Registration No. 333-114495
                                                            File No. 811-21561

                                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. 2                                             [X]


                                    and/or

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

      Amendment No. 3


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                  OPPENHEIMER PRINCIPAL PROTECTED TRUST III
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              (Exact Name of Registrant as Specified in Charter)

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

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

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


It is proposed that this filing will become effective (check appropriate box):
     [   ] immediately upon filing pursuant to paragraph (b)
     [X]   on December 28, 2005 pursuant to paragraph (b)
     [   ] 60 days after filing pursuant to paragraph (a)(1)
     [   ] on _______________ 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 III(R)

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Prospectus dated December 28, 2005       Oppenheimer Principal Protected Main
                                         Street Fund III(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
Shares of the Fund cannot be purchased   the Warranty Agreement and less any
except by the reinvestment of the        sales charges, your share of
Fund's dividends and distributions.      extraordinary expenses and the
                                         proportional reduction for dividends
As with all mutual funds, the            paid in cash and redemption of Fund
Securities and Exchange Commission has   shares). The Fund seeks high total
not approved or disapproved the Fund's   return as a secondary objective. It
securities nor has it determined that    invests in shares of the Oppenheimer
this Prospectus is accurate or           Main Street Fund(R)(which invests
complete. It is a criminal offense to    mainly in common stocks), futures
represent otherwise.                     contracts on the Standard and Poor's
                                         500 Composite Stock Price Index, and
                                         U.S. government securities, including
                                         zero 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
                                         sell shares of the Fund and other
An investment in the Fund is not a       account features. Please read this
deposit of any bank and is not insured   Prospectus carefully before you invest
or guaranteed by the Federal Deposit     and keep it for future reference about
Insurance Corporation or any other       your account.
government agency or any person.
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                                                (logo) OppenheimerFunds
                                                The Right Way to Invest






CONTENTS


                  ABOUT THE FUND


                  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



                  ABOUT YOUR ACCOUNT


                  Special Investor Services
                  AccountLink
                  PhoneLink
                  OppenheimerFunds Internet Website
                  Reinvestment Privilege

                  How to Sell Shares
                  By Mail
                  By Telephone

                  How to Exchange Shares
                  Shareholder Account Rules and Policies
                  Dividends, Capital Gains and Taxes
                  The Underlying Fund's Past Performance
                  Financial Highlights of the Fund
                  Financial Highlights of the Underlying Fund






ABOUT THE FUND


Overview


The Oppenheimer Principal Protected Main Street Fund III is a "fund of funds"
that invests a portion of its assets in shares of Oppenheimer Main Street
Fund(R)and futures contracts on the Standard and Poor's 500 Composite Stock
Price Index ("S&P 500 Index") 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 will
not be offered during the Warranty Period, except in connection with
reinvestment of dividends and distributions. The Offering Period was from
October 7, 2004 through December 10, 2004.


      The Warranty Period began on December 16, 2004 and will run until
December 16, 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 an equity portfolio (consisting of Class Y
shares of Oppenheimer Main Street Fund(R)and futures contracts on the S&P 500
Index) and a debt portfolio (consisting of 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 has issued, subject to certain conditions, 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 that 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) that shareholder's pro rata portion of any
Extraordinary Expenses (as described on page 11), (iii) the proportional
reduction for dividends and distributions paid in cash and redemptions of
Fund shares, (iv) that 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 that 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 on the Maturity Date for an amount
equal to his or her Warranty Amount.

      Because the front-end sales charge paid 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, Class C or Class N
shares. Normal operating fees and expenses of the Fund incurred in the
ordinary course of business will not reduce the Warranty Amount. However,
certain Extraordinary Expenses (as described on page 11) incurred by the Fund
will reduce the Warranty Amount. In addition, in the event the Fund is
completely and irreversibly invested in U.S. government securities and cash
and cash equivalents, any Fund expenses in excess of certain limits (as
described on pages 26-27) will reduce the Warranty Amount.


      The Warranty Provider, a wholly-owned 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.
The Warranty Provider is regulated and examined by the FDIC and the Utah
Department of Financial Institutions. The Warranty Provider is not regulated
by the Federal Reserve or the U.S. Department of Treasury. 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 the Fund incurs Extraordinary
Expenses (as described on page 11), or 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 or is
unable 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, futures
contracts on the S&P 500 Index, 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. The Fund's
investment objectives are fundamental policies that can be changed only with
the approval of a majority of the Fund's outstanding voting shares, as
described in the Statement of Additional Information.


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 Fund's investment manager, OppenheimerFunds, Inc. (the
"Manager"), will allocate the Fund's assets, consistent with the Warranty
Agreement, between a portfolio of equity securities and futures contracts as
described below (the "equity portfolio") and a portfolio of debt securities
as described below (the "debt portfolio"). The equity portfolio will consist
of Class Y shares of Oppenheimer Main Street Fund(R)(referred to as the
"Underlying Fund") and futures contracts on the S&P 500 Index. 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 principally consist of zero coupon U.S. government
securities, but may also include certain other 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, either in its
capacity as the Fund's investment manager or 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 stocks
(indirectly through its investment in the Underlying Fund), futures
contracts, 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.

      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, the value of the S&P 500
futures contracts may rise or fall, 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 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.

RISK OF USING FUTURES CONTRACTS. Futures contracts are considered derivative
instruments. In general terms, a derivative instrument is a financial
contract whose value is derived, at least in part, from the performance of an
underlying asset, such as an index. If the issuer of a derivative does not
pay the amount due, the Fund can lose money on the investment. The underlying
investment on which the derivative is based (in this case the S&P 500 Index),
and the derivative itself, might not perform in the manner the Manager
expected, which could cause the Fund's share price to decline. Markets
underlying securities may move in a direction not anticipated by the Manager,
which may result in the Fund realizing a lower return than expected on an
investment.

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 of the Warranty Provider's obligations under the Warranty
Agreement presents some risk to shareholders if the Warranty Provider fails
to 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 22. 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
26) 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, a shareholder's 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 shareholder's 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 must satisfy 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 equity
portfolio. 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 to increase
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 obligation to the Fund. Since 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 obligations or
defaults on its 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 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, under certain
conditions, assign its obligations under the Warranty Agreement to an
affiliate, provided the Warranty Provider's parent company guarantees the
obligations of the affiliate. The Warranty Provider may assign its
obligations under the Warranty Agreement to a non-affiliate only if the Board
and the Manager have consented to such assignment. 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 decrease and the Fund will be more highly correlated with debt
securities. 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. If the value of the shares of the Underlying
Fund or the futures contracts held by the 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
or futures 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 a payment to the Fund, if necessary, under the Financial Warranty. You
could lose money if, among other reasons, the Fund incurs Extraordinary
Expenses as described on page 11 or is liquidated prior to the Maturity Date,
or if you redeem your shares prior to 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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Warranty Period. The Warranty Period began December 16, 2004, the fourth
business day after the end of the Offering Period, and will run through
December 16, 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 (December 16, 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, will
be subject to market fluctuations, and 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 examples on pages 24-26, 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). 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, 2.05% for Class C shares and 1.55% for Class N 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, futures contracts on the S&P 500
Index, 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 October 7, 2004, 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 51 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, and therefore its shareholders, 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, other than
Extraordinary Expenses, of the Underlying Fund. Therefore, shareholders will
not bear any expenses, other than Extraordinary 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, 2005.


Shareholder Fees (charges paid directly from your investment):
---------------------------------------------------------------------------------
                                          Class A   Class B   Class C   Class N
                                           Shares    Shares    Shares    Shares
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maximum Sales Charge (Load) on              5.75%     None      None      None
purchases (as % of offering price)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)
(as % of the lower of the original
offering                                   None(1)    5%(2)     1%(3)    1%(4)
price or redemption proceeds)
---------------------------------------------------------------------------------

Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)(4)
---------------------------------------------------------------------------------
                                    Class A     Class B     Class C    Class N
                                    Shares     Shares(5)    Shares      Shares
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Management Fees(6)                   0.50%       0.50%       0.50%      0.50%

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

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

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

Warranty Fee(7)                      0.60%       0.60%       0.60%      0.60%

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

Other Expenses                       0.10%       0.17%       0.11%      0.10%

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

Total Annual Operating               1.45%       2.27%       2.21%      1.70%
Expenses(8)

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

Fee Waiver and/or Expense            0.25%       0.25%       0.25%      0.25%
Reimbursement(9)

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

Net Fund Expenses (after fee
waiver and/or expense                1.20%       2.02%       1.96%      1.45%
reimbursement)(9)

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

Because the Manager waived or reimbursed most Fund expenses, incurred during
the Offering Period (which ended December 10, 2004). The expenses shown above
are representative of the expenses that the Fund will incur during the
Warranty Period (which ends December 16, 2011).

Expenses may vary in future years.

"Total Annual Operating Expenses" include the Fund's portion of the
Underlying Fund's fees and expenses paid by the Fund as a shareholder of the
Underlying Fund. The Fund's actual operating expenses may be higher as a
result of changes in the allocation of assets to the Underlying Fund, the
expenses of the Underlying Fund and/or the Fund's own expenses.

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. A contingent deferred sales charge applies to shares redeemed within 18
months of the retirement plan's first purchase of Class N shares.
5. Class B shares automatically convert to Class A shares 90 months after
purchase.
6. "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. The Manager has
contractually agreed to further reduce its management fee to 0.25% of average
annual net assets 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,
2.05% for Class C shares and 1.55% for Class N 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.
7. 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.
8. "Other Expenses" include transfer agent fees, custodial fees, 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 all classes. That voluntary
undertaking may be amended or withdrawn at any time.
9. Under the terms of the investment advisory agreement, the Manager has
agreed, for the duration of the investment advisory agreement, 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.


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:           1 Year      3 Years     5 Years    10 Years
--------------------------------------------------------------------------------

Class A Shares                     $715       $1,010      $1,327      $2,222

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

Class B Shares                     $733       $1,017      $1,429      $2,326*

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

Class C Shares                     $327        $699       $1,198      $2,572

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

Class N Shares                     $274        $540        $931       $2,025

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

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

Class A Shares                     $715       $1,010      $1,327      $2,222

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

Class B Shares                     $233        $717       $1,229      $2,326*

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

Class C Shares                     $227        $699       $1,198      $2,572

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

Class N Shares                     $174        $540        $931       $2,025

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

In the first example, expenses include the initial sales charge for Class A
and the applicable Class B, Class C or Class N contingent deferred sales
charges. In the second example, the Class A expenses include the sales
charge, but Class B, Class C and Class N expenses do not include the
contingent deferred sales charges.

   * Class B expense for years 8 through 10 are based on Class A expenses
   because Class B shares automatically convert to Class A 90 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(R). The Fund may invest
      most of the equity portfolio in Class Y shares of Oppenheimer Main
      Street Fund(R)(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 portfolio managers of the Underlying Fund determine its
      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 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 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 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 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 the prices of securities
      of large capitalization issuers have tended to be less volatile than
      those 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. 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.
      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 & Poor's
      Ratings Service or have 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 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. Foreign issuers are
      not subject to the same accounting and disclosure requirements to which
      U.S. companies are subject. The value of foreign investments may be
      affected by exchange control regulations, expropriation or
      nationalization of a company's assets, foreign taxes, delays in
      settlement of transactions, changes in governmental economic or
      monetary policy in the U.S. or abroad, or other political and economic
      factors.


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

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
      can 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 Futures Contracts. Under normal circumstances, at least 15%,
      and up to 30%, of the equity portfolio's net assets may be invested in
      futures contracts to maintain liquidity to meet shareholder redemptions
      and minimize trading costs. The Fund may only invest in futures
      contracts on the S&P 500 Index generally maturing within 4 months. The
      S&P 500 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 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. The Fund seeks to maintain a position in futures contracts on
      the S&P 500 Index sufficient to allow the Fund to increase or decrease
      the percentage of the Fund's assets invested in the equity portfolio as
      permitted by the Warranty Agreement with minimal impact on the trading
      activities of the Underlying Fund.

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 can engage in active and frequent
      trading to try to achieve its objective, and will likely have a high
      portfolio turnover rate. 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 futures contracts on the S&P 500
Index) and the debt portfolio (consisting of U.S. government securities,
including zero coupon bonds and certain securities guaranteed by certain U.S.
government agencies and instrumentalities) 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 or uses leverage in violation of the Financial
            Warranty Agreement;
o     if the Fund's investment in the equity portfolio on any given day
            exceeds certain limitations as established by, or the Fund 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, the Fund or the 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.


CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? The Fund's Board of
Trustees can change non-fundamental investment policies without shareholder
approval, although significant changes will be described in amendments to
this Prospectus. Fundamental policies cannot be changed without the approval
of a majority of the Fund's outstanding voting shares. The Fund's investment
objective is a fundamental policy. Other investment restrictions that are
fundamental policies are listed in the Statement of Additional Information.
An investment policy is not fundamental unless this Prospectus or the
Statement of Additional Information says that it is.


The 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
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 the following
limited circumstances:

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 conditions precedent to the Warranty Provider's issuance of the
      Financial Warranty have not been met under the terms of 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;
o     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.

      If the Fund receives notice of termination from the Warranty Provider,
the Fund will promptly notify shareholders of such termination.


      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 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 10; (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 liquidating 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 the Warranty
Provider. 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.

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, 2005
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,
2005.

      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, 2005 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, 2005.

      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 multiply
         1,885.01 shares by $0.15 per share to arrive at $282.75. If you
         reinvested the distribution, you would have received 25.13
         additional shares for a total of 1,910.14 shares. However, because
         you will receive this amount in cash rather than additional Fund
         shares, the number of Fund shares you own remains at 1,885.01.

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., referred to as 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, subject to the policies established by the
Fund's Board of Trustees, under an investment advisory agreement that states
the Manager's responsibilities. The agreement sets the fees the Fund pays to
the Manager and describes the expenses that the Fund is responsible to pay to
conduct its business.


      The Manager has been an investment advisor since 1960. The Manager and
its subsidiaries and controlled affiliates managed more than $190 billion in
assets as of September 30, 2005, including other Oppenheimer funds with more
than 6 million shareholder accounts. The Manager is located at Two World
Financial Center, 225 Liberty Street, 11th Floor, New York, New York
10281-1008.


Advisory Fees. Under the investment advisory agreement, the Fund pays the
      Manager 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 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, 2.05% for Class C shares and 1.55% for Class N 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. The Manager voluntarily waived its management fee during
      the Offering Period. A discussion regarding the basis for the Board of
      Trustees' approval of the Fund's investment advisory contract is
      available in the Fund's Annual Report to shareholders for the year
      ended August 31, 2005.
Portfolio Managers. The Fund's portfolio is managed by Angelo Manioudakis and
      Rudi W. Schadt, who are primarily responsible for the day-to-day
      management of the Fund's investments.


      Mr. Manioudakis has been a portfolio manager of the Fund since May
      2003.  He has been a Senior Vice President of the Manager and of
      HarbourView Asset Management Corporation since April 2002. He has been
      a Senior Vice President of OFI Institutional Asset Management, Inc.
      since June 2002. He is also a portfolio manager and officer of other
      portfolios in the OppenheimerFunds complex. Mr. Manioudakis was
      Executive Director and portfolio manager for Miller, Anderson &
      Sherrerd, a division of Morgan Stanley Investment Management from
      August 1993 through April 2002.


      Mr. Schadt has been a portfolio manager of the Fund since August 2004.
      He has been a Vice President, Director of Research in Product Design
      and Risk Management of the Manager since August 2004 and is an officer
      and portfolio manager of other portfolios in the OppenheimerFunds
      complex.  Prior to joining the Manager in February 2002, he was a
      Director and Senior Quantitative Analyst from 2000 through 2001 at UBS
      Asset Management and an Associate Director and Senior Researcher and
      Portfolio Manager from June 1997 at State Street Global Advisors.

      The Statement of Additional Information provides additional information
      about the portfolio managers' compensation, other accounts they manage
      and their ownership of Fund shares.
Pending Litigation. A consolidated amended complaint has been filed as
      putative derivative and class actions against the Manager,
      OppenheimerFunds Distributor, Inc. (the "Distributor") and
      OppenheimerFunds Services (the "Transfer Agent"), as well as 51 of the
      Oppenheimer funds (collectively the "funds") not including the Fund, 30
      present and former Directors or Trustees and 8 present and former
      officers of certain of the funds. This complaint, initially filed in
      the U.S. District Court for the Southern District of New York on
      January 10, 2005 and amended on March 4, 2005, consolidates into a
      single action and amends six individual previously-filed putative
      derivative and class action complaints. Like those prior complaints,
      the complaint alleges that the Manager charged excessive fees for
      distribution and other costs, improperly used assets of the funds in
      the form of directed brokerage commissions and 12b-1 fees to pay
      brokers to promote sales of the funds, and failed to properly disclose
      the use of fund assets to make those payments in violation of the
      Investment Company Act of 1940 and the Investment Advisers Act of 1940.
      Also, like those prior complaints, the complaint further alleges that
      by permitting and/or participating in those actions, the
      Directors/Trustees and the officers breached their fiduciary duties to
      Fund shareholders under the Investment Company Act of 1940 and at
      common law.  The complaint seeks unspecified compensatory and punitive
      damages, rescission of the funds' investment advisory agreements, an
      accounting of all fees paid, and an award of attorneys' fees and
      litigation expenses.


      The defendants 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.

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

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

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 NYSE, on each day the NYSE is open for
      trading (referred to in this Prospectus as a "regular business day").
      The NYSE 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 NYSE or market on which the security is principally
      traded, that security may be valued by another method that the Board of
      Trustees believes accurately reflects the fair value.

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

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


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


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 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, Class C and Class N Shares. The
      Fund has adopted Distribution and Service Plans for Class B, Class C
      and Class N shares to pay the Distributor for its services and costs in
      distributing Class B, Class C and Class N shares and servicing
      accounts. Under the plans, the Fund pays the Distributor an annual
      asset-based sales charge of 0.75% on Class B and Class C shares and
      0.25% on Class N shares. The 0.75% asset-based sales charge on Class B
      shares does not apply as of January 1, 2010 and thereafter. The
      Distributor also receives a service fee of 0.25% per year under the
      Class B, Class C and Class N plans.


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

      The Distributor uses the service fees to compensate dealers for
      providing personal services for accounts that hold Class B, Class C or
      Class N shares. The Distributor 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 periodic basis. The Distributor normally
      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 normally
      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 to dealers from its own resources at the time of
      sale. Including the advance of the service fee, the total amount paid
      by the Distributor to the dealer at the time of sale of Class C shares
      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.

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


OTHER PAYMENTS TO FINANCIAL INTERMEDIARIES AND SERVICE PROVIDERS. The Manager
and the Distributor, in their discretion, also may pay dealers or other
financial intermediaries and service providers for distribution and/or
shareholder servicing activities. These payments are made out of the
Manager's and/or the Distributor's own resources, including from the profits
derived from the advisory fees the Manager receives from the Fund. These cash
payments, which may be substantial, are paid to many firms having business
relationships with the Manager and Distributor. These payments are in
addition to any distribution fees, servicing fees, or transfer agency fees
paid directly or indirectly by the Fund to these financial intermediaries and
any commissions the Distributor pays to these firms out of the sales charges
paid by investors. These payments by the Manager or Distributor from their
own resources are not reflected in the tables in the section called "Fees and
Expenses of the Fund" in this prospectus because they are not paid by the
Fund.

      "Financial intermediaries" are firms that have offered and sold Fund
shares to their clients, or provide shareholder services to the Fund, or
both, and receive compensation for doing so. Your securities dealer or
financial adviser, for example, is a financial intermediary, and there are
other types of financial intermediaries that receive payments relating to the
sale or servicing of the Fund's shares. In addition to dealers, the financial
intermediaries that may receive payments include sponsors of fund
"supermarkets," sponsors of fee-based advisory or wrap fee programs, sponsors
of college and retirement savings programs, banks and trust companies
offering products that hold Fund shares, and insurance companies that offer
variable annuity or variable life insurance products.

      In general, these payments to financial intermediaries can be
categorized as "distribution-related" or "servicing" payments. Payments for
distribution-related expenses, such as marketing or promotional expenses, are
often referred to as "revenue sharing." Revenue sharing payments may be made
on the basis of the sales of shares attributable to that dealer, the average
net assets of the Fund and other Oppenheimer funds attributable to the
accounts of that dealer and its clients, negotiated lump sum payments for
distribution services provided, or sales support fees. In some circumstances,
revenue sharing payments may create an incentive for a dealer or financial
intermediary or its representatives to recommend or offer shares of other
Oppenheimer funds to its customers. These payments also may give an
intermediary an incentive to cooperate with the Distributor's marketing
efforts. A revenue sharing payment may, for example, provide representatives
of the Distributor with access to representatives of the intermediary's sales
force, in some cases on a preferential basis over funds of competitors.
Additionally, as firm support, the Manager or Distributor may reimburse
expenses related to educational seminars and "due diligence" or training
meetings (to the extent permitted by applicable laws or the rules of the
NASD) designed to increase sales representatives' awareness about Oppenheimer
funds, including travel and lodging expenditures. However, the Manager does
not consider a financial intermediary's sale of shares of the Fund or other
Oppenheimer funds when selecting brokers or dealers to effect portfolio
transactions for the funds.

      Various factors are used to determine whether to make revenue sharing
payments. Possible considerations include, without limitation, the types of
services provided by the intermediary, past sales of Fund shares, the
redemption rates on accounts of clients of the intermediary or overall asset
levels of Oppenheimer funds held for or by clients of the intermediary, the
willingness of the intermediary to allow the Distributor to provide
educational and training support for the intermediary's sales personnel
relating to the Oppenheimer funds, the availability of the Oppenheimer funds
on the intermediary's sales system, as well as the overall quality of the
services provided by the intermediary and the Manager or Distributor's
relationship with the intermediary. The Manager and Distributor have adopted
guidelines for assessing and implementing each prospective revenue sharing
arrangement. To the extent that financial intermediaries receiving
distribution-related payments from the Manager or Distributor sell more
shares of the Oppenheimer funds or retain more shares of the funds in their
client accounts, the Manager and Distributor benefit from the incremental
management and other fees they receive with respect to those assets.

      Payments may also be made by the Manager, the Distributor or the
Transfer Agent to financial intermediaries to compensate or reimburse them
for administrative or other client services provided such as sub-transfer
agency services for shareholders or retirement plan participants, omnibus
accounting or sub-accounting, participation in networking arrangements,
account set-up, recordkeeping and other shareholder services. Payments may
also be made for administrative services related to the distribution of Fund
shares through the intermediary. Firms that may receive servicing fees
include retirement plan administrators, qualified tuition program sponsors,
banks and trust companies, and others. These fees may be used by the service
provider to offset or reduce fees that would otherwise be paid directly to
them by certain account holders, such as retirement plans.

      The Statement of Additional Information contains more information about
revenue sharing and service payments made by the Manager or the Distributor.
Your dealer may charge you fees or commissions in addition to those disclosed
in this prospectus. You should ask your dealer or financial intermediary for
details about any such payments it receives from the Manager or the
Distributor and their affiliates, or any other fees or expenses it charges.


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 or Class N 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 4:00p.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 (December 16, 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
examples starting on page 24 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.

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

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

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

HOW DO YOU SELL SHARES BY TELEPHONE? You and your dealer representative of
record may also sell your shares by telephone. To receive the redemption
price calculated on a particular regular business day, your call must be
received by the Transfer Agent by the close of the 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, Class C or Class N contingent deferred
sales charge and redeem any of those shares during the applicable holding
period for the class of shares, the contingent deferred sales charge will be
deducted from the redemption proceeds (unless you are eligible for a waiver
of that sales charge based on the categories listed in Appendix 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, Class
B, Class C or Class N 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, Class C or
Class N 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:

-------------------------------------------------------------------------------
                                        Contingent Deferred Sales Charge on
Years Since Beginning of Month in       Redemptions in That Year
Which Purchase Order was Accepted       (As % of Amount Subject to Charge)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
0 - 1                                   5.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
1 - 2                                   4.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
2 - 3                                   3.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
3 - 4                                   3.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
4 - 5                                   2.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
5 - 6                                   1.0%
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
More than 6                             None
-------------------------------------------------------------------------------

In the table,  a "year" is a  12-month  period.  In  applying  the  contingent
deferred  sales charge,  all purchases are considered to have been made on the
first regular business day of the month in which the purchase was made.

