485APOS 1 body.htm FORM N-1A, PSP, SAI, PART C

Registration No. 2-57116

File No. 811-2668

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. 58 [X]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY

ACT OF 1940 [X]

Amendment No. 46

OPPENHEIMER AMT-FREE MUNICIPALS

(Exact Name of Registrant as Specified in Charter)

6803 South Tucson Way, Centennial, Colorado 80112-3924

(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

(Name and Address of Agent for Service)

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

     [ ]     immediately upon filing pursuant to paragraph (b)
     [   ]     on _______________ pursuant to paragraph (b)
     [X]     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
AMT-Free Municipals

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NYSE Ticker Symbols
Class A	OPTAX
Class B	OTFBX
Class C	OMFCX
Class Y	OMFYX

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Prospectus dated November 26, 2010

Oppenheimer AMT-Free Municipals is a mutual fund. It seeks as high a level of current interest income exempt from federal income taxes as is available from investing in municipal securities.

This prospectus contains important information about the Fund's objective, investment policies, strategies and risks. It also contains important information about how to buy and sell shares of the Fund and other account features. Please read this prospectus carefully before you invest and keep it for future reference about your account.

As with all mutual funds, the Securities and Exchange Commission has not approved or disapproved the Fund's securities nor has it determined that this prospectus is accurate or complete. It is a criminal offense to represent otherwise.

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Table of contents
THE FUND SUMMARY
Investment Objective	3
Fees and Expenses of the Fund	3
Principal Investment Strategies	4
Principal Risks	5
The Fund's Past Performance	9
Investment Adviser	10
Portfolio Managers	10
Purchase and Sale of Fund Shares	10
Taxes	10
Payments to Broker-Dealers and Other Financial Intermediaries	11
MORE ABOUT THE FUND
About the Fund's Investments	12
How the Fund is Managed	21
ABOUT YOUR ACCOUNT
About Your Account	23
Choosing a Share Class	24
The Price of Fund Shares	30
How to Buy, Sell and Exchange Shares	32
Dividends, Capital Gains and Taxes	45
Financial Highlights	48

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Inside Front Cover

To Summary Prospectus

THE FUND SUMMARY

Investment Objective. The Fund seeks as high a level of current interest income exempt from federal income taxes as is available from investing in municipal securities, while attempting to preserve capital.

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Fees and Expenses of the Fund. This table describes the fees and expenses that you may pay if you buy and hold or redeem shares of the Fund. You may qualify for sales charge discounts if you (or you and your spouse) invest, or agree to invest in the future, at least $50,000 in certain funds in the Oppenheimer family of funds. More information about these and other discounts is available from your financial professional and in the section "About Your Account" beginning on page 23 of the prospectus and in the sections "How to Buy Shares" beginning on page 55 and "Appendix A" in the Fund's Statement of Additional Information.

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Shareholder Fees (fees paid directly from your investment)
	Class A Shares	Class B Shares	Class C Shares	Class Y Shares
Maximum Sales Charge (Load) imposed on purchases (as % of offering price)		4.75%	None	None	None
Maximum Deferred Sales Charge (Load) (as % of the lower of the original offering price or redemption proceeds)		None	5%	1%	None

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Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)
	Class A Shares	Class B Shares	Class C Shares	Class Y Shares*
Management Fees	0.41%	0.41%	0.41%	0.41%
Distribution and/or Service (12b-1) Fees	0.24%	1.00%	1.00%	None
Total Other Expenses	0.51%	0.60%	0.52%	0.62%
Interest and Fees from Borrowing	0.23%	0.23%	0.23%	0.23%
Interest and Related Expenses from Inverse Floaters	0.22%	0.22%	0.22%	0.22%
Other Expenses	0.06%	0.15%	0.07%	0.17%
Total Annual Fund Operating Expenses	1.16%	2.01%	1.93%	1.03%

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* Class Y Shares were first available November 29, 2010. The expenses for Class Y shares are estimated for the first full fiscal year that they are offered.

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Example. The following Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in a class of shares of the Fund for the time periods indicated. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your expenses would be as follows:

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	If shares are redeemed								If shares are not redeemed
	1 Year		3 Years		5 Years		10 Years		1 Year		3 Years		5 Years		10 Years
Class A Shares	$	588	$	828	$	1,086	$	1,825	$	588	$	828	$	1,086	$	1,825
Class B Shares	$	706	$	937	$	1,294	$	1,933	$	206	$	637	$	1,094	$	1,933
Class C Shares	$	298	$	612	$	1,052	$	2,275	$	198	$	612	$	1,052	$	2,275
Class Y Shares	$	106	$	329	$	571	$	1,266	$	106	$	329	$	571	$	1,266

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Portfolio Turnover. The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in the annual fund operating expenses or in the examples, affect the Fund's performance. During the most recent fiscal year, the Fund's portfolio turnover rate was 21% of the average value of its portfolio.

