Oppenheimer Principal Protected Main Street Fund II

485BPOS 1 body.htm FORM N1-A, PROSPECTUS, SAI, PART C Oppenheimer Principal Protected Main Street Fund II

                                                   Registration No. 333-108093
                                                            File No. 811-21414

                                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. 4                                       [X]


                                    and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940                                                                [X]


      Amendment No. 5                                                      [X]


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                   OPPENHEIMER PRINCIPAL PROTECTED TRUST II
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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)

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

                             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):


[ X] Immediately upon filing pursuant to paragraph (b)
[   ]                       On _______________ pursuant to paragraph (b)
[   ]                  60 days after filing pursuant to paragraph (a)(1)
[   ]                   On January __, 2004 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.

Oppenheimer
Principal Protected
Main Street Fund II(R)

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Prospectus dated October 25, 2004

Oppenheimer Principal Protected Main
Street Fund II(R)is a mutual fund that
seeks capital preservation in order to
have a net asset value on the Maturity
Date at least equal to your original
investment (reduced by any adjustments
to the Warranty Amount permitted under
the Warranty Agreement and less any

Shares of the Fund cannot be purchased sales charges, your share of
except by the reinvestment of the extraordinary expenses and the
Fund's dividends and distributions. proportional reduction for dividends

paid in cash and redemption of Fund
As with all mutual funds, the shares). The Fund seeks high total
Securities and Exchange Commission has return as a secondary objective. It
not approved or disapproved the Fund's invests in shares of the Oppenheimer
securities nor has it determined that Main Street Fund(R)(which invests
this Prospectus is accurate or mainly in common stocks) and U.S.
complete. It is a criminal offense to government securities, including zero
represent otherwise. coupon bonds.
This Prospectus contains important
information about the Fund's
objective, its investment policies,
strategies and risks. It also contains
important information about how to buy
and sell shares of the Fund and other
account features. Please read this
An investment in the Fund is not a Prospectus carefully before you invest
deposit of any bank and is not insured and keep it for future reference about
or guaranteed by the Federal Deposit your account.
Insurance Corporation or any other
government agency or any person.
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The Right Way to Invest

CONTENTS

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

Overview

The Fund's Investment Objective and Principal Investment Strategies

Main Risks of Investing in the Fund

The Fund's Past Performance

Fees and Expenses of the Fund

About the Fund's Investments

The Warranty Agreement and the Financial Warranty

How is the Warranty Amount Determined?

How the Fund is Managed

A B O U T Y O U R A C C O U N T

Special Investor Services
AccountLink
PhoneLink
OppenheimerFunds Internet Website
Reinvestment Privilege

How to Sell Shares
By Wire
By Mail
By Telephone

How to Exchange Shares

43 Dividends, Capital Gains and Taxes

Dividends, Capital Gains and Taxes

The Underlying Fund's Past Performance

Financial Highlights of the Fund

Financial Highlights of the Underlying Fund

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

Overview

The Oppenheimer Principal Protected Main Street Fund II is a "fund-of-funds" that
invests a portion of its assets in shares of Oppenheimer Main Street Fund(R)and a
portion of its assets in U.S. Government securities.

The Fund has an Offering Period, a Warranty Period and a Post-Warranty Period.
Shares of the Fund were offered during an Offering Period but are not offered during
the Warranty Period, except in connection with reinvestment of dividends and
distributions. The Offering Period was from November 10, 2003 to February 27, 2004.

The Warranty Period began March 3, 2004 and will run until March 3, 2011 (the
"Maturity Date"). During the Warranty Period, the Fund will seek primarily capital
preservation, and secondarily high total return, by allocating its assets between
Class Y shares of Oppenheimer Main Street Fund, U.S. government securities,
including zero coupon bonds and certain securities guaranteed by certain U.S.
government agencies and instrumentalities. Shareholders may receive taxable gains
from portfolio transactions by the Fund, whether they take payment in cash or
reinvest them to purchase additional Fund shares.

The Fund has entered into a Financial Warranty Agreement (the "Warranty
Agreement") with Merrill Lynch Bank USA (the "Warranty Provider") pursuant to which
the Warranty Provider, subject to certain conditions, has issued a financial
warranty (the "Financial Warranty") to the Fund. The Financial Warranty attempts to
make sure that the value of each shareholder's account on the Maturity Date will be
no less than the value of the shareholder's account on the second business day after
the end of the Offering Period, including net income, if any, earned by the Fund
during the Offering Period, reduced by (i) sales charges, (ii) the shareholder's pro
rata portion of any Extraordinary Expenses not covered by the Warranty Agreement,
(iii) proportionately reduced for dividends and distributions paid in cash and
redemptions of Fund shares, (iv) the shareholder's pro rata portion of the value of
any shares issued by the Fund during the Warranty Period other than in connection
with the reinvestment of dividends and distributions, (v) the amount of any increase
in the shareholder's investment in the Fund as a result of changes in accounting
practices for the Fund, corporate actions or certain other events, and (vi) if
OppenheimerFunds, Inc., as manager of the Fund (the "Manager") is required to make
payments under the Warranty Agreement in certain instances, and the Manager fails to
do so in a timely manner, the amount of such payments (on a pro rata basis). The
value of the shareholder's account on the second business day after the end of the
Offering period minus the above-described reductions is referred to as the "Warranty
Amount." In order to avoid having their Warranty Amount reduced, shareholders must
reinvest all dividends and distributions received from the Fund to purchase
additional shares of the Fund and must not redeem any shares of the Fund during the
Warranty Period. If the value of the Fund's assets on the Maturity Date is
insufficient to result in the value of each shareholder's account being at least
equal to the shareholder's Warranty Amount, the Warranty Provider will pay the Fund
an amount sufficient to make sure that each shareholder's account can be redeemed
for an amount equal to his or her Warranty Amount.

Because the front-end sales charge you pay on the purchase of Class A shares
reduces the Warranty Amount for Class A shareholders, Class A shares will have a
lower Warranty Amount than the Class B or Class C. Normal operating fees and
expenses of the Fund incurred in the ordinary course of business will not reduce the
Warranty Amount. However, extraordinary expenses incurred by the Fund will reduce
the Warranty Amount. In addition, in the event the Fund is completely and
irreversibly invested in debt securities and cash and cash equivalents, any Fund
expenses in excess of certain limits as described on page 13 will reduce the
Warranty Amount.

The Warranty Provider, a direct subsidiary of Merrill Lynch & Co., Inc., is
licensed as an industrial bank organized under Utah law. The Warranty Provider's
principal business is to engage in banking activities. Neither Merrill Lynch & Co.,
Inc. nor any other entity will be guaranteeing the obligations of the Warranty
Provider. The Warranty Provider has not participated in the organization of the Fund
and makes no representation regarding the advisability of an investment in the Fund.
Further information about the Warranty Provider can be found in the Statement of
Additional Information.

Shareholders could lose money by investing in this Fund. A shareholder's
Warranty Amount will be reduced, as more fully described in this prospectus, if the
shareholder takes any dividends or distributions in cash instead of reinvesting them
in additional shares of the Fund, redeems any shares before the Maturity Date, if
there are Extraordinary Expenses incurred by the Fund (as such expenses are not
covered by the Warranty Agreement), if the Fund or the Manager fails to perform
certain obligations under the Warranty Agreement (in which case the Warranty
Provider may have the right to terminate the Financial Warranty). Moreover,
shareholders could lose money if the Warranty Provider fails to meet its obligations
under the Warranty Agreement.

During the Post-Warranty Period, which will commence immediately following the
Warranty Period, the Fund will seek high total return by investing in Class Y shares
of Oppenheimer Main Street Fund, common stocks of U.S. companies of different
capitalization ranges, and/or debt securities, such as bonds and debentures. The
Fund's shares will be offered on a continuous basis during the Post-Warranty Period.

The Fund's Investment Objective and Principal Investment Strategies

What Is the Fund's Investment Objective During the Warranty Period? During the
Warranty Period, the Fund will seek capital preservation in order to have a net
asset value on the Maturity Date at least equal to the Warranty Amount. The Fund
seeks high total return as a secondary objective.

What Does The Fund Mainly Invest In During the Warranty Period? The Fund is a
special type of mutual fund known as a "fund of funds" because it can invest a
substantial portion of its assets in other mutual funds. During the Warranty Period,
the Manager will allocate the Fund's assets between a portfolio of equity securities
as described below (the "equity portfolio") and a portfolio of debt securities as
described below (the "debt portfolio"). The equity portfolio will invest in Class Y
shares of Oppenheimer Main Street Fund (referred to as the "Underlying Fund"). The
Underlying Fund's investment objective is to seek high total return by investing
mainly in common stocks of U.S. companies of different capitalization ranges. The
debt portfolio will invest principally in zero coupon U.S. government securities,
but may also include certain securities guaranteed by certain U.S. government
agencies and instrumentalities and securities issued by government-sponsored
enterprises which are neither guaranteed nor insured by the U.S. government. The
securities in the debt portfolio will have a maturity approximately equal to the
period remaining in the Warranty Period.

Who Is The Fund Designed For? The Fund may be an appropriate investment for you if
you:
o Have an investment time horizon of at least 7 years
o Seek potential for growth but are concerned about capital preservation
o Want a professionally managed and diversified portfolio
o Are not seeking current income through cash dividends

Main Risks of Investing in the Fund

All investments have risks to some degree. The Fund's investments are subject to
changes in their value from a number of factors described below. There is also the
risk that poor security selection by the Manager and Manager, in its capacity as the
Underlying Fund's investment manager, will cause the Fund to underperform other
funds having a similar objective.

The principal risks of an investment in the Fund during the Warranty Period
and the Post-Warranty Period are those generally attributable to investing in stocks
and debt securities. Because the Fund invests in both shares of the Underlying Fund
and debt securities during the Warranty Period, the Fund may underperform stock
funds when stocks are in favor and underperform bond funds when debt securities are
in favor.

In order to enable the Fund to obtain the benefits of the Financial Warranty,
the Fund expects to comply with certain investment limitations established by the
Warranty Agreement. If the Fund or the Manager chooses not to comply with those
investment limitations because it determines that such non-compliance would be in
the shareholder's best interests, the Warranty Provider may exercise its rights to
have more of the Fund's assets invested in the debt portfolio (including a complete
and irreversible allocation to the debt portfolio) or could terminate the Financial
Warranty.

As with any mutual fund, the value of the Fund's investments - and therefore
the value of Fund shares - may go down. Although the Fund will seek to return a
shareholder's Warranty Amount at the end of the Warranty Period, the value of the
Fund's shares will fluctuate during the Warranty Period and may decline below your
original account value. Changes in the value of the Fund's shares may occur because
a particular stock market in which the Underlying Fund invests is rising or falling,
or in response to interest rate changes because of the effect of the change on the
value of the Fund's debt portfolio. You could lose money by investing in the Fund if
you redeem your shares prior to the Maturity Date or after the Maturity Date or if
the value of the Fund's investments goes down and the Warranty Provider is unable to
meet its obligations under the Financial Warranty. See "The Warranty Agreement and
the Financial Warranty" on page 22 for further information about the Warranty
Agreement and when the Financial Warranty may be terminated.

The Fund will distribute any net gains and income (including accrued but
unpaid income on zero coupon bonds) to shareholders at least annually. Such
distributions are taxable to shareholders even if the distributions are reinvested
in the Fund. Shareholders who reinvest distributions in the Fund will be required to
pay taxes on such distributions from other sources. Shareholders who do not reinvest
distributions, however, will be subject to a reduction in their Warranty Amount.

RISKS OF INVESTING IN STOCKS. Stocks fluctuate in price, and their short-term
volatility at times may be great. Because the Underlying Fund currently invests a
substantial portion of its assets in common stocks, the value of the Underlying
Fund's portfolio and therefore the Fund's equity portfolio will be affected by
changes in the stock markets. Market risk will affect the Fund's net asset values
per share, which will fluctuate as the values of the Underlying Fund's portfolio
securities change. The corresponding effect on the net asset value of the Fund will
depend on the percentage of the Fund's assets allocated to shares of the Underlying
Fund.

A variety of factors can affect the price of a particular stock and the prices
of individual stocks do not all move in the same direction uniformly or at the same
time. Different stock markets may behave differently from each other. In particular,
because the Underlying Fund currently focuses its stock investments in U.S. issuers,
it will be primarily affected by changes in U.S. stock markets.

Other factors can affect a particular stock's price, such as poor earnings
reports by the issuer, loss of major customers, major litigation against the issuer,
or changes in government regulations affecting the issuer or its industry. The
Underlying Fund currently invests substantial amounts in large companies, but may
buy securities of small and medium-size companies, which may have more volatile
prices than stocks of large companies. Therefore, if the Underlying Fund is focusing
on or has substantial investments in smaller capitalization companies at times of
market volatility, the Underlying Fund's share price may fluctuate more than that of
funds focusing on larger capitalization issuers.

At times, the Underlying Fund's emphasis of its investments in a particular
industry may differ compared to the weighting of that industry in the S&P 500 Index,
which the Underlying Fund uses as a performance benchmark. To the extent that the
Underlying Fund increases its emphasis on stocks in a particular industry, its share
values may fluctuate in response to events affecting that industry, such as changes
in economic conditions, government regulations, availability of basic resources or
supplies, or other events that affect that industry more than others.

INTEREST RATE RISK. Debt securities are subject to changes in value when prevailing
interest rates change. When interest rates fall, the values of already-issued debt
securities generally rise. When interest rates rise, the values of already-issued
debt securities generally fall, and those securities may sell at a discount from
their face amount. The magnitude of these price fluctuations is generally greater
for debt securities having longer maturities and for zero coupon securities.

The Fund buys zero-coupon or "stripped" securities, which are particularly
sensitive to interest rate changes. Their prices may go up or down more than the
prices of other types of debt securities in response to interest rate changes.

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.
Securities, including zero-coupon 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 generally have low credit risks. Securities
issued by government-sponsored enterprises, such as the Federal Home Loan Mortgage
Corporation, the Federal National Mortgage Association and the Federal Home Loan
Bonds, are neither guaranteed nor insured by the U.S. government and thus may
experience greater credit risk than other types of U.S. government securities.

RISKS ASSOCIATED WITH THE FINANCIAL WARRANTY. Although neither the Warranty
Provider, nor any other person (including the Manager, its affiliates or the United
States government) has guaranteed the performance of the Fund, the Fund has entered
into the Warranty Agreement with the Warranty Provider to try to make sure that on
the Maturity Date shareholders will be able to redeem their shares of the Fund at
their Warranty Amount. The Financial Warranty is solely the obligation of the
Warranty Provider. It is possible that the financial position of the Warranty
Provider may deteriorate and it would be unable to satisfy its obligations under the
Financial Warranty. As described above, shareholders could lose money if the
Warranty Provider fails to or is unable to perform its obligations under the
Warranty Agreement.

The Fund's assets and the obligations of the Warranty Provider under the
Warranty Agreement are not guaranteed by Merrill Lynch & Co., Inc., the United
States government, the Manager, or any other entity or person. The lack of a
guarantee presents some risks to shareholder if the Warranty Provider fails or is
unable to honor its obligations to the Fund on the Maturity Date under the Warranty
Agreement.

The Warranty Agreement may be terminated by the Warranty Provider in certain
circumstances, as discussed in "The Warranty Agreement and the Financial Warranty,"
on page 20. In such event, shareholders will not receive the Warranty Amount but
instead will receive the Fund's then-current net asset value when they redeem their
shares, which may be lower than the Warranty Amount. Shareholders may receive less
than their Warranty Amount as calculated on the first day of the Warranty Period in
certain other circumstances as well. For example, the Warranty Agreement requires
the Manager to make payments to the Warranty Provider upon the happening of certain
specified events. If the Manager fails to make a required payment, the Warranty
Provider may reduce its obligations under the Financial Warranty. As a result, a
shareholder's Warranty Amount may be reduced.

In addition, the Manager has contractually agreed to reduce its management fee
for the remainder of the Warranty Period in the event that the Fund becomes
completely and irreversibly invested in the debt portfolio to the extent necessary
so that total annual operating expenses of the Fund are limited to certain agreed
amounts (as described under "Advisory Fees" on page 25) for each share class
(excluding Extraordinary Expenses and certain other expenses). However, if this
reduction in the management fee is not sufficient to reduce total annual operating
expenses to these limits, the Manager is not required to subsidize Fund expenses to
assure that expenses do not exceed those limits. Under such circumstances, the
aggregate Warranty Amount will be reduced by the portion of the Fund's annual
operating expenses that exceed these limits.

Furthermore, the Warranty Amount per share will be reduced by the
shareholder's proportionate share of any Extraordinary Expenses incurred by the Fund,
by any shortfall amount resulting from the negligence of the Manager, by dividends
and distributions paid in cash, and by redemption of Fund shares during the Warranty
Period. If any of those were to occur, the shareholder will receive less than the
original Warranty Amount on the Maturity Date. The Manager will not be responsible
to the Fund for a reduction in the Warranty Amount due to an Extraordinary Expense
or other shortfall resulting from the Manager's negligent acts.

Investment Restrictions Under Warranty Agreement. To avoid losing the benefits of
the Financial Warranty, the Fund is subject to conditions of the Warranty Agreement
that require the Manager to make investment allocation decisions based on a
mathematical formula (the "Warranty Formula") that limits the amount of the Fund's
assets that may be allocated to the shares of the Underlying Fund. This limitation
is designed to reduce, but does not eliminate, the risk that the Fund's assets will
be insufficient to allow the Fund to redeem shares at not less than the Warranty
Amount on the Maturity Date. Accordingly, the Warranty Agreement could limit the
Manager's ability to respond to changing market conditions during the Warranty
Period. If the Manager fails to comply with the agreed-upon investment parameters or
otherwise fails to comply with certain requirements set forth in the Warranty
Agreement, the Warranty Provider may terminate the Financial Warranty, exercise its
right to instruct the Manager to immediately allocate the Fund's assets to the debt
portfolio, deliver to the Fund's custodian (the "Custodian") pre-signed instructions
from the Manager instructing the Custodian to immediately allocate all of the Fund's
assets to the debt portfolio, or change one of the variables in the Warranty Formula
which would have the effect of increasing the portion of the Fund's assets allocated
to the debt portfolio. If the Warranty Provider were to exercise the right to have
all of the Fund's assets invested in the debt portfolio, the Fund's ability to
participate in upward equity market movements would be eliminated.

Risk of Default. A shareholder's ability to receive the Warranty Amount depends on
the financial condition of the Warranty Provider. The Warranty Agreement is an
obligation that runs solely to the Fund, not to the Fund's shareholders, and
shareholders would have no recourse against the Warranty Provider in the event it
defaults on its respective obligations to the Fund. Because the Financial Warranty
is solely an obligation of the Warranty Provider, an investment in the Fund involves
a risk of loss if the Warranty Provider is placed in receivership, or is otherwise
unable to perform its respective obligations or defaults on its respective
obligations, if any, to the Fund. In the event of an act of insolvency by the
Warranty Provider, the Fund's board of trustees (the "Board") could take a variety
of actions including replacing the Financial Warranty. However, the Board is under
no obligation to replace the Financial Warranty or otherwise find a substitute
provider of principal protection. In each of the above circumstances, shareholders
could suffer a loss of principal. No entity or person is obligated to make up any
shortfall in the event the Warranty Provider defaults on its respective obligations
to the Fund and the Fund's assets are insufficient to redeem the Fund's shares for
the Warranty Amount on the Maturity Date. The Warranty Provider may, with the
written consent of the Fund and the Manager, assign its obligations under the
Warranty Agreement to an affiliate, provided it guarantees such affiliate's
obligations under the Warranty Agreement. There is a risk that the substitute
Warranty Provider may not have the financial resources to fulfill its obligations
under the Warranty Agreement.

The availability of the Financial Warranty on the Maturity Date is conditioned
upon the Manager and the Fund satisfying their respective obligations under the
Warranty Agreement. Should the Manager or the Fund fail to satisfy their respective
obligations under the Warranty Agreement, the Warranty Provider is permitted to
terminate the Financial Warranty and thus terminate its obligations to make any
payment to the Fund if a shortfall exists on the Maturity Date. In addition, the
availability of the Financial Warranty on the Maturity Date is conditional upon the
Manager and the Fund's Custodian providing certain information to the Warranty
Provider. If the Manager or the Custodian fails to provide such information, the
Warranty Provider may require the Fund to invest exclusively in the debt portfolio,
which will eliminate the Fund's ability to participate in upward equity market
movements.

Risks Associated with Asset Allocation. At times, the Fund's assets may be largely
invested in the debt portfolio in order to increase the likelihood of preserving the
original principal value of the Fund. If Fund assets are largely invested in the
debt portfolio, the Fund's exposure to equity markets will be reduced and the Fund
will be more highly correlated with bonds. In addition, if during the Warranty
Period the equity markets experience a major decline, the Fund's assets may become
largely or entirely invested in the debt portfolio. In fact, if the value of the
shares of the Underlying Fund were to decline significantly (whether within a short
period of time or over a protracted period), a complete and irreversible
reallocation to the debt portfolio may occur. In this circumstance, the Fund would
not participate in any subsequent recovery in the equity markets. Investment in debt
securities during the Warranty Period reduces the Fund's ability to participate as
fully in upward equity market movements, and therefore represents some loss of
opportunity compared to a portfolio that invests principally in equity securities.
In addition, the terms of the Warranty Agreement prescribe certain investment
parameters within which the Fund must be managed during the Warranty Period to
preserve the benefit of the Financial Warranty. Accordingly, the Warranty Agreement
could limit the Manager's ability to alter the allocation of Fund assets during the
Warranty Period in response to changing market conditions. The terms of the Warranty
Agreement could require the Fund to liquidate an equity position when it otherwise
would not be in the shareholders' best interests or at a time when the Manager
otherwise would not recommend that the securities be sold.

The asset allocation process may result in additional transaction costs. This
process can have an adverse effect on the performance of the Fund during periods of
increased equity market volatility. In addition, a high portfolio turnover rate may
increase the Fund's transaction costs, which would adversely affect performance.
Also, you may receive taxable gains from portfolio transactions by the Fund, whether
you take payment in cash or reinvest them to purchase additional Fund shares.

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, particularly if the financial condition of the Warranty
Provider deteriorates and it is unable to make the required payment to the Fund, if
necessary, under the Financial Warranty. You could lose money if, among other
reasons, the Fund incurs Extraordinary Expenses, or is liquidated prior to the
Maturity Date, or if you redeem your shares prior to the Maturity Date or after the
Maturity Date and the Fund's net asset value is less than the Warranty Amount on the
date of redemption. It is possible that the Warranty Provider will not be able to
satisfy its obligations under the Warranty Agreement as of the Maturity Date or that
the Manager or the Fund will not be able to satisfy their respective obligations
under the Warranty Agreement. As a result, the Fund may not be able to redeem your
shares for the Warranty Amount on the Maturity Date, and the value of your shares on
the Maturity Date may be more or less than your Warranty Amount. There is no
assurance that the Fund will achieve its investment objective.

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The life of the Fund is divided into three phases: an Offering Period (which has
ended), a Warranty Period and a Post-Warranty Period.
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Offering Period. The Warranty Period began March 3, 2004, the third business day
after the end of the Offering Period, and will run through March 3, 2011, or if that
day is not a business day, the first business day thereafter (previously defined as
the "Maturity Date"). During the Warranty Period, the Fund will not accept purchase
orders for Fund shares, except for reinvestment of dividends and distributions.

If you maintain your investment in the Fund through the Maturity Date, do not
redeem any shares, and reinvest all dividends and distributions, you will be
entitled to redeem your shares held as of the Maturity Date for the greater of the
then-current net asset value of your shares or your Warranty Amount. A transfer or
reregistration of existing shares during the Warranty Period that does not result in
an increase in Fund shares that are issued and outstanding will not interrupt the
seven year period calculated to determine the Warranty Amount. Shareholders must
redeem their shares in the Fund on, and only on, the Maturity Date (March 3, 2011)
to ensure that they receive the greater of the then-current net asset value of the
Fund or their Warranty Amount. Prior to the Maturity Date the Fund will provide each
shareholder a notice reminding them that shares must be redeemed on the Maturity
Date to receive the full benefit of the Financial Warranty. In the event there is a
shortfall on the Maturity Date, each redeeming shareholder will be entitled to
redemption proceeds that include a pro rata allocation of any payments made to the
Fund by the Warranty Provider. Shareholders who remain invested in the Fund past the
Maturity Date will also receive the benefit of a pro-rata allocation of any
shortfall payments made by the Warranty Provider, if any, on the Maturity Date.
However, after the Maturity Date shares of the Fund will not be protected by the
Financial Warranty and will be subject to market fluctuations, and the shares will
then be redeemable at the Fund's then-current net asset value, which may be lower
than the Warranty Amount.

The Fund never restricts your ability to redeem your shares. However,
shareholders who do not reinvest their distributions or dividends will reduce their
Warranty Amount and shareholders who redeem prior to the Maturity Date will bear the
cost of the Warranty Agreement without receiving any corresponding benefit. As
explained in the example on page 23, if you reinvest your dividends and
distributions, the number of shares you own in the Fund will increase at each date
on which a dividend or distribution is effective and the corresponding Warranty
Amount per share decreases so that your overall Warranty Amount does not change.
Therefore, if you fail to reinvest the Fund's dividends or distributions or you
redeem Fund shares, your overall Warranty Amount will decrease because you will have
fewer shares multiplied by the applicable Warranty Amount per share. See "How is the
Warranty Amount Determined?" for further information. Shareholders (other than
certain retirement plans) are subject to income taxes on distributions from the Fund
whether they take payment of distributions in cash or reinvest them to purchase
additional Fund shares.

If the Fund incurs certain Extraordinary Expenses or if the Manager is
required to make payments under the Warranty Agreement in certain instances and the
Manager fails to do so in a timely manner, your Warranty Amount also will be reduced
by the proportionate amount of the Extraordinary Expenses or the amount of the
payment which the Manager failed to make.

"Extraordinary Expenses" means any Fund fees and expenses that are not
incurred or accrued in the ordinary course of the Fund's business (including for
example, all costs of defending or prosecuting any claim, or litigation, to which
the Fund is a party, together with any amounts in judgment, settlement or
indemnification expense incurred by the Fund or any other non-recurring,
non-operating expenses and all redemption fees and sales charges incurred or accrued
by the Fund as a shareholder of the Underlying Fund, whether or not incurred in the
ordinary course of the Fund's business). If the Fund's assets are invested
completely and irreversibly in the debt portfolio, Extraordinary Expenses will also
include any Fund fees and expenses incurred in excess of the Fund's expense limits
whether or not incurred in the ordinary course of the Fund's business. Those expense
limits are 1.30% for Class A shares, 2.05% for Class B shares and 2.05% for Class C
shares. The Fund will invest its assets completely and irreversibly in the debt
portfolio if the Warranty Formula provides for such allocation or if, under the
terms of the Warranty Agreement, the Warranty Provider exercises its right to
instruct the Manager to allocate the Fund's assets to the debt portfolio, or deliver
to the Fund's Custodian pre-signed instructions from the Manager instructing the
Custodian to immediately allocate all of the assets of the Fund to the debt
portfolio.

Post-Warranty Period. On and after the Maturity Date, you can redeem your shares or
exchange your shares for shares of the same class of another Oppenheimer fund that
offers an exchange privilege. The value of your shares on the Maturity Date will be
the greater of (i) the then-current net asset value of the Fund or (ii) the Warranty
Amount. Because the benefits of the Warranty Agreement terminate after the Maturity
Date, the entire amount of your investment in the Fund following the Maturity Date
will be subject to market risk.

If after the Maturity Date shares of the Fund remain issued and outstanding,
the Board may elect at the recommendation of the Manager and without shareholder
approval (1) to have the Fund redeem all issued and outstanding shares and then
terminate the Fund, (2) to merge the Fund into the Underlying Fund, or (3) to
continue the existence of the Fund. Shareholders who continue their investment in
the Fund after the Maturity Date will receive prior notice of the Board's decision.
If the Board chooses to have the Fund redeem all issued and outstanding shares and
terminate the Fund, those remaining shareholders will receive the then-current net
asset value which may be more or less than their Warranty Amount. If the Board
chooses to continue the existence of the Fund during the Post-Warranty Period, then
the Fund's investment objectives will be changed by the Board to the single
objective of seeking high total return and the Fund's name will change to an
appropriate name as determined by the Board. To achieve that objective, the Fund may
invest its assets during the Post-Warranty Period primarily in shares of the
Underlying Fund, common stocks of U.S. companies of different capitalization ranges,
and debt securities, such as bonds and debentures. The Manager will sell a portfolio
security during the Post-Warranty Period if it determines that the security will not
provide the return anticipated. During the Post-Warranty Period, the Fund's shares
will be offered on a continuous basis. Shareholders will not have the benefit of the
Financial Warranty during the Post-Warranty Period.