Automatic Conversion of Class B Shares. Class B shares automatically convert
      to Class A shares 90 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.

      A contingent deferred sales charge of 1.0% will be imposed upon the
redemption of Class N shares, if:
o     The group retirement plan is terminated or Class N shares of all
      Oppenheimer funds are terminated as an investment option of the plan
      and Class N shares are redeemed within 18 months after the plan's first
      purchase of Class N shares of any Oppenheimer fund, or
o     With respect to an IRA or 403(b) plan, Class N shares are redeemed
      within 18 months of the plan's first purchase of Class N shares of any
      Oppenheimer fund.

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

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

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

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


      A  contingent  deferred  sales  charge  (CDSC) is not  charged  when you
exchange shares of the Fund for shares of another  Oppenheimer fund.  However,
if you exchange your shares during the  applicable  CDSC holding  period,  the
holding  period  will  carry  over  to  the  fund  shares  that  you  acquire.
Similarly,  if you  acquired  shares  of the Fund in  exchange  for  shares of
another  Oppenheimer  fund that are  subject to a CDSC  holding  period,  that
holding  period will carry over to the acquired  shares of the Fund. In either
of  these  situations,  a CDSC  may be  imposed  if the  acquired  shares  are
redeemed  before  the end of the  CDSC  holding  period  that  applied  to the
exchanged shares.


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

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

Written Exchange Requests. Send a request letter, signed by all owners of the
      account, to the Transfer Agent at the address on the back cover.
      Exchanges of shares for which share certificates have been issued
      cannot be processed unless the Transfer Agent receives the certificates
      with the request letter.

Telephone and Internet Exchange Requests. Telephone exchange requests may be
      made either by calling a service representative or by using PhoneLink
      by calling 1.800.225.5677. You may submit internet exchange requests on
      the OppenheimerFunds internet website, at www.oppenheimerfunds.com. You
      must have obtained a user I.D. and password to make transactions on
      that website. Telephone and/or internet exchanges may be made only
      between accounts that are registered with the same name(s) and address.
      Shares for which share certificates have been issued may not be
      exchanged by telephone or the internet.

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

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

ARE THERE LIMITATIONS ON FREQUENT PURCHASES, REDEMPTIONS AND EXCHANGES?

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Shareholder Account Rules and Policies

More information about the Fund's policies and procedures for selling and
exchanging shares is contained in the Statement of Additional Information.
A $12 annual "Minimum Balance Fee" is assessed on each Fund account with a
      value of less than $500. The fee is automatically deducted from each
      applicable Fund account annually in September. See the Statement of
      Additional Information to learn how you can avoid this fee and for
      circumstances under which this fee will not be assessed.
Telephone transaction privileges for 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 the Fund redeems your shares in kind, you may
      bear transaction costs and will bear market risks until such time as
      such securities are converted into cash. 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.
Federal regulations may require the Fund to obtain your name, your date of
      birth (for a natural person), your residential street address or
      principal place of business and your Social Security Number, Employer
      Identification Number or other government issued identification when
      you open an account. Additional information may be required in certain
      circumstances or to open corporate accounts.  The Fund or the Transfer
      Agent may use this information to attempt to verify your identity.  The
      Fund may not be able to establish an account if the necessary
      information is not received.  The Fund may also place limits on account
      transactions while it is in the process of attempting to verify your
      identity.  Additionally, if the Fund is unable to verify your identity
      after your account is established, the Fund may be required to redeem
      your shares and close your account.
"Backup withholding" of federal income tax may be applied against taxable
      dividends, distributions and redemption proceeds (including exchanges)
      if you fail to furnish the Fund your correct, certified Social Security
      or Employer Identification Number when you sign your application, or if
      you under-report your income to the Internal Revenue Service.
To avoid sending duplicate copies of materials to households, the Fund will
      mail only one copy of each prospectus, annual and semi-annual report
      and annual notice of the Fund's privacy policy to shareholders having
      the same last name and address on the Fund's records. The consolidation
      of these mailings, called householding, benefits the Fund through
      reduced mailing expense.

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

Dividends, Capital Gains and Taxes

DIVIDENDS. The Fund intends to declare dividends separately for each class of
shares from net investment income on an annual basis and to pay them to
shareholders 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, Class C and Class N 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 DO 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 AccountLink.
Reinvest Your Distributions in Another OppenheimerFunds Account. You can
      reinvest all distributions in the same class of shares of another
      OppenheimerFunds account you have established.

      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.

      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. 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 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 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 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. In certain cases, the figure
representing "Return After Taxes on Distributions and Sale of Underlying Fund
Shares" may be higher than the other return figures for the same period. A
higher after-tax return results when a capital loss occurs upon redemption
and translates into an assumed tax deduction that benefits the shareholder.
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 January 1, 2005 through September 30, 2005, the
cumulative return (not annualized) before taxes for Class Y shares was 3.82%.


During the period shown in the bar chart, the highest return (not annualized)
before taxes for a calendar quarter was 22.05% (4th Qtr `98) and the lowest
return (not annualized) before taxes for a calendar quarter was -16.49% (3rd
Qtr `02).


 ------------------------------------------------------------------------------
 Average Annual Total                                            10 Years
 Returns for the periods               1 Year      5 Years      (or Life of
 Ended December 31, 2004                                          Class,
                                                                 if Less)
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 Class Y Shares (inception              9.73%      -1.40%          7.58%
 November 1, 1996)
 Return before taxes
 Return after taxes on distributions    9.48%      -1.83%          6.22%
 Return after taxes on distributions
 and sale of Underlying Fund shares     6.64%      -1.33%          5.98%
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 S&P 500 Index (reflects no            10.87%      -2.30%        8.51%(1)
 deductions for fees, expenses or
 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 reflect
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 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
-------------------------------------------------------------------------------

                                                                             CLASS A         CLASS B
PERIOD ENDED AUGUST 31,                                                       2005 1          2005 1
-------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
-------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $    30.00        $  30.00
-------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                                            .25 2           .03 2
Net realized and unrealized gain                                                 .28             .28
                                                                          -----------------------------
Total from investment operations                                                 .53             .31
-------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                            (.05)           (.02)
-------------------------------------------------------------------------------------------------------
Net asset value, end of period                                            $    30.48        $  30.29
                                                                          =============================

-------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                              1.76%           1.03%
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
-------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $   40,981        $ 20,856
-------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $   36,571        $ 18,576
-------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                                           0.93%           0.10%
Total expenses                                                                  1.45% 5         2.27% 6
Expenses after payments and waivers and reduction to  custodian expenses        1.20%           2.02%
-------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                           37%             37%


1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. 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.

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

5. Expenses paid including all underlying fund expenses was as follows:
           Year Ended August 31, 2005     1.66%

6. Expenses paid including all underlying fund expenses was as follows:
           Year Ended August 31, 2005     2.48%




           24 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



                                                                           CLASS C      CLASS N
PERIOD ENDED AUGUST 31,                                                     2005 1       2005 1
--------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
--------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $  30.00     $  30.00
--------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                                          .05 2        .19 2
Net realized and unrealized gain                                               .28          .28
                                                                          ------------------------
Total from investment operations                                               .33          .47
--------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                          (.02)        (.04)
--------------------------------------------------------------------------------------------------

Net asset value, end of period                                            $  30.31     $  30.43
                                                                          ========================

--------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                            1.11%        1.57%
--------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
--------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $ 21,414     $  1,438
--------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $ 18,591     $  1,269
--------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                                         0.17%        0.69%
Total expenses                                                                2.21% 5      1.70% 6
Expenses after payments and waivers and reduction to custodian expenses       1.96%        1.45%
--------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                         37%          37%


1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. 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.

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

5. Expenses paid including all underlying fund expenses was as follows:
            Year Ended August 31, 2005       2.42%

6. Expenses paid including all underlying fund expenses was as follows:
            Year Ended August 31, 2005       1.91%



Financial Highlights of the Underlying Fund


Because the Oppenheimer Principal Protected Main Street Fund III(R)may invest
a significant amount of its assets in the Underlying Fund the Financial
Highlights Table on the following page 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 Y     YEAR ENDED AUGUST 31,                     2005           2004           2003           2002           2001
-------------------------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
-------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  32.93       $  29.75       $  28.02       $  32.28       $  45.64
-------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                  .64 1          .34            .11            .19            .17
Net realized and unrealized gain (loss)               3.34           3.13           1.86          (4.28)        (11.22)
                                                  -----------------------------------------------------------------------
Total from investment operations                      3.98           3.47           1.97          (4.09)        (11.05)
-------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                  (.53)          (.29)          (.24)          (.12)          (.21)
Distributions from net realized gain                    --             --             --           (.05)         (2.10)
                                                  -----------------------------------------------------------------------
Total dividends and/or distributions
to shareholders                                       (.53)          (.29)          (.24)          (.17)         (2.31)
-------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  36.38       $  32.93       $  29.75       $  28.02       $  32.28
                                                  =======================================================================

-------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2                   12.15%         11.69%          7.11%        (12.74)%       (24.76)%
-------------------------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
-------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $483,532       $570,991       $441,460       $225,298       $225,475
-------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $496,349       $558,130       $242,029       $227,835       $239,222
-------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income                                 1.82%          1.07%          1.01%          0.74%          0.60%
Total expenses                                        0.53%          0.60%          0.87%          0.92%          0.79% 4
Expenses after payments and waivers and
reduction to custodian expenses                        N/A 5          N/A 5         0.83%          0.78%          0.73%
-------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 79%            76%            94%            78%            76%


1. Per share amounts calculated based on the average shares outstanding during
the period.

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

5. Reduction to custodian expenses less than 0.01%.






INFORMATION AND SERVICES

For More Information on Oppenheimer Principal Protected Main Street Fund III(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.CALL OPP (225.5677)
------------------------------------------------------------------------------
------------------------------------------------------------------------------
By Mail:                      Write to:
                              OppenheimerFunds Services
                              P.O. Box 5270
                              Denver, Colorado 80217-5270
------------------------------------------------------------------------------
------------------------------------------------------------------------------
On the Internet:              You can request these documents by e-mail or
                              through the OppenheimerFunds website. You may
                              also read or download certain documents on the
                              OppenheimerFunds website at:
                              www.oppenheimerfunds.com
------------------------------------------------------------------------------

Information about the Fund including the Statement of Additional Information
can be reviewed and copied at the SEC's Public Reference Room in Washington,
D.C. Information on the operation of the Public Reference Room may be
obtained by calling the SEC at 1.202.942.8090.  Reports and other information
about the Fund are available on the EDGAR database on the SEC's Internet
website at www.sec.gov. Copies may be obtained after payment of a duplicating
fee by electronic request at the SEC's e-mail address: publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, D.C. 20549-0102.
No one has been authorized to provide any information about the Fund or to
make any representations about the Fund other than what is contained in this
Prospectus. This Prospectus is not an offer to sell shares of the Fund, nor a
solicitation of an offer to buy shares of the Fund, to any person in any
state or other jurisdiction where it is unlawful to make such an offer.


The Fund's SEC File No. 811-21561        The Fund's shares are distributed by:
PR0771.001.1205                          [logo] OppenheimerFunds  Distributor,
Inc.
Printed on recycled paper.





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

      Graphic material included in the Prospectus of Oppenheimer Principal
Protected Main Street Fund III ("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%
12/31/04                    9.73%



Oppenheimer Principal Protected Main Street Fund III(R)

6803 South Tucson Way, Centennial, Colorado 80112-3924
1.800.CALL OPP (225.5677)

Statement of Additional Information dated December 28, 2005


This Statement of Additional Information is not a prospectus. This document
contains additional information about the Fund and supplements information in
the Prospectus dated December 28, 2005. 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
    Other Investment Restrictions.........................................10
    Disclosure of Portfolio Holdings......................................12
How the Fund is Managed...................................................16
    Organization and History..............................................16
    Board of Trustees and Oversight Committees............................17
    Trustees and Officers of the Fund.....................................18
    The Manager...........................................................27
Brokerage Policies of the Fund............................................31
Distribution and Service Plans............................................33
Payments to Fund Intermediaries...........................................37
Performance of the Fund...................................................41


About Your Account

How to Sell Shares........................................................48
How to Exchange Shares....................................................51
Dividends, Capital Gains and Taxes........................................55
Additional Information About the Fund.....................................59


Financial Information About the Fund

Report of Independent Registered Public Accounting Firm...................61
Financial Statements......................................................62


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
December 16, 2004 and will end December 16, 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
September 24, 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 of Class Y
shares of the Oppenheimer Main Street Fund (the "Underlying Fund") and
futures contracts on the Standard and Poor's 500 Composite Stock Price Index
("S&P 500 Index"), 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 bank 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 values of the
Underlying Fund and the futures contracts on the S&P 500 Index. For example,
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 and the futures contracts
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 Warranty Provider has deteriorated beyond
certain thresholds, the Board of Trustees will determine whether there is a
substantial likelihood that the Warranty Provider will be unable to satisfy
its obligations under the Warranty Agreement, and, in response, 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 equity portfolio, (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 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 Warranty
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 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.

Investment in Futures Contracts. The Fund can buy and sell S&P 500 Index
futures contracts. The Standard and Poor's 500 Composite Stock Index is the
basis for trading S&P 500 futures contracts. The S&P 500 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. The
S&P 500 Index cannot be purchased or sold directly. S&P 500 Index futures
contracts are based on the future value of the basket of securities that
comprise the S&P 500 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.

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

      At any time prior to expiration of the futures contract, the 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 Fund. Any loss or gain on the futures
contract is then realized by the Fund for tax purposes. All stock index
futures contracts are effected through a clearinghouse associated with the
exchange on which the contracts are traded. There can be no assurance that
the Fund will be able to enter into an offsetting transaction with respect to
a particular contract at a particular time. If the Fund is not able to enter
into an offsetting transaction, it will continue to be required to maintain
the margin deposits on the contract.

      The prices of futures contracts are volatile and are influenced by,
among other things, actual and anticipated changes in interest rates and
equity prices, which in turn are affected by fiscal and monetary policies and
national and international political and economic events.

      When the Fund buys or sells a futures contract, unless it already owns
an offsetting position, it will designate cash having an aggregate value at
least equal to the full "notional" value of the futures contract, thereby
ensuring that the leveraging effect of such futures contract is minimized, in
accordance with regulatory requirements.

      |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 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 consists 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, instrumentalities or government sponsored
enterprises: 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, 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 typically 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 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 (the "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. 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 the 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 the Fund's assets fluctuate in value, but borrowing
obligations are fixed when the Fund has outstanding borrowings, the net asset
value per share of the 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 can 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.

Other 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.

      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 Appendix C to this Statement of Additional
Information 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
III 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 derivative instruments or hedging instruments permitted by
any of its other policies. It does not matter if the derivative instrument or
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.

|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, and (c) 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 Prospectus or this Statement of Additional Information
states that a percentage restriction applies on an ongoing basis, it applies
only at the time an investment (except in the case of borrowing and
investments in illiquid securities) is made. The Fund and 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 Fund or Underlying Fund.

      For purposes of the policy not to concentrate investments as described
above, the Fund and the Underlying Fund have each adopted as a
non-fundamental policy the industry classifications set forth in Appendix A
to its Statement of Additional Information. The Fund and the Underlying Fund
do not intend to concentrate its investments in a group of industries.

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

o     Public Disclosure. The Fund's portfolio holdings are made publicly
      available no later than 60 days after the close of each of the Fund's
      fiscal quarters in semi-annual and annual reports to shareholders, or
      in its Statements of Investments on Form N-Q, which are publicly
      available at the SEC. In addition, the top 10 or more holdings are
      posted on the OppenheimerFunds' website at www.oppenheimerfunds.com in
      the "Fund Profiles" section. Other general information about the Fund's
      portfolio investments, such as portfolio composition by asset class,
      industry, country, currency, credit rating or maturity, may also be
      posted with a 15-day lag.

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

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

      A list of the top 10 or more portfolio securities holdings (based on
invested assets), listed by security or by issuer, as of the end of each
month may be disclosed to third parties (subject to the procedures below) no
sooner than 15 days after month-end.

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

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

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

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

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

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

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

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

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

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

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

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

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






A.G. Edwards & Sons
ABG Securities
ABN AMRO
Advest
AG Edwards
American Technology Research
Auerbach Grayson
Banc of America Securities
Barclays
Baseline
Bear Stearns
Belle Haven
Bloomberg
BNP Paribas
BS Financial Services
Buckingham Research Group
Caris & Co.
CIBC World Markets
Citigroup
Citigroup Global Markets
Collins Stewart
Craig-Hallum Capital Group LLC
Credit Agricole Cheuvreux N.A. Inc.
Credit Suisse First Boston
Daiwa Securities
Davy
Deutsche Bank
Deutsche Bank Securities
Dresdner Kleinwort Wasserstein
Emmet & Co
Empirical Research
Enskilda Securities
Essex Capital Markets
Exane BNP Paribas
Factset
Fidelity Capital Markets
Fimat USA Inc.
First Albany
First Albany Corporation
Fixed Income Securities
Fortis Securities
Fox-Pitt, Kelton
Friedman, Billing, Ramsey
Fulcrum Global Partners
Garp Research
George K Baum & Co.
Goldman
Goldman Sachs
HSBC
HSBC Securities Inc
ING Barings
ISI Group
Janney Montgomery
Jefferies
Jeffries & Co.
JP Morgan
JP Morgan Securities
JPP Eurosecurities
Keefe, Bruyette & Woods
Keijser Securities
Kempen & Co. USA Inc.
Kepler Equities/Julius Baer Sec
KeyBanc Capital Markets
Leerink Swan
Legg Mason
Lehman
Lehman Brothers
Lipper
Loop Capital Markets
MainFirst Bank AG
Makinson Cowell US Ltd
Maxcor Financial
Merrill
Merrill Lynch
Midwest Research
Mizuho Securities
Morgan Stanley
Morningstar
Natexis Bleichroeder
Ned Davis Research Group
Nomura Securities
Pacific Crest
Pacific Crest Securities
Pacific Growth Equities
Petrie Parkman
Pictet
Piper Jaffray Inc.
Plexus
Prager Sealy & Co.
Prudential Securities
Ramirez & Co.
Raymond James
RBC Capital Markets
RBC Dain Rauscher
Research Direct
Robert W. Baird
Roosevelt & Cross
Russell Mellon
Ryan Beck & Co.
Sanford C. Bernstein
Scotia Capital Markets
SG Cowen & Co.
SG Cowen Securities
Soleil Securities Group
Standard & Poors
Stone & Youngberg
SWS Group
Taylor Rafferty
Think Equity Partners
Thomas Weisel Partners
UBS
Wachovia
Wachovia Corp
Wachovia Securities
Wescott Financial
William Blair
Yieldbook






How the Fund is Managed


Organization and History. The Fund, a series of Oppenheimer Principal
Protected Trust III, is an open-end, diversified management investment
company with an unlimited number of authorized shares of beneficial interest.
The Fund was organized as a Massachusetts business trust in March 2004.


|X|   Classes of Shares. The Trustees are authorized, without shareholder
approval, to create new series and classes of shares, to reclassify unissued
shares into additional series or classes and to 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, preemptive rights or subscription rights.
Shares may be voted in person or by proxy at shareholder meetings.

      The Fund currently has four classes of shares: Class A, Class B, Class
C, and Class N. All classes invest in the same investment portfolio. Only
retirement plans may purchase Class N shares. Each class of shares:

o     has its own dividends and distributions,

o     pays certain expenses which may be different for the different classes,
      will generally have a different net asset value,
      will generally 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 a vote of shareholders. Each share of the Fund
represents an interest in the Fund proportionately equal to the interest of
each other share of the same class.


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

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

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

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

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


      The Board of Trustees has an Audit Committee, a Review Committee and a
Governance Committee. Each committee is comprised solely of Trustees who are
not "interested persons" under the Investment Company Act (the "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 7 meetings during the Fund's fiscal year ended August 31,
2005. The Audit Committee furnishes the Board with recommendations regarding
the selection of the Fund's independent registered public accounting firm
(also referred to as the "independent Auditors"). Other main functions of the
Audit Committee, outlined in the Audit Committee Charter, 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) reviewing reports from the Manager's Internal Audit Department; (iv)
reviewing certain reports from and meet periodically with the Funds' Chief
Compliance Officer; (v) maintaining a separate line of communication between
the Fund's independent Auditors and the Independent Trustees; (vi) reviewing
the independence of the Fund's independent Auditors; and (vii) pre-approving
the provision of any audit or non-audit services by the Fund's independent
Auditors, including tax services, that are not prohibited by the
Sarbanes-Oxley Act, to the Fund, the Manager and certain affiliates of the
Manager.

      The Review Committee is comprised solely of Independent Trustees. The
members of the Review Committee are Jon S. Fossel (Chairman), Robert G. Avis,
Sam Freedman and Beverly L. Hamilton. The Review Committee held 6 meetings
during the Fund's fiscal year ended August 31, 2005. Among other duties, as
set forth in the Review Committee's Charter, the Review Committee reports and
makes recommendations to the Board concerning the fees paid to the Fund's
transfer agent and the Manager and the services provided to the Fund by the
transfer agent and the Manager. The Review Committee also reviews the Fund's
investment performance as well as the policies and procedures adopted by the
Fund to comply with the Investment Company Act and other applicable law.

      The Governance Committee is comprised solely of Independent Trustees.
The members of the Governance Committee are, Robert J. Malone (Chairman),
William Armstrong, Beverly L. Hamilton and F. William Marshall, Jr. The
Governance Committee held 5 meetings during the Fund's fiscal year ended
August 31, 2005. The Governance Committee has adopted a charter setting forth
its duties and responsibilities. Among other duties, the Governance Committee
reviews and oversees the Fund's governance guidelines, the adequacy of the
Fund's Codes of Ethics and the nomination of Trustees, including Independent
Trustees. The Governance Committee has adopted a process for shareholder
submission of nominees for board positions. 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
Governance Committee in care of the Fund. The Governance Committee may
consider such persons at such time as it meets to consider possible nominees.
The Governance Committee, however, reserves sole discretion to determine
which candidates for Trustees and Independent Trustees it will recommend to
the Board and/or shareholders and it may identify candidates other than those
submitted by Shareholders. The Governance Committee may, but need not,
consider the advice and recommendation of the Manager and/or 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 below. 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. All of the Trustees are also trustees or
directors of the following Oppenheimer/Centennial funds (referred to as
"Board II Funds"):

                                           Oppenheimer   Principal   Protected
Oppenheimer Cash Reserves                  Trust II
                                           Oppenheimer   Principal   Protected
Oppenheimer Capital Income Fund            Trust III
Oppenheimer Champion Income Fund           Oppenheimer Real Asset Fund
                                           Oppenheimer  Senior  Floating  Rate
Oppenheimer Equity Fund, Inc.              Fund
Oppenheimer High Yield Fund                Oppenheimer Strategic Income Fund
Oppenheimer Integrity Funds                Oppenheimer Variable Account Funds
Oppenheimer International Bond Fund        Panorama Series Fund, Inc.
Oppenheimer Limited-Term Government Fund
                                           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

      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 charge on Class A shares is
waived for that group because of the reduced sales efforts realized by the
Distributor.