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Principal Investment Strategies. The Fund invests mainly in municipal securities that pay interest that, in the opinion of counsel to the issuer of each security, is exempt from federal individual income tax. These primarily include municipal bonds, municipal notes, interests in municipal leases, and tax-exempt commercial paper. As a non-fundamental investment policy, the Fund will not invest in municipal securities the interest on which would be subject to the federal "alternative minimum tax" (AMT).

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Most of the securities the Fund buys are "investment-grade," although it can invest as much as 25% of its total assets in below-investment-grade securities (sometimes called "junk bonds") and may acquire securities that are in default. Investment-grade securities are rated in one of the four highest rating categories of nationally recognized statistical rating organizations, such as Standard & Poor's (or, in the case of unrated securities, determined by the Fund's investment adviser to be comparable to securities rated investment-grade). The Fund also invests in unrated securities, in which case the Fund's investment adviser, OppenheimerFunds, Inc., internally assigns ratings to those securities, after assessing their credit quality and other factors, in categories similar to those of nationally recognized statistical rating organizations.

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The Fund does not limit its investments to securities in a particular maturity range, but it currently focuses on securities with maturities between 5 and 30 years when issued. The Fund may invest in obligations that pay interest at fixed or variable rates. The Fund also borrows for leverage and invests in inverse floaters, a variable rate obligation and form of derivative, to seek increased income and return. The Fund can expose up to 20% of its total assets to the effects of leverage from its investments in inverse floaters. The Fund also can borrow money to purchase additional securities, another form of "leverage." Although the amount of borrowing will vary from time to time, the amount of leveraging from borrowings will not exceed one-third of the Fund's total assets.

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In selecting investments for the Fund, the portfolio managers generally look at a wide range of municipal securities nationwide that provide high current income, have favorable credit characteristics, and provide opportunities for value. The portfolio managers may consider selling a security if any of these factors no longer applies to a security purchased for the Fund, but are not required to do so.

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Principal Risks. The price of the Fund's shares can go up and down substantially. The value of the Fund's investments may change because of broad changes in the markets in which the Fund invests or from poor security selection, which could cause the Fund to underperform other funds with similar investment objectives. There is no assurance that the Fund will achieve its investment objective. When you redeem your shares, they may be worth more or less than what you paid for them. These risks mean that you can lose money by investing in the Fund.

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Main Risks of Investing in Municipal Securities. Municipal securities may be subject to interest rate risk, credit risk, credit spread risk and reinvestment risk. Interest rate risk is the risk that when prevailing interest rates fall, the values of already-issued debt securities generally rise; and when prevailing interest rates rise, the values of already-issued debt securities generally fall, and they may be worth less than the amount the Fund paid for them. When interest rates change, the values of longer-term debt securities usually change more than the values of shorter-term debt securities. Credit risk is the risk that the issuer of a security might not make interest and principal payments on the security as they become due. If an issuer fails to pay interest or repay principal, the Fund's income or share value might be reduced. Adverse news about an issuer or a downgrade in an issuer's credit rating, for any reason, can also reduce the market value of the issuer's securities. "Credit spread" is the difference in yield between securities that is due to differences in their credit quality. There is a risk that credit spreads may increase when the market expects lower-grade bonds to default more frequently. Widening credit spreads may quickly reduce the market values of the Fund's lower-rated and non-rated securities. Reinvestment risk is the risk that when interest rates fall the Fund may be required to reinvest the proceeds from a security's sale or redemption at a lower interest rate. Callable bonds are generally subject to greater reinvestment risk than non-callable bonds.

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Special Risks of Below-Investment-Grade Securities. Below-investment-grade debt securities may be subject to greater price fluctuations and have a greater risk that the issuer might not be able to pay interest and principal when due. The market for below-investment-grade securities may be less liquid and they may be harder to value or to sell at an acceptable price, especially during times of market volatility or decline.

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Because the Fund can invest up to 25% of its assets in below-investment-grade securities, the Fund's credit risks are greater than those of funds that buy only investment-grade securities.

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Taxability Risk. The Fund's investments in municipal securities rely on the opinion of the issuer's bond counsel that the interest paid on those securities will not be subject to federal income tax. Tax opinions are generally provided at the time the municipal security is initially issued. However, after the Fund buys a security, the Internal Revenue Service may determine that a bond issued as tax-exempt should in fact be taxable and the Fund's dividends with respect to that bond might be subject to federal income tax.

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Municipal Market Volatility and Illiquidity. The municipal bond market can be susceptible to unusual volatility, particularly for lower-rated and unrated securities. Liquidity can be reduced unpredictably in response to overall economic conditions or credit tightening. During times of reduced market liquidity, the Fund may not be able to readily sell bonds at the prices at which they are carried on the Fund's books. If the Fund needed to sell large blocks of bonds to meet shareholder redemption requests or to raise cash, those sales could further reduce the bonds' prices.