--------------------------------------------------------------------------------------
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 or any person.
--------------------------------------------------------------------------------------

The Fund's Past Performance

Because the Fund commenced operations on November 10, 2003, prior performance
information for a full calendar year is not yet available. Please remember that the
Fund is intended to be a long-term investment and that performance results are
historical, and that past performance (particularly over a short-term period) is not
predictive of future results. Because the Fund may invest a significant amount of
its assets in Class Y shares of the Underlying Fund, performance data and financial
information about Class Y shares of the Underlying Fund is included beginning on
page 39 of this Prospectus. That information is not intended to predict the
performance of the Fund. The Fund's performance will differ from the performance of
the Underlying Fund.

Fees and Expenses of the Fund

The Fund pays a variety of expenses directly for management of its assets,
administration, distribution of its shares and other services and for the Financial
Warranty. Those expenses are subtracted from the Fund's assets to calculate the
Fund's net asset value per share. All shareholders therefore pay those expenses
indirectly. The fees for the Fund may be higher than fees paid by other mutual funds
which do not offer principal protection. While the Fund will indirectly bear its
pro-rata share of the expenses of the Underlying Fund, the Manager will reimburse
the Fund for the full amount of those expenses indirectly incurred. Therefore,
shareholders will not bear any expenses of the Underlying Fund by investing in
shares of this Fund. Shareholders pay other expenses directly, such as sales
charges and account transaction charges. The following tables are meant to help you
understand the fees and expenses you may pay if you buy and hold shares of the Fund.
"Other Expenses" and "Total Annual Operating Expenses" are based on the Fund's
expenses during its fiscal year ended August 31, 2004.

Shareholder Fees (charges paid directly from your investment):

--------------------------------------------------------------------
Class A Class B Class C
Shares Shares Shares
--------------------------------------------------------------------
--------------------------------------------------------------------
Maximum Sales Charge (Load) on
purchases (as % of offering price) 5.75% None None
--------------------------------------------------------------------
--------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)
(as % of the lower of the original
offering None1 5%2 1%3
price or redemption proceeds)
--------------------------------------------------------------------

Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)

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

Class A Class B Class C
Shares Shares4 Shares

--------------------------------------------------------------------
--------------------------------------------------------------------
Management Fees5 0.50% 0.50% 0.50%
--------------------------------------------------------------------
--------------------------------------------------------------------
Distribution and/or Service (12b-1) 0.25% 1.00% 1.00%
Fees
--------------------------------------------------------------------
--------------------------------------------------------------------

Other Expenses 0.59% 0.62% 0.58%

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

Total Annual Operating Expenses6 1.34% 2.12% 2.08%

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

Because the Manager waived or reimbursed most Fund expenses, other than 12b-1
expenses, incurred during the Offering Period (which ended February 27, 2004), the
expenses shown in the table above are the actual expenses incurred by the Fund from
March 3, 2004 (the beginning of the Warranty Period) until August 31, 2004. The
expenses shown above are representative of the expenses that the Fund will incur
during the Warranty Period (which ends March 3, 2011). Expenses may vary in future
years. "Other Expenses" include transfer agent fees, custodial fees, the Warranty
Agreement fee of 0.60% of average daily net assets of the Fund, and accounting and
legal expenses that the Fund pays. The Transfer Agent has voluntarily undertaken to
the Fund to limit the transfer agent fees to 0.35% of average daily net assets per
fiscal year for each class. That voluntary undertaking may be amended or terminated
at any time without notice to shareholders.

1. A contingent deferred sales charge may apply to redemptions of investments of $1
million or more of Class A shares. See "How to Sell Shares - How Contingent Deferred
Sales Charges Affect Redemptions" for details.
2. Applied 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. Applied to shares redeemed within 12 months of purchase.
4. Class B shares automatically convert to Class A shares when the Maturity Date is
reached, which is 88 months after purchase.
5. "Management Fees" in the table above reflect the maximum annual management fee
rate under the investment advisory agreement. During the Warranty Period, the
management fees shall be 0.40% of average annual net assets of the Fund in any month
following a month where the Fund's investment in equity securities is, on average,
less than 10% of net assets. If 100% of the Fund's assets are completely and
irreversibly invested in the debt portfolio, the Management Fees will be 0.25% for
the remainder of the Warranty Period.
6. The Manager has agreed to reimburse the Fund for expenses equal to the Underlying
Fund expenses, other than Extraordinary Expenses, paid by the Fund as a shareholder
in the Underlying Fund. For the fiscal year ended August 31, 2004, following this
reimbursement, the Fund's "Total Annual Operating Expenses" were 0.99% for Class A
shares, 1.77% for Class B shares and 1.73% for Class C shares. The amount of this
expense reimbursement is based on the percentage allocation of the Fund's assets in
shares of the Underlying Fund and will fluctuate as the allocation changes.
The Manager has contractually agreed to further reduce its management fee for the
remainder of the Warranty Period in the event that 100% of the Fund's assets are
completely and irreversibly invested in the debt portfolio to the extent necessary
so that total annual operating expenses of the Fund (other than Extraordinary
Expenses such as litigation costs) do not exceed 1.30% for Class A shares, 2.05% for
Class B shares and 2.05% for Class C shares. However, if this reduction in the
management fee is not sufficient to reduce total annual operating expenses to these
limits, the Manager is not required to subsidize Fund expenses to assure that
expenses do not exceed those limits. Furthermore, if the Fund's annual operating
expenses exceed those limits while the Fund's assets are completely and irreversibly
allocated to the debt portfolio, the Warranty Amount will be reduced by the portion
of the Fund's annual operating expenses that exceed those limits. Additionally, if
the Fund becomes completely and irreversibly invested in the debt portfolio, the
Warranty Fee payable by the Fund to the Warranty Provider under the Warranty
Agreement will decrease to 0.35% per annum.

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

1 Year 3 Years 5 Years 10 Years

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 are based on the
Total Annual Operating
Expenses shown in the table
above, and 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 redeemed:

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

Class A Shares $704 $975 $1,267 $2,095

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

Class B Shares $715 $964 $1,339 $2,1601

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

Class C Shares $311 $652 $1,119 $2,410

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

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

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

Class A Shares $704 $975 $1,267 $2,095

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

Class B Shares $215 $664 $1,139 $2,1601

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

Class C Shares $211 $652 $1,119 $2,410

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

In the first example, expenses include the initial sales charge for Class A and the
applicable Class B or Class C contingent deferred sales charges. In the second
example, the Class A expenses include the sales charge, but Class B and Class C
expenses do not include the contingent deferred sales charges.
1. Class B expense for years 7 through 10 are bases on Class A expenses because
Class B shares automatically convert to Class A 88 months after purchase.

About the Fund's Investments

THE FUND'S PRINCIPAL INVESTMENT POLICIES AND RISKS. The allocation of the Fund's
assets among the debt portfolio and the equity portfolio will vary over time based
upon the Warranty Formula, which is a mathematical formula intended to allow the
Fund to have a net asset value on the Maturity Date at least equal to the Warranty
Amount. The Statement of Additional Information contains more detailed information
about the Fund's investment policies and risks.

Investment in Shares of Oppenheimer Main Street Fund. The Fund invests the equity
portfolio in Class Y shares of Oppenheimer Main Street Fund (the "Underlying Fund").
The Underlying Fund seeks high total return, by investing mainly in common stocks of
U.S. companies of different capitalization ranges, presently focusing on large
capitalization issuers. It also can buy debt securities, such as bonds and
debentures but does not currently emphasize these investments. The portfolio
managers of the Underlying Fund use a variety of proprietary quantitative models to
rank stocks on the basis of valuation, momentum and investor psychology, fundamental
research about particular industries and individual judgment. While this process and
the inter-relationship of the factors used may change over time and its
implementation may vary in particular cases, in general the selection process
currently involves the use of:

o Multi-factor quantitative models: The Underlying Fund uses both "top down" and
"bottom up" models. The "top down" models are primarily used to help the
Underlying Fund's portfolio managers determine their market capitalization
exposure (large, mid, small) and rely on indicators such as relative
valuations, relative price trends and interest rate relationships. The "bottom
up" models help the Underlying Fund's portfolio managers identify the most
attractive stocks within each market capitalization category. These stock
selection models are based upon many factors that measure the attractiveness
of individual securities relative to each other. The Underlying Fund's
portfolio managers typically follow and analyze more than 3,000 stocks on a
daily basis and select those that are deemed attractive.

o Fundamental research: The portfolio managers use internal research and
analysis by other market analysts, with emphasis on current company news and
industry-related events.
o Judgment: The Underlying Fund's portfolio is then continuously rebalanced by
the portfolio managers, using the tools described above.

The portfolio managers of the Underlying Fund emphasize wide diversification.
The allocation of the Underlying Fund's portfolio among different investments will
vary over time based upon the Underlying Fund's Manager's evaluation of economic and
market trends. The Underlying Fund's portfolio might not always include all of the
different types of investments described below.

Stock Investments. The Underlying Fund currently invests mainly in common stocks.
The Underlying Fund currently focuses on securities of issuers that have large
capitalizations. Historically their stock prices have tended to be less
volatile than securities of smaller issuers. However, the Underlying Fund can
buy stocks of issuers in all capitalization ranges. "Capitalization" refers to
the market value of all of the issuer's outstanding common stock.
Debt Securities. The mix of equities and debt securities in the Underlying Fund's
portfolio will vary over time depending on the Manager's judgment about market
and economic conditions. The Underlying Fund currently does not emphasize
investment in debt securities. The Underlying Fund's investments in debt
securities can include securities issued or guaranteed by the U.S. government
or its agencies and instrumentalities, and foreign and domestic corporate
bonds, notes and debentures. They may be selected for their income
possibilities, for liquidity and to help cushion fluctuations in the
Underlying Fund's net asset values.
The debt securities the Underlying Fund buys may be rated by nationally
recognized rating organizations such as Moody's Investors Service, Inc. or
Standard & Poor's Rating Service or they may be unrated securities assigned a
comparable rating by the Manager.
o Special Credit Risks of Lower-Grade Securities. The Underlying Fund can invest
up to 25% of its total assets in "lower-grade" securities commonly known as
"junk bonds." These are securities rated below "Baa" by Moody's Investors
Service, Inc. or "BBB" by Standard & Poors Ratings Service or having similar
ratings by other ratings organizations, or if unrated, assigned a comparable
rating by the Manager. However, the Underlying Fund currently does not intend
to invest more than 10% of its assets in lower-grade securities and cannot
invest more than 10% of its total assets in lower-grade securities that are
not convertible.

Debt securities below investment grade, 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 to sell at an acceptable price.
There is a relatively greater possibility that the issuer's earnings may be
insufficient to make the payments of interest and principal when due. These
risks mean that the Underlying Fund's net asset value per share could be
affected by declines in value of these securities.

Risks of Foreign Investing. The Underlying Fund can buy securities of companies or
governments in any country, developed or underdeveloped. While there is no
limit on the amount of the Underlying Fund's assets that may be invested in
foreign securities, the Manager does not currently plan to invest significant
amounts of the Underlying Fund's assets in foreign securities. While foreign
securities offer special investment opportunities, there are also special
risks, such as the effects of a change in value of a foreign currency against
the U.S. dollar, which will result in a change in the U.S. dollar value of
securities denominated in that foreign currency.
Other Equity Securities. Equity securities include common stocks, as well as "equity
equivalents" such as preferred stocks and securities convertible into common
stock. Preferred stock has a set dividend rate and ranks after bonds and
before common stocks in its claim for dividends and on assets if the issuer is
liquidated or becomes bankrupt. The Manager considers some convertible
securities to be "equity equivalents" because of the conversion feature and in
that case their rating has less impact on the investment decision than in the
case of debt securities.

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 Underlying
Fund will not invest more than 10% of its net assets in illiquid or restricted
securities. The Underlying Fund's Board can increase that limit to 15%.
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.

Derivative Investments. The Underlying Fund can invest in a number of different
kinds of "derivative" investments. 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. In the broadest sense,
options, futures contracts, and other hedging instruments the Underlying Fund
might use may be considered "derivative" investments. The Underlying Fund
currently does not use derivatives to a significant degree and is not required
to use them in seeking its objective.
Derivatives have risks. If the issuer of the derivative investment does not
pay the amount due, the Underlying Fund can lose money on the investment. The
underlying security or investment on which a derivative is based, and the
derivative itself, may not perform the way the Manager expected it to. As a
result of these risks the Underlying Fund could realize less principal or
income from the investment than expected or its hedge might be unsuccessful.
As a result, the Underlying Fund's share prices could fall. Certain derivative
investments held by the Underlying Fund might be illiquid.
o Hedging. The Underlying Fund can buy and sell futures contracts, put and call
options, forward contracts and options on futures and securities indices.
These are all referred to as "hedging instruments." Some of these strategies
would hedge the Underlying Fund's portfolio against price fluctuations. Other
hedging strategies, such as buying futures and call options, would tend to
increase the Underlying Fund's exposure to the securities market.
There are also special risks in particular hedging strategies. Options trading
involves the payment of premiums and can increase portfolio turnover. If the
Manager used a hedging instrument at the wrong time or judged market
conditions incorrectly, the strategy could reduce the Underlying Fund's
return.

Temporary Defensive and Interim Investments. In times of adverse or unstable market,
economic or political conditions, the Underlying Fund can invest up to 100% of
its total assets in temporary defensive investments that are inconsistent with
its principal investment strategies. Generally, they would be money market
instruments, U.S. government securities, highly-rated commercial paper, or
repurchase agreements. The Underlying Fund may also hold these types of
securities pending the investment of proceeds from the sale of Underlying Fund
shares or portfolio securities or to meet anticipated redemptions of
Underlying Fund shares. To the extent the Underlying Fund invests defensively
in these securities, it may not achieve its investment objective. For more
information about the types of securities the Underlying Fund may invest in,
you can request a prospectus of Oppenheimer Main Street Fund by calling the
toll-free number listed on the back cover of this prospectus.

Loans of Portfolio Securities. The Underlying Fund has entered into a Securities
Lending Agreement with JP Morgan Chase. Under the agreement, portfolio
securities of the Underlying Fund may be loaned to brokers, dealers and other
financial institutions. The Securities Lending Agreement provides that loans
must be adequately collateralized and may be made only in conformity with the
Underlying Fund's Securities Lending Guidelines, adopted by the Underlying
Fund's Board of Trustees. The value of the securities loaned may not exceed
25% of the value of the Underlying Fund's net assets.

Investment in Debt Securities. During the Warranty Period the Fund will invest a
portion of its assets, and in certain circumstances the Fund may invest all of its
assets, in U.S. government securities having a maturity approximately equal to the
period remaining in the Warranty Period.

U.S. Government Securities. U.S. government securities the Fund buys will consist of
non-callable general obligations of the U.S. Treasury backed by the full faith
and credit of the U.S. government or of any of the following U.S. government
agencies: Federal National Mortgage Association, Federal Home Loan Mortgage
Corporation, Federal Home Loan Bank, Resolution Funding Corporation, Financing
Corporation and Tennessee Valley Authority, provided such securities are rated
no less than "AAA" by Standard & Poor's Rating Services or "Aaa" by Moody's
Investors Service, Inc. Securities issued by the Federal Home Loan Mortgage
Corporation, the Federal National Mortgage Association and the Federal Home
Loan Banks are neither guaranteed nor insured by the U.S. government.
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. Government National Mortgage Association ("Ginnie Mae")
pass-through mortgage certificates, for example, are supported by the full
faith and credit of the U.S. government.
Zero-Coupon Securities. Some of the debt securities the Fund buys are zero-coupon
bonds that pay no interest. The Fund can invest up to 100% of its assets in
zero-coupon U.S. government securities. They are issued at a substantial
discount from their face value.

Because zero-coupon securities have no reinvestment risk if held to maturity,
they are more appropriate than coupon-paying securities for seeking to ensure
that the Fund has a certain amount of assets at the end of a set period of
time. Zero-coupon 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. The Fund will not purchase
zero coupon securities in the form of collateralized mortgage obligations.

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,
and certain short-term demand and time deposits in, certificates of deposit of
and bankers' acceptances issued by certain U.S. depository institutions or
trust companies, and certain commercial paper having a maturity of not more
than 180 days, which are short-term, negotiable promissory notes of companies.
Because these instruments tend to offer lower yields than other debt
securities, the Fund ordinarily uses them for liquidity and cash management
purposes or for defensive purposes when market conditions are unstable.

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 will likely 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. The
Financial Highlights table at the end of the Prospectus shows the Fund's
portfolio turnover rate during the past fiscal year.

Asset allocation. The Manager allocates the Fund's assets between the equity
portfolio (shares of the Underlying Fund) and the debt portfolio (primarily zero
coupon U.S. government securities) based upon the Warranty Formula. The Manager
evaluates the relative allocation between the equity portfolio and debt portfolio
daily and makes any necessary adjustments to the Fund's portfolio. The Warranty
Formula may allocate between 0% to 100% of the Fund's assets to the equity
portfolio. The allocation during the Warranty Period will fluctuate in response to
changes in the securities markets. Factors reflected in the asset allocation
methodology include, but are not limited to:
o The market value of the Fund's assets as compared to the Warranty Amount
o The prevailing level of interest rates
o Equity market volatility
o The length of time remaining until the Maturity Date

Under the terms of the Warranty Agreement, the Fund may be required in certain
limited circumstances, including a material decline in the value of the Fund's
assets relative to the Warranty Amount or a breach by the Fund or the Manager of its
obligations under the Warranty Agreement, to invest all or a substantial portion of
its assets in U.S. government securities (as well as cash and cash equivalents to
the extent necessary to meet redemption requests and Fund expenses) or in zero
coupon U.S. government securities (and cash or cash equivalents to the extent
necessary to meet redemption requests and Fund expenses).

Specifically, situations where the Warranty Provider can require the Fund to
invest all of its assets in the debt portfolio include:
o if the Fund issues additional shares during the Warranty Period in violation
of the Warranty Agreement;

o if the Fund invests in securities other than as permitted in this Prospectus;
o if the Fund's investment in the equity portfolio on any given day exceeds

certain limitations as established by, or fails to allocate assets pursuant
to, the Warranty Formula;

o if the Fund fails to comply with the expense limitations imposed on the Fund
if it is required to invest completely and irreversibly in the debt
portfolio;

o if the Fund fails to pay the Warranty Agreement fee when due;
o if the investment advisory agreement with the Manager is terminated and the
successor investment adviser is not acceptable to the Warranty Provider;
o if the Manager fails to manage the Fund in accordance with its objectives,
policies and strategies;

o if the Manager or the Fund's Custodian fails to provide the Warranty Provider
with certain information necessary for it to monitor the Fund's compliance
with the Warranty Agreement;

o if representations or warranties made by the Manager or the Fund in certain
agreements and documents were incorrect or misleading when made;
o if the Manager, the Fund or the Custodian fails to perform any obligation or
breaches any covenant under the Warranty Agreement or other related
agreements and such failure could have an adverse effect on the Warranty
Provider (including a change to the Fund's investment objective or any
material change to the Fund's investment policies or strategies without the
Warranty Provider's prior written consent, even where such change is in the
Fund's and the shareholders' best interest);
o if the commencement of any proceeding in a federal, state or local court which
if adversely determined, could have an adverse effect on the Manager or the
Fund;

o if an action or proceeding is commenced to place the Fund or the Manager in
receivership or bankruptcy; or

o if any governmental or regulatory action limits, suspends, or terminates the
rights, privileges or operation of the Manager or the Fund that could
adversely affect the Manager or the Fund.

Under the Warranty Agreement, the Fund is also required to satisfy certain
risk management requirements, which will also restrict the manner in which the Fund
may invest its assets. The Fund's holdings of cash and cash equivalents will
generally be limited to an amount necessary to meet anticipated expenses and
redemptions.

The Warranty Formula may require the Fund to have a higher portfolio turnover
rate as compared to other mutual funds.

The Warranty Agreement and the Financial Warranty
The Fund has entered into the Warranty Agreement to help make sure that on the
Maturity Date, each shareholder will be entitled to redeem his or her shares for an
amount not less than the Warranty Amount, i.e., the initial value of that
shareholder's account on the second business day after the end of the Offering Period
(including any net income earned by the Fund during the Offering Period and the two
business days subsequent thereto, but reduced by any adjustments the Warranty
Provider is permitted to make under the Warranty Agreement and less sales charges
and Extraordinary Expenses and a proportionate reduction for dividends and
distributions paid in cash and shares redeemed). Certain calculations under the
Warranty Agreement (including the calculation of any shortfall) will be performed by
an affiliate of the Warranty Provider as calculation agent.

The Warranty Agreement requires the Manager to comply with certain agreed upon
investment parameters in an attempt to limit the Fund's risk. These investment
parameters are designed to reduce, but do not eliminate, the risk that the Fund's
assets will be insufficient to allow the Fund to redeem shares at not less than the
Warranty Amount on the Maturity Date. If the Fund fails to comply with the
agreed-upon investment parameters or otherwise fails to comply with certain
requirements set forth in the Warranty Agreement, the Warranty Provider may
terminate its Financial Warranty in certain limited circumstances. If the Fund
receives notice of termination from the Warranty Provider, the Fund will promptly
notify shareholders of such termination.

These circumstances include:

o if the Fund liquidates, is merged, reorganizes or sells all or substantially
all of its assets;

o if the Manager ceases to be the adviser of the Fund and any successor adviser
is not acceptable to the Warranty Provider;
o if under the terms of the Warranty Agreement, the Manager or the Custodian is
required to allocate all of the Fund's assets to the debt portfolio and fails
to do so within a reasonable time;
o if the custodian agreement is amended so that the Custodian or successor
custodian is no longer obligated or does not agree to provide the Warranty
Provider with certain information regarding the Fund's portfolio as required
by the Warranty Agreement;
o if the Manager fails to pay to the Warranty Provider a shortfall amount
resulting from the negligence, recklessness, bad faith, willful misconduct or
fraud of the Manager;
o a determination of negligence, recklessness, fraud, bad faith or willful
misconduct on the part of the Manager or the Fund under the Warranty Agreement
and related agreements by a court of competent jurisdiction or a board of
arbitration;
if the Manager fails to provide the Warranty Provider with information regarding
the Underlying Fund in certain circumstances;
o if the Manager does not manage the assets of the Fund in accordance with the
Fund's objective, policies and strategies;
o if the Trust establishes another series other than this Fund during the
Warranty Period; or
o if the Manager fails to provide certain instructions and information to, and
cooperate with, the Custodian in the event that the Warranty Provider has
exercised its right to deliver pre-signed instructions from the Manager to the
Custodian instructing the Custodian to invest all of the Fund's assets in the
debt portfolio.

The Warranty Provider (or its affiliate) may monitor the Fund's compliance
with the Warranty Agreement solely to protect the interests of the Warranty Provider
and not the Fund's shareholders. In monitoring the Fund's compliance, the Warranty
Provider (or its affiliate) will rely predominantly on information provided by the
Fund, the Manager and the Fund's Custodian.

The Fund and the Manager may terminate the Warranty Agreement if the Warranty
Provider becomes insolvent or if the Warranty Provider ceases to be "well
capitalized" within the meaning of the capital maintenance regulations of the Federal
Deposit Insurance Corporation.

The Fund will pay to the Warranty Provider, under the Warranty Agreement, an
annual fee equal to 0.60% of the average daily net assets of the Fund during the
Warranty Period. If the Fund is required to make a complete and irreversible
allocation of its assets to the debt portfolio, the Warranty fee will thereafter be
reduced to 0.35% of the average daily net assets of the Fund. If the value of the
Fund's assets on the Maturity Date is insufficient to result in the value of each
shareholder's account being at least equal to his or her Warranty Amount (a
"Shortfall"), the Warranty Provider will pay to the Fund an amount sufficient to make
sure that each shareholder's account can be redeemed on the Maturity Date for an
amount equal to his or her Warranty Amount. The amount of any Shortfall required to
be paid by the Warranty Provider will be less if the Warranty Amount is reduced.
The Warranty Amount will be reduced by (i) the amount of any dividends and
distributions taken in cash rather than reinvested in additional shares of the Fund;
(ii) the value of any shares redeemed; (iii) the shareholder's pro rata portion of
the amount of any Extraordinary Expenses or any expenses incurred by the Fund in
excess of the expense limits described under "Warranty Period" on page 11; (iv) the
shareholder's pro rata portion of the value of any shares issued by the Fund during
the Warranty Period other than in connection with the reinvestment of dividends and
distributions; (v) the amount of any increase in the Warranty Amount per share as a
result of changes in accounting practices for the Fund, corporate actions or certain
other events; and (vi) if the Manager is required to make payments under the
Warranty Agreement in certain instances and the Manager fails to do so in a timely
manner, the amount of the payments the Manager failed to make (on a pro rata basis).

A shareholder's ability to receive his or her Warranty Amount depends on the
financial condition of the Warranty Provider. If the Warranty Provider becomes
insolvent or its credit deteriorates substantially, payment under the Financial
Warranty may not be made or may become unlikely. In such event, the Board could take
a variety of actions, including replacing the Financial Warranty or liquidation of
the Fund. In such circumstances, shareholders could suffer a loss of principal. The
Board is under no obligation to replace the Financial Warranty. If it does so, the
fee charged by any replacement warranty provider may be higher or lower than the fee
charged by Merrill Lynch Bank USA. If the Board were to determine that liquidation
of the Fund during the Warranty Period is in the shareholders' best interests, the
Warranty Agreement would automatically terminate upon such liquidation and the
Warranty Provider would have no obligations to make a payment to the Fund. In that
event neither the Manager nor any other person would be liable to make a payment to
the Fund to provide shareholders with their Warranty Amount. Upon liquidation,
shareholders would receive the then-current net asset value of their Fund account,
which may be less than the Warranty Amount they would have received on the Maturity
Date.

The Warranty Agreement may be amended with the prior consent of the Warranty
Provider, the Fund and the Manager. Therefore, material changes to the Warranty
Agreement may be made without shareholder approval, even to the extent such change
could have a direct or indirect impact on a shareholder's investment in the Fund.
Any material amendments to the Warranty Agreement will be disclosed in amendments to
this prospectus.

The Fund will provide you with a copy of the most recent audited annual or
unaudited quarterly financial statements of the Warranty Provider, free of charge,
upon your request. To receive a copy of these financial statements please contact
the Fund at the telephone number or write to the Fund at the address shown on the
outside back cover of this Prospectus.

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.

How is the Warranty Amount Determined?

Example.*Assume you have $20,000 to invest in Fund shares. Assume that you decided
to purchase Class A shares and the public offering price is $10.61 per share
(initial net asset value of $10.00 per share plus a sales load of 5.75%). After
deducting your sales load of 5.75%,
$18,850.14 will be invested in Fund shares and you will have 1,885.01 shares in your
account. Your initial Warranty Amount will be $18,850.14.

* Figures used in the example have been rounded to the nearest hundredth.
The full amount of your investment will not receive the benefit of the Financial
Warranty. Rather, the Financial Warranty protects only the amount invested, as
reduced by any adjustments to the Warranty Amount by the Warranty Provider permitted
under the Warranty Agreement and less any sales charges and your proportionate share
of certain Extraordinary Expenses, and reduced proportionately for any dividends
paid in cash or redemption of shares.

Redemption of shares during the Warranty Period will decrease the Warranty Amount to
which a shareholder is entitled. If a shareholder redeems shares in the Fund, he or
she will then hold fewer shares at the then-current Warranty Amount per share,
thereby reducing the overall Warranty Amount for the shareholder. A redemption made
from the Fund prior to the Maturity Date will be made at the Fund's then-current net
asset value per share, less any applicable deferred sales charge, which may be
higher or lower than the Warranty Amount per share.