      Messrs. Gillespie, Manioudakis, Murphy, Petersen, Schadt, Szilagyi,
Vandehey, Wixted and Zack and Mss. Bloomberg and Ives, who are officers of
the Fund, hold the same offices with one or more of the other Board II Funds.
As of November 30, 2005 the Trustees and officers of the Fund, as a group,
owned of record or beneficially less than 1% of any 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 Board II
Funds. In addition, none of the Independent Trustees (nor any of their
immediate family members) owns securities of either the Manager or the
Distributor or of any entity directly or indirectly controlling, controlled
by or under common control with the Manager or the Distributor of the Board
II Funds.

      Biographical Information. The Trustees and officers, their positions
with the Fund, length of service in such position(s), and principal
occupations and business affiliations during at least the past five years are
listed in the charts below. The charts also include information about each
Trustee's beneficial share ownership in the Fund and in all of the registered
investment companies that the Trustee oversees in the Oppenheimer family of
funds ("Supervised Funds"). The address of each Trustee in the chart below is
6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for
an indefinite term, or until his or her resignation, retirement, death or
removal.


---------------------------------------------------------------------------------------
                                 Independent Trustees
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Name, Position(s)   Principal Occupation(s) During the Past      Dollar     Aggregate
                                                                             Dollar
                                                                            Range of
                                                                             Shares
                                                                Range of   Beneficially
                    5 Years; Other                               Shares     Owned in
with the Fund,      Trusteeships/Directorships Held; Number   Beneficially     All
Length of Service,  of Portfolios in the Fund Complex           Owned in   Supervised
Age                 Currently Overseen                          the Fund      Funds
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
                                                              As of December 31, 2004
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
William L.          Chairman of the following private         None         Over
Armstrong,          mortgage banking companies: Cherry Creek               $100,000
Chairman of the     Mortgage Company (since 1991),
Board of Trustees   Centennial State Mortgage Company (since
since 2003,         1994), and The El Paso Mortgage Company
Trustee since 2004  (since 1993); Chairman of the following
Age: 68             private companies: Ambassador Media
                    Corporation (since 1984) and Broadway
                    Ventures (since 1984); Director of the
                    following: Helmerich & Payne, Inc. (oil
                    and gas drilling/production company)
                    (since 1992), Campus Crusade for Christ
                    (since 1991) and The Lynde and Harry
                    Bradley Foundation, Inc. (non-profit
                    organization) (since 2002); former
                    Chairman of the following: Transland
                    Financial Services, Inc. (private
                    mortgage banking company) (1997-2003),
                    Great Frontier Insurance (insurance
                    agency) (1995-2000), Frontier Real
                    Estate, Inc. (residential real estate
                    brokerage) (1994-2000) and Frontier
                    Title (title insurance agency)
                    (1995-2000); former Director of the
                    following: UNUMProvident (insurance
                    company) (1991-2004), Storage Technology
                    Corporation (computer equipment company)
                    (1991-2003) and International Family
                    Entertainment (television channel)
                    (1992-1997); U.S. Senator (January
                    1979-January 1991). Oversees 38
                    portfolios in the OppenheimerFunds
                    complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Robert G. Avis,     Director and President of A.G. Edwards    None         Over
Trustee since 2004  Capital, Inc. (General Partner of                      $100,000
Age: 74             private equity funds) (until February
                    2001); Chairman, President and Chief
                    Executive Officer of A.G. Edwards
                    Capital, Inc. (until March 2000);
                    Director of A.G. Edwards & Sons, Inc.
                    (brokerage company) (until 2000) and
                    A.G. Edwards Trust Company (investment
                    adviser) (until 2000); Vice Chairman and
                    Director of A.G. Edwards, Inc. (until
                    March 1999); Vice Chairman of A.G.
                    Edwards & Sons, Inc. (until March 1999);
                    Chairman of A.G. Edwards Trust Company
                    (until March 1999) and A.G.E. Asset
                    Management (investment adviser) (until
                    March 1999). Oversees 38 portfolios in
                    the OppenheimerFunds complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
George C. Bowen,    Assistant Secretary and Director of       None         Over
Trustee since 2004  Centennial Asset Management Corporation                $100,000
Age: 69             (December 1991-April 1999); President,
                    Treasurer and Director of Centennial
                    Capital Corporation (June 1989-April
                    1999); Chief Executive Officer and
                    Director of MultiSource Services, Inc.
                    (March 1996-April 1999); Mr. Bowen held
                    several positions with the Manager and
                    with subsidiary or affiliated companies
                    of the Manager (September 1987-April
                    1999). Oversees 38 portfolios in the
                    OppenheimerFunds complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Edward L. Cameron,  Member of The Life Guard of Mount Vernon  None         Over
Trustee since 2004  (George Washington historical site)                    $100,000
Age: 67             (since June 2000); Director of Genetic
                    ID, Inc. (biotech company) (March
                    2001-May 2002); Partner at
                    PricewaterhouseCoopers LLP (accounting
                    firm) (July 1974-June 1999); Chairman of
                    Price Waterhouse LLP Global Investment
                    Management Industry Services Group (July
                    1994-June 1998). Oversees 38 portfolios
                    in the OppenheimerFunds complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Jon S. Fossel,      Director of UNUMProvident (insurance      None         Over
Trustee since 2004  company) (since June 2002); Director of                $100,000
Age: 63             Northwestern Energy Corp. (public
                    utility corporation) (since November
                    2004); Director of P.R. Pharmaceuticals
                    (October 1999-October 2003); Director of
                    Rocky Mountain Elk Foundation
                    (non-profit organization) (February
                    1998-February 2003); Chairman and
                    Director (until October 1996) and
                    President and Chief Executive Officer
                    (until October 1995) of the Manager;
                    President, Chief Executive Officer and
                    Director of the following: Oppenheimer
                    Acquisition Corp. ("OAC") (parent
                    holding company of the Manager),
                    Shareholders Services, Inc. and
                    Shareholder Financial Services, Inc.
                    (until October 1995). Oversees 38
                    portfolios in the OppenheimerFunds
                    complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Sam Freedman,       Director of Colorado Uplift (charitable   None         Over
Trustee since 2004  organization) (since September 1984).                  $100,000
Age: 65             Mr. Freedman held several positions with
                    the Manager and with subsidiary or
                    affiliated companies of the Manager
                    (until October 1994). Oversees 38
                    portfolios in the OppenheimerFunds
                    complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Beverly L.          Trustee of Monterey Institute for         None         Over
Hamilton,           International Studies (educational                     $100,000
Trustee since 2004  organization) (since February 2000);
Age: 59             Director of The California Endowment
                    (philanthropic organization) (since
                    April 2002); Director of Community
                    Hospital of Monterey Peninsula (since
                    February 2002); Director of American
                    Funds' Emerging Markets Growth Fund,
                    Inc. (mutual fund) (since October 1991);
                    President of ARCO Investment Management
                    Company (February 1991-April 2000);
                    Member of the investment committees of
                    The Rockefeller Foundation and The
                    University of Michigan; Advisor at
                    Credit Suisse First Boston's Sprout
                    venture capital unit (venture capital
                    fund) (1994-January 2005); Trustee of
                    MassMutual Institutional Funds
                    (investment company) (1996-June 2004);
                    Trustee of MML Series Investment Fund
                    (investment company) (April 1989-June
                    2004); Member of the investment
                    committee of Hartford Hospital
                    (2000-2003); and Advisor to Unilever
                    (Holland) pension fund (2000-2003).
                    Oversees 38 portfolios in the
                    OppenheimerFunds complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
Robert J. Malone,   Director of Jones International           None         Over
Trustee since 2004  University (educational organization)                  $100,000
Age: 61             (since August 2005); Chairman, Chief
                    Executive Officer and Director of Steele
                    Street State Bank (commercial banking)
                    (since August 2003); Director of
                    Colorado UpLIFT (charitable
                    organization) (since 1986); Trustee of
                    the Gallagher Family Foundation
                    (non-profit organization) (since 2000);
                    Former Chairman of U.S. Bank-Colorado
                    (subsidiary of U.S. Bancorp and formerly
                    Colorado National Bank) (July 1996-April
                    1999); Director of Commercial Assets,
                    Inc. (real estate investment trust)
                    (1993-2000); Director of Jones
                    Knowledge, Inc. (2001-July 2004); and
                    Director of U.S. Exploration, Inc. (oil
                    and gas exploration) (1997-February
                    2004). Oversees 38 portfolios in the
                    OppenheimerFunds complex.
---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
F. William          Trustee of MassMutual Select Funds        None         Over
Marshall, Jr.,      (formerly MassMutual Institutional                     $100,000
Trustee since 2004  Funds) (investment company) (since 1996)
Age: 63             and MML Series Investment Fund
                    (investment company) (since 1996)
                    Trustee (since 2003) and Chairman

                    (1994-2005) of the Investment Committee

                    of the Worcester Polytech Institute
                    (private university); President and
                    Treasurer of the SIS Funds (private
                    charitable fund) (since January 1999);
                    Chairman of SIS & Family Bank, F.S.B.
                    (formerly SIS Bank) (commercial bank)
                    (January 1999-July 1999); and Executive
                    Vice President of Peoples Heritage
                    Financial Group, Inc. (commercial bank)
                    (January 1999-July 1999). Oversees 40
                    portfolios in the OppenheimerFunds
                    complex.*
---------------------------------------------------------------------------------------
*  Includes two open-end investment companies: MassMutual Select Funds and
   MML Series Investment Fund. In accordance with the instructions for Form
   N-1A, for purposes of this section only, MassMutual Select Funds and MML
   Series Investment Fund are included in the "Fund Complex." The Manager
   does not consider MassMutual Select Funds and MML Series Investment Fund
   to be part of the OppenheimerFunds' "Fund Complex" as that term may be
   otherwise interpreted.


The address of Mr. Murphy is Two World Financial Center, 225 Liberty Street,
11th Floor, New York, New York 10281-1008. Mr. Murphy serves as a Trustee and
as an officer for an indefinite term, or until his resignation, retirement,
death or removal. 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 director or trustee.


----------------------------------------------------------------------------------------
                            Interested Trustee and Officer
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
Name,            Principal Occupation(s) During the Past 5        Dollar     Aggregate
                                                                              Dollar
                                                                             Range Of
                                                                              Shares
                                                                 Range of   Beneficially
Position(s)                                                       Shares     Owned in
Held with the    Years; Other Trusteeships/Directorships Held;  Beneficially    All
Fund, Length of  Number of Portfolios in the Fund Complex        Owned in   Supervised
Service, Age     Currently Overseen                              the Fund      Funds
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
                                                                As of December 31, 2004
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------

John V. Murphy,  Chairman, Chief Executive Officer and          None        Over
President,       Director (since June 2001) and President                   $100,000
Principal        (since September 2000) of the Manager;
Executive        President and director or trustee of other
Officer and      Oppenheimer funds; President and Director of
Trustee since    OAC and of Oppenheimer Partnership Holdings,
2004             Inc. (holding company subsidiary of the
Age: 56          Manager) (since July 2001); Director of

                 OppenheimerFunds Distributor, Inc.
                 (subsidiary of the Manager) (since November
                 2001); Chairman and Director of Shareholder
                 Services, Inc. and of Shareholder Financial
                 Services, Inc. (transfer agent subsidiaries
                 of the Manager) (since July 2001); President
                 and Director of OppenheimerFunds Legacy
                 Program (charitable trust program established
                 by the Manager) (since July 2001); 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
                 2001) and Director (since July 2001) of
                 Oppenheimer Real Asset Management, Inc.;
                 Executive Vice President of Massachusetts
                 Mutual Life Insurance Company (OAC's parent
                 company) (since February 1997); Director of
                 DLB Acquisition Corporation (holding company
                 parent of Babson Capital Management LLC)
                 (since June 1995); Member of the Investment
                 Company Institute's Board of Governors (since
                 October 3, 2003); Chief Operating Officer of
                 the Manager (September 2000-June 2001);
                 President and Trustee of MML Series
                 Investment Fund and MassMutual Select Funds
                 (open-end investment companies) (November
                 1999-November 2001); Director of C.M. Life
                 Insurance Company (September 1999-August
                 2000); President, Chief Executive Officer and
                 Director of MML Bay State Life Insurance
                 Company (September 1999-August 2000);
                 Director of Emerald Isle Bancorp and Hibernia
                 Savings Bank (wholly-owned subsidiary of
                 Emerald Isle Bancorp) (June 1989-June 1998).
                 Oversees 87 portfolios in the
                 OppenheimerFunds complex.
----------------------------------------------------------------------------------------


The addresses of the officers in the chart below are as follows: for Messrs.
Gillespie, Manioudakis, Schadt and Zack and Ms. Bloomberg, Two World
Financial Center, 225 Liberty Street, New York, New York 10281-1008, for
Messrs. Petersen, Szilagyi, Vandehey and Wixted and Ms. Ives, 6803 S. Tucson
Way, Centennial, Colorado 80112-3924. Each officer serves for an indefinite
term or until his or her resignation, retirement death or removal.


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

       Angelo Manioudakis, Senior Vice President of the Manager (since April 2002), of
       Vice President and  HarbourView Asset Management Corporation (since April, 2002
       Portfolio Manager   and of OFI Institutional Asset Management, Inc. (since June
       since 2004          2002); Executive Director and portfolio manager for Miller,
       Age: 39             Anderson & Sherrerd, a division of Morgan Stanley
                           Investment Management (August 1993-April 2002). An officer
                           of 17 portfolios in the OppenheimerFunds complex.

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

       Rudi W. Schadt,     Vice President, Director of Research in Product Design and
       Vice President and  Risk Management of the Manager since August 2004. Prior to
       Portfolio Manager   joining the Manager in February 2002 he was a Director and
       since 2004          Senior Quantitative Analyst (2000-2001) at UBS Asset
       Age: 48             Management prior to which he was an Associate Director of
                           Research (since June 1999) and Senior Researcher and
                           Portfolio Manager (from June 1997) at State Street Global
                           Advisors. An officer of 7 portfolios in the
                           OppenheimerFunds complex.

       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------
       Mark S. Vandehey,   Senior Vice President and Chief Compliance Officer of the
       Vice President and  Manager (since March 2004); Vice President of
       Chief Compliance    OppenheimerFunds Distributor, Inc., Centennial Asset
       Officer since 2004  Management Corporation and Shareholder Services, Inc.
       Age: 55             (since June 1983); Vice President and Director of Internal
                           Audit of the Manager (1997-February 2004). An officer of 87
                           portfolios in the OppenheimerFunds complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------

       Brian W. Wixted,    Senior Vice President and Treasurer of the Manager (since
       Treasurer and       March 1999); Treasurer of the following: HarbourView Asset
       Principal           Management Corporation, Shareholder Financial Services,
       Financial &         Inc., Shareholder Services, Inc., Oppenheimer Real Asset
       Accounting Officer  Management Corporation, and Oppenheimer Partnership
       since 2004          Holdings, Inc. (since March 1999), OFI Private Investments,
       Age: 46             Inc. (since March 2000), OppenheimerFunds International

                           Ltd. and OppenheimerFunds plc (since May 2000), OFI
                           Institutional Asset Management, Inc. (since November 2000),
                           and OppenheimerFunds Legacy Program (since June 2003);
                           Treasurer and Chief Financial Officer of OFI Trust Company
                           (trust company subsidiary of the Manager) (since May 2000);
                           Assistant Treasurer of the following: OAC (since March
                           1999), Centennial Asset Management Corporation (March
                           1999-October 2003) and OppenheimerFunds Legacy Program
                           (April 2000-June 2003); Principal and Chief Operating
                           Officer of Bankers Trust Company-Mutual Fund Services
                           Division (March 1995-March 1999). An officer of 87
                           portfolios in the OppenheimerFunds complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------
       Brian Petersen,     Assistant Vice President of the Manager (since August
       Assistant           2002); Manager/Financial Product Accounting of the Manager
       Treasurer since     (November 1998-July 2002). An officer of 87 portfolios in
       2004                the OppenheimerFunds complex.
       Age: 35
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------

       Brian C. Szilagyi,  Assistant Vice President of the Manager (since July 2004);
       Assistant           Director of Financial Reporting and Compliance of First
       Treasurer since     Data Corporation (April 2003-July 2004); Manager of
       2005                Compliance of Berger Financial Group LLC (May 2001-March
       Age: 35             2003). An officer of 87 portfolios in the OppenheimerFunds

                           complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------

       Robert G. Zack,     Executive Vice President (since January 2004) and General
       Vice President and  Counsel (since March 2002) of the Manager; General Counsel
       Secretary since     and Director of the Distributor (since December 2001);
       2004                General Counsel of Centennial Asset Management Corporation
       Age: 57             (since December 2001); Senior Vice President and General

                           Counsel of HarbourView Asset Management Corporation (since
                           December 2001); Secretary and General Counsel of OAC (since
                           November 2001); Assistant Secretary (since September 1997)
                           and Director (since November 2001) of OppenheimerFunds
                           International Ltd. and OppenheimerFunds plc; Vice President
                           and Director of Oppenheimer Partnership Holdings, Inc.
                           (since December 2002); Director of Oppenheimer Real Asset
                           Management, Inc. (since November 2001); Senior Vice
                           President, General Counsel and Director of Shareholder
                           Financial Services, Inc. and Shareholder Services, Inc.
                           (since December 2001); Senior Vice President, General
                           Counsel and Director of OFI Private Investments, Inc. and
                           OFI Trust Company (since November 2001); Vice President of
                           OppenheimerFunds Legacy Program (since June 2003); Senior
                           Vice President and General Counsel of OFI Institutional
                           Asset Management, Inc. (since November 2001); Director of
                           OppenheimerFunds (Asia) Limited (since December 2003);
                           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 the following: Shareholder Services,
                           Inc. (May 1985-November 2001), Shareholder Financial
                           Services, Inc. (November 1989-November 2001), and
                           OppenheimerFunds International Ltd. (September
                           1997-November 2001). An officer of 87 portfolios in the
                           OppenheimerFunds complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------
       Lisa I. Bloomberg,  Vice President and Associate Counsel of the Manager (since
       Assistant           May 2004); First Vice President (April 2001-April 2004),
       Secretary since     Associate General Counsel (December 2000-April 2004),
       2004                Corporate Vice President (May 1999-April 2001) and
       Age: 37             Assistant General Counsel (May 1999-December 2000) of UBS
                           Financial Services Inc. (formerly, PaineWebber
                           Incorporated). An officer of 87 portfolios in the
                           OppenheimerFunds complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------
       Kathleen T. Ives,   Vice President (since June 1998) and Senior Counsel and
       Assistant           Assistant Secretary (since October 2003) of the Manager;
       Secretary since     Vice President (since 1999) and Assistant Secretary (since
       2004                October 2003) of the Distributor; Assistant Secretary of
       Age: 40             Centennial Asset Management Corporation (since October
                           2003); Vice President and Assistant Secretary of
                           Shareholder Services, Inc. (since 1999); Assistant
                           Secretary of OppenheimerFunds Legacy Program and
                           Shareholder Financial Services, Inc. (since December 2001);
                           Assistant Counsel of the Manager (August 1994-October
                           2003). An officer of 87 portfolios in the OppenheimerFunds
                           complex.
       ---------------------------------------------------------------------------------
       ---------------------------------------------------------------------------------
       Phillip S.          Senior Vice President and Deputy General Counsel of the
       Gillespie,          Manager (since September 2004); First Vice President
       Assistant           (2000-September 2004), Director (2000-September 2004) and
       Secretary since     Vice President (1998-2000) of Merrill Lynch Investment
       2004                Management. An officer of 87 portfolios in the
       Age: 41             OppenheimerFunds complex.
       ---------------------------------------------------------------------------------


      Remuneration of the Officers and Trustees. The officers and the
interested Trustee of the Fund who are affiliated with the Manager receive no
salary or fee from the Fund. The Independent Trustees received the
compensation shown below from the Fund for serving as a Trustee and member of
a committee (if applicable), with respect to the Fund's fiscal year ended
August 31, 2005. The total compensation, including accrued retirement
benefits, from the Fund and fund complex represents compensation received for
serving as a Trustee and member of a committee (if applicable) of the Boards
of the Fund and other funds in the OppenheimerFunds complex during the
calendar year ended December 31, 2004.




---------------------------------------------------------------------------------
Name of Trustee and Other Fund    Aggregate Compensation    Total Compensation
                                                            From the Fund and
Position(s) (as applicable)          From the Fund(1)        Fund Complex(2)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William L. Armstrong                       $585                  $178,000
Chairman of the Board and
Governance Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Avis                             $389                  $118,500
Review Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George C. Bowen                            $389                  $118,500
Audit Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward L. Cameron                          $447                  $136,000
Audit Committee Chairman
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jon S. Fossel                              $447                  $136,000
Review Committee Chairman
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Sam Freedman                               $389                  $118,500
Review Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Beverly Hamilton                         $392(3)               $152,355(5)
Review Committee Member and
Governance Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert J. Malone                         $450(4)                 $121,726
Governance Committee Chairman
and
Audit Committee Member
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
F. William Marshall, Jr.
Audit Committee Member and                 $389                $167,500(6)
Governance Committee Member
---------------------------------------------------------------------------------
1.    "Aggregate Compensation From the Fund" includes fees and deferred
   compensation, if any.

2.    In accordance with SEC regulations, for purposes of this section only,
   "Fund Complex" includes the Oppenheimer funds, the MassMutual
   Institutional Funds, the MassMutual Select Funds and the 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 following: MassMutual Premier International Equity Fund, MassMutual
   Premier Main Street Fund, MassMutual Premier Strategic Income Fund,
   MassMutual Premier Capital Appreciation Fund, and MassMutual Premier
   Global Fund. The Manager does not consider MassMutual Institutional Funds,
   MassMutual Select Funds and MML Series Investment Fund to be part of the
   OppenheimerFunds' "Fund Complex" as that term may be otherwise interpreted.

3.    Includes $392 deferred by Ms. Hamilton under the "Deferred Compensation
   Plan" described below.
4.    Includes $450 deferred by Mr. Malone under the "Deferred Compensation
   Plan" described below.
5.    Includes $36,654 deferred by Ms. Hamilton under a deferred compensation
   plan for serving as a Trustee for MassMutual Institutional Funds and MML
   Series Investment Fund (until June 30, 2004).
6.    Includes $49,000 compensation paid to Mr. Marshall for serving as a
   Trustee for MassMutual Select Funds and MML Series Investment Fund.

|X|   Deferred Compensation Plan For Trustees. The Board of Trustees has
adopted a Deferred Compensation Plan for Independent 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 Fund. 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 amount of compensation deferred and the performance of the
selected funds.


      Deferral of Trustees' fees under the plan will not materially affect
the Fund's assets, liabilities or 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 Trustees under the plan without shareholder
approval for the limited purpose of determining the value of the Trustees'
deferred compensation account.

|X|   Major Shareholders. As of November 30, 2005, the only persons or
entities who owned of record or were known by the Fund to own beneficially 5%
or more of any class of the Fund's outstanding shares 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
36,764.293 Class B shares (representing approximately 5.50% 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
177,920.620 Class C shares (representing approximately 26.02% of the Class C
shares then outstanding).

RPSS TR Rollover IRA, FBO Janelle F. File, 16250 Borden Road, Crescent, IA
51526-4042, which owned 11,111.282 Class N shares (representing approximately
24.21% of the Class N shares then outstanding).

RPSS TR Single K Phyllis D Karm MD, FBO Phyllis D. Karm, 3652 Rebel Circle,
Huntington Beach, CA 92649-2513, which owned 8,336.211 Class N shares
(representing approximately 18.16% of the Class N shares then outstanding).

RPSS TR Rollover IRA, FBO Jesse W. Allery, 2330 13th Avenue SW, Devils Lake,
ND 58301-8626, which owned 2,792.125 Class N shares (representing
approximately 6.08% of the Class N shares then outstanding).

RPSS TR IRA, FBO Joyce G. Pontbriand, 43 Globeflower Lane, West Windsor, NJ
08550-2427, which owned 2,735.735 Class N shares (representing approximately
5.96% of the Class N shares then outstanding).

