modler(1)                 Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

David W. Mountford(2)           Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Moser((1))               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Gzim Muja(2)                    Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John V. Murphy(2)               Director                  President, Trustee &
                                                          Chairman
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy Jean Murray               Vice President            None
32 Carolin Road
Upper Montclair, NJ 07043
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John S. Napier(2)               Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin P. Neznek(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bradford Norford                Vice President            None
2217 Ivan Street #911
Dallas, TX 75201
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alan Panzer                     Vice President            None
6755 Ridge Mill Lane
Atlanta, GA 30328
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Perkes                 Vice President            None
8734 Shady Shore Drive
Frisco, TX 75034
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles K. Pettit               Vice President            None
22 Fall Meadow Drive
Pittsford, NY 14534
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elaine Puleo-Carter(2)          Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Minnie Ra                       Vice President            None
100 Dolores Street, #203
Carmel, CA 93923
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dusting Raring                  Vice President            None
27 Blakemore Drive
Ladera Ranch, CA 92797
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael A. Raso                 Vice President            None
3 Vine Place
Larchmont, NY 10538
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Rath                    Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas Rentschler              Vice President            None
677 Middlesex Road
Grosse Pointe Park, MI 48230
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ruxandra Risko(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David R. Robertson(2)           Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Ian M. Roche                    Vice President            None
7070 Bramshill Circle
Bainbridge, OH 44023

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth A. Rosenson             Vice President            None
24753 Vantage Pt. Terrace
Malibu, CA 90265
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James H. Ruff(2)                President & Director      None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Matthew Rutig                   Vice President            None
199 North Street
Ridgefield, CT 06877

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William R. Rylander             Vice President            None
85 Evergreen Road
Vernon, CT 06066
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Sabow                    Vice President            None
6617 Southcrest Drive
Edina, MN 55435
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Saunders                   Vice President            None
911 North Orange Avenue #401
Orlando, FL 32801
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill E. Schmitt(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Schmitt(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Schories                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Charles F. Scully               Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric Sharp                      Vice President            None
862 McNeill Circle
Woodland, CA 95695
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debbie A. Simon                 Vice President            None
1 W. Superior Street, Apt. 4101
Chicago, IL 60610
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas Bruce Smith             Vice President            None
8927 35th Street W.
University Place, WA 98466
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John Spensley(2)                Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bryan Stein                     Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Stoma(2)                   Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wayne Strauss                   Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Summe                  Vice President            None
2479 Legends Way
Crestview Hills, KY 41017
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Sussman(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George T. Sweeney               Senior Vice President     None
5 Smoke House Lane
Hummelstown, PA 17036
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Taylor(2)                 Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Martin Telles(2)                Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David G. Thomas                 Vice President            None
16628 Elk Run Court
Leesburg, VA 20176
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Barrie L. Tiedemann(2)          Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bryan K.Toma                    Vice President            None
7311 W. 145th Terrace
Overland Park, KS 66223
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Mark Vandehey(1)                Vice President and Chief  Vice President and
                                Compliance Officer        Chief Compliance
                                                          Officer

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Vermete                 Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Rachel Walkey                   Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Cynthia Walloga                 Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth Lediard Ward            Vice President            None
1400 Cottonwood Valley Circle
N.
Irving, TX 75038
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Teresa Ward(1)                  Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael J. Weigner              Vice President            None
4905 W. San Nicholas Street
Tampa, FL 33629
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Donn Weise                      Vice President            None
3249 Earlmar Drive
Los Angeles, CA 90064
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine White(2)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Wilson(2)                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Donna Winn(2)                   Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Philip Witkower(2)              Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cary Patrick Wozniak            Vice President            None
18808 Bravata Court
San Diego, CA 92128
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Charles Young              Vice President            None
3914 Southwestern
Houston, TX 77005
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Zachman                    Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Zack(2)               General Counsel &         Secretary
                                Director
---------------------------------------------------------------------------------

(1) 6803 South Tucson Way, Centennial, CO 80112-3924
(2) Two World Financial  Center,  225 Liberty Street,  11th Floor,  New York, NY
10281-1008
(3) 350 Linden Oaks, Rochester, NY 14623

(c)   Not applicable.

Item 28. Location of Accounts and Records
-----------------------------------------

The accounts,  books and other documents required to be maintained by Registrant
pursuant  to  Section  31(a) of the  Investment  Company  Act of 1940 and  rules
promulgated  thereunder are in the possession of  OppenheimerFunds,  Inc. at its
offices at 6803 South Tucson Way, Centennial, Colorado 80112-3924.

Item 29. Management Services
----------------------------

Not applicable

Item 30. Undertakings
---------------------

Not applicable.




                                   SIGNATURES


Pursuant  to  the  requirements  of  the  Securities  Act  of  1933  and/or  the
Investment   Company  Act  of  1940,   the   Registrant  has  duly  caused  this
Registration Statement to be signed on its behalf by the undersigned,  thereunto
duly  authorized,  in the City of New York and State of New York on the 23rd day
of June, 2005.


                                 OPPENHEIMER TOTAL RETURN BOND FUND

                                 By:  /s/ John V. Murphy

                                      _________________________
                                     John V. Murphy, President, Principal
                                     Executive Officer, Chairman & Trustee

Pursuant to the  requirements of the Securities Act of 1933,  this  Registration
Statement  has been signed below by the following  persons in the  capacities on
the dates indicated:

Signatures                    Title                        Date
----------                    -----                        ----


/s/ Peter I. Wold*
-------------------           Chairman of the Board        June 23, 2005
Peter I. Wold


/s/ John V. Murphy *          President, Principal

-----------------------       Executive Officer,           June 23, 2005
John V. Murphy                Chairman and Trustee

/s/ Brian W. Wixted*          Treasurer and Principal      June 23, 2005
-----------------------       Financial and Accounting
Brian W. Wixted               Officer


/s/ Ronald J. Abdow*

------------------------      Trustee                      June 23, 2005
Ronald J. Abdow


/s/ Eustis Walcott*

---------------------         Trustee                      June 23, 2005
Eustis Walcott


/s/ Joseph M. Wikler*

------------------------      Trustee                      June 23, 2005
Joseph M. Wikler


*By: /s/ Mitchell J. Lindauer

-----------------------------------------

Mitchell J. Lindauer, Attorney-in-Fact




                       OPPENHEIMER TOTAL RETURN BOND FUND


                         Post Effective Amendment No. 3


                     Registration Statement No. 333-101878


                                 EXHIBIT INDEX
                                 -------------


Exhibit No.      Description
-----------      -----------


23(m) (i)        Amended and Restated Distribution and Service Plan and
Agreement for

                 Class A shares