The Warranty Amount per share will decline as dividends and distributions are made
to shareholders. If a shareholder automatically reinvests dividends and
distributions in additional shares of the Fund, the shareholder's total Warranty
Amount will remain the same because he or she will hold a greater number of shares
at a reduced Warranty Amount per share following payment of a dividend or
distribution. The result is to preserve the total Warranty Amount to which he or she
was entitled before the dividend or distribution was made. If a shareholder elects
to receive any dividends or distributions in cash, however, he or she will hold the
original number of shares at the reduced Warranty Amount per share following payment
of a dividend or distribution. This will reduce the Warranty Amount to which such
shareholder was entitled before the dividend or distribution was made.

Example 1. Assume you reinvest your dividends and distributions. The number of
shares you own in the Fund will increase at each date on which a dividend or
distribution is effective. Although the number of shares in your account increases,
and the Warranty Amount per share decreases, your overall Warranty Amount does not
change. Using our example, assume it is now December 30, 2004 and the Fund makes
effective a dividend of $0.15 per share. Also, assume that the net asset value is
$11.25 per share at the end of the day on December 30, 2004.

To recalculate your Warranty Amount per share:
1. Determine the value of your dividend. Your total dividend will equal the per
share dividend multiplied by the number of shares you own the day before
the dividend is declared. In our example, we will multiply 1,885.01 shares
by $0.15 per share to arrive at $282.75.
2. Determine the number of shares that will get added to your account when your
dividend is reinvested. Your additional shares equal the value of your
dividend divided by the ending net asset value per share on the day the
dividend was declared. In our case, $282.75 divided by $11.25 equals 25.13
additional shares.
3. Adjust your account for your additional shares. Add 1,885.01 and 25.13 to
arrive at your new share balance of 1,910.14.
4. Determine your new Warranty Amount per share. Take your original Warranty
Amount and divide by your new share balance. Using our example, divide
$18,850.14 by 1,910.14 shares to arrive at the new Warranty Amount per
share of $9.87.
5. Your Warranty Amount still equals $18,850.14.

If you do not reinvest your dividends and distributions in additional shares
of the Fund, your Warranty Amount will be reduced with the same effect as if you had
reinvested such dividends and distributions and then immediately redeemed them.

Example 2. Assume you elect to receive Fund dividends and distributions in cash. On
each date on which a dividend or distribution is effective, the number of shares you
own in the Fund will remain the same and the Warranty Amount per share will decrease
resulting in your overall Warranty Amount declining. Using our example, assume it is
now December 30, 2004 and the Fund makes effective a dividend of $0.15 per share.
Also assume that the net asset value is $11.25 per share at the end of the day on
December 30, 2004.

2. Determine your new Warranty Amount per share. Take your original Warranty
Amount and divide by the number of shares you would have had if you
reinvested the distribution. Using our example, divide $18,850.14 by
1,910.14 shares to arrive at $9.87 per share.

3. Multiply $9.87 by the number of shares you actually own (1,885.01) to arrive
at your new Warranty Amount of $18,605.05.

Although shareholders can perform this calculation themselves, the Fund will
recalculate the Warranty Amount per share whenever the Fund declares a dividend or
makes a distribution. It is possible that the Fund's calculations may differ from a
shareholder's calculation, for example, because of rounding or the number of decimal
places used. In each case, the Fund's calculations will control.

See "Dividends, Capital Gains and Taxes" for additional details regarding the
Financial Warranty.

How the Fund is Managed

THE MANAGER. OppenheimerFunds, Inc., the Manager, serves as Investment Adviser to
the Fund and to the Underlying Fund. The Manager chooses the Fund's investments and
handles its day-to-day business. The Manager carries out its duties with respect to
each Fund, subject to certain 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 $155 billion in assets as
of September 30, 2004, 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.

Portfolio Managers. Angelo Manioudakis and other investment professionals selected
from the Manager's high-grade team in its fixed-income department are
primarily responsible for the day-to-day management of the Fund's fixed-income
portfolio. Rudi Schadt and other members of the Manager's risk management
department shall be primarily responsible for the allocation of the Fund's
assets between shares of Oppenheimer Main Street Fund and debt securities. Mr.
Manioudakis is a Vice President of the Fund and Senior Vice President of the
Manager and joined the Manager in April 2002. Mr. Manioudakis was a portfolio
Manager at Morgan Stanley Investment Management (since August 1993). Mr.
Schadt is a Vice President, Director of Research in Product Design and Risk
Management of the Manager. Prior to joining the Manager in February 2002, Mr.
Schadt was a Director and Senior Quantitative Analyst at UBS Asset Management
from 2000 to 2001. Prior to that he was an Associate Director , Senior
Researcher and portfolio manager (from 1997) at State Street Global Advisors.

Advisory Fees. Under the investment advisory agreement, the Fund pays the Manager a
management fee at an annual rate of 0.50% of the average annual net assets of
the Fund. That fee will apply during the Warranty Period and the Post-Warranty
Period. The management fee shall be reduced to 0.40% per annum of average
annual net assets of the Fund in any month during the Warranty Period
following a month where the Fund's investment in equity securities (including
shares of Oppenheimer Main Street Fund) is, on average, less than 10% of net
assets. If during the Warranty Period 100% of the Fund's assets are
completely and irreversibly invested in the debt portfolio, the management fee
will be at an annual rate of 0.25% of the average annual net assets of the
Fund, and if that occurs the Manager will further reduce its management fee to
the extent necessary so that total annual operating expenses of the Fund
(other than Extraordinary Expenses such as litigation costs) do not exceed
1.30% for Class A shares, 2.05% for Class B shares and 2.05% for Class C
shares. However, if this reduction in the management fee is not sufficient to
reduce total annual operating expenses to these limits, the Manager is not
required to subsidize Fund expenses to assure that expenses do not exceed
those limits. Furthermore, if expenses exceed these expense limits, the
Warranty Amount will be reduced by any expenses that exceed those limits.

PENDING LITIGATION. Six law suits have been filed as putative derivative and class
actions against the Fund's investment Manager, Distributor and Transfer Agent, some
of the Oppenheimer funds and directors or trustees of some of those funds, excluding
the Fund. The complaints allege 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
Oppenheimer 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. The complaints further allege that by permitting and/or
participating in those actions, the defendant directors breached their fiduciary
duties to fund shareholders under the Investment Company Act and at common law.
Those law suits were filed on August 31, 2004, September 3, 2004, September 14,
2004, September 14, 2004, September 21, 2004 and September 22, 2004, respectively,
in the U. S. District Court for the Southern District of New York. The complaints
seek 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

CAN YOU PURCHASE SHARES OF THE FUND? No, shares of the Fund cannot be purchased
during the Warranty Period other than by the reinvestment of the Fund's dividends
and distributions in additional shares of the Fund.

--------------------------------------------------------------------------------------
Net Asset Value. The Fund calculates the net asset value of each class of shares as
of the close of The New York Stock Exchange, (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 reflects the fair value.

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.

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.

Distribution and Service Plans for Class B and Class C Shares. The Fund has adopted
Distribution and Service Plans for Class B and Class C shares to pay the
Distributor for its services and costs in distributing Class B and Class C
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. The
Distributor also receives a service fee of 0.25% per year under the Class B
and Class C plans.

The asset-based sales charge and service fees increase Class B and Class C
expenses by 1.0% 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 or Class C shares. The
Distributor paid 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 retains the service fees for accounts for which it
renders the required personal services.

The Distributor paid 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 was therefore
4.00% of the purchase price. The Distributor retains the Class B asset-based
sales charge. See the Statement of Additional Information for exceptions.

The Distributor paid
a sales concession of
0.75% of the purchase
price of Class C
Shares? Class C
shares was 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. See the
Statement of
Additional
Information for
exceptions.

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 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.

AccountLink
privileges should have been
requested on your
Application or your
dealer's settlement
instructions if you bought
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.

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.

REINVESTMENT PRIVILEGE. If
you redeem some or all of
your Class A or Class B
shares of the Fund at any
time, you have up to six
months to reinvest all or a
part of the redemption
proceeds in Class A shares
of other Oppenheimer funds
without paying a sales
charge. If you redeem some
or all of your Class A or
Class B shares of the Fund
during the Post-Warranty
Period, you have up to six
months to reinvest all or a
part of the redemption
proceeds in Class A shares
of this Fund or other
Oppenheimer funds without
paying a sales charge. This
privilege applies only to
Class A shares that you
purchased subject to an
initial sales charge and to
Class A or Class B shares
on which you paid a
contingent deferred sales
charge when you redeemed
them. This privilege does
not apply to Class C
shares. You must have asked
the Distributor for this
privilege when you sent
your payment.

How to Sell Shares

You can sell (redeem) some
or all of your shares on
any regular business day.
Prior to the Maturity Date
and during the
Post-Warranty Period,
shares are redeemed at
their net asset value
(which may be less than
your Warranty Amount) minus
any applicable contingent
deferred sales charge. For
redemptions prior to the
Maturity Date and during
the Post-Warranty Period,
the net asset value used in
determining your share
price is the next one
calculated after your
redemption order is
received in proper form
(which means that it must
comply with the procedures
described below) and is
accepted by the Transfer
Agent. Redemption of Fund
shares prior to the
Maturity Date will reduce
your Warranty Amount. The
Fund lets you sell your
shares by writing a letter,
or by telephone. 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. Redemption
requests received after
4:00 p.m. (or such earlier
time as may be required by
your financial
intermediary) will be
priced at the net asset
value at the close of
business on the next
business day.

For redemptions made
on the Maturity Date (March
3, 2011), the value used in
determining your share
price will be the greater
of (i) the then-current net
asset value or (ii) your
Warranty Amount per share.
See the example starting on
page 23 for help in
understanding how this
amount is calculated.
Redemptions made prior to
the Maturity Date or during
the Post-Warranty Period
will not be protected by
the Financial Warranty and
the value of your shares
will be the then-current
net asset value of the
Fund, which may be less
than your Warranty Amount.

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.

Sending 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 Send courier
by Federal Funds wire or express
to a bank account you requests t
designate. It must be Oppenheime
a commercial bank Services
that is a member of 10200 E.
the Federal Reserve Girard Ave
wire system. The Building D
minimum redemption Denver,
you can have sent by Colorado 8
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.

HOW DO you SELL SHARES BY
MAIL? Write a letter of
instruction that includes:
o Your name
o The Fund's name mail
o Your Fund account o:
number (from your rFunds
account statement)
o The dollar amount or
number of shares to nue,
be redeemed
o Any special payment
instructions 0231
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
Requests by mail:
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado 80217
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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 New York Stock 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 retirement plan account 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 purchased shares
subject to a Class A, Class B or Class C 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 B 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 B 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 during the
Offering Period you acquired Class A or Class C shares of this Fund by exchanging
shares of another Oppenheimer fund that were still subject to a contingent deferred
sales charge holding period, that holding period will carry over to this Fund.
During the Post-Warranty Period, if you acquire Class A, Class B or Class C shares
of this Fund by exchanging the same class of shares of another Oppenheimer fund that
are subject to a contingent deferred sales charge holding period, that holding
period will carry over to this Fund.

If you purchased Class A Shares of any one or more of the Oppenheimer funds
aggregating $1 million or more and 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.

If Class B shares are redeemed within six years (72 months) 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)

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

0 - 1 5.0%

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

1 - 2 4.0%

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2 - 3 3.0%

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3 - 4 3.0%

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4 - 5 2.0%

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5 - 6 1.0%

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More than 6 None

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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 88 months after you purchase them. This conversion feature relieves
Class B shareholders of the asset-based sales charge (which stops 72 months after
purchase) that applies to Class B shares under the Class B Distribution and Service
Plan, described above. 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.

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 to Exchange Shares

The Fund does not offer the ability to exchange into the Fund during the Warranty
Period. Because the Fund is not continuously offering its shares during the Warranty
Period, if you exchange your shares of the Fund for shares of another fund you will
not be able to effect an exchange back into the Fund during the Warranty Period. In
addition, your exchange will be considered a redemption and will reduce your
Warranty Amount.

If you make an exchange prior to the Maturity Date, you may receive an amount
less than your original investment in the 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 prospectuses of both funds must offer the exchange privilege.
o You must hold the shares you buy when you establish your account for at least
seven days before you can exchange them. After the account is open seven days,
you can exchange shares every regular business day.
o You must meet the minimum purchase requirements for the fund whose shares you
purchase by exchange.
o Before exchanging into a fund, you must obtain and read its prospectus.
Shares of a particular class of the Fund may be exchanged only for shares of
the same class in the other Oppenheimer funds. For example, you can exchange Class A
shares of this Fund only for Class A shares of another fund. In some cases, sales
charges may be imposed on exchange transactions. For tax purposes, exchanges of
shares involve a sale of the shares of the fund you own and a purchase of the shares
of the other fund, which may result in a capital gain or loss. Please refer to "How
to Exchange Shares" in the Statement of Additional Information for more details.

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

HOW DO you SUBMIT EXCHANGE REQUESTS? Exchanges may be requested in writing or by
telephone:

Written Exchange Requests. Submit an OppenheimerFunds Exchange Request form, signed
by all owners of the account. Send it to the Transfer Agent at the address on
the back cover. Exchanges of shares held under certificates cannot be
processed unless the Transfer Agent receives the certificates with the
request.
Telephone Exchange Requests. Telephone exchange requests may be made either by
calling a service representative or by using PhoneLink for automated exchanges
by calling 1.800.225.5677. Telephone exchanges may be made only between
accounts that are registered with the same name(s) and address. Shares held
under certificates may not be exchanged by telephone.

ARE THERE LIMITATIONS ON EXCHANGES? There are certain exchange policies you should
be aware of:
o Shares are redeemed from one fund and purchased from the other fund in the
exchange transaction on the same regular business day on which the Transfer
Agent receives an exchange request that conforms to the policies described
above. It must be received by the close of The New York Stock Exchange that
day, which is normally 4:00 P.M. but may be earlier on some days.
o The Fund may amend, suspend or terminate the exchange privilege at any time.
The Fund may refuse any exchange order and is currently not obligated to
provide notice before rejecting an exchange order.
o If the Transfer Agent cannot exchange all the shares you request because of a
restriction cited above, only the shares eligible for exchange will be
exchanged.

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 on or about the second to last "regular business day" of
September. See the Statement of Additional Information (shareholders may
visit the OppenheimerFunds website) to learn how you can avoid this fee and
for circumstances under which this fee will not be assessed.

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.
If you redeem your shares before or after the Maturity Date, the redemption
value of your shares may be more or less than their original cost. The value
of your shares on the Maturity Date will equal the greater of the Warranty
Amount or the Fund's then-current net asset value.
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 redemptions are paid in-kind, shareholders will incur
transaction costs when, and will bear market risk until such time as,
securities received in-kind are converted into cash. However, the Fund has
made an election which requires it to pay a certain portion of redemption
proceeds in cash. See the section entitled "Payments in-Kind" in the
Statement of Additional Information for more information.
"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 on an annual basis and to pay them to shareholders in
December on a date selected by the Board of Trustees. Dividends and distributions
paid to Class A shares will generally be higher than dividends for Class B and Class
C shares, which normally have higher expenses than Class A. 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 in December of 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 TO YOU HAVE FOR RECEIVING DISTRIBUTIONS?

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 Account Link.
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.

Unless otherwise specified, all dividends and distributions will be
automatically reinvested in additional full and fractional shares of the Fund. If
you do not reinvest all of your dividends and capital gains distributions in the
Fund during the Warranty Period, your Warranty Amount will be reduced.

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. When you sell or exchange Fund shares you will
generally recognize a capital gain or capital loss in an amount equal to the
difference between the net amount of sale proceeds (or, in the case of an exchange,
the fair market value of the shares) that you receive and your tax basis for the
shares that you sell or exchange. In January of each year the Fund will mail to you
information about your dividends, distributions and any shares you sold in the
previous calendar year.

The asset allocation process may increase turnover of the Fund's assets, which
may result in the realization of additional gains by the Fund. It may also result in
a larger portion of any net gains being treated as short-term capital gains, which
would be taxed as ordinary income when distributed to shareholders. As noted above,
distributions of any gains and income will be taxable to shareholders even if those
distributions are reinvested in Fund shares. Shareholders may receive taxable
distributions of income from investments included in the debt portfolio even in
situations where the Fund has capital losses from investments in the equity
portfolio.

The determination of the tax character of any payment of the Warranty Amount
under the Warranty Agreement to the Fund as capital gain or ordinary income is not
free from doubt under federal tax law. The Fund intends to take the position that
its right to receive the payment under the Warranty Agreement is itself a capital
asset, and that the payment in termination of such right gives rise to capital gain.
Were the Internal Revenue Service to challenge such position, at least the portion
of such payment attributable to capital losses previously realized by the Fund, and
perhaps attributable to the Fund's unrealized capital losses, should be treated as
capital gain. Any such gain would be offset by otherwise allowable capital losses,
if any. To the extent that the Fund distributes such payment to its shareholders, a
portion of such payment may constitute ordinary income to the shareholders, provided
however, that if the trustees of the Fund should elect to terminate the Fund at the
end of the Warranty Period, it is anticipated that the shareholders receiving such
payment in exchange for their shares would be treated as receiving a return of
capital to the extent of their basis in the shares of the Fund, and to the extent
such payment exceeds basis, as having capital gain.

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 each year to qualify 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.

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.

The Fund will invest in zero coupon U.S. Treasury bonds and other debt
securities that are issued at a discount or provide for deferred interest. Even
though the Fund receives no actual interest payments on these securities, the Fund
will be deemed to receive income equal, generally, to a portion of the excess of the
face value of the securities over their issue price ("original issue discount") each
year that the securities are held. Since the original issue discount income earned
by the Fund in a taxable year may not be represented by cash income, the Fund may
have to dispose of securities, which it might otherwise have continued to hold, to
generate cash in order to satisfy its distribution requirements if shareholders
request cash distributions.

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.

The Underlying Fund's Past Performance

The following information about the Oppenheimer Main Street Fund (previously defined
as the "Underlying Fund") is provided because the Fund may invest a substantial
amount of its assets in Class Y shares of the Underlying Fund. The following
information is for the Underlying Fund only and is not intended to predict the
performance of the Fund. The performance of the Fund will differ from the
performance of the Underlying Fund. The magnitude of that difference will depend on
the amount of the Fund's assets that are invested in the Underlying Fund.

The bar chart and table below show one measure of the risks of investing in
the Underlying Fund, by showing the Underlying Fund's performance (for its Class Y
shares) since inception of the Class Y shares and by showing how the average annual
total returns of the Underlying Fund's Class Y shares, both before and after taxes,
compare to those of a broad-based market index. The after-tax returns 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. The Underlying Fund's past investment performance both before and after
taxes, is not necessarily an indication of how the Underlying Fund or the Fund will
perform in the future.

Annual Total Returns (Class Y) (as of 12/31 each year)

[See appendix to prospectus for data in bar chart showing annual total returns]

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 1/1/04 through 9/30/04, the cumulative return (not
annualized) before taxes for Class Y shares was 0.76%. During the period shown in
the bar chart, the highest return (not annualized) before taxes for a calendar
quarter was 22.05% (4thQTR `98) and the lowest return (not annualized) before taxes
for a calendar quarter was -16.49% (3rdQTR `02).

------------------------------------------------------------------------------
Average Annual Total 10 Years
Returns for the periods 1 Year 5 Years (or Life of

Ended December 31, 2003 Class,

if Less)
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Class Y Shares (inception 11/1/96)

Return before taxes 27.21% -0.06% 7.29%
Return after taxes on distributions 27.03% -0.90% 5.78%

Return after taxes on distributions

and sale of Underlying Fund shares 17.90% -0.30% 5.65%

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S&P 500 Index (reflects no

deductions for fees, expenses or 28.67% -0.57% 8.18%1

taxes)
------------------------------------------------------------------------------

1 From 10/31/96.
There is no sales charge on Class Y shares. The Underlying Fund's 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 Underlying Fund's Class Y shares is compared to the S&P 500 Index, an unmanaged
index of equity securities. Index performance reflects the reinvestment of income
but does not consider the effects of transaction costs, fees, expenses or taxes. The
Underlying Fund may have investments that vary from those in the index.

Financial Highlights of the Fund

The Financial Highlights Table shown further below is presented to help you
understand the Fund's financial performance since inception. Certain information
reflects financial results for a single Fund share. 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 Deloitte & Touche LLP, 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.

Financial Highlights of the Underlying Fund

Because the Oppenheimer Principal Protected Main Street Fund II may invest a
significant amount of its assets in the Underlying Fund the second Financial
Highlights Table below is presented to help you understand the Underlying Fund's
Class Y share financial performance for the past five fiscal years. The total
returns in the table represent the rate that an investor would have earned (or lost)
on an investment in the Underlying Fund (assuming reinvestment of all dividends and
distributions). This information has been audited by Deloitte & Touche LLP, the
Fund's and the Underlying Fund's independent registered public accounting firm, whose
report, along with the Underlying Fund's financial statements is incorporated by
reference in the Fund's Statement of Additional Information, which is available on
request.

FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------

                                              CLASS A       CLASS B       CLASS C
PERIOD ENDED AUGUST 31,                        2004 1        2004 1        2004 1
------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
------------------------------------------------------------------------------------
Net asset value, beginning of period         $  30.00      $  30.00      $  30.00
------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                             .25           .10           .09
Net realized and unrealized loss                 (.75)         (.78)         (.76)
                                             ---------------------------------------
Total from investment operations                 (.50)         (.68)         (.67)
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Net asset value, end of period               $  29.50      $  29.32      $  29.33
                                             =======================================

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TOTAL RETURN, AT NET ASSET VALUE 2              (1.67)%       (2.27)%       (2.23)%
------------------------------------------------------------------------------------

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RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------
Net assets, end of period (in thousands)     $100,995      $100,646      $ 69,188
------------------------------------------------------------------------------------
Average net assets (in thousands)            $ 80,924      $ 81,999      $ 54,330
------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                            1.29%         0.49%         0.50%
Total expenses                                   1.34% 4       2.12% 5       2.08% 6
Expenses after payments and waivers              0.99%         1.77%         1.73%
------------------------------------------------------------------------------------
Portfolio turnover rate                           118%          118%          118%

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Expenses paid including all underlying fund expenses were 1.54% for August
31, 2004.

5. Expenses paid including all underlying fund expenses were 2.32% for August
31, 2004.

6. Expenses paid including all underlying fund expenses were 2.28% for August
31, 2004.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.





CLASS Y     YEAR ENDED AUGUST 31,                     2004        2003       2002       2001         2000
-----------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
-----------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  29.75    $  28.02   $  32.28   $  45.64     $  43.00
-----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                  .34         .11        .19        .17          .24
Net realized and unrealized gain (loss)               3.13        1.86      (4.28)    (11.22)        6.88
                                                  ---------------------------------------------------------
Total from investment operations                      3.47        1.97      (4.09)    (11.05)        7.12
-----------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                  (.29)       (.24)      (.12)      (.21)          --
Distributions from net realized gain                    --          --       (.05)     (2.10)       (4.48)
                                                  ---------------------------------------------------------
Total dividends and/or distributions
to shareholders                                       (.29)       (.24)      (.17)     (2.31)       (4.48)
-----------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  32.93    $  29.75   $  28.02   $  32.28     $  45.64
                                                  =========================================================

-----------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 1                   11.69%       7.11%    (12.74)%   (24.76)%      18.00%
-----------------------------------------------------------------------------------------------------------

-----------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $570,991    $441,460   $225,298   $225,475     $260,289
-----------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $558,130    $242,029   $227,835   $239,222     $205,586
-----------------------------------------------------------------------------------------------------------
Ratios to average net assets: 2
Net investment income                                 1.07%       1.01%      0.74%      0.60%        0.77%
Total expenses                                        0.60%       0.87%      0.92%      0.79% 3      0.66%
Expenses after payments and waivers
and reduction to custodian expenses                    N/A 4      0.83%      0.78%      0.73%         N/A 4
-----------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 76%         94%        78%        76%          73%

1. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

2. Annualized for periods of less than one full year.

3. Added since August 31, 2001 to reflect expenses before reduction to custodian
expenses and voluntary waiver of transfer agent fees.

4. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

INFORMATION AND SERVICES


For More Information on Oppenheimer Principal Protected Main Street Fund II(R)


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
------------------------------------------------------------------------------
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On the Internet:              You can send us a request by e-mail or read or

                              down-load documents (other than the Statement
                              of Additional Information) on the

                              OppenheimerFunds website:
                              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 SEC File No. 811-21414        The Fund's shares are distributed by:
PR0711.001.1004                          [logo] OppenheimerFunds Distributor, Inc.
Printed on recycled paper









                            APPENDIX TO THE PROSPECTUS OF
                OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUN D II(R)

Graphic material included in the Prospectus of Oppenheimer Principal Protected Main
Street Fund II ("the Fund") includes "Annual Total Returns (Class Y) (% as of 12/31
each year)" for Oppenheimer Main Street Fund (the "Underlying Fund"):

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


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

Calendar Year Ended:        Annual Total Returns

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

12/31/97                    26.99%

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

12/31/98                    25.40%

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

12/31/99                    17.37%

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

12/31/00                    -7.77%

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

12/31/01                    -10.29%

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

12/31/02                    -19.29%

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

12/31/03                       27.21%

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


Oppenheimer Principal Protected Main Street Fund II(R)


6803 South Tucson Way, Centennial, Colorado 80112-3924

1.800.CALL OPP (225.5677)

Statement of Additional Information dated October 25, 2004

This Statement of Additional Information is not a prospectus. This document
contains additional information about the Fund and supplements information in
the Prospectus dated October 25, 2004.  It should be read together with the
Prospectus, which may be obtained by writing to the Fund's Transfer Agent,
OppenheimerFunds Services, at P.O. Box 5270, Denver, Colorado 80217, or 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......2
    The Fund's Investment Policies.........................................2
    The Asset Allocation Process...........................................3
    Investment Restrictions.................................................
How the Fund is Managed ....................................................
Organization and History....................................................
    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 Sell Shares..........................................................
How To Exchange Shares......................................................
Dividends, Capital Gains and Taxes..........................................
Additional Information About the Fund.......................................

Financial Information About the Fund
Independent Auditors' Report................................................
Financial Statements........................................................

Appendix A: Industry Classifications.....................................A-1
Appendix B: Special Sales Charge Arrangements and Waivers................B-1
Appendix C: Information About the Underlying Fund........................C-1







About the Fund

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 as well as information about any non-principal investment policies
and the attendant risks not described in the prospectus and the types of
securities that the Fund's investment Manager, OppenheimerFunds, Inc., can
select for the Fund. Additional information is also provided about the
strategies that the Fund can 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 Fund's Manager can use in selecting
portfolio securities will vary over time. The "Warranty Period" began March
3, 2004 and will end March 3, 2011 or the next following business day (the
"Maturity Date")). The investment objective of the Fund during the Warranty
Period is to seek capital preservation in order to attempt to make sure that
the value of each shareholder's account on the Maturity Date will be no less
than the value of that shareholder's account on the last day of the Offering
Period, less sales charges, extraordinary expenses and other amounts not
covered by the "Warranty Agreement" (the "Warranty Amount"). The Fund seeks
high total return as a secondary objective. There can be no assurance that
the Fund will achieve its objective. The Fund's investment objective during
the "Post-Warranty Period," the period immediately following the Maturity
Date, is high total return. This section supplements the disclosure in the
Fund's Prospectus and provides additional information on the Fund's
investment policies or restrictions to the extent permitted under the
Financial Warranty Agreement, dated January 20, 2004 (the "Warranty
Agreement"), among the Fund, the Manager and Merrill Lynch Bank USA.
Restrictions or policies stated as a maximum percentage of the Fund's assets
are only applied immediately after a portfolio investment to which the policy
or restriction is applicable (other than the limitations on borrowing and
illiquid securities). Accordingly, any later increase or decrease resulting
from a change in values, net assets or other circumstances will not be
considered in determining whether the investment complies with the Fund's
restrictions and policies.