RPSS TR Rollover IRA, FBO Sharon Blankenship, 6 Hearthston Lane, Monsey, NY
10952-5204, which owned 2,503.432 Class N shares (representing approximately
5.45% of the Class N shares then outstanding).

NFS LLC FEBO, FMT CO Customer IRA Rollover, FBO Gail Scotton Powell, 6516
Deerview Drive, Raleigh, NC 27606 which owned 2,500.863 Class N shares
(representing approximately 5.44% of the Class N shares then outstanding).


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

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

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

|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 the Manager where a
directly-controlled affiliate of the Manager 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 the independent registered public
         accounting firm, unless circumstances indicate otherwise.
o     In general, the Fund opposes "anti-takeover" proposals and supports the
         elimination of anti-takeover proposals, absent unusual
         circumstances.
o     The Fund supports shareholder proposals to reduce a super-majority vote
         requirement, and opposes management proposals to add a
         super-majority vote requirement.
o     The Fund opposes proposals to classify the board of directors.
o     The Fund supports proposals to eliminate cumulative voting.
o     The Fund opposes re-pricing of stock options.
o     The Fund generally considers executive compensation questions such as
         stock option plans and bonus plans to be ordinary business activity.
         The Fund analyzes stock option plans, paying particular attention to
         their dilutive effect. While the Fund generally supports management
         proposals, the Fund opposes plans it considers to be excessive.

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

      |X| The Investment Advisory Agreement. The Manager provides investment
advisory and management services to the Fund under an investment advisory
agreement between the Manager and the Fund. The Manager selects securities
for the Fund's portfolio and handles its day-to-day business. The portfolio
managers of the Fund are employed by the Manager and are the persons who are
principally responsible for the day-to-day management of the Fund's
portfolio.

      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 the Fund's last
fiscal year was:

         -----------------------------------------------------------------
          Fiscal Year Ended August 31:       Management Fee Paid to
                                             OppenheimerFunds, Inc.
         -----------------------------------------------------------------
         -----------------------------------------------------------------

                    2005(1)                         $336,743

         -----------------------------------------------------------------
      1.    For the fiscal period from October 7, 2004 (commencement of
operations) to August 31, 2005.

      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.

 Portfolio Manager. The Fund's portfolio is managed by Angelo Manioudakis and
Rudi W. Schadt (the "Portfolio Managers") who are responsible for the
day-to-day management of the Fund's investments.

     Other Accounts Managed. In addition to managing the Fund's
investments, each Portfolio Manager also manages other investment portfolios
and accounts. The following table provides information regarding the other
portfolios and accounts managed by the Portfolio Managers as of August 31,
2005. No account has a performance-based advisory fee:

Portfolio        RegistereTotal      Other         Total    Other    Total
                                                 Assets in
                          Assets in                Other
                          Registered Pooled       Pooled               Assets
                 InvestmenInvestment Investment Investment           in Other
                 CompaniesCompanies  Vehicles    Vehicles   Accounts Accounts
Manager          Managed   Managed*   Managed    Managed*   Managed   Managed*
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Angelo              17    $12,777.8      6        $205.4       1       $39.5
Manioudakis
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Rudi W. Schadt      7       $690.8      None       None       None      None
--------------------------------------------------------------------------------
   *  In millions.


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

      Compensation of the Portfolio Managers. The Fund's Portfolio Managers
are employed and compensated by the Manager, not the Fund. Under the
Manager's compensation program for its portfolio managers and portfolio
analysts, their compensation is based primarily on the investment performance
results of the funds and accounts they manage, rather than on the financial
success of the Manager. This is intended to align the portfolio managers and
analysts' interests with the success of the funds and accounts and their
shareholders. The Manager's compensation structure is designed to attract and
retain highly qualified investment management professionals and to reward
individual and team contributions toward creating shareholder value. As of
August 31, 2005, each Portfolio Managers' compensation consisted of three
elements: a base salary, an annual discretionary bonus and eligibility to
participate in long-term awards of options and appreciation rights in regard
to the common stock of the Manager's holding company parent. Senior portfolio
managers may also be eligible to participate in the Manager's deferred
compensation plan.

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

      Ownership of Fund Shares. As of August 31, 2005, the Portfolio Managers
did not beneficially own any shares of the Funds.

Brokerage Policies of the Fund

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

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

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

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

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

      Transactions in securities other than those for which an exchange is
the primary market are generally done with principals or market makers.
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       Total Brokerage Commissions Paid by the
          August 31:                         Fund((1))

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

             2005                            None((2))

   ---------------------------------------------------------------------
1.    Amounts do not include spreads or commissions on principal  transactions
         on a net trade basis.
2.    For the fiscal period from October 7,  2004 (commencement of operations)
         to August 31,  2005,  the amount of  transactions  directed to
         brokers  for  research  services  was  $0  and  amount  of the
         commissions paid to broker-dealers for those services was $0.

Distribution and Service Plans

The Distributor. Under its General Distributor's Agreement with the Fund, the
Distributor 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, 2005 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       Distributor(1)
---------------------------------------------
---------------------------------------------
 2005(2)     $1,062,753         $228,623
---------------------------------------------
1.    Includes amounts  retained by a broker-dealer  that is an affiliate or a
   parent of the Distributor.
2.    For the fiscal period from October 7,  2004 (commencement of operations)
   to August 31, 2005.

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

Fiscal     Concessions on    Concessions on   Concessions on    Concessions on
Year       Class A Shares    Class B Shares   Class C Shares    Class N Shares
Ended        Advanced by      Advanced by       Advanced by      Advanced by

  8/31:    Distributor(1)    Distributor(1)   Distributor(1)    Distributor(1)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 2005(2)        None              None             None              None
--------------------------------------------------------------------------------

1.    The   Distributor    advanced    concession    payments   to   financial
   intermediaries  for  certain  sales of Class A  shares  and for  sales of
   Class B, Class C and Class N shares  from its own  resources  at the time
   of sale.
2.    For the fiscal period from October 7, 2004  (commencement of operations)
   to August 31, 2005.


--------------------------------------------------------------------------------
Fiscal         Class A          Class B           Class C          Class N
             Contingent        Contingent       Contingent        Contingent
Period     Deferred Sales    Deferred Sales   Deferred Sales    Deferred Sales
Ended          Charges          Charges           Charges          Charges
  8/31:      Retained by      Retained by       Retained by      Retained by
             Distributor      Distributor       Distributor      Distributor
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 2005(1)        None            $41,608           $6,863             $91
--------------------------------------------------------------------------------
1. For the fiscal period from October 7, 2004 (commencement of operations)
to August 31, 2005.


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


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


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

      The Board of Trustees and the Independent Trustees must approve all
material amendments to a plan. An amendment to increase materially the amount
of payments to be made under a plan must be approved by shareholders of the
class affected by the amendment. Because Class B shares of the Fund
automatically convert into Class A shares 90 months after purchase, the Fund
must obtain the approval of both Class A and Class B shareholders for a
proposed material amendment to the Class A plan that would materially
increase payments under the plan. That approval must be by a majority of the
shares of each class, voting separately by class.

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

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

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

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

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

      For the fiscal year ended August 31, 2005 payments under the Class A
plan totaled $81,542, of which $700 was retained by the Distributor under the
arrangement described above, and included $1,825 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, Class C and Class N Distribution and Service Plan Fees. Under
each plan, distribution and service fees are computed on the average of the
net asset value of shares in the respective class, determined as of the close
of each regular business day during the period. Each plan provides for the
Distributor to be compensated at a flat rate, whether the Distributor's
distribution expenses are more or less than the amounts paid by the Fund
under the plan during the period for which the fee is paid. The types of
services that recipients provide are similar to the services provided under
the Class A service plan, described above.

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

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

      The Distributor retains the asset-based sales charge on Class B and
Class N shares. The Distributor retains the asset-based sales charge on Class
C shares during the first year the shares are outstanding. It pays the
asset-based sales charge as an ongoing concession to the recipient on Class C
shares outstanding for a year or more. If a dealer has a special agreement
with the Distributor, the Distributor will pay the Class B, Class C or Class
N service fee and the asset-based sales charge to the dealer periodically in
lieu of paying the sales concession and service fee in advance at the time of
purchase. As of January 1, 2010, the Distribution and Service (12b-1) fees
for Class B shares will be reduced to 0.25%.

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

o     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, Class C and Class
         N shares,
o     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, Class C and Class N shares without receiving payment under the
         plans and therefore may not have been able to offer such Classes for
         sale absent the plans,

      received 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,
      may not be able to continue providing, at the same or at a lesser cost,
         the same quality distribution sales efforts and services, or to
         obtain such services from brokers and dealers, if the plan payments
         were to be discontinued.


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


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

  Distribution and Service Fees Paid to the Distributor for the Fiscal Year

                            Ended August 31, 2005
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
                     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        166,793     $157,692(1)       $714,393          3.43%

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

Class C Plan        166,924     $158,338(2)        $37,278          0.17%

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

Class N Plan         5,696       $4,450(3)         $12,501          0.87%

-------------------------------------------------------------------------------
1.    Includes $0 paid to an affiliate of the Distributor's parent company.
2.    Includes $188 paid to an affiliate of the Distributor's parent company.
3.    Includes  $13,887  paid  to an  affiliate  of the  Distributor's  parent
   company.

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


Payments to Fund Intermediaries

      Financial intermediaries may receive various forms of compensation or
reimbursement from the Fund in the form of 12b-1 plan payments as described
in the preceding section of this Statement of Additional Information. They
may also receive reallowance of commissions from the Distributor, derived
from sales charges paid by the clients of the financial intermediary, also as
described in this Statement of Additional Information. Additionally, the
Manager and/or the Distributor (including their affiliates) may make payments
to financial intermediaries in connection with their offering and selling
shares of the Fund and other Oppenheimer funds, providing marketing or
promotional support, transaction processing and/or administrative services.
Among the financial intermediaries that may receive these payments are
brokers and dealers who sell and/or hold shares of the Fund, banks (including
bank trust departments), registered investment advisers, insurance companies,
retirement plan and qualified tuition program administrators, third party
administrators, and other institutions that have selling, servicing or
similar arrangements with the Manager or Distributor. The payments to
intermediaries vary by the types of product sold, the features of the Fund
share class and the role played by the intermediary.

      Possible types of payments to financial intermediaries include, without
limitation, those discussed below.

o     Payments made by the Fund, or by an investor buying or selling shares
         of the Fund may include:

o     depending on the share class that the investor selects, contingent
              deferred sales charges or initial front-end sales charges, all
              or a portion of which front-end sales charges are payable by
              the Distributor to financial intermediaries as sales
              commissions (see "About Your Account" in the Prospectus);
o     ongoing asset-based payments attributable to the share class selected,
              including fees payable under the Fund's distribution and/or
              service plans adopted under Rule 12b-1 under the Investment
              Company Act, which are paid from the Fund's assets and
              allocated to the class of shares to which the plan relates (see
              "About the Fund -- Distribution and Service Plans" above);
o     shareholder servicing payments for providing omnibus accounting,
              recordkeeping, networking, sub-transfer agency or other
              administrative or shareholder services, including retirement
              plan and 529 plan administrative services fees, which are paid
              from the assets of a Fund as reimbursement to the Manager or
              Distributor for expenses they incur on behalf of the Fund.

o     Payments made by the Manager or Distributor out of their respective
         resources and assets, which may include profits the Manager derives
         from investment advisory fees paid by the Fund. These payments are
         made at the discretion of the Manager and/or the Distributor. These
         payments, often referred to as "revenue sharing" payments, may be in
         addition to the payments by the Fund listed above.

o     These types of payments may reflect compensation for marketing support,
              support provided in offering the Fund or other Oppenheimer
              funds through certain trading platforms and programs,
              transaction processing or other services;
o     The Manager and Distributor each may also pay other compensation to the
              extent the payment is not prohibited by law or by any
              self-regulatory agency, such as the NASD. Payments are made
              based on the guidelines established by the Manager and
              Distributor, subject to applicable law.

      These payments may provide an incentive to financial intermediaries to
actively market or promote the sale of shares of the Fund or other
Oppenheimer funds, or to support the marketing or promotional efforts of the
Distributor in offering shares of the Fund or other Oppenheimer funds. In
addition, some types of payments may provide a financial intermediary with an
incentive to recommend the Fund or a particular share class. Financial
intermediaries may earn profits on these payments, since the amount of the
payment may exceed the cost of providing the service. Certain of these
payments are subject to limitations under applicable law. Financial
intermediaries may categorize and disclose these arrangements to their
clients and to members of the public in a manner different from the
disclosures in the Fund's prospectus and this Statement of Additional
Information. You should ask your financial intermediary for information about
any payments it receives from the Fund, the Manager or the Distributor and
any services it provides, as well as the fees and commissions it charges.

      Although brokers or dealers that sell Fund shares may also act as a
broker or dealer in connection with the execution of the purchase or sale of
portfolio securities by the Fund or other Oppenheimer funds, a financial
intermediary's sales of shares of the Fund or such other Oppenheimer funds is
not a consideration for the Manager when choosing brokers or dealers to
effect portfolio transactions for the Fund or such other Oppenheimer funds.

      Revenue sharing payments can pay for distribution-related or asset
retention items including, without limitation,

o     transactional support, one-time charges for setting up access for the
         Fund or other Oppenheimer funds on particular trading systems, and
         paying the intermediary's networking fees;
o     program support, such as expenses related to including the Oppenheimer
         funds in retirement plans, college savings plans, fee-based advisory
         or wrap fee programs, fund "supermarkets", bank or trust company
         products or insurance companies' variable annuity or variable life
         insurance products;
o     placement on the dealer's list of offered funds and providing
         representatives of the Distributor with access to a financial
         intermediary's sales meetings, sales representatives and management
         representatives.

      Additionally, the Manager or Distributor may make payments for firm
support, such as business planning assistance, advertising, and educating a
financial intermediary's sales personnel about the Oppenheimer funds and
shareholder financial planning needs.

      For the year ended December 31, 2004, the following financial
intermediaries that are broker-dealers offering shares of the Oppenheimer
funds, and/or their respective affiliates, received revenue sharing or
similar distribution-related payments from the Manager or Distributor for
marketing or program support:

  ADVEST INC.                             AEGON
  A.G. Edwards & Sons, Inc                AIG Network
  Allianz Life Insurance Company          Allstate Life Insurance Company
  Ameritas Life Insurance Corporation     American Centurian Life Insurance
  American Enterprise Life Insurance      American Express Financial Advisors
                                          Inc.
  American Portfolios                     Annuity Investors Life
  AXA Advisors                            Banc One Securities Corporation
  Bank of New York                        Cadaret Grant & Co. Inc.
  Charter One Securities Inc.             Chase Investment Services
  Citigroup Financial Network             CitiStreet
  Citizens Bank of Rhode Island           CJM Planning Corp.
  Columbus Life Insurance Company         Commonwealth Financial Network
  CUNA Brokerage Services Inc.            CUSO Financial Services, L.P.
  Federal Kemper                          First Allied Securities Inc
  First Global Capital                    GE Financial Assurance
  GlenBrook Life and Annuity Co.          Great West Life & Annuity Co., Inc.
  HD Vest                                 Hewitt Associates
  HSBC Brokerage (USA) Inc.               ING Network
  Jefferson Pilot Securities Corporation  John Hancock Variable Life Insurance
                                          Company
  Kemper Life Assurance Company           Legend Equities Corporation
  Legg Mason Wood Walker, Incorporated    Lincoln National Life Insurance
                                          Company
  Lincoln Financial Advisors Corporation  Lincoln Investment Planning
  Linsco/Private Ledger Corp.             MassMutual Financial Group and
                                          affiliates
  McDonald Investments, Inc.              Merrill Lynch & Co., Inc. and
                                          affiliates
  Metlife and affiliates                  Minnesota Life Insurance Company
  Morgan Stanley DW Inc.                  NPH Network
  Nationwide and affiliates               New York Life Securities, LLC
  PacLife Network                         Park Avenue Securities LLC
  Planmember Securities Corporation       Prime Capital Services, Inc.
  Princor Financial Services Corporation  Protective Life Insurance Co.
  Provident Mutual Insurance Company      Prudential Investment Management
                                          Services LLC
  Raymond James Financial Services, Inc.  Raymond James & Associates, Inc.
  RBC Dain Rauscher Inc.                  Securities America, Inc.
  Security Benefit Life Insurance Company Signator Investments
  Sun Life Insurance Company              Suntrust Investment Services, Inc.
  Tower Square Securities, Inc            Travelers Life & Annuity Co., Inc.
  UBS Financial Services Inc.             Union Central Life Insurance Company
  Wachovia Securities LLC                 Wells Fargo Investments, LLC

      For the year ended December 31, 2004, the following firms, which in
some cases are broker-dealers, received payments from the Manager or
Distributor for administrative or other services provided (other than revenue
sharing arrangements), as described above:

  ABN AMRO                                ADP
  Alliance Benefit Group                  AMVESCAP Retirement Plans
  American Stock & Transfer               Baden Retirement
  BCG                                     Benefit Administration Co., LLC
  Benefit Administration, Inc.            Benefit Plans Administrative Services
  Benetech, Inc.                          BISYS Retirement Services
  Boston Financial Data Services          Ceridian
  Circle Trust Company                    Citigroup
  CitiStreet                              CPI
  Daily Access.Com, Inc.                  Digital Retirement Solutions
  Dyatech                                 ERISA Administrative Services, Inc.
  ExpertPlan.com                          FAScore
  FBD Consulting                          Federated Investors
  Fidelity Institutional                  First National Bank of Omaha
  First Trust Corp.                       Franklin Templeton
  Geller Group                            Gold K
  Great West Financial Services           Hartford Life Insurance Co.
  Equities, Inc.
  ICMA - RC Services                      In West Pension Mgmt
  Independent Plan Coordinators           Ingham Group
  Interactive Retirement Systems, Ltd.    Invesmart, Inc.
  Kaufman & Goble                         Leggette & Co., Inc.
  Manulife                                MassMutual Financial Group and
                                          affiliates
  Matrix Settlement & Clearance Services  Mellon HR Solutions
  Merrill Lynch & Co., Inc.               Metavante
  Metlife Securities Inc.                 MFS Investment Management
  Mid Atlantic Capital Corp.              Milliman USA
  Morgan Stanley DW Inc.                  National City Bank
  National Financial Services Corp.       National Investors Services Corp.
  Nationwide Investment Service Corp.     New York Life Investment Management,
                                          Inc.
  Northwest Plan Services                 Pension Administration and Consulting
  PFPC, Inc.                              PSMI Group
  Putnam Fiduciary Trust Company          Quads Trust Company
  RSM McGladrey                           SAFECO
  Charles Schwab & Co., Inc.              Security Trust Company
  Sentinel / National Life                Standard Insurance Co
  Stanley, Hunt, Dupree & Rhine           State Street Bank & Trust Company
  Suntrust Investment Services, Inc.      Swerdlin & Co.
  T. Rowe Price Brokerage Services, L.P.  Taylor, Perky & Parker, LLC
  The 401k Company                        The Investment Center, Inc.
  Trusource                               Union Bank and Trust Co.
  USI Consulting Group                    Vanguard Group
  Web401K.com                             Wilmington Trust Company


Performance of the Fund

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

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

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

o     Total returns measure the performance of a hypothetical account in the
         Fund over various periods and do not show the performance of each
         shareholder's account. Your account's performance will vary from the
         model performance data if your dividends are received in cash, or
         you buy or sell shares during the period, or you bought your shares
         at a different time and price than the shares used in the model.
o     The Fund's performance returns do not reflect the effect of taxes on
         dividends and capital gains distributions.
o     An investment in the Fund is not insured by the FDIC or any other
         government agency.
o     The principal value of the Fund's shares, and total returns are not
         guaranteed and normally will fluctuate on a daily basis.
o     When an investor's shares are redeemed, they may be worth more or less
         than their original cost.
o     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 debt
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 1.0%
contingent deferred sales charge is deducted for returns for the one-year
period. For Class N shares, the 1.0% contingent deferred sales charge is
deducted for returns for the one-year and life-of-class periods, as
applicable.


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

ERV       - 1  = Average Annual Total
l/n            Return
  P

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

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

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

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

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

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

o     Total Returns at Net Asset Value. From time to time the Fund may also
quote a cumulative or an average annual total return "at net asset value"
(without deducting sales charges) for Class A, Class B, Class C or Class N
shares. Each is based on the difference in net asset value per share at the
beginning and the end of the period for a hypothetical investment in that
class of shares (without considering front-end or contingent deferred sales
charges) and takes into consideration the reinvestment of dividends and
capital gains distributions.

---------------------------------------------------------------------------------
         The Fund's Total Returns for the Periods Ended August 31, 2005
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Class of       Cumulative Total            Average Annual Total Returns
                   Returns
                 (10 Years or
              life-of-class, if
Shares             less)(1)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
                                           1-Year                 5-Year
                                                           (or life of class if
                                                                 less)(1)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
               After    Without       After    Without       After    Without
               Sales    Sales         Sales    Sales         Sales    Sales
              Charge      Charge     Charge      Charge     Charge      Charge
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Class A(1)     -4.09       1.76        N/A        N/A         N/A        N/A
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Class B(1)     -3.97       1.03        N/A        N/A         N/A        N/A
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Class C(1)     0.11        1.11        N/A        N/A         N/A        N/A
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Class N(1)     0.57        1.57        N/A        N/A         N/A        N/A
---------------------------------------------------------------------------------
1. Inception of Class A, Class B, Class C and Class N: October 7, 2004.

----------------------------------------------------------------
 Average Annual Total Returns for Class A Shares (After Sales
                            Charge)
             For the Periods Ended August 31, 2005
----------------------------------------------------------------
----------------------------------------------------------------
                               1-Year(1)          5-Year
                                            (or life of class
                                               if less)(1)
----------------------------------------------------------------
----------------------------------------------------------------
After Taxes on Distributions     -4.14             N/A
----------------------------------------------------------------
----------------------------------------------------------------
After Taxes on                   -2.66             N/A
Distributions and
Redemption of Fund Shares
----------------------------------------------------------------
           1. Inception of Class A shares: October 7, 2004.

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

Appendix B contains more information about the special sales charge
arrangements offered by the Fund, and the circumstances in which sales
charges may be reduced.


Classes of Shares. Each class of shares of the Fund represents an interest in
the same portfolio of investments of the Fund. However, each class has
different shareholder privileges and features. The net income attributable to
Class B, Class C or Class N shares and the dividends payable on Class B,
Class C or Class N shares will be reduced by incremental expenses borne
solely by that class. Those expenses include the asset-based sales charges to
which Class B, Class C and Class N shares are subject.

      The availability of different classes of shares 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, Class C and Class N shares have no initial sales charge, the purpose
of the deferred sales charge and asset-based sales charge on Class B, Class C
and Class N shares is the same as that of the initial sales charge on Class A
shares - to compensate the Distributor and brokers, dealers and financial
institutions that 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 A Shares Subject to a Contingent Deferred Sales Charge. For
purchases of Class A shares at net asset value whether or not subject to a
contingent deferred sales charge, as described in the Prospectus, no sales
concessions will be paid to the broker-dealer of record on sales of Class A
shares purchased with the redemption proceeds of shares of another mutual
fund offered as an investment option in a retirement plan in which
Oppenheimer funds are also offered as investment options under a special
arrangement with the Distributor, if the purchase occurs more than 30 days
after the Oppenheimer funds are added as an investment option under that
plan. Additionally, that concession will not be paid on purchases of Class A
shares by a retirement plan made with the redemption proceeds of Class N
shares of one or more Oppenheimer funds held by the plan for more than 18
months.

      |X| Class B Conversion. Under current interpretations of applicable
federal income tax law by the Internal Revenue Service, the conversion of
Class B shares to Class A shares 90 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 90 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).