      Under normal market conditions, during the Warranty Period the Fund's
assets are allocated between an equity component, consisting exclusively of
Class Y shares of the Oppenheimer Main Street Fund (the "Underlying Fund"),
and a fixed income component, normally consisting primarily of zero-coupon
U.S. government securities. However, as explained more fully in the
prospectus, under certain circumstances, the Fund's assets may be invested
primarily or even exclusively in U.S. government securities.


      Merrill Lynch Bank USA ("MLBUSA" or the "Warranty Provider") is a
wholly-owned subsidiary of Merrill Lynch & Co., Inc. MLBUSA is licensed as an
industrial loan corporation pursuant to the laws of the State of Utah. MLBUSA
is regulated by certain Federal and state agencies and is examined by those
agencies. MLBUSA may hedge its risks under the Warranty Agreement with one or
more counterparties, including with an affiliate of MLBUSA (which may include
the calculation agent under the Warranty Agreement). MLBUSA is not required
to hedge its risk under the Warranty Agreement and may choose not to do so.
Whether MLBUSA attempts to hedge its risk under the Warranty Agreement or
not, it is the sole entity responsible for making payments to the Fund, if
any, under the Warranty Agreement.

The Asset Allocation Process. In pursuing the Fund's investment objective
during the Warranty Period, the Manager allocates the Fund's assets between
the equity and fixed income components of the portfolio. The Fund did not
employ an asset allocation model during the Offering Period and will not do
so during the Post-Warranty Period.


      The prevailing level of interest rates and the volatility of the equity
markets will significantly influence the initial allocation of Fund assets
between equity and fixed income securities. At the date of this Statement of
Additional Information, interest rates remain at historically low levels and
the equity markets continue to experience above normal volatility, both of
which are factors that may result in the mathematical formula allocating a
high portion of the Fund's assets to fixed income securities. The Manager
will monitor the allocation of the Fund's assets on a daily basis.

      The asset allocation process will also be affected by the Manager's
ability to manage the Underlying Fund. If the market value of the Underlying
Fund increases, a smaller portion of the Fund's assets would be allocated to
the debt portfolio. On the other hand, if the market value of the Underlying
Fund decreases, a higher portion of the Fund's assets would have to be
allocated to the debt portfolio, and the ability of the Fund to participate
in any subsequent upward movement in the equity market would be reduced.

      The Warranty Agreement contains a mathematical formula which provides
the maximum amount of the Fund's assets that may be invested in the equity
portfolio on any given day during the Warranty Period. That percentage
allocation to the equity portfolio can be as high as 100% and as low as zero.
Accordingly, the Warranty Agreement could limit the way that the Manager
manages the Fund during the Warranty Period in response to changing market
conditions.

      In allocating the Fund's assets between equity and fixed income
securities, the Manager will base its decision on the formula set forth in
the Warranty Agreement. The formula will help establish both the initial
allocation of the Fund's assets and on a daily basis will reevaluate the
Fund's then maximum permitted allocation in the equity component. The
objective of the formula is to preserve the principal of the Fund, primarily
through allocations to the fixed income securities. The formula takes into
account a number of factors, including, but not limited to:
o     The market value of the Fund's assets as compared to the Warranty
         Amount;
o     The prevailing level of interest rates;
o     Equity market volatility; and
o     The length of time remaining until the Maturity Date.

      The model may allocate between 0% to 100% of the Fund's assets to
equity securities. However, initially a significant portion of the Fund's
assets will be allocated to fixed income securities. It is also possible that
100% of the Fund's assets will be allocated to the debt portfolio during the
Warranty Period.

      The basic terms of the asset allocation model were determined prior to
the Fund entering into the Warranty Agreement with MLBUSA. MLBUSA reviewed
the asset allocation model in determining whether it was prepared to offer
the Financial Warranty to the Fund and negotiated some modifications to
manage its financial risk. MLBUSA has no right to require any modification to
the structure of the asset allocation formula during the Warranty Period, but
has discretion in certain limited circumstances to adjust certain variables
in the formula. Because the model impacts MLBUSA's financial exposure, MLBUSA
has a right to approve any changes that the Fund wishes to make to the model
during the Warranty Period. MLBUSA has informational rights regarding the
model's allocation and the Fund's portfolio during the Warranty Period, but
these rights are intended to enable MLBUSA to monitor its financial exposure.
Under the terms of the Warranty Agreement, the Fund is subject to certain
investment parameters during the Warranty Period. The Fund has also agreed to
be bound by various covenants. If the Fund's assets are not managed in
accordance with the parameters set forth in the Warranty Agreement or if the
Fund breaches these covenants, the Fund's assets could be allocated entirely
to the fixed income portfolio for the remainder of the Warranty Period, or
MLBUSA may terminate the Warranty Agreement.


The Financial Warranty. The prospectus contains a detailed description of the
Warranty Agreement. The "Financial Warranty" that the Warranty Provider
issued is a contractual obligation to make a payment to the Fund in the event
there is a Shortfall between the Warranty Amount and the then-current net
asset value of the Fund on the Maturity Date ("Shortfall"). The Financial
Warranty is not a guarantee and therefore the availability of the Financial
Warranty on the Maturity Date will be conditioned upon the Manager and the
Fund satisfying their respective obligations under the Warranty Agreement.
Should the Fund and/or the Manager fail to satisfy their respective
obligations under the Warranty Agreement, the Warranty Provider is permitted
to terminate the Financial Warranty and thus terminate its obligation, if
any, to make any payment to the Fund on the Maturity Date. Shareholders also
bear the risk that the Warranty Provider will become insolvent or otherwise
fail to or become unable to satisfy its payment obligation to the Fund, if
any, under the Financial Warranty. If either event were to occur,
shareholders' investment in the Fund would no longer be protected by the
Financial Warranty which means their shares may be worth less than their
anticipated Warranty Amount. The Fund's Board of Trustees will periodically
review the financial statements of the Warranty Provider. In the event that
the financial condition of the Bank has deteriorated beyond certain
thresholds, the Trustees will determine whether there is a substantial
likelihood that the Warranty Provider will be unable to satisfy its
obligations under the Warranty Agreement. Under such circumstances the Board
may, but is not obligated to, replace the Warranty Provider.

      In the event the Manager acts with negligence, recklessness, bad faith,
willful misconduct or fraud and the Fund's net asset value is below a set
limit, the Manager will be required to make a payment under the Warranty
Agreement in an amount equal to the amount of any reduction in the Fund's net
asset value below a set limit that is directly or indirectly attributable to
the Manager's conduct. Additionally, in the event the Manager is required to
allocate the Fund's assets to the debt portfolio and fails to do so and such
failure results in the Fund's net asset value falling below a set limit, the
Manager will be required to pay to the Warranty Provider an amount equal to
the shortfall due to the Fund's assets not being so invested. The Warranty
Provider may also terminate the Financial Warranty for other reasons, as
discussed in the Prospectus and this Statement of Additional Information.

      The Warranty Agreement imposes certain conditions and requirements on
the Fund and the Manager. Failure to satisfy those conditions and
requirements, which are described in detail in the Prospectus, gives the
Warranty Provider the ability to (i) reduce the amount of the Fund's assets
invested in shares of the Underlying Fund, (ii) require 100% of the Fund's
assets to be invested in U.S. government securities, or (iii) terminate the
Warranty Agreement, depending on the condition or requirement. The Manager
will monitor the various conditions and requirements of the Warranty
Agreement on a daily basis to ensure that the Fund and the Manager satisfy
those conditions and requirements. In certain circumstances, the Warranty
Agreement provides that in the case of certain deficiencies, the Fund may
have a specified period of time to cure the deficiency. In the case of other
deficiencies, the Warranty Provider has the right, in its sole discretion, to
either direct the Manager to allocate all of the Fund's assets to the debt
portfolio, deliver to the Fund's Custodian pre-signed instructions from the
Manager instructing the Custodian to immediately allocate all of the Fund's
assets to the debt portfolio or change one of the variables in the formula
which would have the effect of increasing the portion of the Fund's assets
allocated to the debt portfolio or in certain circumstances terminate the
Warranty Agreement. The Warranty Provider will rely on the Manager as well as
on the Fund's Custodian bank for the information necessary to monitor the
Fund's and/or the Manager's compliance with the terms of the Warranty
Agreement. The attendant risks to the Fund and shareholders are if the
Manager or the Custodian bank fail to provide the information required by the
Warranty Agreement, in which case the Warranty Provider may require the Fund
to invest exclusively in U.S. government securities.

      On the Maturity Date, if there is a shortfall between the Warranted
Amount and the Fund's then-current net asset value, the Warranty Provider
will be required to make a payment to the Fund in the amount of the
shortfall. The Shortfall amount will be determined per class of shares and
then the specific shortfall amount per class of shares will be allocated to
the respective class. Once the dollar amount of shortfall is allocated per
class, that amount will then be divided evenly among the outstanding shares
of the class to apply on a shareholder basis. The Fund will then provide
those shareholders who redeem their Fund shares on the Maturity Date with
their respective Warranty Amount.

      During the Warranty Period, the Fund may purchase securities or engage
in investment techniques set forth in the following sections.

      |X| Investments in Equity Securities. The Fund's investments in equity
securities will consist exclusively of Class Y shares of the Oppenheimer Main
Street Fund (the "Underlying Fund"). The Underlying Fund does not limit its
investments in equity securities to issuers having a market capitalization of
a specified size or range, and therefore can invest in securities of small-,
mid- and large-capitalization issuers. At times, the Underlying Fund can
focus its equity investments in securities of one or more capitalization
ranges, based upon the Manager's judgment of where the best market
opportunities are to seek the Underlying Fund's objective. At times, the
market may favor or disfavor securities of issuers of a particular
capitalization range. Securities of small capitalization issuers may be
subject to greater price volatility in general than securities of larger
companies. Therefore, if the Underlying Fund is focusing on or has
substantial investments in smaller capitalization companies at times of
market volatility, the Underlying Fund's share prices may fluctuate more than
that of funds focusing on larger capitalization issuers. Further information
about the Underlying Fund is included under "Information About the Underlying
Fund" in Appendix C to this Statement of Additional Information. The
Underlying Fund's Prospectus and Statement of Additional Information describe
in detail the Underlying Fund's investment policies, risks, management,
investment restrictions, strategies and types of securities in which it may
invest, and contains other information about the Underlying Fund. The
Prospectus, Statement of Additional Information and annual and semi-annual
reports of the Underlying Fund are available without charge upon request by
calling 1.800.525.7048.

      |X|  Investments  in Bonds  and  Other  Debt  Securities.  The Fund will
invest in U.S.  government  securities to seek its  investment  objective.  In
general,  debt  securities are also subject to two 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.  The fixed
income  component  of  the  Fund's  portfolio   consist  of  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.,  or at least  "BBB" by  Standard  & Poor's  Rating  Service or
Fitch, Inc., or that have comparable ratings by another  nationally-recognized
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.

      |X| U.S.  Government  Securities.  U.S.  government  securities the Fund
buys  will  include  non-callable  general  obligations  of the U.S.  Treasury
backed by the full  faith and credit of the U.S.  government  or of any of the
following U.S.  government  agencies:  Federal National Mortgage  Association,
Federal Home Loan  Mortgage  Corporation,  Federal Home Loan Bank,  Resolution
Funding  Corporation,  Financing  Corporation and Tennessee Valley  Authority,
provided  such  securities  are rated no less than "AAA" by  Standard & Poor's
Rating Services or "Aaa" by Moody's Investors Service, Inc.

         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.

         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.
The Fund may invest in, Government National Mortgage Association  pass-through
mortgage  certificates (called "Ginnie Maes"), which are supported by the full
faith and credit of the U.S. government .

      |X|   Zero-Coupon   Securities.   The  Fund  can  buy   zero-coupon  and
delayed-interest  securities.  The Fund can buy U.S.  Treasury  notes or bonds
that have been stripped of their  interest  coupons,  and 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.  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.  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| 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.
During the Offering Period the Fund invested its assets in:


         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 Standard & Poor's 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.

      During  the  Warranty  Period,  the Fund may  invest  in bank  deposits,
commercial paper and U.S.  government  securities  (excluding U.S.  government
zero coupon  securities),  having a remaining maturity of 90 days or less. The
bank  deposits  will  include  demand and time  deposits in,  certificates  of
deposit  of,  and  bankers'   acceptances  issued  by,  any  U.S.   depository
institution  or trust  company.  The bank deposits and  commercial  paper must
have a credit rating of at least "P-1" by Moody's Investors Service,  Inc. and
at least "A-1" by Standard & Poor's Rating  Services,  and the issuer  thereof
must  have at the time of such  investment  a  long-term  credit  rating of at
least "Aa3" by Moody's or at least "AA" by S&P.


      |X| Borrowing.  The Fund may borrow for temporary or emergency  purposes
only to the  extent  necessary  in  emergency  situations  to meet  redemption
requests  after  using  all  cash  held by the  Fund to meet  such  redemption
requests, other than cash necessary to pay Fund fees and expenses.  Currently,
under the Investment Company Act of 1940 ("Investment  Company Act"), 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  its
liabilities,  other than  borrowings),  except that a fund may 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.  As a
matter  of  fundamental  policy,  the Fund is  authorized  to borrow up to the
limits set forth in the Investment  Company Act. During periods of substantial
borrowings,  the value of the Fund's  assets would be reduced due to the added
expense of interest on borrowed monies.  The Fund is authorized to borrow, and
to  pledge  assets  to  secure  such  borrowings,  up to  the  maximum  extent
permissible  under the  Investment  Company  Act (i.e.,  presently  50% of net
assets).  Any such borrowing will be made only pursuant to the requirements of
the Investment  Company Act and will be made only to the extent that the value
of each Fund's assets less its liabilities,  other than  borrowings,  is equal
to at least 300% of all borrowings  including the proposed  borrowing.  If the
value of a Fund's  assets,  so  computed,  should  fail to meet the 300% asset
coverage  requirement,  the Fund is required,  within three days to reduce its
bank debt to the extent  necessary  to meet such  requirement  and may have to
sell a  portion  of its  investments  at a time  when  independent  investment
judgment  would not  dictate  such  sale.  Interest  on money  borrowed  is an
expense the Fund would not otherwise  incur,  so that it may have little or no
net  investment  income  during  periods  of  substantial  borrowings.   Since
substantially  all of a  Fund's  assets  fluctuate  in  value,  but  borrowing
obligations are fixed when the Fund has outstanding borrowings,  the net asset
value per share of a Fund  correspondingly  will tend to increase and decrease
more  when  the  Fund's  assets  increase  or  decrease  in value  than  would
otherwise be the case.


         The Fund will pay interest on these loans,  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| Portfolio Turnover. "Portfolio turnover" describes the rate at
which the Fund traded its portfolio securities during its previous 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 is likely to have a
portfolio turnover rate of 100% or more. Increased portfolio turnover creates
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. As a result of the Fund's dynamic asset allocation
model, the Fund may have a higher portfolio turnover rate than other mutual
funds.


Investment in Other Investment Companies. As stated above, the Fund can
invest in the Class Y shares of Oppenheimer Main Street Fund, subject to the
limits set forth in the Investment Company Act or any exemption therefrom
that apply to those types of investments and any percentage limit
established, from time to time, by the asset allocation formula described in
the Warranty Agreement. 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. As a shareholder of an investment company, the Fund
will be subject to its ratable share of that investment company's expenses,
including its advisory and administration expenses.

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 concentrate investments. That means it cannot invest
25% or more of its total assets in any industry. However, there is no
limitation on investments in affiliated funds and obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities.

o     The Fund cannot invest in commodities. However, the Fund can buy and
sell any of the hedging instruments permitted by any of its other policies.
It does not matter if the hedging instrument is considered to be a commodity
or commodity contract.

      o  The Fund cannot invest in real estate or in interests in real
estate. However, the Fund can purchase securities of issuers holding real
estate or interests in real estate (including securities of real estate
investment trusts).

      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.

o     The Fund cannot 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 statutes, rules or
regulations may be amended or interpreted from time to time.

o     The Fund cannot make loans except (a) through lending of securities,
(b) through the purchase of debt instruments or similar evidences of
indebtedness, (c) through an interfund lending program with other affiliated
funds, and (d) through repurchase agreements.

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


      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 as
described above, the Fund has adopted as a non-fundamental policy the
industry classifications set forth in Appendix A to this Statement of
Additional Information. The Fund does not intend to concentrate its
investments in a group of industries.


How the Fund is Managed

Organization and History. The Fund is a "series" of Oppenheimer Principal
Protected Trust II. That Trust is an open-end, management investment company
organized as a Massachusetts business trust on August 12, 2003. The Fund is a
diversified mutual fund and commenced operations on November 10, 2003.

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 or 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 three classes of shares: Class A, Class B and
Class C. All classes invest in the same investment portfolio. 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.

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 declaration in writing or vote of
two-thirds of the outstanding shares of the Fund, to remove a Trustee or to
take certain other action described in the 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 ten
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 Trust's Declaration of Trust
contains an express disclaimer of shareholder or Trustee liability for the
Trust's obligations. It also provides for indemnification and reimbursement
of expenses out of the Trust's property for any shareholder held personally
liable for its obligations. The Declaration of Trust also states that upon
request, the Trust shall assume the defense of any claim made against a
shareholder for any act or obligation of a Fund and shall satisfy any
judgment on that claim. Massachusetts law permits a shareholder of a business
trust (such as the Trust) 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 Trust is limited
to the relatively remote circumstances in which the Trust would be unable to
meet its obligations.

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


Board of Trustees and Oversight Committees.  The Trust 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 Trust's activities, review its
performance, and review the actions of the Manager.

      The Board of Trustees has an Audit Committee, a Review Committee and a
Governance Committee. The Audit Committee is comprised solely of Independent
Trustees. The members of the Audit Committee are Edward L. Cameron
(Chairman), George C. Bowen, Robert J. Malone and F. William Marshall, Jr.
The Audit Committee held 6 meetings during the fiscal year ended August 31,
2004. The Audit Committee furnishes the Board with recommendations regarding
the selection of the Fund's independent auditors. Other main functions of the
Audit Committee include, but are not limited to: (i) reviewing the scope and
results of financial statement audits and the audit fees charged; (ii)
reviewing reports from the Fund's independent auditors regarding the Fund's
internal accounting procedures and controls;  (iii) review reports from the
Manager's Internal Audit Department; (iv) maintaining a separate line of
communication between the Fund's independent auditors and its Independent
Trustees; and (v) exercise all other functions outlined in the Audit
Committee Charter, including but not limited to reviewing the independence of
the Fund's independent auditors and the pre-approval of the performance by
the Fund's independent auditors of any non-audit service, including tax
service, for the Fund and the Manager and certain affiliates of the Manager
that is not prohibited by the Sarbanes-Oxley Act.

      The members of the Review Committee are Jon S. Fossel (Chairman),
Robert G. Avis, Sam Freedman, and Beverly Hamilton. The Review Committee held
6 meetings during the fiscal year ended August 31, 2004. Among other
functions, the Review Committee reviews reports and makes recommendations to
the Board concerning the fees paid to the Fund's transfer agent and the
services provided to the Fund by the transfer agent.  The Review Committee
also reviews the Fund's investment performance and policies and procedures
adopted by the Fund to comply with Investment Company Act and other
applicable law.

      The members of the Governance Committee are Robert Malone (Chairman),
William Armstrong, Beverly Hamilton and F. William Marshall, Jr. Each member
of the Committee is an Independent Trustee.  The Governance Committee was
established in August 2004 and did not hold any meetings during the Fund's
fiscal year ended August 31, 2004. The Governance Committee is expected to
review general governance matters, including a formal process for
shareholders to send communications to the Board and the qualifications of
candidates for board positions including consideration of any candidate
recommended by shareholders.

      The Governance Committee has not yet adopted a charter, but anticipates
that it will do so by the end of this calendar year. The Committee has
temporarily adopted the process preciously adopted by the Audit Committee
regarding shareholder submission of nominees for board positions. That policy
is as follows. 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 Governance 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. This Committee also will select
and nominate, to the full Board, nominees for election as Trustees, and
select and nominate Independent Trustees for election. The 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.

      Shareholders who desire to communicate with the Board should address
correspondence to the Board or an individual Board member and may submit
their correspondence electronically at www.oppenheimerfunds.com under the
caption "contact us" or by mail to the Fund at the address above. The
Governance Committee will consider if a different process should be
recommended to the Board.

Trustees and Officers of the Fund. Except for Mr. Murphy, each of the
Trustees is an "Independent Trustee" 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. Murphy was elected as a Trustee of
the Fund with the understanding that in the event he ceases to be the chief
executive officer of the Manager, he will resign as a trustee of the Fund and
the other Board II Funds (defined below) for which he is a trustee or director

      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 (except for Ms. Hamilton and Mr. Malone, who are not
Trustees of Oppenheimer Senior Floating Rate Fund) (referred to as "Board II
Funds"):


                                           Oppenheimer   Principal   Protected

Oppenheimer Cash Reserves                  Trust III
Oppenheimer Champion Income Fund           Oppenheimer Real Asset Fund

                                           Oppenheimer  Senior  Floating  Rate
Oppenheimer Capital Income Fund            Fund
Oppenheimer Equity Fund, Inc.              Oppenheimer Strategic Income Fund
Oppenheimer High Yield Fund                Oppenheimer Variable Account Funds
Oppenheimer International Bond Fund        Panorama Series Fund, Inc.
Oppenheimer Integrity Funds
Oppenheimer Limited-Term Government Fund   Centennial America Fund, L. P.
                                           Centennial  California  Tax  Exempt
Oppenheimer Main Street Funds, Inc.        Trust
Oppenheimer Main Street Opportunity Fund   Centennial Government Trust
Oppenheimer Main Street Small Cap Fund     Centennial Money Market Trust
                                           Centennial   New  York  Tax  Exempt
Oppenheimer Municipal Fund                 Trust

Oppenheimer Principal Protected Trust      Centennial Tax Exempt Trust
Oppenheimer Principal Protected Trust II

      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. Gillespie, Manioudakis, Miao, Murphy, Petersen, Schadt, Vandehey,
Vottiero, Wixted and Zack and Mses. Bloomberg, Ives and Lee, who are officers
of the Fund, respectively hold the same offices with one or more of the other
Board II Funds as with the Fund. As of October 6, 2004, 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 their immediate family members) do not own securities of either
the Manager or Distributor of the Board II Funds or any person directly or
indirectly controlling, controlled by or under common control with the
Manager or Distributor.

The address of each Trustee in the chart 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;                                  BeneficiallFunds
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,

                                                                       2003

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

William L.          Chairman   of   the   following   private None       Over
Armstrong,          mortgage banking companies:  Cherry Creek            $100,000
Chairman and        Mortgage     Company     (since    1991),
Trustee since 2003  Centennial  State Mortgage Company (since
Age: 67             1994),   The  El  Paso  Mortgage  Company
                    (since   1993),    Transland    Financial
                    Services,  Inc. (since 1997); Chairman of
                    the following  private  companies:  Great
                    Frontier  Insurance   (insurance  agency)
                    (since    1995),     Ambassador     Media
                    Corporation and Broadway  Ventures (since
                    1984);   a  director  of  the   following
                    public  companies:   Helmerich  &  Payne,
                    Inc.  (oil  and  gas  drilling/production
                    company)  (since 1992) and  UNUMProvident
                    (insurance  company)  (since  1991).  Mr.
                    Armstrong is also a  Director/Trustee  of
                    Campus   Crusade   for   Christ  and  the
                    Bradley  Foundation.  Formerly a director
                    of  the  following:   Storage  Technology
                    Corporation  (a  publicly-held   computer
                    equipment company)  (1991-February 2003),
                    and  International  Family  Entertainment
                    (television     channel)     (1992-1997),
                    Frontier Real Estate,  Inc.  (residential
                    real estate brokerage)  (1994-1999),  and
                    Frontier Title (title  insurance  agency)
                    (1995-June    1999);   a   U.S.   Senator
                    (January  1979-January 1991). Oversees 39
                    portfolios   in   the    OppenheimerFunds
                    complex.

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

Robert G. Avis,     Formerly,  Director and President of A.G. None       Over
Trustee since 2003  Edwards  Capital,  Inc.  (General Partner            $100,000
Age: 73             of private equity funds) (until  February

                    2001);  Chairman,   President  and  Chief
                    Executive   Officer   of   A.G.   Edwards
                    Capital,  Inc.  (until March 2000);  Vice
                    Chairman  and  Director of A.G.  Edwards,
                    Inc. and Vice Chairman of A.G.  Edwards &
                    Sons,   Inc.   (its   brokerage   company
                    subsidiary) (until March 1999);  Chairman
                    of A.G.  Edwards Trust Company and A.G.E.
                    Asset  Management   (investment  advisor)
                    (until  March   1999);   and  a  Director
                    (until  March  2000)  of A.G.  Edwards  &
                    Sons  and  A.G.  Edwards  Trust  Company.
                    Oversees    39    portfolios    in    the
                    OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

George C. Bowen,    Formerly   Assistant   Secretary   and  a None       Over
Trustee since 2003  director  (December  1991-April  1999) of            $100,000
Age: 68             Centennial Asset Management  Corporation;
                    President,   Treasurer   and  a  director
                    (June   1989-April  1999)  of  Centennial
                    Capital   Corporation;   Chief  Executive
                    Officer  and a  director  of  MultiSource
                    Services,  Inc. (March  1996-April 1999).
                    Until April 1999 Mr.  Bowen held  several
                    positions  in  subsidiary  or  affiliated
                    companies  of the  Manager.  Oversees  39
                    portfolios   in   the    OppenheimerFunds
                    complex.

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

Edward L. Cameron,  A  member  of The  Life  Guard  of  Mount None       $50,001-
Trustee since 2003  Vernon,  George  Washington's home (since            $100,000
Age: 66             June  2000).   Formerly  Director  (March
                    2001-May  2002) of Genetic ID,  Inc.  and
                    its   subsidiaries   (a  privately   held
                    biotech   company);   a   partner   (July
                    1974-June            1999)           with
                    PricewaterhouseCoopers       LLP      (an
                    accounting   firm);  and  Chairman  (July
                    1994-June  1998) of Price  Waterhouse LLP
                    Global  Investment   Management  Industry
                    Services  Group.  Oversees 39  portfolios
                    in the OppenheimerFunds complex.

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

Jon S. Fossel,      Director  (since  February 1998) of Rocky None       Over
Trustee since 2003  Mountain      Elk      Foundation      (a            $100,000
Age: 62             not-for-profit  foundation);  a  director
                    (since  1997) of  Putnam  Lovell  Finance
                    (finance  company);   a  director  (since
                    June   2002)   of    UNUMProvident    (an
                    insurance  company).  Formerly a director
                    (October   1999-October   2003)  of  P.R.
                    Pharmaceuticals    (a   privately    held
                    company);  Chairman and a director (until
                    October  1996)  and  President  and Chief
                    Executive  Officer  (until  October 1995)
                    of   the   Manager;    President,   Chief
                    Executive  Officer and a director  (until
                    October 1995) of Oppenheimer  Acquisition
                    Corp.,  Shareholders  Services  Inc.  and
                    Shareholder   Financial  Services,   Inc.
                    Oversees    39    portfolios    in    the
                    OppenheimerFunds complex.

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

Sam Freedman,       Director    of    Colorado    Uplift   (a None       Over
Trustee since 2003  non-profit   charity)  (since   September            $100,000
Age: 63             1984).  Formerly (until October 1994) Mr.

                    Freedman   held   several   positions  in
                    subsidiary  or  affiliated  companies  of
                    the Manager.  Oversees 39  portfolios  in
                    the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Beverly L.          Trustee   of    Monterey    International None       $50,001-$100,000
Hamilton,           Studies  (an  educational   organization)
Trustee since 2003  (since  February 2000); a director of The
Age: 58             California   Endowment  (a  philanthropic
                    organization)  (since  April 2002) and of
                    Community  Hospital of Monterey Peninsula
                    (educational     organization)     (since
                    February  2002);  a  director  of America
                    Funds   Emerging   Markets   Growth  Fund
                    (since   October  1991)  (an   investment
                    company);  an  advisor  to Credit  Suisse
                    First  Boston's  Sprout  venture  capital
                    unit.  Mrs.  Hamilton also is a member of
                    the   investment    committees   of   the
                    Rockefeller   Foundation   and   of   the
                    University    of   Michigan.    Formerly,
                    Trustee   of   MassMutual   Institutional
                    Funds   (open-end   investment   company)
                    (1996-May   2004);   a  director  of  MML
                    Series  Investment  Fund (April  1989-May
                    2004) and MML  Services  (April  1987-May
                    2004) (investment  companies);  member of
                    the investment  committee  (2000-2003) of
                    Hartford     Hospital;     an     advisor
                    (2000-2003)   to   Unilever   (Holland)'s
                    pension  fund;  and  President  (February
                    1991-April   2000)  of  ARCO   Investment
                    Management    Company.     Oversees    38
                    portfolios   in   the    OppenheimerFunds
                    complex.

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

Robert J. Malone,   Chairman,  Chief  Executive  Officer  and None       Over
Trustee since 2003  Director of Steele  Street  State Bank (a            $100,000
Age: 60             commercial  banking entity) (since August
                    2003);  director  of  Colorado  UpLIFT (a
                    non-profit  organization)  (since  1986);
                    trustee  (since  2000)  of the  Gallagher
                    Family       Foundation       (non-profit
                    organization).   Formerly,   Chairman  of
                    U.S.  Bank-Colorado (a subsidiary of U.S.
                    Bancorp and  formerly  Colorado  National
                    Bank,)  (July   1996-April  1,  1999),  a
                    director of: Commercial  Assets,  Inc. (a
                    REIT) (1993-2000),  Jones Knowledge, Inc.
                    (a  privately  held  company)  (2001-July
                    2004)  and U.S.  Exploration,  Inc.  (oil
                    and   gas   exploration)   (1997-February
                    2004).  Oversees  38  portfolios  in  the
                    OppenheimerFunds complex.

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

F. William          Trustee   of   MassMutual   Institutional None       Over
Marshall, Jr.,      Funds   (since   1996)  and  MML   Series            $100,000
Trustee since 2003  Investment   Fund   (since   1987)  (both
Age: 62             open-end  investment  companies)  and the
                    Springfield     Library     and    Museum
                    Association  (since 1995)  (museums)  and
                    the    Community    Music    School    of
                    Springfield  (music school) (since 1996);
                    Trustee  (since  1987),  Chairman  of the
                    Board  (since  2003) and  Chairman of the
                    investment  committee  (since  1994)  for
                    the    Worcester    Polytech    Institute
                    (private  university);  and President and
                    Treasurer  (since  January  1999)  of the
                    SIS  Fund  (a  private   not  for  profit
                    charitable  fund).  Formerly,  member  of
                    the    investment    committee   of   the
                    Community     Foundation    of    Western
                    Massachusetts  (1998  -  2003);  Chairman
                    (January  1999-July 1999) of SIS & Family
                    Bank,   F.S.B.    (formerly   SIS   Bank)
                    (commercial  bank);  and  Executive  Vice
                    President  (January  1999-July  1999)  of
                    Peoples Heritage  Financial  Group,  Inc.
                    (commercial     bank).     Oversees    39
                    portfolios   in   the    OppenheimerFunds
                    complex.

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


      The address for 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
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------

Name,                   Principal Occupation(s) During Past   Dollar     Aggregate
                                                                         Dollar
                                                                         Range Of
                                                                         Shares
                                                                         Beneficially
                                                                         Owned in
                        5 Years;                              Range of   Any of the
Position(s) Held with   Other Trusteeships/Directorships      Shares     Oppenheimer
Fund,                   Held by Trustee;                      BeneficiallFunds
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,
                                                                       2003

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

John V. Murphy,     Chairman,  Chief  Executive  Officer  and None       Over
President and       director  (since June 2001) and President            $100,000
Trustee since 2003  (since  September  2000) of the  Manager;
Age: 55             President  and a  director  or trustee of
                    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
                    Institutional 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  74   portfolios  as
                    Trustee/Director  and  10  portfolios  as
                    Officer in the OppenheimerFunds complex.

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



      The address of the Officers in the chart below is as follows: for
Messrs. Gillespie, Manioudakis, Miao, Schadt and Zack and Messes. Bloomberg
and Lee, Two World Financial Center, 225 Liberty Street, 11th Floor, 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 annual term or until his or her earlier resignation, death or removal.


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

Angelo Manioudakis,     Senior Vice  President of the Manager (since April 2002),
Vice President and      of  HarbourView  Asset  Management   Corporation   (since
Portfolio Manager       April,  2002 and of OFI  Institutional  Asset Management,
since 2003              Inc.  (since June 2002);  an officer of 14  portfolios in
Age: 37                 the   OppenheimerFunds    complex.   Formerly   Executive
                        Director  and  portfolio  manager for Miller,  Anderson &
                        Sherrerd,   a  division  of  Morgan  Stanley   Investment
                        Management (August 1993-April 2002.

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

Rudi Schadt,            Vice  President,  Director of Research in Product  Design
Vice President and      and Risk  Management  of the  Manager;  an  officer  of 3
Portfolio Manager       portfolios  in the  OppenheimerFunds  complex.  Prior  to
since 2004              joining the  Manager in  February  2002 he was a Director
Age: 46                 and Senior Quantitative  Analyst (2000-2001) at UBS Asset
                        Management  prior to which he was an  Associate  Director
                        and Senior  Researcher  and Portfolio  Manager (from June
                        1997) at State Street Global Advisors.

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

Mark S. Vandehey,       Senior  Vice  President  and  Chief  Compliance   Officer
Vice President and      (since March 2004) of the Manager;  Vice President (since
Chief Compliance        June  1983)  of   OppenheimerFunds   Distributor,   Inc.,
Officer since 2004      Centennial Asset  Management  Corporation and Shareholder
Age:  54                Services,   Inc.  Formerly  (until  February  2004)  Vice
                        President    and   Director   of   Internal    Audit   of
                        OppenheimerFunds,  Inc.  An officer of 84  portfolios  in
                        the Oppenheimer funds complex.

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

Brian W. Wixted,        Senior Vice  President and  Treasurer  (since March 1999)
Treasurer since 2003    of  the   Manager;   Treasurer   of   HarbourView   Asset
Age: 44                 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  84   portfolios   in   the
                        OppenheimerFunds complex.

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

Brian Petersen,         Assistant  Vice  President  of the Manager  since  August
Assistant Treasurer     2002;  formerly   Manager/Financial   Product  Accounting
since 2004              (November  1998-July 2002) of the Manager.  An officer of
Age: 34                 84 portfolios in the OppenheimerFunds complex.

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

Philip Vottiero,        Vice  President/Fund  Accounting  of  the  Manager  since
Assistant Treasurer     March 2002. Formerly Vice President/Corporate  Accounting
since 2003              of the Manager (July  1999-March  2002) prior to which he
Age: 41                 was  Chief  Financial  Officer  at  Sovlink   Corporation
                        (April  1996-June  1999).  An officer of 84 portfolios in
                        the OppenheimerFunds complex.

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

Robert G. Zack,         Executive  Vice   President   (since  January  2004)  and
Vice President &        General  Counsel  (since  February  2002) of the Manager;
Secretary since 2003    General  Counsel and a director  (since November 2001) of
Age: 56                 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 84
                        portfolios in the OppenheimerFunds complex.

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

Kathleen T. Ives,       Vice  President  (since June 1998) and Senior Counsel and
Assistant Secretary     Assistant  Secretary (since October 2003) of the Manager;
since 2003              Vice  President  (since  1999)  and  Assistant  Secretary
Age: 38                 (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 84
                        portfolios in the OppenheimerFunds complex.

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

Dina C. Lee,            Assistant  Vice  President and  Assistant  Counsel of the
Assistant Secretary     Manager (since December  2000);  formerly an attorney and
since 2004              Assistant  Secretary  of Van Eck Global  (until  December
Age: 34                 2000).    An   officer   of   84    portfolios   in   the

                        OppenheimerFunds complex.
----------------------------------------------------------------------------------
----------------------------------------------------------------------------------

Lisa I. Bloomberg,      Vice  President  and  Associate  Counsel  of the  Manager
Assistant Secretary     since  May  2004;   formerly  First  Vice  President  and
since 2004              Associate General Counsel of UBS Financial  Services Inc.
Age:  36                (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   84    portfolios   in   the
                        OppenheimerFunds complex.

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

Phillip S. Gillespie,   Senior Vice President and Deputy  General  Counsel of the
Assistant Secretary     Manager  since  September  2004.  Formerly Mr.  Gillespie
since 2004              held the following  positions at Merrill Lynch Investment
Age:  40                Management:  First Vice President  (2001-September 2004);
                        Director (from 2000) and Vice President  (1998-2000).  An
                        officer of 74 portfolios in the OppenheimerFunds complex.

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

Wayne Miao,             Assistant  Vice  President and  Assistant  Counsel of the
Assistant Secretary     Manager  since  June 2004.  Formerly  an  Associate  with
since 2004              Sidley  Austin  Brown & Wood  LLP  (September  1999 - May
Age:  31                2004).    An   officer   of   74    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 August 31, 2004. The compensation from all 38 of the
Board II Funds (including the Fund) represents compensation received for
serving as a director or trustee and member of a committee (if applicable) of
the boards of those funds during the calendar year ended December 31, 2003.


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

Trustee Name and Other Fund              Aggregate       Total Compensation From
                                       Compensation       Fund and Fund Complex
Position(s) (as applicable)             From Fund1          Paid to Trustees*

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

William L. Armstrong                       $835                 $118,649
Chairman of the Board of Trustees
and Governance Committee Member

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

Robert G. Avis                             $548                 $101,499
Review Committee Member

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

George C. Bowen                            $548                 $101,499
Audit Committee Member

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

Edward L. Cameron                          $630                 $115,503
Audit Committee Chairman

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

Jon S. Fossel                              $630                 $115,503
Review Committee Chairman

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

Sam Freedman                               $548                 $101,499
Review Committee Member

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

Beverly Hamilton
Review Committee Member and                $5482               $150,5423,4
Governance Committee Member

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

Robert J. Malone
Governance Committee Chairman and          $5485                $100,1793
Audit Committee Member

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

F. William Marshall, Jr.
Audit Committee Member and                 $548                 $149,4996
Governance Committee Member

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

Effective  December  15,  2003,  James C. Swain,  retired as Trustee  from the
Board II Funds.  For the fiscal year ended August 31, 2004, Mr. Swain received
$211  aggregate  compensation  from the Fund. For calendar year ended December
31, 2003, Mr. Swain received  $178,000 in total  compensation  from all of the
Oppenheimer funds for which he served as Trustee.
1.    Aggregate   Compensation   from   Fund   includes   fees  and   deferred
   compensation, if any, for a Trustee.
2.    Includes  $548  deferred  under  Deferred  Compensation  Plan  described
   below.
3.    Total  compensation for Mrs. Hamilton and Mr. Malone was paid by all the
   Board II Funds,  with the  exception of  Oppenheimer  Senior  Floating Rate
   Fund for  which  they  currently  do not  serve as  Trustees  (total  of 37
   Oppenheimer funds at December 31, 2003).
4.    Includes  $50,363  compensation  (of  which  100% was  deferred  under a
   deferred  compensation plan) paid to Mrs. Hamilton for serving as a trustee
   by two open-end investment  companies  (MassMutual  Institutional Funds and
   MML  Series  Investment  Fund)  the  investment  adviser  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.
5.    Includes $548 deferred under Deferred Compensation Plan described below.
6.    Includes  $48,000  compensation  paid to Mr.  Marshall  for serving as a
   trustee by two  open-end  investment  companies  (MassMutual  Institutional
   Funds and MML Series  Investment Fund) the investment  adviser 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 the  instructions  for Form  N-1A.  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| Deferred Compensation Plan for Trustees. The Board of Trustees has
adopted a Deferred Compensation Plan for disinterested Trustees that enables
them to elect to defer receipt of all or a portion of the annual fees they
are entitled to receive from the Funds. Under the plan, the compensation
deferred by a Trustee is periodically adjusted as though an equivalent amount
had been invested in shares of one or more Oppenheimer funds selected by the
Trustee. The amount paid to the Trustee under the plan will be determined
based upon the performance of the selected funds.


      Deferral of Trustee's fees under the plan will not materially affect
the Fund's assets, liabilities and net income per share.  The plan will not
obligate the Fund to retain the services of any Trustee or to pay any
particular level of compensation to any Trustee. Pursuant to an Order issued
by the Securities and Exchange Commission ("SEC"), the Fund may invest in the
funds selected by the Trustee under the plan without shareholder approval for
the limited purpose of determining the value of the Trustee's deferred fee
account.

      |X| Major Shareholders. As of October 6, 2004, the only persons who
owned of record or who were known by the Fund to own of record 5% or more of
the Fund's outstanding Class A, Class B and Class C were:

      MLPF&S   for  the   Sole   Benefit   of  its   Customers,   Attn:   Fund
      Administration/#,  4800 Deer Lake Drive E.,  Floor 3,  Jacksonville,  FL
      32246-6484,   which  owned  202,299.224  Class  B  shares  (representing
      approximately 5.90% of the Class B shares then outstanding).

      MLPF&S   for  the   Sole   Benefit   of  its   Customers,   Attn:   Fund
      Administration/#,  4800 Deer Lake Drive E.,  Floor 3,  Jacksonville,  FL
      32246-6484,   which  owned  701,422.741  Class  C  shares  (representing
      approximately 30.08% of the Class C 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.

      |X| 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 new 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.
                 -----------


      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.

      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 fiscal
year was:


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

                  Fiscal Year                Management Fee Paid to
                   Ended 8/31                OppenheimerFunds, Inc.

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

                     20041                          $874,917

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

         1. For the fiscal period from November 10, 2003 (commencement of
operations) to August 31, 2004.


      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 names "Oppenheimer" and
"Main Street" 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's parent corporation to use the names "Oppenheimer" and
"Main Street" as part of its name and the name of the Fund.


      |X|   Approval of Investment Advisory Agreement. Each year, the Board
of Trustees, including a majority of the Independent Trustees, is required to
approve the renewal of the investment advisory agreement. The Investment
Company Act requires that the Board request and evaluate and the Manager
provide such information as may be reasonably necessary to evaluate the terms
of the investment advisory agreement. The Board employs an independent
consultant to prepare a report that provides such information as the Board
requests for this purpose.

      The Board also receives information about the 12b-1 distribution fees
the Fund pays. These distribution fees are reviewed and approved at a
different time of the year.

      The Board discussed the services the Manager performs for the
Underlying Fund and the services the Manager performs for the Fund and
concluded that the advisory fee charged is based on services provided that
are in addition to, rather than duplicative of, services provided under the
investment advisory agreement with the Underlying Fund. The Board considered
that the investment advisory agreement requires that the Manager reduce its
advisory fee in the event the Fund's assets become completely and
irreversibly invested in debt securities.

      The Board reviewed the foregoing information in arriving at its
decision to renew the investment advisory agreement. Among other factors, the
Board considered:

o     The nature, cost, and quality of the services provided to the Fund and
         its shareholders;
o     The profitability of the Fund to the Manager;

o     The investment performance of the Fund in comparison to regular market

         indices;
o     Economies of scale that may be available to the Fund from the Manager;
o     Fees paid by other mutual funds for similar services;
o     The value and quality of any other benefits or services received by the

         Fund from its relationship with the Manager, and
o     The direct and indirect benefits the Manager received from its
         relationship with the Fund. These included services provided by the
         Distributor and the Transfer Agent, and brokerage and soft dollar
         arrangements permissible under Section 28(e) of the Securities
         Exchange Act.

      The Board considered that the Manager must be able to pay and retain
high quality personnel at competitive rates to provide services to the Fund.
The Board also considered that maintaining the financial viability of the
Manager is important so that the Manager will be able to continue to provide
quality services to the Fund and its shareholders in adverse times. The Board
also considered the investment performance of other mutual funds advised by
the Manager. The Board is aware that there are alternatives to the use of the
Manager.

      These matters were also considered by the Independent Trustees meeting
separately from the full Board with experienced Counsel to the Fund and
experienced Counsel to the Independent Trustees who assisted the Board in its
deliberations.  The Fund's Counsel and the Independent Trustees Counsel is
independent of the Manager within the meaning and intent of the SEC Rules
regarding the independence of counsel.

      After careful deliberation, the Board, including the Independent
Trustees concluded that it was in the best interest of shareholders to
continue the investment advisory agreement for another year. In arriving at a
decision, the Board did not single out any one factor or group of factors as
being more important than other factors, but considered all factors together.
The Board judged the terms and conditions of the investment advisory
agreement, including the investment advisory fee, in light of all of the
surrounding circumstances.



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 commission 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.

      Subject to those considerations, as a factor in selecting brokers for
the Fund's portfolio transactions, the investment advisory agreement also
permits the Manager to consider sales of shares of the Fund and other
investment companies for which the Manager or an affiliate serves as
investment adviser.  Notwithstanding that authority, and with the concurrence
of the Fund's Board, the Manager has determined not to consider sales of
shares of the Fund and other investment companies for which the Manager or an
affiliate serves as investment adviser as a factor in selecting brokers for
the Fund's portfolio transactions.  However, the Manager may continue to
effect portfolio transactions through brokers who sell shares of the Fund.


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.
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.


      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.

      Most purchases of debt obligations are principal transactions at net
prices. Instead of using a broker for those transactions, the Fund normally
deals directly with the selling or purchasing principal or market maker
unless the Manager determines that a better price or execution can be
obtained by using the services of a broker. Purchases of portfolio securities
from underwriters include a commission or concession paid by the issuer to
the underwriter. Purchases from dealers include a spread between the bid and
asked prices. The Fund seeks to obtain prompt execution of these orders at
the most favorable net price.

      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 broadens 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.









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

   Fiscal Year Ended 8/31:   Total Brokerage Commissions Paid by the
                                              Fund1

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

            2004                               $02

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

1.    Amounts do not include spreads or commissions on principal  transactions
   on a net trade basis.
2.    For  the  fiscal  period  from  November  10,  2003   (commencement   of
      operations)  to August  31,  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 Trust,
the Distributor acted as the Fund's principal underwriter in the public
offering of the Fund's classes of shares. The Distributor bore 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 was 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
most recent fiscal year ended August 31, 2004 are shown in the tables below.


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

Fiscal        Aggregate         Class A
                            Front-End Sales
Year       Front-End Sales      Charges
Ended     Charges on Class    Retained by
  8/31:       A Shares        Distributor1

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

  20042      $2,398,320          $5,385

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

1.    Includes amounts  retained by a broker-dealer  that is an affiliate or a
   parent of the Distributor.
2.    For the fiscal period from November 10, 2003 (commencement of
    operations) to August 31, 2004.


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

Fiscal     Concessions on    Concessions on   Concessions on
Year       Class A Shares    Class B Shares   Class C Shares
Ended        Advanced by      Advanced by       Advanced by
  8/31:     Distributor1      Distributor1     Distributor1

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

  20042        $64,370         $5,758,636        $924,158

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

1.    The   Distributor    advanced    concession    payments   to   financial
   intermediaries  for  certain  sales of Class A  shares  and for  sales of
   Class B and Class C shares from its own resources at the time of sale.
2.    For the fiscal period from November 10, 2003 (commencement of
   operations) to August 31, 2004.



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

Fiscal         Class A          Class B           Class C
             Contingent        Contingent       Contingent
Period     Deferred Sales    Deferred Sales   Deferred Sales
Ended          Charges          Charges           Charges
  8/31:      Retained by      Retained by       Retained by
             Distributor      Distributor       Distributor

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

  20041        $9,008           $144,493          $15,641

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

1. For the fiscal period from November 10, 2003 (commencement of
operations) to August 31, 2004.


Distribution and Service Plans. The Fund has adopted a Service Plan for Class
A shares and Distribution and Service Plans for Class B and Class C shares
under Rule 12b-1 of the Investment Company Act. Under those plans the Fund
reimburses 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, 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 have received 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 purpose


      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
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 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 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
88 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" (as defined in the Investment Company Act) 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.

      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 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. 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. The
Distributor makes payments to plan 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.

For the fiscal year ended August 31, 2004 payments under the Class A plan
totaled $162,027, of which $3,448 was retained by the Distributor under the
arrangement described above, and included $8,871 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.


      |_| ?Class B and Class C Service and Distribution Plan. Under each
plan, service fees and distribution 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. The Class B and Class C plans
allow the Distributor to be compensated at a flat rate for its services and
costs in distributing Class B and Class C shares and servicing accounts,
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 the shares were purchased. After the first year shares are
outstanding, 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 or Class C 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.


      The Distributor retains the asset-based sales charge on Class B 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 and/or Class C service fee
and the asset-based sales charge to the dealer quarterly in lieu of paying
the sales concessions and service fee in advance at the time of purchase.


      The asset-based sales charges on Class B and Class C shares allowed
investors to buy shares without a front-end sales charge while allowing the
Distributor to compensate dealers that sold those shares. The Fund pays the
asset-based sales charges to the Distributor for its services rendered in
distributing Class B and Class C shares. The payments are made to the
Distributor in recognition that the Distributor:
      paid 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 and Class C
         shares,

      bore 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 have been able to adequately compensate dealers that sold Class
         B and Class C shares without receiving payment under the plans and
         therefore may not have been 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 have used the payments under the plan to include the Fund in
         various third-party distribution programs that may have increased
         sales of Fund shares, 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 and Class C 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 or Class C 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 Period Ended 8/31/04

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

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

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

Class B Plan       $660,497      $557,9271       $6,613,047         6.57%

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

Class C Plan       $437,553      $357,1422       $1,274,843         1.84%

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

1.    Includes $0 paid to an affiliate of the Distributor's parent company.
2.    Includes $706 paid to an affiliate of the Distributor's parent company.



      All payments under the Class B and Class C 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 1.800.525-7048 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.  Those
returns must be shown for the 1-, 5- and 10-year periods (or the life of the
class, if less) ending as of the most recently ended calendar quarter prior
to the publication of the advertisement (or its submission for publication).


      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     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.

      The Fund's performance returns do not reflect the effect of taxes on
         dividends and capital gains distributions.
      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, and total returns are not
         guaranteed and normally will fluctuate on a daily basis.

      When an investor's shares are redeemed, they may be worth more or less
         than their original cost.
      Total returns for any given past period represent historical
         performance information and are not, and should not be considered, a
         prediction of future 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 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 those
investments, the types of investments the Fund holds, and its operating
expenses that are allocated to the particular class.


      |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 5.75% (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% contingent
deferred sales charge is deducted for returns for the 1-year and
life-of-class periods, as applicable.


         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

         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 or
Class C
shares.
Each is
based on
the
difference
in net
asset
value per
share at
the
beginning
and the
end of
the
period
for a
hypothetica
investment
in that
class of
shares
(without
considering
front-end  l
or
contingent
deferred
sales
charges)
and takes
into
considerati
the
reinvestmen
of
dividends
and
capital
gains      on
distributio
           t
The
Fund's
Total
Returns
for the
Periods    ns.
Ended
 8/31/04

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

Class of     Cumulative Total            Average Annual Total Returns
                 Returns
               (10 Years or
            life-of-class, if
Shares            less)1

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

                                        1-Year1                 5-Year
                                                         (or life of class if
                                                                less)

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

             After    Without       After    Without       After    Without
             Sales    Sales         Sales    Sales         Sales    Sales
            Charge      Charge     Charge      Charge     Charge      Charge

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

Class A     -7.32%      -1.67%       N/A        N/A         N/A        N/A

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

Class B     -7.16%      -2.27%       N/A        N/A         N/A        N/A

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

Class C     -3.21%      -2.23%       N/A        N/A         N/A        N/A

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

1. Inception of Class A, Class B and Class C: 11/10/03.


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

  Average Annual Total Returns for Class A Shares (After
                      Sales Charge)
              For the Periods Ended 8/31/04

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

                                1-Year1        5-Year
                                             (or life of
                                           class if less)

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

After Taxes on Distributions    -7.32%           N/A

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

After Taxes on                  -4.76%           N/A
Distributions and
Redemption of Fund Shares

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

           1. Inception of Class A shares: 11/10/03.


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 among domestic hybrid
funds.

      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


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 shares and the dividends payable on
Class B or Class C shares will be
reduced by incremental expenses borne
solely by that class. Those expenses
include the asset-based sales charges to
which Class B and Class C shares are
subject.

      The availability of different
classes of shares permitted an investor
to choose the method of purchasing
shares that was more appropriate for the
investor. That may have depended on the
amount of the purchase, the length of
time the investor expected to hold
shares, and other relevant
circumstances. Class A shares normally
are sold subject to an initial sales
charge. While Class B and Class C shares
have no initial sales charge, the
purpose of the deferred sales charge and
asset-based sales charge on Class B and
Class C 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 sold 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.


      |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 88 months
from the date of 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 88 months.

      |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).


Account Fees. As stated in the
Prospectus, a $12 annual "Minimum
Balance Fee" is assessed on any account
valued at less than $500. This fee will
not be assessed on the following
accounts:

o     Accounts that have balances below
         $500 due to the automatic
         conversion of shares from Class
         B to Class A shares;
o     Certain accounts held by
         broker-dealers through the
         National Securities Clearing
         Corporation; and
o     Accounts that fall below the $500
         threshold due solely to market
         fluctuations within the
         12-month period preceding the
         date the fee is deducted.

      The fee is automatically deducted
from qualifying accounts annually on or
about the second to last business day of
September. This annual fee is waived for
any shareholders who elect to access
their account documents through
electronic document delivery rather than
in paper copy and who elect to utilize
the Internet or PhoneLink as their
primary source for their general
servicing needs. To sign up 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.

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.

      |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     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).

How to Sell Shares

The information below supplements the
terms and conditions for redeeming
shares set forth in the Prospectus.

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 if the reinvestment
occurs during the Post-Warranty Period
or, if the reinvestment occurs during
the Warranty Period, in 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 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  Centennial New York Tax Exempt Trust
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 and
Class C 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.

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 America Fund, L.P.
Centennial California Tax Exempt Trust    Centennial Tax Exempt Trust
      Centennial Government Trust           Oppenheimer Money Market Fund, Inc.
      Centennial Money Market Trust

      The following funds do not offer Class N shares:
      Oppenheimer AMT-Free Municipals        Oppenheimer Pennsylvania Municipal
                                             Fund

      Oppenheimer AMT-Free New York          Oppenheimer Principal Protected Main
      Municipals                             Street Fund II
      Oppenheimer California Municipal Fund  Oppenheimer Rochester National
                                             Municipals
      Oppenheimer Limited Term Municipal     Limited Term New York Municipal Fund
      Fund
      Oppenheimer New Jersey Municipal Fund  Oppenheimer Senior Floating Rate Fund
                                             Rochester Fund Municipals


      The following funds do not offer Class Y shares:

      Oppenheimer AMT-Free New York         Oppenheimer Multiple Strategies Fund
      Municipals
      Oppenheimer California Municipal Fund Oppenheimer New Jersey Municipal Fund
      Oppenheimer Capital Income Fund       Oppenheimer Pennsylvania Municipal Fund
      Oppenheimer Cash Reserves             Oppenheimer Principal Protected Main
                                            Street Fund
      Oppenheimer Champion Income Fund      Oppenheimer Principal Protected Main
                                            Street Fund II
      Oppenheimer Convertible Securities    Oppenheimer Principal Protected Main
      Fund                                  Street Fund III
      Oppenheimer Disciplined Allocation    Oppenheimer Quest Capital Value Fund,

      Fund                                  Inc.

      Oppenheimer Developing Markets Fund   Oppenheimer Quest International Value
                                            Fund, Inc.
      Oppenheimer Gold & Special Minerals   Oppenheimer Rochester National
      Fund                                  Municipals
      Oppenheimer International Bond Fund   Oppenheimer Senior Floating Rate Fund
      Oppenheimer International Growth Fund Oppenheimer Small Cap Value Fund
      Oppenheimer International Small       Oppenheimer Total Return Bond Fund
      Company Fund
      Oppenheimer Limited Term Municipal    Limited Term New York Municipal Fund
      Fund


   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 X shares of Limited Term New York Municipal Fund may be exchanged
      only for Class B shares of other Oppenheimer funds and no exchanges may
      be made to Class X shares.
o     Shares of Oppenheimer Capital Preservation Fund may not be exchanged
      for shares of Oppenheimer Money Market Fund, Inc., Oppenheimer Cash
      Reserves or Oppenheimer Limited-Term Government Fund.
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 Oppenheimer Money Market Fund, Inc. purchased with the
      redemption proceeds of shares of other mutual funds (other than funds
      managed by the Manager or its subsidiaries) redeemed within the 30 days
      prior to that purchase may subsequently be exchanged for shares of
      other Oppenheimer funds without being subject to an initial sales
      charge or contingent deferred sales charge. To qualify for that
      privilege, the investor or the investor's dealer must notify the
      Distributor of eligibility for this privilege at the time the shares of
      Oppenheimer Money Market Fund, Inc. are purchased. If requested, they
      must supply proof of entitlement to this privilege.

o     Shares of Oppenheimer Principal Protected Main Street Fund and
      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
      until after the expiration of the warranty period (8/5/2010) or for
      shares of Oppenheimer Principal Protected Main Street Fund II until
      after the expiration of its Warranty Period (3/3/2011).

o     Shares of the Fund acquired during the Offering Period 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.