Fund Account Fees. As stated in the Prospectus, a $12 annual "Minimum Balance
Fee" is assessed on each Fund account with a share balance valued under $500.
The Minimum Balance Fee is automatically deducted from each such Fund account
in September.

      Listed below are certain cases in which the Fund has elected, in its
discretion, not to assess the Fund Account Fees. These exceptions are subject
to change:
o     A fund account whose shares were acquired after September 30th of the
            prior year;
o     A fund account that has a balance below $500 due to the automatic
            conversion of shares from Class B to Class A shares. However,
            once all Class B shares held in the account have been converted
            to Class A shares the new account balance may become subject to
            the Minimum Balance Fee;
o     Accounts of shareholders who elect to access their account documents
            electronically via eDoc Direct;
o     A fund account that has only certificated shares and, has a balance
            below $500 and is being escheated;
o     Accounts of shareholders that are held by broker-dealers under the NSCC
            Fund/SERV system;
o     Accounts held under the Oppenheimer Legacy Program and/or holding
            certain Oppenheimer Variable Account Funds; and
o     A fund account that falls below the $500 minimum solely due to market
            fluctuations within the 12-month period preceding the date the
            fee is deducted.

      To access account documents electronically via eDocs Direct, please
visit the Service Center on our website at www.oppenheimerfunds.com or call
1.888.470.0862 for instructions.

      The Fund reserves the authority to modify Fund Account Fees in its
discretion.

Determination of Net Asset Values Per Share. The net asset values per share
of each class of shares of the Fund are determined as of the close of
business of the New York Stock Exchange (the "NYSE") on each day that the
NYSE 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 NYSE 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 NYSE'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 NYSE members may conduct trading in certain
securities on days on which the NYSE is closed (including weekends and
holidays) or after 4:00 p.m. on a regular business day. Because the Fund's
net asset values will not be calculated on those days, the Fund's net asset
values per share may be significantly affected on such days when shareholders
may not purchase or redeem shares. Additionally, with respect to certain
securities held by the Underlying Fund, trading on European and Asian stock
exchanges and over-the-counter markets normally is completed before the close
of the NYSE.

      Changes in the values of securities held by the Underlying Fund and
traded on foreign exchanges or markets as a result of events that occur after
the prices of those securities are determined, but before the close of the
NYSE, will not be reflected in the Underlying Fund's calculation of its net
asset values that day unless the Manager determines that the event is likely
to effect a material change in the value of the security. The Manager, or an
internal valuation committee established by the Manager, as applicable, may
establish a valuation, under procedures established by the Board and subject
to the approval, ratification and confirmation by the Board at its next
ensuing meeting.


      |X| Securities Valuation. The Fund's Board of Trustees has established
procedures for the valuation of the Fund's securities. In general those
procedures are as follows:
o     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 and Class N
shares. The Fund may amend, suspend or cease offering this reinvestment
privilege at any time as to shares redeemed after the date of such amendment,
suspension or cessation.

      Any capital gain that was realized when the shares were redeemed is
taxable, and reinvestment will not alter any capital gains tax payable on
that gain. If there has been a capital loss on the redemption, some or all of
the loss may not be tax deductible, depending on the timing and amount of the
reinvestment. Under the Internal Revenue Code, if the redemption proceeds of
Fund shares on which a sales charge was paid are reinvested in shares of the
Fund or another of the Oppenheimer funds within 90 days of payment of the
sales charge, the shareholder's basis in the shares of the Fund that were
redeemed may not include the amount of the sales charge paid. That would
reduce the loss or increase the gain recognized from the redemption. However,
in that case the sales charge would be added to the basis of the shares
acquired by the reinvestment of the redemption proceeds.

Payments "In Kind." The Prospectus states that payment for shares tendered
for redemption is ordinarily made in cash. However, under certain
circumstances, the Board of Trustees of the Fund may determine that it would
be detrimental to the best interests of the remaining shareholders of the
Fund to make payment of a redemption order wholly or partly in cash. In that
case, the Fund may pay the redemption proceeds in whole or in part by a
distribution "in kind" of liquid securities from the portfolio of the Fund,
in lieu of cash.

      The Fund has elected to be governed by Rule 18f-1 under the Investment
Company Act. Under that rule, the Fund is obligated to redeem shares solely
in cash up to the lesser of $250,000 or 1% of the net assets of the Fund
during any 90-day period for any one shareholder. If shares are redeemed in
kind, the redeeming shareholder might incur brokerage or other costs in
selling the securities for cash. The Fund will value securities used to pay
redemptions in kind using the same method the Fund uses to value its
portfolio securities described above under "Determination of Net Asset Values
Per Share." That valuation will be made as of the time the redemption price
is determined.

Involuntary Redemptions. The Fund's Board of Trustees has the right to cause
the involuntary redemption of the shares held in any account if the aggregate
net asset value of those shares is less than $500 or such lesser amount as
the Board may fix. The Board will not cause the involuntary redemption of
shares in an account if the aggregate net asset value of such shares has
fallen below the stated minimum solely as a result of market fluctuations. If
the Board exercises this right, it may also fix the requirements for any
notice to be given to the shareholders in question (not less than 30 days).
The Board may alternatively set requirements for the shareholder to increase
the investment, or set other terms and conditions so that the shares would
not be involuntarily redeemed.

Transfers of Shares. A transfer of shares to a different registration is not
an event that triggers the payment of sales charges. Therefore, shares are
not subject to the payment of a contingent deferred sales charge of any class
at the time of transfer to the name of another person or entity. It does not
matter whether the transfer occurs by absolute assignment, gift or bequest,
as long as it does not involve, directly or indirectly, a public sale of the
shares. When shares subject to a contingent deferred sales charge are
transferred, the transferred shares will remain subject to the contingent
deferred sales charge. It will be calculated as if the transferee shareholder
had acquired the transferred shares in the same manner and at the same time
as the transferring shareholder.


      If less than all shares held in an account are transferred, and some
but not all shares in the account would be subject to a contingent deferred
sales charge if redeemed at the time of transfer, the priorities described in
the Prospectus under "How to Sell Shares" for the imposition of the Class B,
Class C and Class N contingent deferred sales charge will be followed in
determining the order in which shares are transferred.

Distributions From Retirement Plans. Requests for distributions from
OppenheimerFunds-sponsored IRAs, SEP-IRAs, SIMPLE IRAs, 403(b)(7) custodial
plans 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 NYSE 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 NYSE closes. Normally, the NYSE 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 California Tax Exempt Trust    Centennial New York Tax Exempt
                                             Trust
   Centennial Government Trust               Centennial Tax Exempt Trust
   Centennial Money Market Trust

   The following funds do not offer Class N shares:
   Limited Term New York Municipal Fund      Oppenheimer New Jersey Municipal Fund
   Oppenheimer AMT-Free Municipals           Oppenheimer Principal Protected Main
                                             Street Fund II
   Oppenheimer AMT-Free New York             Oppenheimer Pennsylvania Municipal
   Municipals                                Fund
   Oppenheimer California Municipal Fund     Oppenheimer Rochester National
                                             Municipals
   Oppenheimer International Value Fund      Oppenheimer Senior Floating Rate Fund
   Oppenheimer Limited Term California       Rochester Fund Municipals
   Municipal Fund
   Oppenheimer Limited Term Municipal
   Fund
   Oppenheimer Money Market Fund, Inc.

   The following funds do not offer Class Y shares:

   Limited Term New York Municipal Fund     Oppenheimer Limited Term California
                                            Municipal Fund
   Oppenheimer AMT-Free Municipals          Oppenheimer Limited Term Municipal Fund
   Oppenheimer AMT-Free New York Municipals Oppenheimer New Jersey Municipal Fund
   Oppenheimer Balanced Fund                Oppenheimer Pennsylvania Municipal Fund
   Oppenheimer California Municipal Fund    Oppenheimer Principal Protected Main

                                            Street Fund
   Oppenheimer Capital Income Fund          Oppenheimer Principal Protected Main
                                            Street Fund II

   Oppenheimer Cash Reserves                Oppenheimer Principal Protected Main
                                            Street Fund III
   Oppenheimer Champion Income Fund         Oppenheimer Quest Capital Value Fund,
                                            Inc.
   Oppenheimer Convertible Securities Fund  Oppenheimer Quest International Value
                                            Fund, Inc.
   Oppenheimer Disciplined Allocation Fund  Oppenheimer Rochester National Municipals
   Oppenheimer Dividend Growth Fund         Oppenheimer Total Return Bond Fund
   Oppenheimer Gold & Special Minerals Fund



o     Oppenheimer  Money  Market  Fund,  Inc.  only offers Class A and Class Y
   shares.
   o  Class B and Class C 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, Inc. or Oppenheimer Cash Reserves acquired by exchange of Class M
      shares.

o     Class A shares of Oppenheimer funds may be exchanged at net asset value
      for shares of any money market fund offered by the Distributor. Shares
      of any money market fund purchased without a sales charge may be
      exchanged for shares of Oppenheimer funds offered with a sales charge
      upon payment of the sales charge. They may also be used to purchase
      shares of Oppenheimer funds subject to an early withdrawal charge or
      contingent deferred sales charge.

o     Shares of the Fund acquired 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.

o     Shares of Oppenheimer Principal Protected Main Street Fund may be
      exchanged at net asset value for shares of any of the Oppenheimer
      funds. However, shareholders are not permitted to exchange shares of
      other Oppenheimer funds for shares of Oppenheimer Principal Protected
      Main Street Fund until after the expiration of the warranty period
      (8/5/2010).
o     Shares of Oppenheimer Principal Protected Main Street Fund II may be
      exchanged at net asset value for shares of any of the Oppenheimer
      funds. However, shareholders are not permitted to exchange shares of
      other Oppenheimer funds for shares of Oppenheimer Principal Protected
      Main Street Fund II until after the expiration of the warranty period
      (3/3/2011).
o     Shares of Oppenheimer Principal Protected Main Street Fund III may be
      exchanged at net asset value for shares of any of the Oppenheimer
      funds. However, shareholders are not permitted to exchange shares of
      other Oppenheimer funds for shares of Oppenheimer Principal Protected
      Main Street Fund III until after the expiration of the warranty period
      (12/16/2011).

      The Fund may amend, suspend or terminate the exchange privilege at any
time. Although the Fund may impose these changes at any time, it will provide
you with notice of those changes whenever it is required to do so by
applicable law. It may be required to provide 60 days' notice prior to
materially amending or terminating the exchange privilege. That 60 day notice
is not required in extraordinary circumstances.

      |X|   How Exchanges Affect Contingent Deferred Sales Charges. No
contingent deferred sales charge is imposed on exchanges of shares of any
class purchased subject to a contingent deferred sales charge, with the
following exceptions:

o     When Class A shares of any Oppenheimer fund (other than Rochester
National Municipals and Rochester Fund Municipals) acquired by exchange of
Class A shares of any Oppenheimer fund purchased subject to a Class A
contingent deferred sales charge are redeemed within 18 months measured from
the beginning of the calendar month of the initial purchase of the exchanged
Class A shares, the Class A contingent deferred sales charge is imposed on
the redeemed shares.

o     When Class A shares of Rochester National Municipals and Rochester Fund
Municipals acquired by exchange of Class A shares of any Oppenheimer fund
purchased subject to a Class A contingent deferred sales charge are redeemed
within 24 months of the beginning of the calendar month of the initial
purchase of the exchanged Class A shares, the Class A contingent deferred
sales charge is imposed on the redeemed shares.

o     If any Class A shares of another Oppenheimer fund that are exchanged
for Class A shares of Oppenheimer Senior Floating Rate Fund are subject to
the Class A contingent deferred sales charge of the other Oppenheimer fund at
the time of exchange, the holding period for that Class A contingent deferred
sales charge will carry over to the Class A shares of Oppenheimer Senior
Floating Rate Fund acquired in the exchange. The Class A shares of
Oppenheimer Senior Floating Rate Fund acquired in that exchange will be
subject to the Class A Early Withdrawal Charge of Oppenheimer Senior Floating
Rate Fund if they are repurchased before the expiration of the holding period.

o     When Class A shares of Oppenheimer Cash Reserves and Oppenheimer Money
Market Fund, Inc. acquired by exchange of Class A shares of any Oppenheimer
fund purchased subject to a Class A contingent deferred sales charge are
redeemed within the Class A holding period of the fund from which the shares
were exchanged, the Class A contingent deferred sales charge of the fund from
which the shares were exchanged is imposed on the redeemed shares.

o     Except with respect to the Class B shares described in the next two
paragraphs, the contingent deferred sales charge is imposed on Class B shares
acquired by exchange if they are redeemed within six years of the initial
purchase of the exchanged Class B shares.


o     With respect to Class B shares of Oppenheimer Limited Term California
Municipal Fund, Oppenheimer Limited-Term Government Fund, Oppenheimer Limited
Term Municipal Fund, Limited Term New York Municipal Fund and Oppenheimer
Senior Floating Rate Fund, the Class B contingent deferred sales charge is
imposed on the acquired shares if they are redeemed within five years of the
initial purchase of the exchanged Class B shares.

o     With respect to Class B shares of Oppenheimer Cash Reserves that were
acquired through the exchange of Class B shares initially purchased in the
Oppenheimer Capital Preservation Fund, the Class B contingent deferred sales
charge is imposed on the acquired shares if they are redeemed within five
years of that initial purchase.


o     With respect to Class C shares, the Class C contingent deferred sales
charge is imposed on Class C shares acquired by exchange if they are redeemed
within 12 months of the initial purchase of the exchanged Class C shares.

o     With respect to Class N shares, a 1% contingent deferred sales charge
will be imposed if the retirement plan (not including IRAs and 403(b) plans)
is terminated or Class N shares of all Oppenheimer funds are terminated as an
investment option of the plan and Class N shares are redeemed within 18
months after the plan's first purchase of Class N shares of any Oppenheimer
fund or with respect to an individual retirement plan or 403(b) plan, Class N
shares are redeemed within 18 months of the plan's first purchase of Class N
shares of any Oppenheimer fund.


o     When Class B, Class C or Class N shares are redeemed to effect an
exchange, the priorities described in "How To Sell Shares" in the Prospectus
for the imposition of the Class B, Class C or Class N contingent deferred
sales charge will be followed in determining the order in which the shares
are exchanged. Before exchanging shares, shareholders should take into
account how the exchange may affect any contingent deferred sales charge that
might be imposed in the subsequent redemption of remaining shares.


      Shareholders owning shares of more than one class must specify which
class of shares they wish to exchange.

      |X|   Limits on Multiple Exchange Orders. The Fund reserves the right
to reject telephone or written exchange requests submitted in bulk by anyone
on behalf of more than one account.

      |X|   Telephone Exchange Requests. When exchanging shares by telephone,
a shareholder must have an existing account in the fund to which the exchange
is to be made. Otherwise, the investors must obtain a prospectus of that fund
before the exchange request may be submitted. If all telephone lines are busy
(which might occur, for example, during periods of substantial market
fluctuations), shareholders might not be able to request exchanges by
telephone and would have to submit written exchange requests.

      Processing  Exchange  Requests.  Shares to be exchanged  are redeemed on
the regular  business day the Transfer Agent  receives an exchange  request in
proper  form  (the  "Redemption  Date").  Normally,  shares  of the fund to be
acquired are  purchased on the  Redemption  Date,  but such  purchases  may be
delayed  by either  fund up to five  business  days if it  determines  that it
would be  disadvantaged by an immediate  transfer of the redemption  proceeds.
The Fund  reserves  the  right,  in its  discretion,  to refuse  any  exchange
request  that may  disadvantage  it. For  example,  if the receipt of multiple
exchange  requests  from a dealer might require the  disposition  of portfolio
securities at a time or at a price that might be  disadvantageous to the Fund,
the Fund may refuse the request.

      When you exchange some or all of your shares from one fund to another,
any special account feature such as an Asset Builder Plan or Automatic
Withdrawal Plan, will be switched to the new fund account unless you tell the
Transfer Agent not to do so. However, special redemption and exchange
features such as Automatic Exchange Plans and Automatic Withdrawal Plans
cannot be switched to an account in Oppenheimer Senior Floating Rate Fund.

      In connection with any exchange request, the number of shares exchanged
may be less than the number requested if the exchange or the number requested
would include shares subject to a restriction cited in the Prospectus or this
Statement of Additional Information, or would include shares covered by a
share certificate that is not tendered with the request. In those cases, only
the shares available for exchange without restriction will be exchanged.

      The different Oppenheimer funds available for exchange have different
investment objectives, policies and risks. A shareholder should assure that
the fund selected is appropriate for his or her investment and should be
aware of the tax consequences of an exchange. For federal income tax
purposes, an exchange transaction is treated as a redemption of shares of one
fund and a purchase of shares of another. "Reinvestment Privilege," above,
discusses some of the tax consequences of reinvestment of redemption proceeds
in such cases. The Fund, the Distributor, and the Transfer Agent are unable
to provide investment, tax or legal advice to a shareholder in connection
with an exchange request or any other investment transaction.

Dividends, Capital Gains and Taxes

Dividends and Distributions. The Fund has no fixed dividend rate and there
can be no assurance as to the payment of any dividends or the realization of
any capital gains. The dividends and distributions paid by a class of shares
will vary from time to time depending on market conditions, the composition
of the Fund's portfolio, and expenses borne by the Fund or borne separately
by a class. Dividends are calculated in the same manner, at the same time,
and on the same day for each class of shares. However, dividends on Class B,
Class C and Class N shares are expected to be lower than dividends on Class A
shares. That is because of the effect of the asset-based sales charge on
Class B, Class C and Class N shares. Those dividends will also differ in
amount as a consequence of any difference in the net asset values of the
different classes of shares.

      Dividends, distributions and proceeds of the redemption of Fund shares
represented by checks returned to the Transfer Agent by the Postal Service as
undeliverable will be invested in shares of Oppenheimer Money Market Fund,
Inc. Reinvestment will be made as promptly as possible after the return of
such checks to the Transfer Agent, to enable the investor to earn a return on
otherwise idle funds. Unclaimed accounts may be subject to state escheatment
laws, and the Fund and the Transfer Agent will not be liable to shareholders
or their representatives for compliance with those laws in good faith.

Tax Status of the Fund's Dividends, Distributions and Redemptions of Shares.
The federal tax treatment of the Fund's dividends and capital gains
distributions is briefly highlighted in the Prospectus. The following is only
a summary of certain additional tax considerations generally affecting the
Fund and its shareholders.


      The tax discussion in the Prospectus and this Statement of Additional
Information is based on tax law in effect on the date of the Prospectus and
this Statement of Additional Information. Those laws and regulations may be
changed by legislative, judicial, or administrative action, sometimes with
retroactive effect. State and local tax treatment of ordinary income
dividends and capital gain dividends from regulated investment companies may
differ from the treatment under the Internal Revenue Code described below.
Shareholders 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.

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.

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). Any tax withheld by the
Fund is remitted by the Fund to the U.S. Treasury and all income and any tax
withheld is identified in reports mailed to shareholders in January of each
year with a copy sent to the IRS.

Tax Effects of Redemptions of Shares. If a shareholder redeems all or a
portion of his/her shares, the shareholder will recognize a gain or loss on
the redeemed shares in an amount equal to the difference between the proceeds
of the redeemed shares and the shareholder's adjusted tax basis in the
shares. All or a portion of any loss recognized in that manner may be
disallowed if the shareholder purchases other shares of the Fund within 30
days before or after the redemption.

      In general, any gain or loss arising from the redemption of shares of
the Fund will be considered capital gain or loss, if the shares were held as
a capital asset. It will be long-term capital gain or loss if the shares were
held for more than one year. However, any capital loss arising from the
redemption of shares held for six months or less will be treated as a
long-term capital loss to the extent of the amount of capital gain dividends
received on those shares. Special holding period rules under the Internal
Revenue Code apply in this case to determine the holding period of shares and
there are limits on the deductibility of capital losses in any year.

Foreign Shareholders. Under U.S. tax law, taxation of a shareholder who is a
foreign person (to include, but not limited to, a nonresident alien
individual, a foreign trust, a foreign estate, a foreign corporation, or a
foreign partnership) primarily depends on whether the foreign person's income
from the Fund is effectively connected with the conduct of a U.S. trade or
business. Typically, ordinary income dividends paid from a mutual fund are
not considered "effectively connected" income.

      Ordinary income dividends that are paid by the Fund (and are deemed not
"effectively connected income") to foreign persons will be subject to a U.S.
tax withheld by the Fund at a rate of 30%, provided the Fund obtains a
properly completed and signed Certificate of Foreign Status. The tax rate may
be reduced if the foreign person's country of residence has a tax treaty with
the U.S. allowing for a reduced tax rate on ordinary income dividends paid by
the Fund. Any tax withheld by the Fund is remitted by the Fund to the U.S.
Treasury and all income and any tax withheld is identified in reports mailed
to shareholders in March of each year with a copy sent to the IRS.

      If the ordinary income dividends from the Fund are effectively
connected with the conduct of a U.S. trade or business, then the foreign
person may claim an exemption from the U.S. tax described above provided the
Fund obtains a properly completed and signed Certificate of Foreign Status.
If the foreign person fails to provide a certification of his/her foreign
status, the Fund will be required to withhold U.S. tax at a rate of 28% on
ordinary income dividends, capital gains distributions and the proceeds of
the redemption of shares, paid to any foreign person. Any tax withheld by the
Fund is remitted by the Fund to the U.S. Treasury and all income and any tax
withheld is identified in reports mailed to shareholders in January of each
year with a copy sent to the IRS.

      The tax consequences to foreign persons entitled to claim the benefits
of an applicable tax treaty may be different from those described herein.
Foreign shareholders are urged to consult their own tax advisors or the U.S.
Internal Revenue Service with respect to the particular tax consequences to
them of an investment in the Fund, including the applicability of the U.S.
withholding taxes described above.


Dividend Reinvestment in Another Fund. Shareholders of the Fund may elect to
reinvest all dividends and/or capital gains distributions in shares of the
same class of any of the other Oppenheimer funds into which you may exchange
shares. 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. However, such reinvestment will not be protected by
the Financial Warranty and will result in a reduction of the shareholder's
Warranty Amount. 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.


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 wholly-owned
subsidiary of Merrill Lynch & Co., Inc. and its principal business is to
engage in banking activities. The audited financial statements of Merrill
Lynch Bank USA for the fiscal year ended December 31, 2004, and its
subsequent quarterly unaudited statements dated April 1, 2005, July 1, 2005
and September 30, 2005, have been filed with Post-Effective Amendment No. 6
to Oppenheimer Principal Protected Trust's Form N-1A Registration Statement,
as filed with the SEC on December 23, 2005, and are incorporated herein by
reference. You may request a copy of the Merrill Lynch Bank USA's 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 serves
as the independent registered public accounting firm for the Fund. Deloitte &
Touche LLP audits the Fund's financial statements and performs other related
audit services. Deloitte & Touche LLP also acts as the independent registered
public accounting firm for certain other funds advised by the Manager and its
affiliates. Audit and non-audit services provided by Deloitte & Touche LLP to
the Fund must be pre-approved by the Audit Committee. Deloitte & Touche LLP
are 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, 2005 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 financial statements for the Fund for the fiscal period from
October 7, 2004 (commencement of operations) to August 31, 2005 follow.


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

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

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Principal Protected Main Street Fund III, a series of Oppenheimer
Principal Protected Trust III, including the statement of investments, as of
August 31, 2005, and the related statement of operations, the statement of
changes in net assets and the financial highlights for the period from October
7, 2004 (commencement of operations) to August 31, 2005. 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 audits.

      We conducted our audits 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.
The Fund is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audit includes consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Fund's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of August 31, 2005, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. We believe that our audits provide 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 III as of August 31, 2005, the
results of its operations, the statement of changes in net assets and the
financial highlights for the period from October 7, 2004 (commencement of
operations) to August 31, 2005, in conformity with accounting principles
generally accepted in the United States of America.