      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.

o     With respect to Class B shares, the Class B 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 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     When Class B or Class C 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 or Class C 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. The Fund may accept requests for exchanges
of up to 50 accounts per day from representatives of authorized dealers that
qualify for this privilege.

      |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.

      |X| 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.

      Under certain tax rules, the Fund may be required to include an amount
in income with respect to a security even though the Fund does not receive
payments in cash attributable to such income in respect of the security
during the year. For example, the Fund may be required to accrue a portion of
any discount at which it purchases a debt security as income in each year.
The Fund will not invest in equity securities during the Warranty Period
other than Class Y shares of the Underlying Fund. To the extent that the Fund
invests in any securities producing such "phantom income," the Fund will
nonetheless be required to make income distributions of such phantom income
in order to avoid taxation of such income at the Fund level. Such
distributions will be required to be made from available cash of the Fund or
by liquidation of Fund securities if necessary. If a distribution of cash
necessitates the liquidation of Fund securities, the Fund may realize a gain
or loss from such sales. Any net capital gains realized from such
transactions may result in larger capital gain distributions (if any) to
shareholders than they would have received in the absence of such
transactions.

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
and Class C shares are expected to be lower than dividends on Class A shares.
That is because of the effect of the asset-based sales charge on Class B and
Class C 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.

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.

      |X| 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.

      |X| 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. 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
March of each year.

      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. All income and any tax
withheld (in this situation) 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.

      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 were 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  Warranty  Provider.  Merrill  Lynch  Bank USA,  located  at 15 West South
Temple  Square,  Suite 300 Salt Lake City,  Utah 84101,  has entered  into the
Warranty  Agreement  with  the  Fund.  Merrill  Lynch  Bank  USA  is a  direct
subsidiary  of Merrill  Lynch & Co.,  Inc.  and its  principal  business is to
engage  in  banking  activities.  The 2003  audited  financial  statements  of
Merrill  Lynch Bank USA and its March 25, 2004 and June 25, 2004 and September
24, 2004 quarterly unaudited  financial  statements are incorporated herein by
reference.  You may  request a copy of the  Merrill  Lynch Bank USA  financial
statements,  free of charge,  by calling the Transfer  Agent at the  toll-free
number listed on the back cover of this  Statement of Additional  Information.
You may  request a copy of these  financial  statements,  free of  charge,  by
calling the Transfer  Agent at the  toll-free  number listed on the back cover
of this Statement of Additional Information.


The Custodian. JPMorgan Chase Bank 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 Registered Public Accounting Firm. Deloitte & Touche LLP is the
independent registered public accounting firm of the Fund. It audits the
Fund's financial statements and performs other related audit services. It
also acts as auditors for the Manager and for certain other funds advised by
the Manager and its affiliates. Deloitte & Touche LLP is the independent
auditors of MLBUSA.

Financial Statements. The audited financial statements for the Oppenheimer
Main Street Fund (the "Underlying Fund") are incorporated in this Statement
of Additional Information by reference to the August 31, 2004 annual report
to shareholders of the Underlying Fund. You may request a copy of that annual
report at no charge by calling the toll-free number listed on the back cover
of this Statement of Additional Information during normal business hours on
any business day.

The finanacial statements for the Fund from inception (11/10/03) to the
Fund's fiscal year ended 8/31/04 follow.





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF
OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Principal Protected Main Street Fund II, a series of Oppenheimer
Principal Protected Trust II, including the statement of investments, as of
August 31, 2004, and the related statement of operations, the statement of
changes in net assets and the financial highlights for the period from November
10, 2003 (commencement of operations) to August 31, 2004. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audit.

      We conducted our audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of August 31, 2004, by correspondence with
the custodian and brokers; where replies were not received from brokers, we
performed other auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

      In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Principal Protected Main Street Fund II as of August 31, 2004, the
results of its operations, the changes in its net assets, and the financial
highlights for the period from November 10, 2003 (commencement of operations) to
August 31, 2004, in conformity with accounting principles generally accepted in
the United States of America.


DELOITTE & TOUCHE LLP

Denver, Colorado
October 14, 2004









STATEMENT OF INVESTMENTS  August 31, 2004
--------------------------------------------------------------------------------

                                                                                                           VALUE
                                                                                        SHARES        SEE NOTE 1
------------------------------------------------------------------------------------------------------------------
INVESTMENTS IN AFFILIATED COMPANIES EQUITY FUNDS--38.5%
------------------------------------------------------------------------------------------------------------------
Oppenheimer Main Street Fund, Cl. Y (Cost $107,562,231)                              3,168,303     $ 104,332,230


                                                                                     PRINCIPAL
                                                                                        AMOUNT
------------------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT OBLIGATIONS--61.0%
------------------------------------------------------------------------------------------------------------------
Federal National Mortgage Assn. Unsec. Nts., 6%, 5/15/11                         $  16,000,000        17,716,512
------------------------------------------------------------------------------------------------------------------
Freddie Mac Unsec. Nts., 5.625%, 3/15/11                                            12,800,000        13,922,650
------------------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, STRIPS, 3.82%, 2/15/11 1                                      155,800,000       122,033,622
------------------------------------------------------------------------------------------------------------------
U.S. Treasury Nts., STRIPS, 3.84%, 5/15/11 1                                        14,941,000        11,554,592
                                                                                                   ---------------
Total U.S. Government Obligations (Cost $165,442,554)                                                165,227,376

------------------------------------------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--0.5%
------------------------------------------------------------------------------------------------------------------
Undivided interest of 0.35% in joint repurchase agreement (Principal Amount/
Value $400,941,000, with a maturity value of $400,958,151) with DB Alex Brown
LLC, 1.540%, dated 8/31/04, to be repurchased at $1,402,060 on 9/1/04,
collateralized by U.S. Treasury Bonds, 2%, 1/15/14, with a value of
$409,193,552 (Cost $1,402,000)                                                       1,402,000         1,402,000

------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $274,406,785)                                          100.0%      270,961,606
------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS                                                      0.0          (132,666)
                                                                                 ---------------------------------
NET ASSETS                                                                               100.0%    $ 270,828,940
                                                                                 =================================

FOOTNOTE TO STATEMENT OF INVESTMENTS

1. Zero coupon bond reflects effective yield on the date of purchase.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            19 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

STATEMENT OF ASSETS AND LIABILITIES  August 31, 2004
--------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
ASSETS
-------------------------------------------------------------------------------------------------------
Investments, at value (cost $274,406,785)--see accompanying statement of investments     $270,961,606
-------------------------------------------------------------------------------------------------------
Cash                                                                                           58,048
-------------------------------------------------------------------------------------------------------
Receivables and other assets:
Interest                                                                                      617,245
Other                                                                                           2,577
                                                                                         --------------
Total assets                                                                              271,639,476

-------------------------------------------------------------------------------------------------------
LIABILITIES
-------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                                        338,923
Warranty agreement fees                                                                       272,143
Distribution and service plan fees                                                            113,775
Transfer and shareholder servicing agent fees                                                  18,085
Shareholder communications                                                                     17,357
Trustees' compensation                                                                          2,746
Other                                                                                          47,507
                                                                                         --------------
Total liabilities                                                                             810,536

-------------------------------------------------------------------------------------------------------
NET ASSETS                                                                               $270,828,940
                                                                                         ==============

-------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
-------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest                                               $      9,216
-------------------------------------------------------------------------------------------------------
Additional paid-in capital                                                                277,137,857
-------------------------------------------------------------------------------------------------------
Accumulated net investment income                                                           1,452,843
-------------------------------------------------------------------------------------------------------
Accumulated net realized loss on investments                                               (4,325,797)
-------------------------------------------------------------------------------------------------------
Net unrealized depreciation on investments                                                 (3,445,179)
                                                                                         --------------
NET ASSETS                                                                               $270,828,940
                                                                                         ==============


            20 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

----------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
----------------------------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of $100,995,414
and 3,423,992 shares of beneficial interest outstanding)                                           $29.50
Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price)    $31.30
----------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $100,645,546 and 3,432,679 shares
of beneficial interest outstanding)                                                                $29.32
----------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $69,187,980 and 2,359,072 shares
of beneficial interest outstanding)                                                                $29.33

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS


            21 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

STATEMENT OF OPERATIONS  For the Year Ended August 31, 2004 1
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
INVESTMENT INCOME
--------------------------------------------------------------------------------
Interest                                                           $ 3,226,403
--------------------------------------------------------------------------------
Other income                                                           745,000
                                                                   -------------
Total investment income                                              3,971,403

--------------------------------------------------------------------------------
EXPENSES
--------------------------------------------------------------------------------
Management fees                                                        874,917
--------------------------------------------------------------------------------
Distribution and service plan fees:
Class A                                                                162,027
Class B                                                                660,497
Class C                                                                437,553
--------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A                                                                 40,902
Class B                                                                 64,716
Class C                                                                 28,716
--------------------------------------------------------------------------------
Shareholder communications:
Class A                                                                 12,648
Class B                                                                 12,103
Class C                                                                  6,413
--------------------------------------------------------------------------------
Warranty agreement fees                                                816,387
--------------------------------------------------------------------------------
Trustees' compensation                                                   7,217
--------------------------------------------------------------------------------
Custodian fees and expenses                                              3,444
--------------------------------------------------------------------------------
Other                                                                   57,157
                                                                   -------------
Total expenses                                                       3,184,697
Less payments and waivers of expenses                                 (605,441)
                                                                   -------------
Net expenses                                                         2,579,256

--------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                1,392,147

--------------------------------------------------------------------------------
REALIZED AND UNREALIZED LOSS
--------------------------------------------------------------------------------
Net realized loss on investments                                    (4,325,797)
--------------------------------------------------------------------------------
Net change in unrealized depreciation on investments                (3,445,179)

--------------------------------------------------------------------------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS               $(6,378,829)
                                                                   =============

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            22 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II


STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------

PERIOD ENDED AUGUST 31,                                                              2004 1
---------------------------------------------------------------------------------------------
OPERATIONS
---------------------------------------------------------------------------------------------
Net investment income                                                          $  1,392,147
---------------------------------------------------------------------------------------------
Net realized loss                                                                (4,325,797)
---------------------------------------------------------------------------------------------
Net change in unrealized depreciation                                            (3,445,179)
                                                                               --------------
Net decrease in net assets resulting from operations                             (6,378,829)

---------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
---------------------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial interest transactions:
Class A                                                                         102,937,926
Class B                                                                         103,224,070
Class C                                                                          70,943,773

---------------------------------------------------------------------------------------------
NET ASSETS
---------------------------------------------------------------------------------------------
Total increase                                                                  270,726,940
---------------------------------------------------------------------------------------------
Beginning of period                                                                 102,000 2
                                                                               --------------
End of period (including accumulated net investment income
of $1,452,843 at August 31, 2004)                                              $270,828,940
                                                                               ==============

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

2. Reflects the value of the Manager's seed money investment on October 2, 2003.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            23 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------

                                              CLASS A       CLASS B       CLASS C
PERIOD ENDED AUGUST 31,                        2004 1        2004 1        2004 1
------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
------------------------------------------------------------------------------------
Net asset value, beginning of period         $  30.00      $  30.00      $  30.00
------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                             .25           .10           .09
Net realized and unrealized loss                 (.75)         (.78)         (.76)
                                             ---------------------------------------
Total from investment operations                 (.50)         (.68)         (.67)
------------------------------------------------------------------------------------
Net asset value, end of period               $  29.50      $  29.32      $  29.33
                                             =======================================

------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2              (1.67)%       (2.27)%       (2.23)%
------------------------------------------------------------------------------------

------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
------------------------------------------------------------------------------------
Net assets, end of period (in thousands)     $100,995      $100,646      $ 69,188
------------------------------------------------------------------------------------
Average net assets (in thousands)            $ 80,924      $ 81,999      $ 54,330
------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                            1.29%         0.49%         0.50%
Total expenses                                   1.34% 4       2.12% 5       2.08% 6
Expenses after payments and waivers              0.99%         1.77%         1.73%
------------------------------------------------------------------------------------
Portfolio turnover rate                           118%          118%          118%

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

3. Annualized for periods of less than one full year.

4. Expenses paid including all underlying fund expenses were 1.54% for August
31, 2004.

5. Expenses paid including all underlying fund expenses were 2.32% for August
31, 2004.

6. Expenses paid including all underlying fund expenses were 2.28% for August
31, 2004.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

            24 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Principal Protected Main Street Fund II (the Fund), a series of
Oppenheimer Principal Protected Trust II, is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
The Fund seeks capital preservation in order to have a net asset value on the
Maturity Date at least equal to your original investment (the Warranty Amount)
(net of any sales charges and less your share of extraordinary expenses and the
proportional reduction of dividends paid in cash and redemption of the Fund
shares). The Fund's investment advisor is OppenheimerFunds, Inc. (the Manager).

      Shares of the Fund were offered during the Offering Period (November 10,
2003 to February 27, 2004). Shares are not offered during the Warranty Period
(March 3, 2004 to March 3, 2011) to the Maturity Date (March 3, 2011) except in
connection with reinvestment of dividends and distributions. During the Warranty
Period, the Fund will seek capital preservation, and secondarily high total
return by allocating its assets between Oppenheimer Main Street Fund and certain
U.S. government securities.

      The Fund offered Class A, Class B and Class C shares. Class A shares were
sold at their offering price, which is normally net asset value plus a front-end
sales charge. Class B and Class C shares were sold without a front-end sales
charge but may be subject to a contingent deferred sales charge (CDSC). All
classes of shares have identical rights and voting privileges with respect to
the Fund in general and exclusive voting rights on matters that affect that
class alone. Earnings, net assets and net asset value per share may differ due
to each class having its own expenses, such as transfer and shareholder
servicing agent fees and shareholder communications, directly attributable to
that class. Class A, B and C have separate distribution and/or service plans.
Class B shares will automatically convert to Class A shares 88 months after the
date of purchase.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

--------------------------------------------------------------------------------
WARRANTY AGREEMENT. The Fund has entered into a Financial Warranty Agreement
with Merrill Lynch Bank USA ("the Warranty Provider") to ensure that on the
Maturity Date each shareholder's account will be no less than the value of that
shareholder's account on the second business day after the end of the Offering
Period. This value will include net income, if any, earned by the Fund during
the offering period and reduced by adjustments permitted under the Warranty
Agreement, sales charges, applicable share of extraordinary expenses and
proportionately reduced for dividends and distributions paid in cash and
redemptions of Fund shares. To avoid a reduced warranty amount, shareholders
must reinvest all dividends and distributions received from the Fund to purchase
additional shares of the Fund and must not redeem any shares of the Fund during
the Warranty Period. If the value of the Fund's assets on the Maturity Date is
insufficient to result in the value of each shareholder's account being at least
equal to the shareholder's Warranty Amount, the Warranty Provider will pay the
Fund an amount equal to the excess of his or her warranty amount over his or her
account value.


            25 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

NOTES TO FINANCIAL STATEMENTS  Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

The Financial Warranty is solely the obligation of the Warranty Provider. It is
possible that the financial position of the Warranty Provider may deteriorate
and it would be unable to satisfy its obligations under the Financial Warranty.
The Fund's assets and the obligations of the Warranty Provider under the
Warranty Agreement are not guaranteed by Merrill Lynch & Co., Inc. (the Warranty
Provider's parent company), the United States Government, the Manager, or any
other entity or person.

      The Warranty Agreement requires the Manager, on behalf of the Fund, to
comply with certain agreed upon investment parameters in an attempt to limit the
Fund's risk. If the Manager fails to comply with the agreed-upon investment
parameters or otherwise fails to comply with certain requirements set forth in
the Warranty Agreement, the Warranty Provider may terminate its Financial
Warranty in certain limited circumstances. The Warranty Provider may monitor the
Fund's compliance with the Warranty Agreement solely to protect the interests of
the Warranty Provider and not the Fund's shareholders.

      The fee paid to the Warranty Provider is an annual fee of 0.60% of the
average daily net assets of the Fund. If the Fund is required to make a complete
and irreversible allocation of its assets to the debt portfolio, the Warranty
Fee will thereafter be reduced to 0.35% of the average daily net assets of the
Fund. For the period ended August 31, 2004, the amount paid for Warranty
Agreement fees was $544,244.

      The Fund had previously entered into a warranty agreement ("the Original
Warranty Agreement") with Main Place Funding, LLC to provide a financial
warranty to the Fund. Under that agreement, the fee paid to Main Place Funding
LLC would have been 0.475% of the average daily net assets of the Fund. If the
Fund had been required to make a complete and irreversible allocation of its
assets to the debt portfolio, the Warranty Fee would thereafter have been
reduced to 0.35% of the average daily net assets of the Fund. The Original
Warranty Agreement was guaranteed by Bank of America Corporation, the indirect
parent company of Main Place Funding, LLC and was also subject to termination by
the Fund or Main Place Funding, LLC under certain circumstances. Pursuant to a
Termination Agreement approved by the Board of Trustees on January 19, 2004, the
Manager, the Fund, Main Place Funding LLC and Bank of America N.A. agreed to
terminate Main Place Funding, LLC's obligations under the Original Warranty
Agreement. As consideration for entering into the Termination Agreement, the
Fund received $745,000 from Main Place Funding, LLC. The Fund has recorded this
amount as other income in the Statement of Operations.

--------------------------------------------------------------------------------
SECURITIES VALUATION. The allocation of the Fund's assets between the debt
portfolio and the equity portfolio will vary over time based upon the Warranty
Formula. The formula is intended to allow the Fund to have a net asset value on
the Maturity Date at least equal to the Warranty Amount.

      During the Warranty Period, the Fund will invest a portion of its assets,
and in certain circumstances, the Fund may invest all of its assets, in U.S.
government securities having maturities approximately equal to the period
remaining in the Warranty Period. Long-term


            26 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II


debt securities having a remaining maturity in excess of 60 days will be valued
at the mean between the "bid" and "asked" prices. Long-term and short-term
"non-money market" debt securities are valued by a portfolio pricing service
approved by the Board of Trustees. Short-term "money market type" debt
securities with remaining maturities of sixty days or less are valued at
amortized cost (which approximates market value).

      The Fund invests the equity portfolio in Class Y shares of Oppenheimer
Main Street Fund (the Underlying Fund). The net asset value of the Underlying
Fund is determined as of the close of The New York Stock Exchange (the
Exchange), normally 4:00 P.M. Eastern time, on each day the Exchange is open for
business. The net asset value per share is determined 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.

--------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

--------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.

--------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders, therefore, no federal income or excise tax provisions are
required, however, during the period ended August 31, 2004, the Fund paid excise
tax of $474.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.


            27 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II


NOTES TO FINANCIAL STATEMENTS  Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

                                                             NET UNREALIZED
                                                               DEPRECIATION
                                                           BASED ON COST OF
                                                             SECURITIES AND
    UNDISTRIBUTED    UNDISTRIBUTED       ACCUMULATED      OTHER INVESTMENTS
    NET INVESTMENT       LONG-TERM              LOSS     FOR FEDERAL INCOME
    INCOME                    GAIN    CARRYFORWARD 1           TAX PURPOSES
    -----------------------------------------------------------------------
    $1,453,966                 $--        $3,037,585             $4,733,391

1. As of August 31, 2004, the Fund had $3,037,585 of post-October losses
available to offset future realized capital gains, if any. Such losses, if
unutilized, will expire in 2013.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for August 31, 2004. Net assets of the
Fund were unaffected by the reclassifications.

                                               INCREASE TO
                                               ACCUMULATED
                    REDUCTION TO            NET INVESTMENT
                    PAID-IN CAPITAL                 INCOME
                    --------------------------------------
                    $60,696                        $60,696

No distributions were paid during the period ended August 31, 2004.

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of August 31, 2004 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

                Total federal tax cost           $275,694,997
                                                 ============

                Gross unrealized appreciation    $         --
                Gross unrealized depreciation      (4,733,391)
                                                 ------------
                Net unrealized depreciation      $ (4,733,391)
                                                 ============

--------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Board of Trustees has adopted a deferred
compensation plan for independent trustees that enables trustees to elect to
defer receipt of all or a portion of the annual compensation they are entitled
to receive from the Fund. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of other Oppenheimer funds selected by the
Trustee. The Fund purchases shares of the funds


            28 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II


selected for deferral by the Trustee in amounts equal to his or her deemed
investment, resulting in a Fund asset equal to the deferred compensation
liability. Such assets are included as a component of "Other" within the asset
section of the Statement of Assets and Liabilities. Deferral of trustees' fees
under the plan will not affect the net assets of the Fund, and will not
materially affect the Fund's assets, liabilities or net investment income per
share. Amounts will be deferred until distributed in accordance to the Plan.

--------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

--------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date. Interest
income, which includes accretion of discount and amortization of premium, is
accrued as earned.

--------------------------------------------------------------------------------
EXPENSE OFFSET ARRANGEMENT. The reduction of custodian fees, if applicable,
represents earnings on cash balances maintained by the Fund.

--------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

--------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.

--------------------------------------------------------------------------------
2.SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:

               PERIOD ENDED AUGUST 31, 2004 1,2
                       SHARES            AMOUNT
--------------------------------------------------------------------------------
CLASS A
Sold                3,578,204     $107,591,134
Redeemed             (157,545)      (4,653,208)
                    --------------------------
Net increase        3,420,659     $102,937,926
                    ==========================

--------------------------------------------------------------------------------
CLASS B
Sold                3,558,485     $106,908,216
Redeemed             (125,839)      (3,684,146)
                    --------------------------
Net increase        3,432,646     $103,224,070
                    ==========================

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

2. The Fund sold 3,333.33 shares of Class A at a value of $100,000 and 33.33
shares of Class B and Class C at a value of $1,000, respectively, to the Manager
upon seeding of the Fund on October 2, 2003.


            29 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

NOTES TO FINANCIAL STATEMENTS  Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST Continued

             PERIOD ENDED AUGUST 31, 2004 1,2
                      SHARES           AMOUNT
--------------------------------------------------------------------------------
CLASS C
Sold               2,438,651     $ 73,283,021
Redeemed             (79,613)      (2,339,248)
                   --------------------------
Net increase       2,359,038     $ 70,943,773
                   ==========================

1. For the period from November 10, 2003 (commencement of operations) to August
31, 2004.

2. The Fund sold 3,333.33 shares of Class A at a value of $100,000 and 33.33
shares of Class B and Class C at a value of $1,000, respectively, to the Manager
upon seeding of the Fund on October 2, 2003.

--------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than U.S. government obligations and short-term obligations, for the period
ended August 31, 2004, were $192,048,832 and $80,318,414, respectively. There
were purchases of $232,167,960 and sales of $68,418,841 of U.S. government and
government agency obligations for the period ended August 31, 2004.

--------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Under an investment advisory agreement, the Fund pays the
Manager a management fee at an annual rate of 0.50% per annum of the average
annual net assets of the Fund. That fee will apply during the Warranty Period
and the Post-Warranty Period. The management fee shall be reduced to 0.40% per
annum of average annual net assets of the Fund in any month during the Warranty
Period following a month where the Fund's investment in equity securities
(including shares of Oppenheimer Main Street Fund, "the Underlying Fund") is, on
average, less than 10% of net assets. If during the Warranty Period 100% of the
Fund's assets are completely and irreversibly invested in the debt portfolio,
the management fee will be at an annual rate of 0.25% of the average annual net
assets of the Fund, and if that occurs the Manager will further reduce its
management fee to the extent necessary so that total annual operating expenses
of the Fund (other than Extraordinary Expenses such as litigation costs) do not
exceed 1.30% for Class A shares, 2.05% for Class B shares and 2.05% for Class C
shares. However, if this reduction in the management fee is not sufficient to
reduce total annual operating expenses to these limits, the Manager is not
required to subsidize Fund expenses to assure that expenses do not exceed those
limits. Furthermore, if expenses exceed these expense limits, the Warranty
Amount will be reduced by any expenses that exceed those limits.

--------------------------------------------------------------------------------
ADMINISTRATION SERVICES. The Fund pays the Manager a fee of $1,500 per year for
preparing and filing the Fund's tax returns.


            30 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

--------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the period ended August 31, 2004, the Fund paid
$116,249 to OFS for services to the Fund.

--------------------------------------------------------------------------------
OFFERING AND ORGANIZATIONAL COSTS. The Manager paid all offering and
organizational costs associated with the registration and seeding of the Fund.

--------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN (12B-1) FEES. Under its General Distributor's
Agreement with the Fund, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the Fund's principal underwriter in the continuous public offering of
the Fund's classes of shares.

--------------------------------------------------------------------------------
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 services and maintenance of accounts of their customers that
hold Class A shares. Any unreimbursed expenses the Distributor incurs with
respect to Class A shares in any fiscal year cannot be recovered in subsequent
years. Fees incurred by the Fund under the Plan are detailed in the Statement of
Operations.

--------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLANS FOR CLASS B AND CLASS C SHARES. The Fund has
adopted Distribution and Service Plans for Class B and Class C shares to
compensate the Distributor for its services in connection with the distribution
of those shares and servicing accounts. Under the plans, the Fund pays the
Distributor an annual asset-based sales charge of 0.75% per year on Class B and
Class C shares. The Distributor also receives a service fee of up to 0.25% per
year under each plan. If either the Class B or Class C plan is terminated by the
Fund or by the shareholders of a class, the Board of Trustees and its
independent trustees must determine whether the Distributor shall be entitled to
payment from the Fund of all or a portion of the service fee and/or asset-based
sales charge in respect to shares sold prior to the effective date of such
termination. The Distributor's aggregate uncompensated expenses under the plan
at August 31, 2004 for Class B and Class C shares were $6,613,047 and
$1,274,843, respectively. Fees incurred by the Fund under the plans are detailed
in the Statement of Operations.

--------------------------------------------------------------------------------
SALES CHARGES. Front-end sales charges and contingent deferred sales charges
(CDSC) do not represent expenses of the Fund. They are deducted from the
proceeds of sales of Fund shares prior to investment or from redemption proceeds
prior to remittance, as applicable. The sales charges retained by the
Distributor from the sale of shares and the CDSC retained by the Distributor on
the redemption of shares is shown in the table below for the period indicated.


            31 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II


NOTES TO FINANCIAL STATEMENTS  Continued
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued

                                            CLASS A           CLASS B           CLASS C
                          CLASS A        CONTINGENT        CONTINGENT        CONTINGENT
                        FRONT-END          DEFERRED          DEFERRED          DEFERRED
                    SALES CHARGES     SALES CHARGES     SALES CHARGES     SALES CHARGES
                      RETAINED BY       RETAINED BY       RETAINED BY       RETAINED BY
PERIOD ENDED          DISTRIBUTOR       DISTRIBUTOR       DISTRIBUTOR       DISTRIBUTOR
-----------------------------------------------------------------------------------------
August 31, 2004            $5,385            $9,008          $144,493           $15,641

--------------------------------------------------------------------------------
PAYMENTS AND WAIVERS OF EXPENSES. The Manager will reimburse the Fund for
expenses equal to the Underlying Fund expenses paid by the Fund as a shareholder
of the Underlying Fund. That expense reimbursement will fluctuate as the Fund's
allocation between the Underlying Fund and the debt portfolio changes. During
the period ended August 31, 2004, the Manager reimbursed the Fund $350,524 for
such Underlying Fund expenses.

      The Manager voluntarily waived or reimbursed all Fund expenses, other than
12b-1 expenses, in the amount of $254,917 incurred during the Offering Period.

      OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.

--------------------------------------------------------------------------------
5.LITIGATION

Six complaints have been filed as putative derivative and class actions against
the Manager, OFS and the Distributor (collectively, "OppenheimerFunds"), as well
as 51 of the Oppenheimer funds (collectively, the "Funds") excluding this Fund,
and nine directors/trustees of certain of the Funds other than this Fund
(collectively, the "Directors/Trustees"). The complaints allege 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
of 1940 and the Investment Advisers Act of 1940. The complaints further allege
that by permitting and/or participating in those actions, the Directors/Trustees
breached their fiduciary duties to Fund shareholders under the Investment
Company Act of 1940 and at common law.

      OppenheimerFunds believes that it is premature to render any opinion as to
the likelihood of an outcome unfavorable to them, the Funds or the
Directors/Trustees and that no estimate can yet be made with any degree of
certainty as to the amount or range of any potential loss. However,
OppenheimerFunds, the Funds and the Directors/Trustees believe that the
allegations contained in the complaints are without merit and intend to defend
these lawsuits vigorously.


            32 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND II

                                     A-1
                                  Appendix A

                           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









                                     B-13
                                  Appendix B

OppenheimerFunds Special Sales Charge Arrangements and Waivers
--------------------------------------------------------------


Shares of the Fund were sold during the Offering Period and cannot be
purchased during the Warranty Period.


In certain cases, the initial sales charge that applies to purchases of Class
A shares1 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.2 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 plans3
         4) Group Retirement Plans4
         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."5 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 with the proceeds of maturing principal units of
         any Qualified Unit Investment Liquid Trust Series.
|_|   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.

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.
         4) Hardship withdrawals, as defined in the plan.6
         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.7
         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.

|_|   Shares redeemed prior to 4:00 p.m. eastern time on February 27, 2004 by
         shareholders who purchased such shares on or before January 23, 2004.

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 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.

|_|   Distributions8 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.9
         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.10
         9) On account of the participant's separation from service.11
         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.

|_|   Shares redeemed prior to 4:00 p.m. eastern time on February 27, 2004 by
         shareholders who purchased such shares on or before January 23, 2004.


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 Value Fund        Oppenheimer Quest Global
   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:
         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.
         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:
         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
         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:
         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);
         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
         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 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;
   4) 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 Municipal Bond Fund, 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.








                                     C-2

                                     Appendix C

                       Information About the Underlying Fund
                       -------------------------------------

Additional Information About the Underlying Fund's Investment Policies and
Risks

The investment objective, the principal investment policies and the main
risks of the Oppenheimer Main Street Fund (the "Underlying Fund") are
described in the Underlying Fund's Prospectus as well as the Prospectus for
Oppenheimer Principal Protected Main Street Fund II. This Appendix C contains
supplemental information about those policies and risks and the types of
securities that the Underlying Fund's investment Manager, OppenheimerFunds,
Inc., can select for the Underlying Fund. Additional information is also
provided about the strategies that the Underlying Fund can use to try to
achieve its objective.

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

      |X| Investments in Equity Securities. The Underlying Fund does not
limit its investments in equity securities to issuers having a market
capitalization of a specified size or range, and therefore can invest in
securities of small-, mid- and large-capitalization issuers. At times, the
Underlying Fund can focus its equity investments in securities of one or more
capitalization ranges, based upon the Manager's judgment of where the best
market opportunities are to seek the Underlying Fund's objective. At times,
the market may favor or disfavor securities of issuers of a particular
capitalization range. Securities of small capitalization issuers may be
subject to greater price volatility in general than securities of larger
companies. Therefore, if the Underlying Fund is focusing on or has
substantial investments in smaller capitalization companies at times of
market volatility, the Underlying Fund's share prices may fluctuate more than
that of funds focusing on larger capitalization issuers.

         |_| Rights and Warrants. The Underlying Fund can invest up to 10% of
its total assets in warrants or rights, although the Underlying Fund does not
currently intend to invest more than 5% of its total assets in warrants or
rights. Warrants basically are options to purchase equity securities at
specific prices valid for a specific period of time. Their prices do not
necessarily move parallel to the prices of the underlying securities. Rights
are similar to warrants, but normally have a short duration and are
distributed directly by the issuer to its shareholders. Rights and warrants
have no voting rights, receive no dividends and have no rights with respect
to the assets of the issuer.

         |_| 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 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 many
cases their conversion feature (allowing conversion into equity securities)
caused them to be regarded by the Manager more as "equity equivalents." As a
result, the rating assigned to the security has less impact on the Manager's
investment decision than in the case of non-convertible fixed-income
securities.

      To determine whether convertible securities should be regarded as
"equity equivalents," the Manager examines the following factors:
o     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,
o     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
o     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.

      |X| Investments in Bonds and Other Debt Securities. The Underlying Fund
can invest in bonds, debentures and other debt securities to seek its
investment objective. Because the Underlying Fund currently emphasizes
investments in equity securities, such as stocks, it is not anticipated that
significant amounts of the Underlying Fund's assets will be invested in debt
securities. However, if market conditions suggest that debt securities may
offer better total return opportunities than stocks, or if the Manager
determines to seek a higher amount of current income to distribute to
shareholders, the Manager can shift more of the Underlying Fund's investments
into debt securities.

      The Underlying Fund's debt investments can include investment-grade and
non-investment-grade bonds (commonly referred to as "junk bonds").
Investment-grade bonds are bonds rated at least "Baa" by Moody's Investors
Service, Inc., or at least "BBB" by Standard & Poor's Corporation or Fitch,
Inc., or that have comparable ratings by another nationally-recognized rating
organization. In making investments in debt securities, the Manager can rely
to some extent on the ratings of ratings organizations or it can use its own
research to evaluate a security's credit-worthiness. If the securities that
the Underlying Fund buys are unrated, to be considered part of the Underlying
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.

      |_| U.S. Government Securities. The Underlying Fund can buy securities
issued or guaranteed by the U.S. government or its agencies and
instrumentalities. Securities issued by the U.S. Treasury are backed by the
full faith and credit of the U.S. government and are subject to very little
credit risk. Obligations of U.S. government agencies or instrumentalities
(including mortgage-backed securities) may or may not be guaranteed or
supported by the "full faith and credit" of the United States. Some are
backed by the right of the issuer to borrow from the U.S. Treasury; others,
by discretionary authority of the U.S. government to purchase the agencies'
obligations; while others are supported only by the credit of the
instrumentality. 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 and may not be able to assert a
claim against the United States in the event that the agency or
instrumentality does not meet its commitment. The Underlying Fund will invest
in securities of U.S. government agencies and instrumentalities only when the
Manager is satisfied that the credit risk with respect to the agency or
instrumentality is minimal.

         |_| Special Risks of Lower-Grade Securities. While it is not
anticipated that the Underlying Fund will invest a substantial portion of its
assets in debt securities, the Underlying Fund can do so to seek current
income. Because lower-rated securities tend to offer higher yields than
investment grade securities, the Underlying Fund can invest in lower grade
securities if the Manager is trying to achieve greater income (and, in some
cases, the appreciation possibilities of lower-grade securities may be a
reason they are selected for the Underlying Fund's portfolio).

      The Underlying Fund can invest up to 25% of its total assets in "lower
grade" debt securities. However, the Underlying Fund does not currently
intend to invest more that 10% of its total assets in lower grade debt
securities. "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 Standard & Poor's or Fitch, Inc., 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 included in the limitation on the percentage of the Underlying
Fund's assets that can be invested in lower-grade securities. The Underlying
Fund can invest in securities rated as low as "C" or "D" or which may be in
default at the time the Underlying Fund buys them.

      Some of the special credit risks of lower-grade securities are
discussed in the Prospectus. 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 risk of foreign investing discussed in
the Prospectus and in this Statement of Additional Information.

      However, the Underlying Fund's limitations on buying these investments
can reduce the effect of those risks to the Underlying Fund, as will the
Underlying Fund's policy of diversifying its investments. Additionally, to
the extent they can be converted into stock, convertible securities may be
less subject to some of these risks than non-convertible high yield bonds,
since stock may be more liquid and less affected by some of these risk
factors. The Underlying Fund may not invest more than 10% of its total assets
in lower-grade debt securities that are not convertible.

      While securities rated "Baa" by Moody's or "BBB" by Standard & Poor's
or Fitch, Inc. 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, Inc. are included in Appendix A to this Statement of
Additional Information.

      |X| Foreign Securities. The Underlying Fund can purchase equity and
debt securities issued or guaranteed by foreign companies or foreign
governments or their agencies. "Foreign securities" include equity and debt
securities of companies organized under the laws of countries other than the
United States and debt securities of foreign governments. They may be traded
on foreign securities exchanges or in the foreign over-the-counter markets.

      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 Underlying Fund's investment allocations.
That is because they are not subject to many of the special considerations
and risks, discussed below, that apply to foreign securities traded and held
abroad.

      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 growth
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 stock markets that do not move in a
manner parallel to U.S. markets. The Underlying Fund will hold foreign
currency only in connection with the purchase or sale of foreign securities.

         |_| 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 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, stock 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     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.

      |X| Passive Foreign Investment Companies. The Underlying Fund may
purchase the securities of certain foreign investment corporations called
passive foreign investment companies ("PFICs"). Such entities have been the
only or primary way to invest in certain countries because some foreign
countries limit, or prohibit, all direct foreign investment in the securities
of companies domiciled therein. However, the governments of some countries
have authorized the organization of investment funds to permit indirect
foreign investment in such securities. For tax purposes, these funds also may
be PFICs.

      The Underlying Fund is subject to certain percentage limitations under
the 1940 Act relating to the purchase of securities of investment companies,
and, consequently, the Underlying Fund may have to subject any of its
investment in other investment companies, including PFICs, to the limitation
that no more than 10% of the value of the Underlying Fund's total assets may
be invested in such securities. 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.
Like other foreign securities, interests in PFICs also involve the risk of
foreign securities, as described above.

      |X| Portfolio Turnover. "Portfolio turnover" describes the rate at
which the Underlying Fund traded its portfolio securities during its previous
fiscal year. For example, if a fund sold all of its securities during the
year, its portfolio turnover rate would have been 100%. The Underlying Fund's
portfolio turnover rate will fluctuate from year to year, and the Underlying
Fund can have a portfolio turnover rate of 100% or more. Increased portfolio
turnover creates higher brokerage and transaction costs for the Underlying
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
Underlying Fund will normally distribute all of its capital gains realized
each year, to avoid excise taxes under the Internal Revenue Code. The
Financial Highlights table at the end of the Prospectus shows the Underlying
Fund's portfolio turnover rates during prior fiscal years.

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

      |X| Investing in Small, Unseasoned Companies. The Underlying Fund can
invest in securities of small, unseasoned companies. These are companies that
have been in operation for less than three years, including the operations of
any predecessors. Securities of these companies may be subject to volatility
in their prices. They may have a limited trading market, which may adversely
affect the Underlying Fund's ability to dispose of them and can reduce the
price the Underlying Fund might be able to obtain for them. Other investors
that own a security issued by a small, unseasoned issuer for which there is
limited liquidity might trade the security when the Underlying Fund is
attempting to dispose of its holdings of that security. In that case the
Underlying Fund might receive a lower price for its holdings than might
otherwise be obtained. The Underlying Fund currently intends to invest no
more than 5% of its net assets in securities of small, unseasoned issuers.

      |X| When-Issued and Delayed-Delivery Transactions. The Underlying Fund
can invest in securities on a "when-issued" basis and can 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 Underlying Fund. During the period
between purchase and settlement, no payment is made by the Underlying Fund to
the issuer and no interest accrues to the Underlying Fund from the investment.

      The Underlying Fund will engage in when-issued transactions to secure
what the Manager considers to be an advantageous price and yield at the time
of entering into the obligation. When the Underlying 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 Underlying Fund
to lose the opportunity to obtain the security at a price and yield the
Manager considers to be advantageous.

      When the Underlying 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 Underlying Fund will enter into
delayed-delivery or when-issued purchase transactions to acquire securities,
it can dispose of a commitment prior to settlement. If the Underlying 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 Underlying 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 Underlying Fund's net asset value. In a sale transaction, it
records the proceeds to be received. The Underlying Fund will identify on its
books liquid securities of any type at least equal in value to the value of
the Underlying Fund's purchase commitments until the Underlying Fund pays for
the investment.

      When issued and delayed-delivery transactions can be used by the
Underlying 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 Underlying 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 Underlying 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.

Investment in Other Investment Companies. The Underlying 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 Underlying Fund can invest in Exchange-Traded Funds, which
are typically open-end funds or unit investment trusts, listed on a stock
exchange. The Underlying 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 Underlying Fund may not
be able to buy those portfolio securities directly. As a non-fundamental
policy, the Underlying Fund cannot invest in the securities of other
registered open-end 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.

      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 Underlying 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 Underlying Fund would be subject to its ratable share
of that investment company's expenses, including its advisory and
administration expenses. The Underlying Fund does not anticipate investing a
substantial amount of its net assets in shares of other investment companies.

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

      In a repurchase transaction, the Underlying 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 Underlying Fund's limits on holding illiquid investments. The
Underlying Fund will not enter into a repurchase agreement having a maturity
beyond seven days that causes more than 10% of its net assets to exceed that
limit. There is no limit on the amount of the Underlying Fund's net assets
that may be subject to repurchase agreements having maturities of seven days
or less.

      Repurchase agreements, considered "loans" under the Investment Company
Act, are collateralized by the underlying security. The Underlying 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 Underlying
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 SEC, the Underlying Fund,
along with other affiliated mutual funds 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.

      |X| Illiquid and Restricted Securities. To enable the Underlying Fund
to sell its holdings of a restricted security not registered under the
Securities Act of 1933, the Underlying Fund may have to cause those
securities to be registered. The expenses of registering restricted
securities may be negotiated by the Underlying Fund with the issuer at the
time the Underlying Fund buys the securities. When the Underlying Fund must
arrange registration because the Underlying 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
Underlying Fund could sell it. The Underlying Fund would bear the risks of
any downward price fluctuation during that period.

      The Underlying Fund can also acquire restricted securities through
private placements. Those securities have contractual restrictions on their
public resale. Those restrictions might limit the Underlying Fund's ability
to value or to dispose of the securities and might lower the amount the
Underlying Fund could realize upon the sale.

      The Underlying 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 Underlying 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| Loans of Portfolio Securities. The Underlying Fund can lend its
portfolio securities to certain types of eligible borrowers approved by the
Board of Directors. It may do so to try to provide income or to raise cash
for liquidity purposes. These loans are limited to not more than 25% of the
value of the Underlying Fund's total assets. There are some risks in
connection with securities lending. The Underlying Fund might experience a
delay in receiving additional collateral to secure a loan, or a delay in
recovery of the loaned securities. The Underlying Fund presently does not
intend to engage in loans of securities in the coming year.

      The Underlying 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,
securities of the U.S. government or its agencies or instrumentalities, or
other cash equivalents in which the Underlying Fund is permitted to invest.
To be acceptable as collateral, letters of credit must obligate a bank to pay
amounts demanded by the Underlying 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 Underlying Fund.

      When it lends securities, the Underlying 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
Underlying Fund can also pay reasonable finder's, custodian bank and
administrative fees in connection with these loans. The terms of the
Underlying Fund's loans must meet applicable tests under the Internal Revenue
Code and must permit the Underlying Fund to reacquire loaned securities on
five days' notice or in time to vote on any important matter.

      |X| Derivatives. The Underlying Fund can invest in a variety of
derivative investments to seek income or for hedging purposes. Some
derivative investments the Underlying Fund can use are the hedging
instruments described below.

      Other derivative investments the Underlying Fund can invest in include
"index-linked" notes. Principal and/or interest payments on these notes
depend on the performance of an underlying index. Currency-indexed securities
are another derivative the Underlying Fund can use. Typically these are
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 Underlying 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.

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

      The Underlying Fund can use hedging to establish a position in the
securities market as a temporary substitute for purchasing particular
securities. In that case, the Underlying Fund would normally seek to purchase
the securities and then terminate that hedging position. The Underlying 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 Underlying Fund could:
      o  buy futures, or
      o  buy calls on such futures or on securities.

      The Underlying 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 Underlying Fund's strategy of hedging with futures and options on
futures will be incidental to the Underlying Fund's activities in the
underlying cash market. The particular hedging instruments the Underlying
Fund can use are described below. The Underlying Fund can employ new hedging
instruments and strategies when they are developed, if those investment
methods are consistent with the Underlying Fund's investment objective and
are permissible under applicable regulations governing the Underlying Fund.


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


      A broadly-based stock index is used as the basis for trading stock
index futures. They may in some cases be based on stocks of issuers in a
particular industry or group of industries. A stock index assigns relative
values to the common stocks included in the index and its value fluctuates in
response to the changes in value of the underlying stocks. A stock index
cannot be purchased or sold directly. Financial 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.

      The Underlying 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 Underlying Fund can 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.


      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.


      No money is paid or received by the Underlying Fund on the purchase or
sale of a future. Upon entering into a futures transaction, the Underlying
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 Underlying 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 Underlying 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 Underlying Fund can
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 Underlying Fund. Any loss or gain on the
future is then realized by the Underlying 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.

      |_| Put and Call Options. The Underlying Fund can buy and sell certain
kinds of put options ("puts") and call options ("calls"). The Underlying 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.

      |_| Writing Covered Call Options. The Underlying Fund can write (that
is, sell) covered calls. If the Underlying Fund sells a call option, it must
be covered. That means the Underlying Fund must own the security subject to
the call while the call is outstanding, or, for certain types of calls, the
call can be covered by identifying liquid assets on the Underlying Fund's
books to enable the Underlying Fund to satisfy its obligations if the call is
exercised. Up to 25% of the Underlying Fund's total assets can be subject to
calls the Underlying Fund writes.

      When the Underlying Fund writes a call on a security, it receives cash
(a premium). The Underlying 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
Underlying 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 Underlying 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 Underlying Fund would
keep the cash premium and the investment.

      When the Underlying Fund writes a call on an index, it receives cash (a
premium). If the buyer of the call exercises it, the Underlying 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
Underlying Fund would keep the cash premium.

      The Underlying Fund's custodian bank, or a securities depository acting
for the custodian bank, will act as the Underlying Fund's escrow agent,
through the facilities of the Options Clearing Corporation ("OCC"), as to the
investments on which the Underlying 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 Underlying Fund enters into a
closing transaction.

      When the Underlying 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 Underlying 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
Underlying 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 Underlying Fund can purchase a corresponding call in a
"closing purchase transaction." The Underlying 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 Underlying Fund
wrote is more or less than the price of the call the Underlying Fund
purchases to close out the transaction. The Underlying Fund may realize a
profit if the call expires unexercised, because the Underlying 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 Underlying Fund they are taxable as ordinary income. If the Underlying
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 Underlying Fund can 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 Underlying Fund must cover the
call by identifying an equivalent dollar amount of liquid assets on the
Underlying Fund's books. The Underlying Fund will identify additional liquid
assets on its books if the value of the segregated assets drops below 100% of
the current value of the future. Because of this segregation requirement, in
no circumstances would the Underlying Fund's receipt of an exercise notice as
to that future require the Underlying Fund to deliver a futures contract. It
would simply put the Underlying Fund in a short futures position, which is
permitted by the Underlying Fund's hedging policies.

      o Writing Put Options. The Underlying Fund can sell put options. 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 Underlying Fund will not write puts if, as a result,
more than 25% of the Underlying Fund's total assets would be required to be
segregated to cover such put options.

      If the Underlying Fund writes a put, the put must be covered by liquid
assets identified on the Underlying Fund's books. The premium the Underlying
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 Underlying 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 Underlying Fund has written expires unexercised,
the Underlying Fund realizes a gain in the amount of the premium less the
transaction costs incurred. If the put is exercised, the Underlying 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 Underlying 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 Underlying Fund incurred.

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

      As long as the Underlying 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 Underlying Fund to take
delivery of the underlying security and pay the exercise price. The
Underlying 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 Underlying Fund effects a closing
purchase transaction by purchasing a put of the same series as it sold. Once
the Underlying Fund has been assigned an exercise notice, it cannot effect a
closing purchase transaction.

      The Underlying Fund can 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 Underlying 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 Underlying 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 Underlying Fund, are
taxable as ordinary income.

      o Purchasing Calls and Puts. The Underlying Fund can purchase calls to
protect against the possibility that the Underlying Fund's portfolio will not
participate in an anticipated rise in the securities market. When the
Underlying Fund buys a call (other than in a closing purchase transaction),
it pays a premium. The Underlying 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 Underlying
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 Underlying Fund exercises the call. If the Underlying 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 Underlying Fund
will have paid the premium but lost the right to purchase the underlying
investment.

      The Underlying Fund can buy puts whether or not it holds the underlying
investment in its portfolio. When the Underlying 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 Underlying Fund owns enables the Underlying 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 Underlying Fund
will have paid the premium but lost the right to sell the underlying
investment. However, the Underlying Fund can sell the put prior to its
expiration. That sale may or may not be at a profit.

      Buying a put on an investment the Underlying Fund does not own (such as
an index or future) permits the Underlying Fund 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 Underlying 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 Underlying 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 Underlying Fund can buy a call or put only if, after the purchase,
the value of all call and put options held by the Underlying Fund will not
exceed 5% of the Underlying Fund's total assets.

      |_| Buying and Selling Options on Foreign Currencies. The Underlying
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 Underlying 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 Underlying 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 Underlying
Fund's position. The Underlying Fund will then have incurred option premium
payments and transaction costs without a corresponding benefit.

      A call the Underlying Fund writes on a foreign currency is "covered" if
the Underlying 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 Underlying 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
Underlying 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 Underlying Fund covers
the option by maintaining cash, U.S. government securities or other liquid,
high-grade debt securities in an amount equal to the exercise price of the
option, in a segregated account with the Underlying Fund's custodian bank.

      |_| 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 Underlying Fund's
return. The Underlying Fund could also experience losses if the prices of its
futures and options positions were not correlated with its other investments.

      The Underlying Fund's option activities could affect its portfolio
turnover rate and brokerage commissions. The exercise of calls written by the
Underlying Fund might cause the Underlying Fund to sell related portfolio
securities, thus increasing its turnover rate. The exercise by the Underlying
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 Underlying Fund's control, holding a put might
cause the Underlying Fund to sell the related investments for reasons that
would not exist in the absence of the put.

      The Underlying 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 Underlying Fund's net asset value
being more sensitive to changes in the value of the underlying investment.

      If a covered call written by the Underlying Fund is exercised on an
investment that has increased in value, the Underlying Fund will be required
to sell the investment at the call price. It will not be able to realize any
profit 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
Underlying 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 Underlying 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 Underlying Fund's
securities. For example, it is possible that while the Underlying Fund has
used hedging instruments in a short hedge, the market might advance and the
value of the securities held in the Underlying Fund's portfolio might
decline. If that occurred, the Underlying 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
Underlying 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 Underlying 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 Underlying 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
Underlying Fund does so the market might decline. If the Underlying Fund then
concludes not to invest in securities because of concerns that the market
might decline further or for other reasons, the Underlying Fund will realize
a loss on the hedging instruments that is not offset by a reduction in the
price of the securities purchased.

      |_| 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 Underlying Fund uses them to "lock in" the U.S. dollar
price of a security denominated in a foreign currency that the Underlying
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
Underlying Fund limits its exposure in foreign currency exchange contracts in
a particular foreign currency to the amount of its assets denominated in that
currency or a closely-correlated currency. The Underlying Fund can also use
"cross-hedging" where the Underlying 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 Underlying Fund can 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 Underlying 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 Underlying 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 Underlying 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 Underlying Fund might
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 Underlying 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 Underlying 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 Underlying 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 Underlying Fund's portfolio securities denominated in
that foreign currency. When the Underlying Fund believes that the U.S. dollar
may 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 Underlying Fund could enter into a forward
contract to sell a different foreign currency for a fixed U.S. dollar amount
if the Underlying 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 Underlying Fund are denominated. That is referred to as a
"cross hedge."

      The Underlying 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 Underlying Fund's commitment under forward contracts.
The Underlying Fund will not enter into forward contracts or maintain a net
exposure to such contracts if the consummation of the contracts would
obligate the Underlying Fund to deliver an amount of foreign currency in
excess of the value of the Underlying 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 Underlying Fund can maintain a net exposure to forward contracts in
excess of the value of the Underlying 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
Underlying Fund can purchase a call option permitting the Underlying 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 Underlying Fund can purchase a put option permitting the
Underlying 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 Underlying Fund is obligated to deliver, the
Underlying 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
Underlying Fund is obligated to deliver to settle the trade, the Underlying
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 Underlying
Fund to sustain losses on these contracts and to pay additional transactions
costs. The use of forward contracts in this manner might reduce the
Underlying Fund's performance if there are unanticipated changes in currency
prices to a greater degree than if the Underlying Fund had not entered into
such contracts.

      At or before the maturity of a forward contract requiring the
Underlying Fund to sell a currency, the Underlying Fund might sell a
portfolio security and use the sale proceeds to make delivery of the
currency. In the alternative the Underlying Fund might retain the security
and offset its contractual obligation to deliver the currency by purchasing a
second contract. Under that contract the Underlying Fund will obtain, on the
same maturity date, the same amount of the currency that it is obligated to
deliver. Similarly, the Underlying 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 Underlying 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 Underlying 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 Underlying Fund must evaluate the credit and performance risk
of the counterparty under each forward contract.

      Although the Underlying 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 Underlying Fund can 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 Underlying Fund at one rate, while offering a lesser rate of
exchange if the Underlying Fund desires to resell that currency to the
dealer.

      |_| Interest Rate Swap Transactions. The Underlying Fund can enter into
interest rate swap agreements. In an interest rate swap, the Underlying 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 Underlying Fund can enter
into swaps only on securities that it owns. The Underlying Fund will not
enter into swaps with respect to more than 25% of its total assets. Also, the
Underlying Fund will identify liquid assets on its books (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 Underlying 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 Underlying
Fund's loss will consist of the net amount of contractual interest payments
that the Underlying Fund has not yet received. The Manager will monitor the
creditworthiness of counterparties to the Underlying Fund's interest rate
swap transactions on an ongoing basis.

      The Underlying 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 Underlying 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
can 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."


      |_| 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. 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 Underlying 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 Underlying Fund can write or hold may be affected by options
written or held by other entities, including other investment companies
having the same advisor as the Underlying Fund (or an advisor that is an
affiliate of the Underlying 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 the Investment Company Act, when the Underlying Fund purchases a
future, it must maintain cash or readily marketable short-term debt
instruments in an amount equal to the market value of the securities
underlying the future, less the margin deposit applicable to it.

      |_| Tax Aspects of Certain Hedging Instruments. Certain foreign
currency exchange contracts in which the Underlying Fund can 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 Underlying 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 Underlying Fund to exempt those transactions from this marked-to-market
treatment.

      Certain forward contracts the Underlying 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 Underlying
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 Underlying Fund accrues interest or other
         receivables or accrues expenses or other liabilities denominated in
         a foreign currency and the time the Underlying 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 Underlying Fund's investment income available for distribution
to its shareholders.

      |X| Temporary Defensive and Interim Investments. The Underlying Fund's
temporary defensive investments can include (i) obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities; (ii)
commercial paper rated in the highest category by an established rating
organization; (iii) certificates of deposit or bankers' acceptances of
domestic banks with assets of $1 billion or more; (iv) any of the foregoing
securities that mature in one year or less (generally known as "cash
equivalents"); (v) other short-term corporate debt obligations; and (vi)
repurchase agreements.

Investment Restrictions

      |X| What Are "Fundamental Policies?" Fundamental policies are those
policies that the Underlying Fund has adopted to govern its investments that
can be changed only by the vote of a "majority" of the Underlying 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 Underlying Fund's investment objective is a fundamental policy.
Other policies described in the Underlying Fund's Prospectus or its Statement
of Additional Information and in this Appendix C are "fundamental" only if
they are identified as such. The Underlying Fund's Board of Directors can
change non-fundamental policies without shareholder approval. However,
significant changes to investment policies will be described in supplements
or updates to the Underlying Fund's Prospectus or Statement of Additional
Information, as appropriate. The Underlying Fund's most significant
investment policies are described in its Prospectus as well as in the
Oppenheimer Principal Protected Main Street Fund II Prospectus.