/s/ Deloitte & Touche LLP

DELOITTE & TOUCHE LLP

Denver, Colorado
October 17, 2005


STATEMENT OF INVESTMENTS  August 31, 2005
--------------------------------------------------------------------------------

                                                                                                VALUE
                                                                              SHARES       SEE NOTE 1
------------------------------------------------------------------------------------------------------

INVESTMENTS IN AFFILIATED COMPANIES EQUITY FUNDS--44.9%
------------------------------------------------------------------------------------------------------
Oppenheimer Main Street Fund, Cl. Y 1 (Cost $36,882,256)                   1,044,231     $ 37,989,141
                                                                           PRINCIPAL
                                                                              AMOUNT
------------------------------------------------------------------------------------------------------

U.S. GOVERNMENT OBLIGATIONS--45.2%
------------------------------------------------------------------------------------------------------
U.S. Treasury Bonds, STRIPS, 4.06%, 11/15/11 2,3,4 (Cost $37,900,321)   $ 48,630,000       38,288,976

------------------------------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--10.3% 4
------------------------------------------------------------------------------------------------------
Undivided interest of 1.75% in joint repurchase agreement (Principal
Amount/Value $500,739,000, with a maturity value of $500,787,961)
with Cantor Fitzgerald & Co./Cantor Fitzgerald Securities, 3.52%,
dated 8/31/05, to be repurchased at $8,770,858 on 9/1/05,
collateralized by U.S. Treasury Bonds, 6.25%--7.50%,
11/15/16--8/15/23, with a value of $468,462,803 and U.S. Treasury
Nts., 6.50%, 2/15/10, with a value of $43,204,980 (Cost $8,770,000)        8,770,000        8,770,000

------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $83,552,577)                                 100.4%      85,048,117
------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS                                           (0.4)        (358,774)
                                                                        ------------------------------

NET ASSETS                                                                     100.0%    $ 84,689,343
                                                                        ==============================


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Affiliated company. Represents ownership of an affiliated fund, as defined in
the Investment Company Act of 1940, at or during the period ended August 31,
2005. The aggregate fair value of securities of affiliated companies held by the
Fund as of August 31, 2005 amounts to $37,989,141. Transactions during the
period in which the issuer was an affiliate are as follows:

                                                 SHARES        GROSS         GROSS             SHARES
                                        AUGUST 31, 2004    ADDITIONS    REDUCTIONS    AUGUST 31, 2005
------------------------------------------------------------------------------------------------------

Oppenheimer Main Street Fund, Cl. Y                  --    1,044,231            --          1,044,231
                                                                             VALUE           DIVIDEND
                                                                        SEE NOTE 1             INCOME
------------------------------------------------------------------------------------------------------

Oppenheimer Main Street Fund, Cl. Y                                    $37,989,141                $--


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

3. All or a portion of the security is held in collateralized accounts to cover
initial margin requirements on open futures sales contracts. The aggregate
market value of such securities is $830,657. See Note 5 of Notes to Financial
Statements.

4. The Fund may have elements of risk due to concentrated investments. Such
concentrations may subject the Fund to additional risks.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


           19 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



STATEMENT OF ASSETS AND LIABILITIES  August 31, 2005
--------------------------------------------------------------------------------


--------------------------------------------------------------------------------------
ASSETS
--------------------------------------------------------------------------------------

Investments, at value (including cost and market value of
$8,770,000 in repurchase agreements)--see accompanying
statement of investments:
Unaffiliated companies (cost $46,670,321)                             $    47,058,976
Affiliated companies (cost $36,882,256)                                    37,989,141
                                                                      ----------------
                                                                           85,048,117
--------------------------------------------------------------------------------------
Cash                                                                           10,959
--------------------------------------------------------------------------------------
Receivables and other assets:
Futures margins                                                                86,400
Interest                                                                          858
Other                                                                           3,060
                                                                      ----------------
Total assets                                                               85,149,394

--------------------------------------------------------------------------------------
LIABILITIES
--------------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                        282,687
Warranty agreement fees                                                        86,959
Distribution and service plan fees                                             36,259
Legal, auditing and other professional fees                                    16,006
Shareholder communications                                                      9,661
Transfer and shareholder servicing agent fees                                   5,418
Custodian fees                                                                  2,386
Trustees' compensation                                                          1,729
Other                                                                          18,946
                                                                      ----------------
Total liabilities                                                             460,051

--------------------------------------------------------------------------------------
NET ASSETS                                                            $    84,689,343
                                                                      ================

--------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
--------------------------------------------------------------------------------------
Par value of shares of beneficial interest                            $         2,786
--------------------------------------------------------------------------------------
Additional paid-in capital                                                 83,535,469
--------------------------------------------------------------------------------------
Accumulated net investment income                                             391,373
--------------------------------------------------------------------------------------
Accumulated net realized loss on investments                                 (797,600)
--------------------------------------------------------------------------------------
Net unrealized appreciation on investments                                  1,557,315
                                                                      ----------------
NET ASSETS                                                            $    84,689,343
                                                                      ================



            20 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III




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

NET ASSET VALUE PER SHARE
--------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$40,981,498 and 1,344,321 shares of beneficial interest outstanding)           $30.48
Maximum offering price per share (net asset value plus sales charge of 5.75%
of offering price)                                                             $32.34
--------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$20,856,114 and 688,440 shares of beneficial interest outstanding)             $30.29
--------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$21,414,142 and 706,483 shares of beneficial interest outstanding)             $30.31
--------------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $1,437,589
and 47,237 shares of beneficial interest outstanding)                          $30.43


SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


           21 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



STATEMENT OF OPERATIONS  For the Period Ended August 31, 2005 1
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
INVESTMENT INCOME
--------------------------------------------------------------------------------
Interest                                                        $     1,439,713

--------------------------------------------------------------------------------
EXPENSES
--------------------------------------------------------------------------------
Management fees                                                         336,743
--------------------------------------------------------------------------------
Distribution and service plan fees:
Class A                                                                  81,542
Class B                                                                 166,793
Class C                                                                 166,924
Class N                                                                   5,696
--------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A                                                                  18,989
Class B                                                                  17,898
Class C                                                                   9,371
Class N                                                                     507
--------------------------------------------------------------------------------
Shareholder communications:
Class A                                                                   9,051
Class B                                                                   9,633
Class C                                                                   4,821
Class N                                                                     244
--------------------------------------------------------------------------------
Warranty agreement fees                                                 364,618
--------------------------------------------------------------------------------
Trustees' compensation                                                    5,045
--------------------------------------------------------------------------------
Custodian fees and expenses                                               3,906
--------------------------------------------------------------------------------
Other                                                                    51,240
                                                                ----------------
Total expenses                                                        1,253,021
Less reduction to custodian expenses                                       (300)
Less waivers and reimbursements of expenses                            (172,607)
                                                                ----------------
Net expenses                                                          1,080,114

--------------------------------------------------------------------------------
NET INVESTMENT INCOME                                                   359,599

--------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
--------------------------------------------------------------------------------
Net realized loss on:
Investments                                                            (114,057)
Closing of futures contracts                                           (683,543)
                                                                ----------------
Net realized loss                                                      (797,600)
--------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments                                                           1,495,540
Futures contracts                                                        61,775
                                                                ----------------
Net change in unrealized appreciation                                 1,557,315

--------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS            $     1,119,314
                                                                ================

1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


           22 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

PERIOD ENDED AUGUST 31,                                                   2005 1
--------------------------------------------------------------------------------
OPERATIONS
--------------------------------------------------------------------------------
Net investment income                                           $      359,599
--------------------------------------------------------------------------------
Net realized loss                                                     (797,600)
--------------------------------------------------------------------------------
Net change in unrealized appreciation                                1,557,315
                                                                ----------------
Net increase in net assets resulting from operations                 1,119,314

--------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
--------------------------------------------------------------------------------
Dividends from net investment income:
Class A                                                                (66,038)
Class B                                                                (13,002)
Class C                                                                (16,445)
Class N                                                                 (2,062)

--------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
--------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial
interest transactions:
Class A                                                             40,270,940
Class B                                                             20,664,488
Class C                                                             21,209,500
Class N                                                              1,419,648

--------------------------------------------------------------------------------
NET ASSETS
--------------------------------------------------------------------------------
Total increase                                                      84,586,343
--------------------------------------------------------------------------------
Beginning of period                                                    103,000 2
                                                                ----------------
End of period (including accumulated net investment income
of $391,373 at August 31, 2005)                                 $   84,689,343
                                                                ================

1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. Reflects the value of the Manager's seed money investment on September 2,
2004.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


           23 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

                                                                             CLASS A         CLASS B
PERIOD ENDED AUGUST 31,                                                       2005 1          2005 1
-------------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
-------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $    30.00        $  30.00
-------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                                            .25 2           .03 2
Net realized and unrealized gain                                                 .28             .28
                                                                          -----------------------------
Total from investment operations                                                 .53             .31
-------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                            (.05)           (.02)
-------------------------------------------------------------------------------------------------------
Net asset value, end of period                                            $    30.48        $  30.29
                                                                          =============================

-------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                              1.76%           1.03%
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
-------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $   40,981        $ 20,856
-------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $   36,571        $ 18,576
-------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                                           0.93%           0.10%
Total expenses                                                                  1.45% 5         2.27% 6
Expenses after payments and waivers and reduction to  custodian expenses        1.20%           2.02%
-------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                           37%             37%


1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. 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.

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

5. Expenses paid including all underlying fund expenses was as follows:
           Year Ended August 31, 2005     1.66%

6. Expenses paid including all underlying fund expenses was as follows:
           Year Ended August 31, 2005     2.48%

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


           24 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



                                                                           CLASS C      CLASS N
PERIOD ENDED AUGUST 31,                                                     2005 1       2005 1
--------------------------------------------------------------------------------------------------

PER SHARE OPERATING DATA
--------------------------------------------------------------------------------------------------
Net asset value, beginning of period                                      $  30.00     $  30.00
--------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                                          .05 2        .19 2
Net realized and unrealized gain                                               .28          .28
                                                                          ------------------------
Total from investment operations                                               .33          .47
--------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                                          (.02)        (.04)
--------------------------------------------------------------------------------------------------

Net asset value, end of period                                            $  30.31     $  30.43
                                                                          ========================

--------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                            1.11%        1.57%
--------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
--------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                                  $ 21,414     $  1,438
--------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                         $ 18,591     $  1,269
--------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income                                                         0.17%        0.69%
Total expenses                                                                2.21% 5      1.70% 6
Expenses after payments and waivers and reduction to custodian expenses       1.96%        1.45%
--------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                         37%          37%


1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. 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.

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

5. Expenses paid including all underlying fund expenses was as follows:
            Year Ended August 31, 2005       2.42%

6. Expenses paid including all underlying fund expenses was as follows:
            Year Ended August 31, 2005       1.91%

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


            25 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

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

Oppenheimer Principal Protected Main Street Fund III (the Fund), a series of
Oppenheimer Principal Protected Trust III, is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
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. The Fund's
investment advisor is OppenheimerFunds, Inc. (the Manager).

      Shares of the Fund were offered during the Offering Period (October 7,
2004 to December 10, 2004). Shares are not offered during the Warranty Period
(December 16, 2004 to December 16, 2011) to the Maturity Date (December 16,
2011) except in connection with reinvestment of dividends and distributions.
During the Warranty Period, the Fund will allocate its assets between
Oppenheimer Main Street Fund (the Underlying Fund) and certain U.S. government
securities. The Fund offered Class A, Class B, Class C and Class N 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). Class N shares were sold only through retirement plans. 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,
C and N have separate distribution and/or service plans. Class B shares will
automatically convert to Class A shares 90 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 (the Warranty Amount). This value will include net income, if any, earned
by the Fund during the offering period and be 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.


            26 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



      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.

--------------------------------------------------------------------------------
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 debt securities having a remaining
maturity in excess of sixty 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


            27 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

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

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 provision is
required.

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.

                                                             NET UNREALIZED
                                                               APPRECIATION
                                                           BASED ON COST OF
                                                             SECURITIES AND
   UNDISTRIBUTED    UNDISTRIBUTED        ACCUMULATED      OTHER INVESTMENTS
   NET INVESTMENT       LONG-TERM               LOSS     FOR FEDERAL INCOME
   INCOME                    GAIN   CARRYFORWARD 1,2           TAX PURPOSES
   ------------------------------------------------------------------------
   $392,416                   $--           $668,436             $1,428,151

1. As of August 31, 2005, the Fund had $668,436 of post-October losses available
to offset future realized capital gains, if any. Such losses, if utilized, will
expire in 2014.

2. During the fiscal year ended August 31, 2005, the Fund did not utilize any
capital loss carryforward.

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, 2005. Net assets of the
Fund were unaffected by the reclassifications.

                        INCREASE TO
                        ACCUMULATED
   REDUCTION TO      NET INVESTMENT
   PAID-IN CAPITAL           INCOME
   --------------------------------
   $129,321                $129,321


            28 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



The tax character of distributions paid during the period ended August 31, 2005
is as follows:

                                                  PERIOD ENDED
                                             AUGUST 31, 2005 1
                  --------------------------------------------
                  Distributions paid from:
                  Ordinary income                      $97,547

1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

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, 2005 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.

              Federal tax cost of securities          $83,619,966
              Federal tax cost of other investments     8,287,650
                                                      -----------
              Total federal tax cost                  $91,907,616
                                                      ===========
              Gross unrealized appreciation           $ 1,428,151
              Gross unrealized depreciation                    --
                                                      -----------
              Net unrealized appreciation             $ 1,428,151
                                                      ===========

--------------------------------------------------------------------------------
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 the Fund or in other Oppenheimer funds
selected by the Trustee. The Fund purchases shares of the funds 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 or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.


            29 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

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

CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

--------------------------------------------------------------------------------
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, 2005 1,2
                                   SHARES            AMOUNT
------------------------------------------------------------
CLASS A
Sold                            1,409,972      $ 42,344,087
Dividends and/or
distributions reinvested            2,071            62,286
Redeemed                          (71,055)       (2,135,433)
                             -------------------------------
Net increase                    1,340,988      $ 40,270,940
                             ===============================

------------------------------------------------------------
CLASS B
Sold                              718,613      $ 21,566,270
Dividends and/or
distributions reinvested              390            11,721
Redeemed                          (30,596)         (913,503)
                             -------------------------------
Net increase                      688,407      $ 20,664,488
                             ===============================

------------------------------------------------------------
CLASS C
Sold                              728,238      $ 21,857,729
Dividends and/or
distributions reinvested              377            11,343
Redeemed                          (22,165)         (659,572)
                             -------------------------------
Net increase                      706,450      $ 21,209,500
                             ===============================


            30 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



                           PERIOD ENDED AUGUST 31, 2005 1,2
                                   SHARES            AMOUNT
------------------------------------------------------------
CLASS N
Sold                               50,935     $   1,529,775
Dividends and/or
distributions reinvested               68             2,033
Redeemed                           (3,799)         (112,160)
                           ---------------------------------
Net increase                       47,204     $   1,419,648
                           =================================

1. For the period from October 7, 2004 (commencement of operations) to August
31, 2005.

2. The Fund sold 3,333 shares of Class A at a value of $100,000 and 33 shares of
Class B, Class C and Class N at a value of $1,000, respectively, to the Manager
upon seeding of the Fund on September 2, 2004.

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

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended August 31, 2005, were as
follows:

                                             PURCHASES         SALES
           ---------------------------------------------------------
           Investment securities            $36,885,365   $       --
           U.S. government and government
           agency obligations                62,670,268   25,793,747

--------------------------------------------------------------------------------
MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for a 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 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, 2.05% for Class C
shares and 1.55% for Class N 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.

--------------------------------------------------------------------------------
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, 2005, the Fund paid
$41,347 to OFS for services to the Fund.


            31 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

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

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, CLASS C AND CLASS N SHARES. The Fund
has adopted Distribution and Service Plans for Class B, Class C and Class N
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 and 0.25% per year on Class N shares. The Distributor
also receives a service fee of 0.25% per year under each plan. If either the
Class B, Class C or Class N 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, 2005
for Class B, Class C and Class N shares were $714,393, $37,278 and $12,501,
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.


            32 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



                                       CLASS A         CLASS B         CLASS C         CLASS N
                       CLASS A      CONTINGENT      CONTINGENT      CONTINGENT      CONTINGENT
                     FRONT-END        DEFERRED        DEFERRED        DEFERRED        DEFERRED
                 SALES CHARGES   SALES CHARGES   SALES CHARGES   SALES CHARGES   SALES CHARGES
                   RETAINED BY     RETAINED BY     RETAINED BY     RETAINED BY     RETAINED BY
PERIOD ENDED       DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR
----------------------------------------------------------------------------------------------

August 31, 2005     $  228,623           $  --       $  41,608        $  6,863           $  91


--------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS 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, 2005, the Manager reimbursed the Fund $139,710 for
such Underlying Fund expenses.

      The Manager voluntarily agreed to waive its management fee and assume all
expenses of the Fund, with the exception of the 12b-1fee, during the Offering
Period. During the period ended August 31, 2005, the Manager reimbursed the Fund
$32,897.

      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. FUTURES CONTRACTS

A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a negotiated price on a stipulated future
date. Futures contracts are traded on a commodity exchange. The Fund may buy and
sell futures contracts that relate to broadly based securities indices
(financial futures) or debt securities (interest rate futures) in order to gain
exposure to or protection from changes in market value of stocks and bonds or
interest rates. The Fund may also buy or write put or call options on these
futures contracts.

      The Fund generally sells futures contracts as a hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it may
be more efficient or cost effective than actually buying securities.

      Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or has expired.

      Cash held by the broker to cover initial margin requirements on open
futures contracts is noted in the Statement of Assets and Liabilities.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Liabilities reflects a receivable and/or payable for the
daily mark to market for variation margin. Realized gains and


            33 | OPPENHEIMER PRINCIPAL PROTECTED MAIN STREET FUND III



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

--------------------------------------------------------------------------------
5. FUTURES CONTRACTS Continued

losses are reported in the Statement of Operations as the closing and expiration
of futures contracts. The net change in unrealized appreciation and depreciation
is reported in the Statement of Operations.

      Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.

As of August 31, 2005, the Fund had outstanding futures contracts as follows:

                              EXPIRATION   NUMBER OF   VALUATION AS OF     UNREALIZED
CONTRACT DESCRIPTION                DATE   CONTRACTS   AUGUST 31, 2005   APPRECIATION
-------------------------------------------------------------------------------------

CONTRACTS TO PURCHASE
Standard & Poor's 500 Index     12/15/05          27       $ 8,287,650       $ 61,775


--------------------------------------------------------------------------------
6. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor, as well as 51 of the
Oppenheimer funds (as "Nominal Defendants") excluding the Fund, 30 present and
former Directors or Trustees and 8 present and former officers of the funds.
This complaint, initially filed in the U.S. District Court for the Southern
District of New York on January 10, 2005 and amended on March 4, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The defendants believe that the allegations contained in the Complaints
are without merit and that they have meritorious defenses against the claims
asserted. The defendants intend to defend these lawsuits vigorously and to
contest any claimed liability. The defendants believe that it is premature to
render any opinion as to the likelihood of an outcome unfavorable to them and
that no estimate can yet be made with any degree of certainty as to the amount
or range of any potential loss.




                                  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



                                  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 shares(1) 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 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 created or qualified under Sections 401(a) or 401(k) of the
            Internal Revenue Code,
         2) non-qualified deferred compensation plans,
         3) employee benefit plans(3)
         4) Group Retirement Plans(4)
         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 $5 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.
|_|   Effective October 1, 2005, taxable accounts established with the
         proceeds of Required Minimum Distributions from Retirement Plans.

B. Waivers of the Class A Initial and Contingent Deferred Sales Charges in
Certain Transactions.

1.    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 or
         unit investment trusts for which reinvestment arrangements have been
         made with the Distributor.
|_|   Shares purchased by certain Retirement Plans that are part of a
         retirement plan or platform offered by banks, broker-dealers,
         financial advisors or insurance companies, or serviced by
         recordkeepers.
|_|   Shares purchased by the reinvestment of loan repayments by a
         participant in a Retirement Plan for which the Manager or an
         affiliate acts as sponsor.
|_|   Shares purchased in amounts of less than $5.

2.    Class A shares issued and purchased in the following transactions are
   not subject to sales charges (a dealer concession at the annual rate of
   0.25% is paid by the Distributor on purchases made within the first 6
   months of plan establishment):
|_|   Retirement Plans that have $5 million or more in plan assets.
|_|   Retirement Plans with a single plan sponsor that have $5 million or
         more in aggregate assets invested in Oppenheimer funds.

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.
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 (as defined in the
         Internal Revenue Code).
|_|   Distributions from accounts for which the broker-dealer of record has
         entered into a special agreement with the Distributor allowing this
         waiver.
|_|   Redemptions of Class B shares held by Retirement Plans whose records
         are maintained on a daily valuation basis by Merrill Lynch or an
         independent record keeper under a contract with Merrill Lynch.
|_|   Redemptions of Class C shares of Oppenheimer U.S. Government Trust from
         accounts of clients of financial institutions that have entered into
         a special arrangement with the Distributor for this purpose.
|_|   Redemptions of Class C shares of an Oppenheimer fund in amounts of $1
         million or more requested in writing by a Retirement Plan sponsor
         and submitted more than 12 months after the Retirement Plan's first
         purchase of Class C shares, if the redemption proceeds are invested
         to purchase Class N shares of one or more Oppenheimer funds.
|_|   Distributions(8) 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.

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- & Mid- Cap
   Value Fund
   Oppenheimer Quest Balanced Fund              Oppenheimer Quest
   International Value Fund, Inc.
   Oppenheimer Quest Opportunity Value Fund

      These arrangements also apply to shareholders of the following funds
when they merged (were reorganized) into various Oppenheimer funds on
November 24, 1995:

   Quest for Value U.S. Government Income Fund  Quest for Value New York
   Tax-Exempt Fund
   Quest for Value Investment Quality Income Fund     Quest for Value
   National Tax-Exempt Fund
   Quest for Value Global Income Fund     Quest for Value California
   Tax-Exempt Fund

      All of the funds listed above are referred to in this Appendix as the
"Former Quest for Value Funds." The waivers of initial and contingent
deferred sales charges described in this Appendix apply to shares of an
Oppenheimer fund that are either:
|_|   acquired by such shareholder pursuant to an exchange of shares of an
         Oppenheimer fund that was one of the Former Quest for Value Funds,
         or
|_|   purchased by such shareholder by exchange of shares of another
         Oppenheimer fund that were acquired pursuant to the merger of any of
         the Former Quest for Value Funds into that other Oppenheimer fund on
         November 24, 1995.

A. Reductions or Waivers of Class A Sales Charges.

|X|   Reduced Class A Initial Sales Charge Rates for Certain Former Quest for
Value Funds Shareholders.

Purchases by Groups and Associations. The following table sets forth the
initial sales charge rates for Class A shares purchased by members of
"Associations" formed for any purpose other than the purchase of securities.
The rates in the table apply if that Association purchased shares of any of
the Former Quest for Value Funds or received a proposal to purchase such
shares from OCC Distributors prior to November 24, 1995.

--------------------------------------------------------------------------------
                      Initial Sales       Initial Sales Charge   Concession as
Number of Eligible    Charge as a % of    as a % of Net Amount   % of Offering
Employees or Members  Offering Price      Invested               Price
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
9 or Fewer                   2.50%                2.56%              2.00%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
At  least  10 but not        2.00%                2.04%              1.60%
more than 49
--------------------------------------------------------------------------------

------------------------------------------------------------------------------
      For purchases by Associations having 50 or more eligible employees or
members, there is no initial sales charge on purchases of Class A shares, but
those shares are subject to the Class A contingent deferred sales charge
described in the applicable fund's Prospectus.

      Purchases made under this arrangement qualify for the lower of either
the sales charge rate in the table based on the number of members of an
Association, or the sales charge rate that applies under the Right of
Accumulation described in the applicable fund's Prospectus and Statement of
Additional Information. Individuals who qualify under this arrangement for
reduced sales charge rates as members of Associations also may purchase
shares for their individual or custodial accounts at these reduced sales
charge rates, upon request to the Distributor.

|X|   Waiver of Class A Sales Charges for Certain Shareholders. Class A
shares purchased by the following investors are not subject to any Class A
initial or contingent deferred sales charges:
o     Shareholders who were shareholders of the AMA Family of Funds on
            February 28, 1991 and who acquired shares of any of the Former
            Quest for Value Funds by merger of a portfolio of the AMA Family
            of Funds.
o     Shareholders who acquired shares of any Former Quest for Value Fund by
            merger of any of the portfolios of the Unified Funds.

|X|   Waiver of Class A Contingent Deferred Sales Charge in Certain
Transactions. The Class A contingent deferred sales charge will not apply to
redemptions of Class A shares purchased by the following investors who were
shareholders of any Former Quest for Value Fund:

      Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a shareholder
with whom that dealer has a fiduciary relationship, under the Employee
Retirement Income Security Act of 1974 and regulations adopted under that law.

B. Class A, Class B and Class C Contingent Deferred Sales Charge Waivers.

|X|   Waivers for Redemptions of Shares Purchased Prior to March 6, 1995. In
the following cases, the contingent deferred sales charge will be waived for
redemptions of Class A, Class B or Class C shares of an Oppenheimer fund. The
shares must have been acquired by the merger of a Former Quest for Value Fund
into the fund or by exchange from an Oppenheimer fund that was a Former Quest
for Value Fund or into which such fund merged. Those shares must have been
purchased prior to March 6, 1995 in connection with:
o     withdrawals under an automatic withdrawal plan holding only either
            Class B or Class C shares if the annual withdrawal does not
            exceed 10% of the initial value of the account value, adjusted
            annually, and
o     liquidation of a shareholder's account if the aggregate net asset value
            of shares held in the account is less than the required minimum
            value of such accounts.

|X|   Waivers for Redemptions of Shares Purchased on or After March 6, 1995
but Prior to November 24, 1995. In the following cases, the contingent
deferred sales charge will be waived for redemptions of Class A, Class B or
Class C shares of an Oppenheimer fund. The shares must have been acquired by
the merger of a Former Quest for Value Fund into the fund or by exchange from
an Oppenheimer fund that was a Former Quest For Value Fund or into which such
Former Quest for Value Fund merged. Those shares must have been purchased on
or after March 6, 1995, but prior to November 24, 1995:
o     redemptions following the death or disability of the shareholder(s) (as
            evidenced by a determination of total disability by the U.S.
            Social Security Administration);
o     withdrawals under an automatic withdrawal plan (but only for Class B or
            Class C shares) where the annual withdrawals do not exceed 10% of
            the initial value of the account value; adjusted annually, and
o     liquidation of a shareholder's account if the aggregate net asset value
            of shares held in the account is less than the required minimum
            account value.

      A shareholder's account will be credited with the amount of any
contingent deferred sales charge paid on the redemption of any Class A, Class
B or Class C shares of the Oppenheimer fund described in this section if the
proceeds are invested in the same Class of shares in that fund or another
Oppenheimer fund within 90 days after redemption.
V.         Special Sales Charge Arrangements for Shareholders of Certain
           Oppenheimer Funds Who Were Shareholders of Connecticut Mutual
                             Investment Accounts, Inc.
------------------------------------------------------------------------------

The initial and contingent deferred sale charge rates and waivers for Class A
and Class B shares described in the respective Prospectus (or this Appendix)
of the following Oppenheimer funds (each is referred to as a "Fund" in this
section):
   Oppenheimer U. S. Government Trust,
   Oppenheimer Core Bond Fund,
   Oppenheimer Value Fund and
   Oppenheimer Disciplined Allocation Fund
are modified as described below for those Fund shareholders who were
shareholders of the following funds (referred to as the "Former Connecticut
Mutual Funds") on March 1, 1996, when OppenheimerFunds, Inc. became the
investment adviser to the Former Connecticut Mutual Funds:
   Connecticut Mutual Liquid Account         Connecticut Mutual Total Return
   Account
   Connecticut Mutual Government Securities Account   CMIA LifeSpan Capital
   Appreciation Account
   Connecticut Mutual Income Account         CMIA LifeSpan Balanced Account
   Connecticut Mutual Growth Account         CMIA Diversified Income Account

A. Prior Class A CDSC and Class A Sales Charge Waivers.

|X|   Class A Contingent Deferred Sales Charge. Certain shareholders of a
Fund and the other Former Connecticut Mutual Funds are entitled to continue
to make additional purchases of Class A shares at net asset value without a
Class A initial sales charge, but subject to the Class A contingent deferred
sales charge that was in effect prior to March 18, 1996 (the "prior Class A
CDSC"). Under the prior Class A CDSC, if any of those shares are redeemed
within one year of purchase, they will be assessed a 1% contingent deferred
sales charge on an amount equal to the current market value or the original
purchase price of the shares sold, whichever is smaller (in such redemptions,
any shares not subject to the prior Class A CDSC will be redeemed first).

      Those shareholders who are eligible for the prior Class A CDSC are:
         1) persons whose purchases of Class A shares of a Fund and other
            Former Connecticut Mutual Funds were $500,000 prior to March 18,
            1996, as a result of direct purchases or purchases pursuant to
            the Fund's policies on Combined Purchases or Rights of
            Accumulation, who still hold those shares in that Fund or other
            Former Connecticut Mutual Funds, and
         2) persons whose intended purchases under a Statement of Intention
            entered into prior to March 18, 1996, with the former general
            distributor of the Former Connecticut Mutual Funds to purchase
            shares valued at $500,000 or more over a 13-month period entitled
            those persons to purchase shares at net asset value without being
            subject to the Class A initial sales charge

      Any of the Class A shares of a Fund and the other Former Connecticut
Mutual Funds that were purchased at net asset value prior to March 18, 1996,
remain subject to the prior Class A CDSC, or if any additional shares are
purchased by those shareholders at net asset value pursuant to this
arrangement they will be subject to the prior Class A CDSC.

|X|   Class A Sales Charge Waivers. Additional Class A shares of a Fund may
be purchased without a sales charge, by a person who was in one (or more) of
the categories below and acquired Class A shares prior to March 18, 1996, and
still holds Class A shares:
         1) any purchaser, provided the total initial amount invested in the
            Fund or any one or more of the Former Connecticut Mutual Funds
            totaled $500,000 or more, including investments made pursuant to
            the Combined Purchases, Statement of Intention and Rights of
            Accumulation features available at the time of the initial
            purchase and such investment is still held in one or more of the
            Former Connecticut Mutual Funds or a Fund into which such Fund
            merged;
         2) any participant in a qualified plan, provided that the total
            initial amount invested by the plan in the Fund or any one or
            more of the Former Connecticut Mutual Funds totaled $500,000 or
            more;
         3) Directors of the Fund or any one or more of the Former
            Connecticut Mutual Funds and members of their immediate families;
         4) employee benefit plans sponsored by Connecticut Mutual Financial
            Services, L.L.C. ("CMFS"), the prior distributor of the Former
            Connecticut Mutual Funds, and its affiliated companies;
         5) one or more members of a group of at least 1,000 persons (and
            persons who are retirees from such group) engaged in a common
            business, profession, civic or charitable endeavor or other
            activity, and the spouses and minor dependent children of such
            persons, pursuant to a marketing program between CMFS and such
            group; and
         6) an institution acting as a fiduciary on behalf of an individual
            or individuals, if such institution was directly compensated by
            the individual(s) for recommending the purchase of the shares of
            the Fund or any one or more of the Former Connecticut Mutual
            Funds, provided the institution had an agreement with CMFS.

      Purchases of Class A shares made pursuant to (1) and (2) above may be
subject to the Class A CDSC of the Former Connecticut Mutual Funds described
above.

      Additionally, Class A shares of a Fund may be purchased without a sales
charge by any holder of a variable annuity contract issued in New York State
by Connecticut Mutual Life Insurance Company through the Panorama Separate
Account which is beyond the applicable surrender charge period and which was
used to fund a qualified plan, if that holder exchanges the variable annuity
contract proceeds to buy Class A shares of the Fund.

B. Class A and Class B Contingent Deferred Sales Charge Waivers.

In addition to the waivers set forth in the Prospectus and in this Appendix,
above, the contingent deferred sales charge will be waived for redemptions of
Class A and Class B shares of a Fund and exchanges of Class A or Class B
shares of a Fund into Class A or Class B shares of a Former Connecticut
Mutual Fund provided that the Class A or Class B shares of the Fund to be
redeemed or exchanged were (i) acquired prior to March 18, 1996 or (ii) were
acquired by exchange from an Oppenheimer fund that was a Former Connecticut
Mutual Fund. Additionally, the shares of such Former Connecticut Mutual Fund
must have been purchased prior to March 18, 1996:
   1) by the estate of a deceased shareholder;
   2) upon the disability of a shareholder, as defined in Section 72(m)(7) of
      the Internal Revenue Code;
   3) for retirement distributions (or loans) to participants or
      beneficiaries from retirement plans qualified under Sections 401(a) or
      403(b)(7)of the Code, or from IRAs, deferred compensation plans created
      under Section 457 of the Code, or other employee benefit plans;
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 AMT-Free Municipals, Oppenheimer U.S. Government
Trust, Oppenheimer Strategic Income Fund and Oppenheimer Capital Income Fund
who acquired (and still hold) shares of those funds as a result of the
reorganization of series of Advance America Funds, Inc. into those
Oppenheimer funds on October 18, 1991, and who held shares of Advance America
Funds, Inc. on March 30, 1990, may purchase Class A shares of those four
Oppenheimer funds at a maximum sales charge rate of 4.50%.
VII.     Sales Charge Waivers on Purchases of Class M Shares of Oppenheimer
                            Convertible Securities Fund
------------------------------------------------------------------------------

Oppenheimer Convertible Securities Fund (referred to as the "Fund" in this
section) may sell Class M shares at net asset value without any initial sales
charge to the classes of investors listed below who, prior to March 11, 1996,
owned shares of the Fund's then-existing Class A and were permitted to
purchase those shares at net asset value without sales charge:
|_|   the Manager and its affiliates,
|_|   present or former officers, directors, trustees and employees (and
         their "immediate families" as defined in the Fund's Statement of
         Additional Information) of the Fund, the Manager and its affiliates,
         and retirement plans established by them or the prior investment
         advisor of the Fund for their employees,
|_|   registered management investment companies or separate accounts of
         insurance companies that had an agreement with the Fund's prior
         investment advisor or distributor for that purpose,
|_|   dealers or brokers that have a sales agreement with the Distributor, if
         they purchase shares for their own accounts or for retirement plans
         for their employees,
|_|   employees and registered representatives (and their spouses) of dealers
         or brokers described in the preceding section or financial
         institutions that have entered into sales arrangements with those
         dealers or brokers (and whose identity is made known to the
         Distributor) or with the Distributor, but only if the purchaser
         certifies to the Distributor at the time of purchase that the
         purchaser meets these qualifications,
|_|   dealers, brokers, or registered investment advisors that had entered
         into an agreement with the Distributor or the prior distributor of
         the Fund specifically providing for the use of Class M shares of the
         Fund in specific investment products made available to their
         clients, and
|_|   dealers, brokers or registered investment advisors that had entered
         into an agreement with the Distributor or prior distributor of the
         Fund's shares to sell shares to defined contribution employee
         retirement plans for which the dealer, broker, or investment advisor
         provides administrative services.



                                  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(R)(the "Underlying Fund") are
described in the Underlying Fund's Prospectus as well as the Prospectus for
Oppenheimer Principal Protected Main Street Fund III. 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 the Statement of
Additional Information of the Underling Fund.

      |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 Investment Company 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 NYSE-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 net 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.


      The Underlying Fund may lend its portfolio securities pursuant to the
Securities Lending Agreement (the "Securities Lending Agreement") with JP
Morgan Chase, subject to the restrictions stated in the Prospectus. The
Underlying Fund will lend such portfolio securities to attempt to increase
the Fund's income. Under the Securities Lending Agreement and applicable
regulatory requirements (which are subject to change), the loan collateral
must, on each business day, be at least equal to the value of the loaned
securities and must consist of cash, bank letters of credit or securities
of the U.S. Government (or its agencies or instrumentalities), or other
cash equivalents in which the Underlying Fund is permitted to invest. To be
acceptable as collateral, letters of credit must obligate a bank to pay to
JP Morgan Chase, as agent, amounts demanded by the Underlying Fund if the
demand meets the terms of the letter. Such terms of the letter of credit and
the issuing bank must be satisfactory to JP Morgan Chase and the Underlying
Fund. The Underlying Fund will receive, pursuant to the Securities Lending
Agreement, 80% of all annual net income (i.e., net of rebates to the
Borrower) from securities lending transactions. JP Morgan Chase has agreed,
in general, to guarantee the obligations of borrowers to return loaned
securities and to be responsible for expenses relating to securities
lending. The Underlying Fund will be responsible, however, for risks
associated with the investment of cash collateral, including the risk that
the issuer of the security in which the cash collateral has been invested
defaults. The Securities Lending Agreement may be terminated by either JP
Morgan Chase or the Fund on 30 days' written notice. The terms of the
Underlying Fund's loans must also meet applicable tests under the Internal
Revenue Code and permit the Underlying Fund to reacquire loaned securities
on five business 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 III 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 A to this Statement of Additional
Information. This is not a fundamental policy.

(1) In accordance with Rule 12b-1 of the Investment Company Act, the term
"Independent Trustees" in this Statement of Additional Information refers to
those Trustees who are not "interested persons" of the Fund and who do not
have any direct or indirect financial interest in the operation of the
distribution plan or any agreement under the plan.

(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 only applies to qualified retirement plans and 403(b)(7)
custodial plans after your separation from service in or after the year you
reached age 55.
(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 Main Street Fund III(R)

Internet Website:
      www.oppenheimerfunds.com

Investment Adviser
      OppenheimerFunds, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Distributor
      OppenheimerFunds Distributor, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Transfer Agent
      OppenheimerFunds Services
      P.O. Box 5270
      Denver, Colorado 80217
      1.800.CALL.OPP (225.5677)

Custodian Bank
      JPMorgan Chase Bank
      4 Chase MetroTech Center
      Brooklyn, New York 11245

Independent Registered Public Accounting Firm

      Deloitte & Touche LLP
      555 Seventeenth Street
      Denver, Colorado 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

(OppenheimerFunds logo)

PX0771.001.1205









                  OPPENHEIMER PRINCIPAL PROTECTED TRUST III

                                  FORM N-1A

                                    PART C

                              OTHER INFORMATION

Item 23. - Exhibits


(a)   Declaration of Trust dated 3/18/04: Previously filed with Registrant's
Initial Registration Statement, 4/15/04, and incorporated herein by reference.

(b)   By-Laws dated as of 3/18/04: Previously filed with Registrant's Initial
Registration Statement, 4/15/04, and incorporated herein by reference.

(c)   Specimen Class A Share Certificate: Previously filed with Registrant's
Pre-Effective Amendment No. 1, 10/4/04, and incorporated herein by reference.

(d)   Investment Advisory Agreement dated 6/28/04: Previously filed with
Registrant's Pre-Effective Amendment No. 1, 10/4/04, and incorporated herein
by reference.

(e)   (i) General Distributor's Agreement dated 6/28/04: Previously filed
with Registrant's Pre-Effective Amendment No. 1, 10/4/04, 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: Previously filed
with Post-Effective Amendment No. 41 to the Registration Statement of
Oppenheimer Variable Account Funds (Reg. No. 2-93177), 4/28/03, 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 September 24, 2004 among Merrill
Lynch Bank USA, OppenheimerFunds, Inc. and the Registrant: Previously filed
with Registrant's Post-Effective Amendment No. 1, 10/25/05, and incorporated
herein by reference.

      (ii) Service Agreement dated September 24, 2004 among OppenheimerFunds,
Inc., the Registrant, J.P. Morgan Chase Bank and Merrill Lynch Bank USA:
Previously filed with Registrant's Pre-Effective Amendment No. 1, 10/4/04,
and incorporated herein by reference.

(j)   (i) Consent of Deloitte & Touche LLP, independent registered public
accounting firm, 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, independent registered public
accounting firm, with respect to the audited financial statements of Merrill
Lynch Bank USA as of 12/31/04: Filed herewith.

(k)   (i) Audited financial statements of Merrill Lynch Bank USA as of
12/31/04: Previously filed with Post-Effective Amendment No. 6 to the
Registration Statement of Oppenheimer Principal Protected Trust (Reg.
333-102588), 12/23/05, and incorporated herein by reference.

      (ii) Unaudited quarterly financial statements of Merrill Lynch Bank USA
as of 4/1/05: Previously filed with Post-Effective Amendment No. 6 to the
Registration Statement of Oppenheimer Principal Protected Trust (Reg.
333-102588), 12/23/05, and incorporated herein by reference.

      (iii) Unaudited quarterly financial statements of Merrill Lynch Bank
USA as of 7/1/05: Previously filed with Post-Effective Amendment No. 6 to the
Registration Statement of Oppenheimer Principal Protected Trust (Reg.
333-102588), 12/23/05, and incorporated herein by reference.

      (iv) Unaudited quarterly financial statements of Merrill Lynch Bank USA
as of 9/30/05: Previously filed with Post-Effective Amendment No. 6 to the
Registration Statement of Oppenheimer Principal Protected Trust (Reg.
333-102588), 12/23/05, and incorporated herein by reference.

(l)   Investment Letter dated September 24, 2004 from OppenheimerFunds, Inc.
to Registrant: Previously filed with Registrant's Pre-Effective Amendment No.
1, 10/4/04, and incorporated herein by reference.

(m)   (i) Service Plan and Agreement for Class A shares for Oppenheimer
Principal Protected Main Street Fund III dated 6/28/04: Previously filed with
Registrant's Pre-Effective Amendment No. 1, 10/4/04, and incorporated herein
by reference.

      (ii) Distribution and Service Plan and Agreement for Class B shares for
Oppenheimer Principal Protected Main Street Fund III dated 6/28/04:
Previously filed with Registrant's Pre-Effective Amendment No. 1, 10/4/04,
and incorporated herein by reference.

      (iii) Distribution and Service Plan and Agreement for Class C shares
for Oppenheimer Principal Protected Main Street Fund III dated 6/28/04:
Previously filed with Registrant's Pre-Effective Amendment No. 1, 10/4/04,
and incorporated herein by reference.

      (iv) Distribution and Service Plan and Agreement for Class N shares for
Oppenheimer Principal Protected Main Street Fund III dated 6/28/04:
Previously filed with Registrant's Pre-Effective Amendment No. 1, 10/4/04,
and incorporated herein by reference.


(n)   Oppenheimer Funds Multiple Class Plan under Rule 18f-3 updated through
8/11/05: Previously filed with Post-Effective Amendment No. 5 to the
Registration Statement of Oppenheimer Main Street Opportunity Fund (Reg. No.
333-40186), 9/27/05, and incorporated herein by reference.

(o)    Powers of Attorney dated December 13, 2004 for all Trustees/Directors
and Officers: Previously filed with Post-Effective Amendment No. 44 to the
Registration Statement of Oppenheimer Variable Account Funds, 2/25/05, and
incorporated herein by reference.

(p)   Amended and Restated Code of Ethics of the Oppenheimer Funds dated
February 1, 2005 under Rule 17j-1 of the Investment Company Act of 1940:
Previously filed with the Initial Registration Statement of Oppenheimer
Dividend Growth Fund (Reg. No. 333-122902), 2/18/05, and incorporated herein
by reference.

Item 24. - Persons Controlled by or Under Common Control with the Fund

None.

Item 25. - Indemnification

Reference is made to the provisions of Article Seven of Registrant's Amended
and Restated Declaration of Trust filed as Exhibit 23(a) to this Registration
Statement, and incorporated herein by reference.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of
Registrant pursuant to the foregoing provisions or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act of 1933 and will be governed
by the final adjudication of such issue.

Item 26. - Business and Other Connections of the Investment Adviser

(a)   OppenheimerFunds, Inc. is the investment adviser of the Registrant; it
and certain subsidiaries and affiliates act in the same capacity to other
investment companies, including without limitation those described in Parts A
and B hereof and listed in Item 26(b) below.

(b)   There is set forth below information as to any other business,
profession, vocation or employment of a substantial nature in which each
officer and director of OppenheimerFunds, Inc. is, or at any time during the
past two fiscal years has been, engaged for his/her own account or in the
capacity of director, officer, employee, partner or trustee.

---------------------------------------------------------------------------------
Name  and   Current   Position
with OppenheimerFunds, Inc.    Other Business and Connections During the Past
                               Two Years
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Timothy L. Abbuhl,             Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Emeline S. Adwers,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Robert Agan,                   Senior Vice President of Shareholder Financial
Senior Vice President          Services, Inc. and Shareholders Services, Inc.;
                               Vice President of OppenheimerFunds Distributor,
                               Inc., Centennial Asset Management Corporation
                               and OFI Private Investments, Inc.

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

Carl Algermissen,              Formerly  Associate  Counsel  & Legal  Compliance
Vice President & Associate     Officer at Great  West-Life  & Annuity  Insurance
Counsel                        Co. (February 2004-October 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Amato,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik Anderson,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Beck Apostolopoulos,    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Janette Aprilante,             Secretary  (since  December 2001) of:  Centennial
Vice President & Secretary     Asset  Management  Corporation,  OppenheimerFunds
                               Distributor,  Inc.,  HarbourView Asset Management
                               Corporation   (since  June   2003),   Oppenheimer
                               Partnership  Holdings,   Inc.,  Oppenheimer  Real
                               Asset  Management,  Inc.,  Shareholder  Financial
                               Services,   Inc.,  Shareholder  Services,   Inc.,
                               Trinity Investment Management  Corporation (since
                               January 2005),  OppenheimerFunds  Legacy Program,
                               OFI Private  Investments,  Inc. (since June 2003)
                               and  OFI  Institutional  Asset  Management,  Inc.
                               (since June  2003).  Assistant  Secretary  of OFI
                               Trust Company (since December 2001).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hany S. Ayad,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Baker,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Michael Baldwin,               President and Director of  Shareholder  Financial
Executive Vice President       Services,  Inc. and  Shareholder  Services,  Inc.

                               Formerly   Managing  Director  at  Deutsche  Bank
                               (March 2001 - March 2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Michael Banta,            None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joanne Bardell,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin Baum,                    None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeff Baumgartner,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marc Baylin,                   Formerly  Portfolio  Manager at J.P. Morgan (June
Vice President                 2002-August 2005.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Todd Becerra,                  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 B. Bellamy,             Assistant  Vice  President  (Sales Manager of the
Assistant Vice President       International   Division)  of  OFI  Institutional

                               Asset Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik S. Berg,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Robert Bertucci,               None
Assistant Vice President:
Rochester Division

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rajeev Bhaman,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig Billings,                None
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Beth Bleimehl,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John R. Blomfield,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lisa I. Bloomberg,             Formerly   First  Vice   President   &  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,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lori E. Bostrom,               Formerly  Vice  President & Corporate  Counsel at
Vice President & Senior        Prudential   Financial   Inc.   (October  2002  -

Counsel                        November 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Bourgeois,                Assistant    Vice    President   of   Shareholder
Assistant Vice President       Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Boydell,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Bromberg,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lowell Scott Brooks,           Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joan Brunelle,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristine Bryan-Levin,          Formerly  Senior Vice President at Brown Brothers
Vice President                 Harriman (November 2002 - May 2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Stephanie Bullington,          Formerly  Fund  Accounting   Manager  at  Madison
Assistant Vice President       Capital  Management  Company (July 2005 - October
                               2005 and Fund  Accounting  Officer at Butterfield
                               Fund Services  (Bermuda)  Limited (a wholly owned
                               subsidiary of the Bank of NT  Butterfield & Sons)
                               (September 2003 - June 2005).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Burke,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Burns,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Geoffrey Caan,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine Carroll,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debra Casey,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maria Castro,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Chaffee,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
May Chen,                      Formerly  Assistant  Vice President of Enterprise
Assistant Vice President       Services at MassMutual  Financial Group (May 2002
                               - April 2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Chibnik,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patrick Sheng Chu,             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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gerald James Concepcion,       Formerly  (until  November 2004) an RIA Marketing
Assistant Vice President       Associate of OppenheimerFunds, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Corbett,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Susan Cornwell,                Senior Vice  President of  Shareholder  Financial
Senior Vice President          Services,  Inc. and Shareholder  Services,  Inc.;
                               Vice President of  OppenheimerFunds  Distributor,
                               Inc.,  Centennial  Asset  Management  Corporation
                               and OppenheimerFunds Legacy Program.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott Cottier,                 None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Coulston,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie C. Cusker,               None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George Curry,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Damian,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Demarco,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig P. Dinsell,              None
Executive Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Randall C. Dishmon,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

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

Gavin Dobson,                  Formerly  President at Britannic Asset Management
Vice President                 International (September 2001 - May 2005).