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

      o The Underlying Fund cannot concentrate investments. That means it
cannot invest 25% or more of its total assets in any industry. However, there
is no limitation on investments in U.S. government securities.

      o The Underlying Fund cannot invest in commodities. However, the
Underlying Fund can buy and sell any of the hedging instruments permitted by
any of its other policies. It does not matter if the hedging instrument is
considered to be a commodity or commodity contract.

      o The Underlying Fund cannot invest in real estate or in interests in
real estate. However, the Underlying Fund can purchase securities of issuers
holding real estate or interests in real estate (including securities of real
estate investment trusts).

      o The Underlying 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 Underlying 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.

      o The Underlying Fund cannot borrow money in excess of 33 1/3% of the
value of its total assets (including the amount borrowed). The Underlying
Fund may borrow only from banks and/or affiliated investment companies. With
respect to this fundamental policy, the Underlying Fund can borrow only if it
maintains a 300% ratio of assets to borrowings at all times in the manner set
forth in the Investment Company Act.

      o The Underlying Fund cannot make loans except (a) through lending of
securities, (b) through the purchase of debt instruments or similar evidences
of indebtedness, (c) through an interfund lending program with other
affiliated funds, and (d) through repurchase agreements

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

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

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











Oppenheimer Principal Protected Main Street Fund II(R)

Investment Adviser
      OppenheimerFunds, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10080

Distributor
      OppenheimerFunds Distributor, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10080

Transfer Agent
      OppenheimerFunds Services
      P.O. Box 5270
      Denver, Colorado 80217
      1.800.525.7048

Custodian Bank
      J.P. Morgan Chase Bank
      4 Chase MetroTech Center
      Brooklyn, New York 11245


Independent Registered Public Accounting Firm

      Deloitte & Touche LLP
      555 Seventeenth Street
      Suite 3600
      Denver, CO 80202

Counsel to the Fund
      Myer, Swanson, Adams & Wolf, P.C.
      1600 Broadway
      Suite 1480
      Denver, CO 80202

Counsel to the Independent Trustees

      Bell, Boyd & Lloyd LLC
      70 West Madison Street, Suite 3100
      Chicago, Illinois 60602

1234


PX0711.001.1004


--------
1 Certain waivers also apply to Class M shares of Oppenheimer Convertible
Securities Fund.
2 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.
3 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.
4 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.
5 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.
6 This provision does not apply to IRAs.
7 This provision does not apply to 403(b)(7) custodial plans if the
participant is less than age 55, nor to IRAs.
8 The distribution must be requested prior to Plan termination or the
elimination of the Oppenheimer funds as an investment option under the Plan.
9 This provision does not apply to IRAs.
10 This provision does not apply to loans from 403(b)(7) custodial plans and
loans from the OppenheimerFunds-sponsored Single K retirement plan.
11 This provision does not apply to 403(b)(7) custodial plans if the
participant is less than age 55, nor to IRAs.

                   OPPENHEIMER PRINCIPAL PROTECTED TRUST II

                                  FORM N-1A

                                    PART C

                              OTHER INFORMATION

Item 23. - Exhibits
-------------------

(a)   Declaration of Trust dated 8/12/03: Filed with Registrant's initial
registration statement, 8/20/03, and incorporated herein by reference.

(b)   By-Laws dated as of 8/12/03: Filed with Registrant's initial
registration statement, 8/20/03, and incorporated herein by reference.


(c)   (i) Specimen Class A Share Certificate: Filed with Registrant's
Pre-Effective Amendment No. 1, 11/6/03, and incorporated herein by reference.

      (ii) Specimen Class B Share Certificate:   Filed herewith.

      (iii) Specimen Class C Share Certificate: Filed herewith.


(d)   Investment Advisory Agreement dated 10/9/03: Filed with Registrant's
Pre-Effective Amendment No. 1, 11/6/03, and incorporated herein by reference.

(e)   General Distributor's Agreement dated 10/9/03: Filed with Registrant's
Pre-Effective Amendment No. 1, 11/6/03, 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)   Form of Deferred Compensation Plan for Disinterested
Trustees/Directors: Previously filed with Post-Effective Amendment No. 40 to
the Registration Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076),
10/27/98, and incorporated herein by reference.


(g)   (i) Global Custody Agreement dated August 16, 2002 between Registrant
and JP Morgan Chase Bank: Previously filed with Post-Effective Amendment No.
10 to the Registration Statement of Oppenheimer International Bond Fund (Reg.
No. 33-58383), 11/21/02, and incorporated herein by reference.

      (ii) Amendment dated October 2, 2003 to the Global Custody Agreement
dated August 16, 2002: Previously filed with Pre-Effective Amendment No. 1 to
the Registration Statement of Oppenheimer Principal Protected Trust II (Reg.
333-108093), 11/6/03, and incorporated herein by reference.


(h)   (i) Financial Warranty Agreement dated 1/20/04 among Merrill Lynch Bank
USA, OppenheimerFunds, Inc. and the Registrant: Filed with Registrant's
Post-Effective Amendment No. 1, 1/26/04, and incorporated herein by reference.

      (ii) Service Agreement dated 1/20/04 among OppenheimerFunds, Inc., the
Registrant, J.P. Morgan Chase Bank and Merrill Lynch Bank USA: Filed with
Registrant's Post-Effective Amendment No. 1, 1/26/04, and incorporated herein
by reference.

      (iii) Termination Agreement dated 1/20/04 between OppenheimerFunds,
Inc., the Registrant, Main Place Funding LLC, and Bank of America, N.A.:
Filed with Registrant's Post-Effective Amendment No. 1, 1/26/04, and
incorporated herein by reference.

(i)   Opinion and Consent of Counsel: Filed with Registrant's initial
Pre-Effective Amendment No 1, 11/6/03, and incorporated herein by reference.


(j)   (i) Independent Auditors' Consent of Deloitte & Touche LLP with respect
to Registrant's audited financial statements and with respect to the audited
financial statements of Oppenheimer Main Street Fund incorporated in the
Statement of Additional Information by reference: Filed herewith.

      (ii) Consent of Deloitte & Touche LLP with respect to the audited
financial statements of Merrill Lynch Bank USA as of 12/31/02: Previously
filed with Registrant's Pre-Effective Amendment No. 3, 2/5/04, and
incorporation herein by reference.

(k)   (i) Audited Financial Statements of Merrill Lynch Bank USA for the
period ended 12/31/02: Previously filed with Registrant's Pre-Effective
Amendment No. 3, 2/5/04, and incorporated herein by reference.

      (ii) Unaudited Financial Statements of Merrill Lynch Bank USA for the
quarters ended 3/31/03: Previously filed with Registrant's Pre-Effective
Amendment No. 3. 2/5/04, and incorporated herein by reference.

      (iii) Unaudited Financial Statements of Merrill Lynch Bank USA for the
quarters ended 6/30/03 and 9/30/03: Previously filed with Registrant's
Pre-Effective Amendment No. 3. 2/5/04, and incorporated herein by reference.


(l)   Investment Letter from OppenheimerFunds, Inc. to Registrant dated
10/9/03: Filed with Registrant's Pre-Effective Amendment No 1, 11/6/03, and
incorporated herein by reference.

(m)   (i) Service Plan and Agreement for Class A shares for Oppenheimer
Principal Protected Main Street Fund II: dated 10/9/03 Filed with
Registrant's Pre-Effective Amendment No 1, 11/6/03, and incorporated herein
by reference.

      (ii) Distribution and Service Plan and Agreement for Class B shares for
Oppenheimer Principal Protected Main Street Fund II dated 10/9/03: Filed with
Registrant's Pre-Effective Amendment No 1, 11/6/03, and incorporated herein
by reference.

      (iii) Distribution and Service Plan and Agreement for Class C shares
for Oppenheimer Principal Protected Main Street Fund II dated 10/9/03: Filed
with Registrant's Pre-Effective Amendment No 1, 11/6/03, and incorporated
herein by reference.


(n)   Oppenheimer Funds Multiple Class Plan under Rule 18f-3 updated through
9/15/04: Previously filed with Post-Effective Amendment No. 24 to the
Registration Statement of Oppenheimer Cash Reserves (Reg. No. 33-23223),
9/27/04, and incorporated herein by reference.

(o)   Powers of Attorney dated June 28, 2004 for all
Trustees/Directors/Managing General Partners and Officers: Filed herewith.


(p)   Amended and Restated Code of Ethics of the Oppenheimer Funds dated
5/15/02 under Rule 17j-1 of the Investment Company Act of 1940: Previously
filed with Post-Effective Amendment No. 29 to the Registration Statement of
Oppenheimer Discovery Fund (Reg. No. 33-371), 11/21/02, 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
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lizbeth Aaron-DiGiovanni       Formerly  Vice  President  (April 2000) and First
Vice President                 Vice  President   (February  2003-July  2004)  of
                               Citigroup Global Markets Inc.

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

Timothy L. Abbuhl,             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.

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

Michael Amato,                 None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik Anderson,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Tracey Beck Apostolopoulos,    Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.

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

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rajeev Bhaman,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Craig Billings,                None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Binning,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Robert J. Bishop,              Treasurer     (since     October     2003)     of
Vice President                 OppenheimerFunds     Distributor,     Inc.    and

                               Centennial Asset Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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,               Formerly  (until  February  2004) an  independent
Assistant Vice President       consultant/coach in organizational development.

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

Chad Boll,                     None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Antulio N. Bomfim,             A  senior  economist  with  the  Federal  Reserve
Vice President                 Board (June 1992-October 2003).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John C. Bonnell,               Vice  President of  Centennial  Asset  Management
Vice President                 Corporation.  Formerly  a  Portfolio  Manager  at
                               Strong Financial Corporation (May 1999-May 2004).

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

Michelle Borre Massick,        None
Vice President

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

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

Jeoffrey Caan,                 Formerly  Vice  President  of ABN AMRO  NA,  Inc.
Vice President                 (June 2002-August 2003).

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

Catherine Carroll,             None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debra Casey,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lisa Chaffee,                  None
Assistant Vice President

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

Charles Chibnik,               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,   Shareholder   Financial  Services,

                               Inc. and OppenheimerFunds  Legacy Program; 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
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Edmiston,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel R. Engstrom,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

James Robert Erven             None
Assistant Vice President

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

George R. Evans,               None
Senior Vice President and
Director of International
Equities

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward N. Everett,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathy Faber,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

David Falicia,                 Assistant   Secretary   (as  of  July   2004)  of
Assistant Vice President       HarbourView Asset Management Corporation.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott T. Farrar,               Vice President of OFI Private Investments, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Thomas Farrell,                None
Assistant 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 of the Rochester      Governor of St. John's  College;  Chairman of the
Division                       Board of  Directors  of  International  Museum of

                               Photography at George Eastman House.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Bradley G. Finkle,             Formerly Head of Business  Management/Proprietary
Vice President                 Distribution   at  Citigroup   Asset   Management
                               (August 1986-September 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
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).

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan Gagliardo,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hazem Gamal,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan P. Gangemi,                None
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..

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Granger,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert B. Grill,               None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Gwynn,                  None
Vice President: Rochester
                                    Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Joseph Higgins,                Vice   President  of  OFI   Institutional   Asset
Vice President                 Management, Inc.

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

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

Corry E. Hyer,                 None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James G. Hyland,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Steve P. Ilnitzki,             Vice President of  OppenheimerFunds  Distributor,
Senior Vice President          Inc.

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

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,          None
Assistant Vice President

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

Charles Kandilis,              None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer E. Kane,              None
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Martin S. Korn,                Formerly  a  Senior  Vice  President  at  Bank of
Senior Vice President          America   (Wealth   and   Investment   Management
                               Technology Group) (March 2002-August 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Kourkoulakos,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Kramer,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Paul Kunz,                     None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Lamentino,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John W. Land,                  Formerly  Human  Resources   Manager  at  Goldman
Assistant Vice President       Sachs (October 2000-July 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John Latino,                   None
Assistant Vice President

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

Kristina Lawrence,             Formerly     Assistant    Vice    President    of
Vice President                 OppenheimerFunds,   Inc.   (November   2002-March
                               2004).

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

Guy E. Leaf,                   None
Vice President

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

Gayle Leavitt,                 None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
Assistant Vice President &     (September 1998-January 2004).
Assistant Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Leitzinger,              Senior Vice  President of  Shareholder  Services,
Vice President                 Inc.;  Vice  President of  Shareholder  Financial
                               Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Justin Leverenz,               Formerly,   a   research/technology   analyst  at
Vice President                 Goldman Sachs, Taiwan (May 2002-May 2004)

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael S. Levine,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gang Li,                       None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shanquan Li,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Daniel Lifshey,                Formerly a  Marketing  Manager at PIMCO  Advisors
Assistant Vice President       (January 2002-September 2004).

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

Mark H. Madden,                Formerly   Senior  Vice   President   and  Senior
Vice President                 Portfolio Manager with Pioneer Investments,  Inc.
                               (July 1990-July 2004).

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

Michael Magee,                 None
Vice President

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

Kathleen Mandzij,              Formerly   Marketing   Manager   -  Sales   Force
Assistant Vice President       Marketing     (March     2003-June    2004)    of
                               OppenheimerFunds, Inc.

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

Jerry Mandzij,                 None
Vice President

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

Angelo G. Manioudakis          Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation and of OFI  Institutional
                               Asset Management, Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Susan Mattisinko,              Assistant    Secretary   of   HarbourView   Asset
Vice President & Associate     Management  Corporation,  OppenheimerFunds Legacy
Counsel                        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,           Chairman  of the Board and  Director of OFI Trust
Senior Vice President          Company;  Chief  Executive  Officer,   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
Senior Vice President

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

Charles Moon,                  Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset
                               Management, Inc.

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

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.

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

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

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas J. Murray,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth Nadler,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jesper Nergaard,               None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Nichols,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Norman,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Matthew O'Donnell,             None
Assistant Vice President

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

John O'Hare,                   Formerly  Executive  Vice President and Portfolio
Vice President                 Manager  (June  2000 -  August  2003)  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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Scott Phillips,                Formerly   Vice   President   at  Merrill   Lynch
Vice President                 Investment Management (June 2000-July 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gary Pilc,                     None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jason Pizzorusso,              Formerly   a   Vice   President,   Research   and
Assistant Vice President       Development  at  Crucial  Security  Inc.  (August
                               2000-May 2002;  part-time while attending  school
                               until 2003).

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

David Poiesz,                  Formerly  a Senior  Portfolio  Manager at Merrill
Senior Vice President, Head    Lynch (October 2002-May 2004).
of Growth Equity Investments

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

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,                 None
Assistant Vice President

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

Marc Reinganum,                None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Reiter,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristina Richardson,           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,                  None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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  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 W. Schadt,                None
Vice President

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

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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,                  None
Vice President

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

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bonnie Sherman,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David C. Sitgreaves,           None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Edward James Sivigny           None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gregory J. Stitt,              None
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 of OFI Trust Company.
Assistant Vice President &
Assistant Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mary Sullivan,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Sussman,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan B. Switzer,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Brian C. Szilagyi,             Manager of Compliance at Berger  Financial  Group
Assistant Vice President       LLC (May 2001-March 2003);  Director of Financial
                               Reporting   and    Compliance   at   First   Data
                               Corporation (April 2003-June 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Martin Telles,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Paul Temple,                   None
Vice President

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

Jeaneen Terrio,                None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Toner,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eamon Tubridy,                 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.  Formerly (until
                               March 2004) Vice  President of  OppenheimerFunds,
                               Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maureen Van Norstrand,         None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

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

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

Patricia Walters,              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,                   Formerly a Vice  President at AIG Trading  (March
Assistant Vice President       2003-May  2004)  prior to which he was a Managing
                               Director at ING Barings  (December  1999-February
                               203).

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

Barry D. Weiss,                Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and of Centennial  Asset  Management
                               Corporation.

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

Melissa Lynn Weiss,            None
Vice President & Associate
Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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,              None
Senior Vice President and
Senior Investment Officer,
Director of Equities

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 E. Wolf,                 Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation  and of Centennial  Asset
                               Management  Corporation;  serves  on the Board of
                               the Colorado Ballet.

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

Kurt Wolfgruber,               Director  of Tremont  Capital  Management,  Inc.,
Executive Vice President,      HarbourView Asset Management  Corporation and OFI
Chief Investment Officer and   Institutional Asset Management,  Inc. (since June

Director                       2003)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Caleb C. Wong,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward C. Yoensky,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jill Zachman,                  Vice President of  OppenheimerFunds  Distributor,
Vice President: Rochester      Inc.
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 America Fund, L.P.
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 Bond Fund (a series of Oppenheimer Integrity Funds)
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Capital Income Fund
Oppenheimer Capital Preservation Fund
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Convertible Securities Fund (Bond Fund Series)
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 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 Bond Fund/VA
     Oppenheimer Capital Appreciation 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(2)            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(2)             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(2)              Assistant Vice President  None

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

Julian C. Curry(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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kristi Diehl(1)                 Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph A. DiMauro               Vice President            None
522 Lakeland Avenue
Grosse Pointe, MI 48230
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven Dombrower(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George P. Dougherty             Vice President            None
328 Regency Drive
North Wales, PA 19454
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cliff H. Dunteman               Vice President            None
N 53 27761 Bantry Road
Sussex, WI 53089-45533
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Eiler(2)                   Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kent M. Elwell                  Vice President            None
35 Crown Terrace
Yardley, PA 19067
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric C. Fallon                  Vice President            None
10 Worth Circle
Newton, MA 02458
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Joseph Fernandez                Vice President            None
1717 Richbourg Park Drive
Brentwood, TN 37027

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 Healy(2)                  Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Clifford W. Heidinger           Vice President            None
111 Ipswich Road
Boxford, MA 01921
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Phillipe D. Hemery              Vice President            None
5 Duck Pond Lane
Ramsey, NJ 07446
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kevin Hennessey                 Vice President            None
10206 Emerald Woods Avenue
Orlando, FL 32836

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

Elyse R. Jurman Herman          Vice President            None
5486 NW 42 Avenue
Boca Raton, FL 33496

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

Andrew Humble                   Vice President            None
419 Phillips Avenue
len Ellyn, IL 60137

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
61500 Tam McArthurLoop
Bend, OR 97702

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David T. Kuzia                  Vice President            None
19102 Miranda Circle
Omaha, NE 68130
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Paul R. LeMire(2)               Vice President            None

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

Eric J. Liberman(2)             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 W. Low                  Vice President            None
1636 N. Wells Street, Apt. 3411
Chicago, IL 60614

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

Craig Lyman                     Vice President            None
3930 Swenson St. #502
Las Vegas, NV 89119

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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(2)               Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Theresa-Marie Maynier           Vice President            None
2421 Charlotte Drive
Charlotte, NC 28203
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Anthony P. Mazzariello          Vice President            None
8 Fairway Road
Sewickley, PA 15143
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John C. McDonough               Vice President            None
3812 Leland Street
Chevy Chase, MD 20815
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kent C. McGowan                 Vice President            None
9510 190th Place SW

Edmonds, WA 98020
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Craig Meister                   Vice President            None
1880 Hemlock Cricle
Abinston, PA 19001

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

John V. Murphy(2)               Director                  President & Trustee

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy Jean Murray               Vice President            None
32 Carolin Road
Upper Montclair, NJ 07043
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin P. Neznek(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Bradford Norford                Vice President            None
4607 Timberglen Rd.
Dallas, TX 75287

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alan Panzer                     Vice President            None
6755 Ridge Mill Lane
Atlanta, GA 30328
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Brian C. Perkes                 Vice President            None
6 Lawton Ct.

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
46 Mt. Vernon Ave.
Alexandria, VA 22301

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 Schmitt(2)                 Vice President            None

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Schmitt(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

William Schories(2)             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(2)                  Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Stoma(2)                   Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Wayne Strauss(3)                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 Smokehouse 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bryan K.Toma                    Vice President            None
7311 W. 145th Terrace
Overland Park, KS 66223
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Mark Vandehey(1)                Vice President            Vice President and
                                                          Chief Compliance
                                                          Officer

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

Vincent Vermete(2)              Assistant 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Chris Werner(1)                 Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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(2)                 Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Zack(2)               General Counsel &         Vice President &
                                Director                  Secretary
---------------------------------------------------------------------------------



(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
---------------------

During the Warranty Period, the Registrant hereby undertakes to mail notices
to current shareholders promptly after the happening of significant events
related to the Financial Warranty issued by Merrill Lynch Bank USA (or any
successors or substituted entities thereto) to the Fund under the Financial
Warranty Agreement. These significant events include (i) the termination of
the Financial Warranty Agreement; (ii) a default under the Financial Warranty
Agreement that has a material adverse effect on a shareholder's right to
receive his or her Warranted Amount on the Maturity Date; or (iii) the
insolvency of Merrill Lynch Bank USA (or any successors or substituted
entities thereto).

The Registrant hereby undertakes to update its registration statement on an
annual basis under the Investment Company Act of 1940, as amended (the "1940
Act") to include updated audited financial statements for Merrill Lynch Bank
USA (or any successors or substituted entities thereto), as applicable.
Merrill Lynch Bank USA has represented to Registrant that its audited
financial statements to be included in Registrant's Registration Statement,
as it may be amended from time to time, have been and will be prepared in
accordance with Regulation S-X and U.S. GAAP, as if Merrill Lynch Bank USA
was required to file Form 10-K under the Securities Exchange Act of 1934, as
amended (the "Exchange Act").  Further, the Registrant undertakes under such
circumstances to include as an exhibit to its registration statement as it
relates to the Fund, the consent of the independent auditors of Merrill Lynch
Bank USA (or such successors or substituted entities), as applicable,
regarding such financial statements.

The Registrant hereby undertakes to update its registration statement to
include the executed Financial Warranty after it has been issued by Merrill
Lynch Bank USA.

In the event that a Warranty Provider to the Fund is an entity other than
Merrill Lynch Bank USA ("Substitute Warranty Provider"), and such Substitute
Warranty Provider files Forms 10-K under the Exchange Act then Registrant
hereby undertakes to incorporate by reference in its Statement of Additional
Information on an annual basis under the 1940 Act updated audited financial
statements for the Substitute Warranty Provider included in such Forms 10-K
under the Exchange Act.  In the event that at any time during the Warranty
Period during which the Registrant is required to file amendments to its
Registration Statement under the 1940 Act the Substitute Warranty Provider
ceases to file a Form 10-K pursuant to the Exchange Act or if any other
Substitute Warranty Provider is not required to file a Form 10-K pursuant to
the Exchange Act, the Registrant undertakes to update its Registration
Statement on an annual basis under the 1940 Act to include updated audited
financial statements for the then-current Substitute Warranty Provider (or
any successors or substituted entities thereto) and will obtain a
representation from said Substitute Warranty Provider (or any successors or
substituted entities thereto) that its audited financial statements provided
to Registrant for inclusion in Registrant's Registration Statement, as it may
be amended from time to time, have been and will be prepared in accordance
with Regulation S-X and U.S. GAAP covering the periods that would be required
if the Substitute Warranty Provider was required to file Form 10-K under the
Exchange Act.  Any Substitute Warranty Provider's audited financial
statements will also be incorporated by reference in Registrant's Statement
of Additional Information.  Further, the Registrant undertakes under any
circumstances described in this paragraph to include as an exhibit to its
Registration Statement as it relates to the Fund, the consent of the
independent auditors of the Substitute Warranty Provider (or such successors
or substituted entities), as applicable, regarding such financial statements.

During the Warranty Period, the Registrant hereby undertakes to include in
the Registrant's annual and semiannual reports (with respect to the Fund) to
shareholders, an offer to supply the most recent annual and/or quarterly
report of Merrill Lynch Bank USA, or any Substitute Warranty Provider to the
Financial Warranty or Financial Warranty Agreement, free of charge, upon a
shareholder's request.










                                  SIGNATURES


Pursuant  to  the  requirements  of the  Securities  Act of  1933  and/or  the
Investment Company Act of 1940, the Registrant  certifies that it meets all of
the requirements for effectiveness of the Registration  Statement  pursuant to
Rule  485(b)  under  the  Securities  Act of 1933  and 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 25th day of October, 2004.



                              OPPENHEIMER PRINCIPAL PROTECTED TRUST II

                              By:  /s/ John V. Murphy*

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

                              John V. Murphy, President,
                              Principal Executive Officer & 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/ William L. Armstrong*     Chairman of the
----------------------------- Board of Trustees            October 25, 2004
William L. Armstrong


/s/ John V. Murphy*           President, Principal
----------------------------- Executive Officer,           October 25, 2004
John V. Murphy                and Trustee


/s/ Brian W. Wixted*          Treasurer, Principal         October 25, 2004
----------------------------- Financial and Accounting
Brian W. Wixted               Officer


/s/ Robert G. Avis*
----------------------------- Trustee                      October 25, 2004
Robert G. Avis


/s/ George C. Bowen*
----------------------------- Trustee                      October 25, 2004
George C. Bowen


/s/ Edward Cameron*
----------------------------- Trustee                      October 25, 2004
Edward Cameron


/s/Jon S. Fossel*
----------------------------- Trustee                      October 25, 2004
Jon S. Fossel


/s/Sam Freedman*
----------------------------- Trustee                      October 25, 2004
Sam Freedman


/s/Beverly L. Hamilton*
----------------------------- Trustee                      October 25, 2004
Beverly L. Hamilton


/s/ Robert J. Malone*
----------------------------- Trustee                      October 25, 2004
Robert J. Malone


/s/ F. William Marshall Jr.*
----------------------------  Trustee                      October 25, 2004
F. William Marshall Jr.




*By: /s/ Mitchell J. Lindauer
        -----------------------------------------
        Mitchell J. Lindauer, Attorney- in-Fact









                                  SIGNATURES


Oppenheimer  Main  Street  Funds,  Inc.  has  duly  caused  this  Registration
Statement of  Oppenheimer  Principal  Protected  Trust  relating to its series
Oppenheimer  Principal  Protected  Main Street Fund 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 25th day of October, 2004.


                              OPPENHEIMER MAIN STREET FUNDS, INC.

                              By:  /s/ John V. Murphy*

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

                              John V. Murphy, President,
                              Principal Executive Officer & Director


Pursuant to the requirements of the Securities Act of 1933, this  Registration
Statement of  Oppenheimer  Principal  Protected  Trust  relating to its series
Oppenheimer  Principal Protected Main Street Fund has been signed below by the
following persons in the capacities on the dates indicated:

Signatures                    Title                        Date
----------                    -----                        ----


/s/ William L. Armstrong*     Chairman of the
----------------------------- Board of Directors           October 25, 2004
William L. Armstrong



/s/ John V. Murphy*           President, Principal

----------------------------- Executive Officer            October 25, 2004
John V. Murphy                and Director


/s/ Brian W. Wixted*          Treasurer, Principal         October 25, 2004
----------------------------- Financial and Accounting
Brian W. Wixted               Officer



/s/ Robert G. Avis*

----------------------------- Director                     October 25, 2004
Robert G. Avis



/s/ George C. Bowen*

----------------------------- Director                     October 25, 2004
George C. Bowen


/s/ Edward Cameron*
----------------------------- Director                     October 25, 2004
Edward Cameron


/s/Jon S. Fossel*
----------------------------- Director                     October 25, 2004
Jon S. Fossel


/s/Sam Freedman*
----------------------------- Director                     October 25, 2004
Sam Freedman


/s/Beverly L. Hamilton*
----------------------------- Director                     October 25, 2004
Beverly L. Hamilton



/s/ Robert J. Malone*

----------------------------- Director                     October 25, 2004
Robert J. Malone


/s/ F. William Marshall Jr.*
----------------------------  Director                     October 25, 2004
F. William Marshall Jr.




*By: /s/ Mitchell J. Lindauer

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

        Mitchell J. Lindauer, Attorney-in-Fact







                   OPPENHEIMER PRINCIPAL PROTECTED TRUST II


                        Post-Effective Amendment No. 4


                    Registration Statement No. 333-108093


                                EXHIBIT INDEX
                                -------------


Exhibit No.    Description
-----------    -----------


23 (c)         (ii) Specimen Class B Share Certificate
               (iii) Specimen Class C Share Certificate

23(j)          Independent Auditors' Consent of Deloitte & Touche LLP

23(o)          Powers of Attorney