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

Rebecca K. Dolan,              None
Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven D. Dombrower,           Senior    Vice    President    of   OFI   Private
Vice President                 Investments,     Inc.;    Vice    President    of
                               OppenheimerFunds Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Doyle,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce C. Dunbar,               None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Dvorak,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Edmiston,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel R. Engstrom,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Robert Erven             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

George R. Evans,               None
Senior Vice President &
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristie Feinberg,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Emmanuel Ferreira,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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,             Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.      Formerly      Head     of      Business
                               Management/Proprietary  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,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan Gagliardo,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hazem Gamal,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Seth Gelman,                   Formerly  an  Associate  in the Asset  Management
Vice President                 Legal   Department   at   Goldman   Sachs  &  Co.
                               (February 2003-August 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Timothy Gerlach,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Benjamin J. Gord,              Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset
                               Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Granger,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Leyla Greengard,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert B. Grill,               None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Haley,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marilyn Hall,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kelly Haney,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Hauenstein,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Jacqueline Girvin-Harkins,     None
Assistant Vice President

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

Robert W. Hawkins,             Formerly an  Associate  at Shearman  and Sterling
Assistant Vice President &     LLP  (July  2004-August  2005)  and  Dechert  LLP
Assistant Counsel              (September 2000-June 2004).

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas B. Hayes,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer Heathwood,            None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Annika Helgerson,              None
Assistant Vice President

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

Dennis Hess,                   None
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
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Huttlin,                  Senior   Vice   President    (Director   of   the
Vice President                 International  Division)  (since January 2004) of
                               OFI   Institutional   Asset   Management,   Inc.;
                               Director  (since  June 2003) of  OppenheimerFunds
                               (Asia) Limited
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James G. Hyland,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Stephen P. Ilnitzki,           Vice President of  OppenheimerFunds  Distributor,
Senior Vice President          Inc.;   Senior  Vice  President  of  OFI  Private

                               Investments, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kelly Bridget Ireland,         Vice   President    (since   January   2004)   of
Vice President                 OppenheimerFunds Distributor Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Kathleen T. Ives,              Vice   President  and   Assistant   Secretary  of
Vice President, Senior         OppenheimerFunds     Distributor,     Inc.    and
Counsel & Assistant Secretary  Shareholder  Services,  Inc.; Assistant 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Kadehjian,                Formerly Vice President,  Compensation Manager at
Assistant Vice President       The  Bank  of New  York  (November  1996-November
                               2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Kandilis,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas W. Keffer,              None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina 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).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dimitrios Kourkoulakos,        None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Kramer,                  None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Kunz,                     None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Lamentino,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Tracey Lange,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc. and OFI Private Investments, Inc.

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

Jeffrey P. Lagarce,            President  &  Chief  Marketing   Officer  of  OFI
Senior Vice President          Institutional   Asset  Management,   Inc.  as  of

                               January    2005.    Formerly    Executive    Vice
                               President-Head  of Fidelity  Tax-Exempt  Services
                               Business   at   Fidelity    Investments   (August
                               1996-January 2005).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Latino,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristina Lawrence,             Formerly     Assistant    Vice    President    of
Vice President                 OppenheimerFunds,   Inc.   (November   2002-March
                               2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gayle Leavitt,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher M. Leavy,          None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Randy Legg,                    Formerly   an   associate    with   Dechert   LLP
Vice President & Assistant     (September 1998-January 2004).
Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

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

Brian Levitt,                  None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gang Li,                       None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shanquan Li,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Julie A. Libby,                Senior Vice President of OFI Private  Investment,
Senior Vice President          Inc.  Formerly  Executive  Vice President & Chief

                               Operating Officer at Fred Alger Management,  Inc.
                               (July 1996 - February 2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Misha Lozovik,                 Formerly Senior Director at Clinical  Development
Vice President                 Capital  LLC/Care  Capital  LLC  (August  2002  -
                               October 2005)

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven Lucaccini,              Formerly  Director and High Yield  Analyst at UBS
Assistant Vice President       Global Asset  Management  (November  2001 - April
                               2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dongyan Ma,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Macchia,                 None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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   Centennial    Asset
Vice President & Associate     Management    Corporation,    HarbourView   Asset
Counsel                        Management   Corporation,    Trinity   Investment
                               Management  Corporation,  OppenheimerFunds Legacy
                               Program,  OFI  Private  Investments,   Inc.,  OFI
                               Institutional   Asset   Management,    Inc.   and
                               Oppenheimer Real Asset Management, Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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, Director,  Chief Executive
Senior Vice President          Officer  and  President  of  OFI  Trust  Company;

                               Chairman,    Chief   Executive   Officer,   Chief
                               Investment    Officer   and   Director   of   OFI
                               Institutional   Asset  Management,   Inc.;  Chief
                               Executive  Officer,  President,  Senior  Managing
                               Director  and  Director  of   HarbourView   Asset
                               Management Corporation;  Chairman,  President and
                               Director   of   Trinity   Investment   Management
                               Corporation

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Medev,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lucienne Mercogliano,          None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew J. Mika,                None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jan Miller,                    Formerly a Supervisor at Janus (May  2004-October
Assistant Vice President       2004  and  a   Manager   at   Invesco   (February
                               1994-February 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 V. Murphy,                President and Management  Director of Oppenheimer
Chairman, President, Chief     Acquisition  Corp.;  President  and  Director  of
Executive Officer & Director   Oppenheimer   Partnership   Holdings,   Inc.  and

                               Oppenheimer   Real   Asset   Management,    Inc.;
                               Chairman  and Director of  Shareholder  Services,
                               Inc. and Shareholder  Financial  Services,  Inc.;
                               Director   of   Centennial    Asset    Management
                               Corporation,  OppenheimerFunds Distributor, Inc.,
                               OFI   Institutional   Asset   Management,   Inc.,
                               Trinity   Investment   Management    Corporation,
                               Tremont  Capital  Management,  Inc.,  HarbourView
                               Asset  Management  Corporation  and  OFI  Private
                               Investments,  Inc.;  Executive  Vice President of
                               Massachusetts   Mutual  Life  Insurance  Company;
                               Director  of  DLB  Acquisition   Corporation;   a
                               member  of  the  Investment  Company  Institute's
                               Board of Governors.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Meaghan Murphy,                Formerly  Marketing  Professional,  RFP Writer at
Assistant Vice President       JP Morgan  Fleming Asset  Management  (May 2002 -
                               October 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Suzanne Murphy,                None
Vice President

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

Paul Newman,                   None
Assistant Vice President

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Nichols,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Norman,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James B. O'Connell,            Formerly   a   Senior    Designer    Manager   of
Assistant Vice President       OppenheimerFunds,  Inc.  (April  2002 -  December
                               2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Matthew O'Donnell,             None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John O'Hare,                   None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John J. Okray,                 Formerly   Vice   President,    Head   of   Trust
Vice President                 Operations at Lehman Brothers (June  2004-October
                               2004)  prior to which  he was an  Assistant  Vice
                               President,   Director   of  Trust   Services   at
                               Cambridge Trust Company (October 2002-June 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lerae A. Palumbo,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Anthony Parish,                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
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 & Chief  Management   Corporation   since  February  2004.
Financial Officer              Formerly,  Director & 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

John Piper,                    Assistant    Vice    President   of   Shareholder
Assistant Vice President       Services, Inc.

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Nicolas Pisciotti,             Formerly  Assistant  Vice President at ING (April
Assistant Vice President       2002 - May 2005)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jason Pizzorusso,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Poiesz,                  Formerly  a Senior  Portfolio  Manager at Merrill
Senior Vice President, Head    Lynch (October 2002-May 2004).
of Growth Equity Investments
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Sergei Polevikov,              None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Semyon Polyak,                 Formerly Vice President and Co-Portfolio  Manager
Vice President                 at Pioneer Investments (June 1998 - August 2005)

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey Portnoy,               None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raghaw Prasad,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Preuss,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ellen Puckett,                 Formerly   Sennior  Program  Manager  at  Dendant
Assistant Vice President       Telecommunications (May 2002-September 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jane C. Putnam,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Quarles,                  Formerly a  Principal  at AIM  Management  Group,
Assistant Vice President       Inc. (October 1997-October 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael E. Quinn,              None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie S. Radtke,               None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Norma J. Rapini,               None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Corry E. Read,                 None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marc Reinganum,                None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Reiter,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Claire Ring,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Robertson,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Robis,                  Formerly  a  Proprietary  Trader  at J.P.  Morgan
Assistant Vice President       Chase & Co. (May 2004-May 2005).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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   &   Director   of    OppenheimerFunds
Executive Vice President       Distributor,    Inc.   and    Centennial    Asset

                               Management Corporation;  Executive Vice President
                               of OFI Private Investments, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Adrienne Ruffle,               Formerly an Associate  with Sidley Austin Brown &
Assistant Vice President &     Wood LLP (September 2002-February 2005).
Assistant Counsel

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Nava 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John P. Stoma,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Deborah A. Sullivan,           Secretary of OFI Trust Company.
Vice President & Assistant
Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Sussman,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Szilagyi,             Director of Financial  Reporting  and  Compliance
Assistant Vice President       at First Data Corporation (April 2003-June 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Matthew Tartaglia,             None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Leonid Tsvayg,                 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 and Chief  Compliance  Officer of
Senior Vice President & Chief  OppenheimerFunds  Distributor,  Inc.,  Centennial
Compliance Officer             Asset  Management   Corporation  and  Shareholder
                               Services,   Inc.;  Chief  Compliance  Officer  of
                               HarbourView    Asset   Management    Corporation,
                               Oppenheimer  Partnership  Holdings,   Inc.,  Real
                               Asset  Management,  Inc.,  Shareholder  Financial
                               Services,  Inc.,  Trinity  Investment  Management
                               Corporation,   OppenheimerFunds  Legacy  Program,
                               OFI  Private   Investments  Inc.  and  OFI  Trust
                               Company and OFI  Institutional  Asset Management,
                               Inc.

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

Nancy Vann,                    Formerly  Assistant  General  Counsel  at Reserve
Vice President & Assistant     Management  Company,   Inc.  (April  to  December
Counsel                        2004);  attorney  at Sidley  Austin  Brown & Wood

                               LLP (October 1997 - April 2004).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Rene Vecka,                    None
Assistant Vice President:
Rochester Division

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Vermette,              Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Phillip F. Vottiero,           None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Walsh,                    None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Teresa M. Ward,                Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jerry A. Webman,               Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher D. Weiler,         None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Adam Weiner,                   None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Barry D. Weiss,                Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  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 Werdmolder,          Director of  OppenheimerFunds  International Ltd.
Senior Vice President          and  OppenheimerFunds  plc  and  OppenheimerFunds

                               (Asia) Limited;  Senior Vice President  (Managing
                               Director of the  International  Division)  of OFI
                               Institutional Asset Management, Inc..
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 &
Senior Investment Officer,
Director of Equities

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

Troy Willis,                   None
Assistant Vice President

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

Donna M. Winn,                 President,  Chief Executive Officer & Director of
Senior Vice President          OFI  Private   Investments,   Inc.;   Director  &
                               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 &        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.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Meredith Wolff,                None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Oliver Wolff,                  None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

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

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

Robert G. Zack                 General  Counsel of Centennial  Asset  Management
Executive Vice President &     Corporation;  General  Counsel  and  Director  of
General Counsel                OppenheimerFunds  Distributor,  Inc.; 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
                               International  Ltd  and   OppenheimerFunds   plc;
                               Secretary  and  General  Counsel  of  Oppenheimer
                               Acquisition  Corp.;  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  of   HarbourView   Asset
Senior Vice President          Management Corporation.
---------------------------------------------------------------------------------

The Oppenheimer Funds include the following:

Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Limited Term New York Municipal Fund (a series of Rochester Portfolio Series)
OFI Tremont Core Strategies Hedge Fund
OFI Tremont Market Neutral Hedge Fund
Oppenheimer AMT-Free Municipals
Oppenheimer AMT-Free New York Municipals
Oppenheimer Balanced Fund
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Capital Income Fund
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Convertible Securities Fund (a series of Bond Fund Series)
Oppenheimer Core Bond Fund (a series of Oppenheimer Integrity Funds)
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Dividend Growth 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 Diversified 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-State Municipal Trust (3 series):
     Oppenheimer New Jersey Municipal Fund
     Oppenheimer Pennsylvania Municipal Fund
     Oppenheimer Rochester National Municipals
Oppenheimer Portfolio Series (4 series)
     Active Allocation Fund
     Aggressive Investor Fund
     Conservative Investor Fund
     Moderate Investor Fund
Oppenheimer Principal Protected Main Street Fund (a series of Oppenheimer
Principal
     Protected Trust)
Oppenheimer Principal Protected Main Street Fund II (a series of Oppenheimer
Principal
     Protected Trust II)
Oppenheimer Principal Protected Main Street Fund III (a series of Oppenheimer
Principal
     Protected Trust III)
Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds (3 series)
     Oppenheimer Quest Balanced Fund
     Oppenheimer Quest Opportunity Value Fund
     Oppenheimer Small- & Mid- Cap Value Fund
Oppenheimer Quest International Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Real Asset Fund
Oppenheimer Real Estate Fund
Oppenheimer Select Value Fund
Oppenheimer Senior Floating Rate Fund
Oppenheimer Series Fund, Inc. (2 series):
     Oppenheimer Disciplined Allocation Fund
     Oppenheimer Value Fund
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Bond Fund
Oppenheimer Tremont Market Neutral Fund, LLC
Oppenheimer Tremont Opportunity Fund, LLC
Oppenheimer U.S. Government Trust
Oppenheimer Variable Account Funds (11 series):
     Oppenheimer Aggressive Growth Fund/VA
     Oppenheimer Balanced Fund/VA
     Oppenheimer Capital Appreciation Fund/VA
     Oppenheimer Core Bond Fund/VA
     Oppenheimer Global Securities Fund/VA
     Oppenheimer High Income Fund/VA
     Oppenheimer Main Street Fund/VA
     Oppenheimer Main Street Small Cap Fund/VA
     Oppenheimer Money Fund/VA
     Oppenheimer Strategic Bond Fund/VA
     Oppenheimer Value Fund/VA
Panorama Series Fund, Inc. (4 series):
     Government Securities Portfolio
     Growth 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 Two
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 Part B of this
Registration Statement and listed in Item 26(b) above (except 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rocco Benedetto(2)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert J. Bishop(1)             Treasurer                 None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas S. Blankenship          Vice President            None
10407 Cromdale Manor Ct.
Springs, TX 77379
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Blinzler(1)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David A. Borrelli               Vice President            None
105 Black Calla Ct.
San Ramon, CA 94583
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey R. Botwinick(2)         Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michelle Brennan(2)             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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Rodney Constable(1)             Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan Cornwell(1)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Neev Crane                      Vice President            None
1530 Beacon Street, Apt. #1403
Brookline, MA 02446
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julian C. Curry                 Vice President            None
5801 Nicholson Lane, Suite 420
North Bethesda, MD 20852
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey D. Damia(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Davis(2)                   Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stephen J. Demetrovits(2)       Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph A. DiMauro               Vice President            None
522 Lakeland Avenue
Grosse Pointe, MI 48230
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven Dombrower(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George P. Dougherty             Vice President            None
328 Regency Drive
North Wales, PA 19454
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ryan C. Drier                   Vice President            None
3307 Park Ridge Lane NE
Grand Rapids, MI 49525
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cliff H. Dunteman               Vice President            None
N 53 W 27761 Bantry Road
Sussex, WI 53089-45533
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hillary Eigen(2)                Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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(1)              Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric C. Fallon                  Vice President            None
10 Worth Circle
Newton, MA 02458
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Deanna Farrugia(1)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bradley Finkle(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric P. Fishel                  Vice President            None
725 Boston Post Rd., #12
Sudbury, MA 01776
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patrick W. Flynn (1)            Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John E. Forrest(2)              Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John ("J") Fortuna(2)           Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jayme Fowler(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Lucio Giliberti(2)              Vice President            None

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

Michael Gottesman               Vice President            None
255 Westchester Way
Birmingham, MI 48009

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raquel Granahan(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ralph Grant                     Senior Vice President     None
10 Boathouse Close
Mt. Pleasant, SC 29464
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kahle Greenfield(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Eric Grossjung                  Vice President            None
4002 N. 194th Street
Elkhorn, NE 68022

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael D. Guman                Vice President            None
3913 Pleasant Avenue
Allentown, PA 18103
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

James E. Gunther                Vice President            None
603 Withers Circle
Wilmington, DE 19810

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin J. Healy(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin Hennessey                 Vice President            None
8634 Forest Run Lane
Orlando, FL 32836
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elyse R. Jurman Herman          Vice President            None
5486 NW 42 Avenue
Boca Raton, FL 33496
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy G. Hetson(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William E. Hortz(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward Hrybenko(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian F. Husch(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stephen Ilnitzki(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives(1)             Vice President &          Assistant Secretary
                                Assistant Secretary
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shonda Rae Jaquez(2)            Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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 South
Minneapolis, MN 55419
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Knott(1)                Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brent A. Krantz                 Senior Vice President     None
61500 Tam McArthur Loop
Bend, OR 97702
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

David T. Kuzia(1)               Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Paul R. LeMire(2)               Assistant Vice President  None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric J. Liberman(2)             Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Malissa Lischin(2)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James V. Loehle(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Loncar(1)                Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Craig Lyman                     Vice President            None
7425 Eggshell Drive
Las Vegas, NV 89084

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

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John J. Lynch                   Vice President            None
6325 Bryan Parkway
Dallas, TX 75214
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Malik                   Vice President            None
546 Idylberry Road
San Rafael, CA 94903
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven C. Manns                 Vice President            None
1627 N. Hermitage Avenue
Chicago, IL 60622
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Todd A. Marion(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Theresa-Marie Maynier           Vice President            None
2421 Charlotte Drive
Charlotte, NC 28203
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John C. McDonough               Vice President            None
2 Leland Ct.
Chevy Chase, MD 20815
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kent C. McGowan                 Vice President            None
9510 190th Place SW
Edmonds, WA 98020
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian F. Medina(1)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel Melehan                  Vice President            None
906 Bridgeport Court
San Marcos, CA 92069
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Mezzanotte                 Vice President            None
16 Cullen Way
Exeter, NH 03833
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Clint Modler(1)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Moser(1)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David W. Mountford              Vice President            None
7820 Banyan Terrace
Tamarac, FL 33321
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gzim Muja                       Vice President            None
269 S. Beverly Dr. #807
Beverly Hills, CA 90212
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John V. Murphy(2)               Director                  President & Trustee
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Wendy Jean Murray(2)            Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John S. Napier                  Vice President            None
17 Hillcrest Ave.
Darien, CT 06820
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin P. Neznek(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bradford Norford                Vice President            None
3914 Easton Sq. Pl.
Columbus, OH 43219
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alan Panzer                     Vice President            None
6755 Ridge Mill Lane
Atlanta, GA 30328
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Park(2)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Perkes                 Vice President            None
6 Lawton Ct.
Frisco, TX 75034
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles K. Pettit(2)            Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elaine M. 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(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Rath                    Vice President            None
46 Mt. Vernon Ave.
Alexandria, VA 22301
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

William J. Raynor(2)            Vice President            None

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ruxandra Risko(2)               Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David R. Robertson(2)           Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Nicole Robbins(2)               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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles F. Scully               Vice President            None
125 Cypress View Way
Apex, NC 27502
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric Sharp                      Vice President            None
862 McNeill Circle
Woodland, CA 95695
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Sheluck(2)              Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debbie A. Simon                 Vice President            None
55 E. Erie St., #4404
Chicago, IL 60611
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bryant Smith(1)                 Vice President            None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas Bruce Smith             Vice President            None
8927 35th Street W.
University Place, WA 98466
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Christopher Spencer             Vice President            None
22641 SW 106th Ave.
Portland, Oregon 97062

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Spensley                   Vice President            None
2000 Rhettsbury Street
Carmel, IN 46032
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alfred St. John(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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------

Barrie L. Tiedemann             Vice President            None
1774 Sheridan Drive
Ann Arbor, MI 48104

---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark S. Vandehey(1)             Vice President and Chief  Vice President and
                                Compliance Officer        Chief Compliance
                                                          Officer
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Vermete(2)              Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elaine Villas(2)                Assistant Vice President  None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cynthia Walloga(2)              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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Donna Winn(2)                   Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Philip Witkower(2)              Senior Vice President     None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Meredith Wolff(2)               Assistant 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
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
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.

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
the requirements for effectiveness of this 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 23rd day of December, 2005.



                              OPPENHEIMER PRINCIPAL PROTECTED TRUST III



By:                     /s/ John V. Murphy*
                                    John V. Murphy, President,
                                    Principal Executive Officer and 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               December 23, 2005
William L. Armstrong          Board of Trustees


/s/ John V. Murphy*           President, Principal          December 23, 2005
John V. Murphy                Executive Officer and Trustee


/s/ Brian W. Wixted*          Treasurer, Principal          December 23, 2005
Brian W. Wixted               Financial & Accounting Officer


/s/ Robert G. Avis*           Trustee                       December 23, 2005

Robert G. Avis



/s/ George C. Bowen*          Trustee                       December 23, 2005
George C. Bowen


/s/ Edward L. Cameron*                                      Trustee
December 23, 2005
Edward L. Cameron


/s/ Jon S. Fossel*            Trustee                       December 23, 2005

Jon S. Fossel



/s/ Sam Freedman*             Trustee                       December 23, 2005

Sam Freedman


/s/ Beverly L. Hamilton*                                    Trustee

December 23, 2005
Beverly L. Hamilton



/s/ Robert J. Malone*                                       Trustee

December 23, 2005
Robert J. Malone


/s/ F. William Marshall, Jr.* Trustee                       December 23, 2005
F. William Marshall, Jr.



*By:  /s/ Mitchell J. Lindauer
      Mitchell J. Lindauer, Attorney-in-Fact





                  OPPENHEIMER PRINCIPAL PROTECTED TRUST III


                        Post-Effective Amendment No. 2


                    Registration Statement No. 333-114495


                                EXHIBIT INDEX


Exhibit No.    Description


23(j) (i)   Consent of Deloitte & Touche LLP, independent registered public
            accounting firm, with respect to Registrant's audited financial
            statements and with respect to the audited financial statements
            of Oppenheimer Main Street Fund(R)incorporated in the Statement of
            Additional Information by reference

23(j) (ii)  Consent of Deloitte & Touche LLP, independent registered public
            accounting firm, with respect to the audited financial statements
            of Merrill Lynch Bank USA as of 12/31/04