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Municipal Sector Concentration. While the Fund's fundamental policies do not allow it to concentrate its investments (that is, to invest more than 25% of its total assets) in a single industry, certain types of municipal securities are not considered a part of any "industry" under that policy. Examples of these types of municipal securities include: general obligation, government appropriation, municipal leases, special assessment and special tax bonds. Therefore, the Fund may invest more than 25% of its total assets in these types of municipal securities, which may finance similar types of projects or from which the interest is paid from revenues of similar types of projects. "Similar types of projects" are projects that are related in such a way that economic, business or political developments tend to have the same impact on each similar project. For example, a change that affects one project, such as proposed legislation on the financing of the project, a shortage of the materials needed for the project, or a declining economic need for the project, would likely affect all similar projects, thereby increasing market risk. Thus, market or economic changes that affect a security issued in connection with one project also would affect securities issued in connection with similar types of projects.

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Although these types of municipal securities may be related to certain industries, because they are issued by governments or their political subdivisions, these types of municipal securities are not considered a part of any industry for purposes of the Fund's industry concentration policy.

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Risks of Tobacco Related Bonds. In 1998, the largest U.S. tobacco manufacturers reached an out of court agreement, known as the Master Settlement Agreement (the "MSA"), to settle claims against them by 46 states and six other U.S. jurisdictions. The tobacco manufacturers agreed to make annual payments to the government entities in exchange for the release of all litigation claims. A number of the states have sold bonds that are backed by those future payments. The Fund may invest in two types of those bonds: (i) bonds that make payments only from a state's interest in the MSA and (ii) bonds that make payments from both the MSA revenue and from an "appropriation pledge" by the state. An "appropriation pledge" requires the state to pass a specific periodic appropriation to make the payments and is generally not an unconditional guarantee of payment by a state.
The settlement payments are based on factors, including, but not limited to, annual domestic cigarette shipments, cigarette consumption, inflation and the financial capability of participating tobacco companies. Payments could be reduced if consumption decreases, if market share is lost to non-MSA manufacturers, or if there is a negative outcome in litigation regarding the MSA.
The Fund can invest up to 25% of its total assets in tobacco-related bonds without an appropriation pledge that makes payments only from a state's interest in the MSA.

Risks of Land-Secured or "Dirt" Bonds. These special assessment or special tax bonds are issued to promote residential, commercial or industrial growth and redevelopment. They are exposed to real estate development-related risks. The bonds could default if the developments failed to progress as anticipated or if taxpayers failed to pay the assessments, fees and taxes specified in the financing plans for a project.

Main Risks of Borrowing and Leverage. The Fund can borrow up to one-third of the value of its assets (including the amount borrowed) from banks, as permitted by the Investment Company Act of 1940. It can use those borrowings for a number of purposes, including for purchasing securities, which can create "leverage." In that case, changes in the value of the Fund's investments will have a larger effect on its share price than if it did not borrow. Borrowing results in interest payments to the lenders and related expenses. Borrowing for investment purposes might reduce the Fund's return if the yield on the securities purchased is less than those borrowing costs. The Fund may also borrow to meet redemption obligations, for temporary and emergency purposes, or to unwind or contribute to trusts in connection with the Fund's investment in inverse floaters. The Fund currently participates in a line of credit with other Oppenheimer funds for its borrowing.

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Reverse repurchase agreements that the Fund may engage in also create leverage. A reverse repurchase agreement is the sale by the Fund of a debt obligation to a party for a specified price, with the simultaneous agreement by the Fund to repurchase that debt obligation from that party on a future date at a higher price. Similar to a borrowing, reverse repurchase agreements provide the Fund with cash for investment and operational purposes. When the Fund engages in reverse repurchase agreements, changes in the value of the Fund's investments will have a larger effect on its share price than if it did not engage in these transactions due to the effect of leverage. Reverse repurchase agreements create fund expenses and require that the Fund have sufficient cash available to repurchase the debt obligation when required. Reverse repurchase agreements also involve the risk that the market value of the debt obligation that is the subject of the reverse repurchase agreement could decline significantly below the price at which the Fund is obligated to repurchase the security.

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Risks of Derivatives. A "derivative" is an investment whose value depends on (or is derived from) the value of an underlying security, asset, interest rate, index or currency. Derivatives may be volatile and involve significant risks. Derivative transactions may require the payment of premiums and can increase portfolio turnover. Certain derivative investments may be illiquid. The underlying security or other reference on which a derivative is based, or the derivative itself, may not perform the way the Fund expects it to. The Fund could realize little or no income or lose principal from a derivative investment or a hedge might be unsuccessful. The Fund may also lose money if the issuer of a derivative fails to pay the amount due.

Inverse Floaters. The Fund invests in inverse floaters because, under ordinary circumstances, they offer higher yields and thus provide higher income than fixed-rate bonds of comparable maturity and credit quality. An inverse floater is a derivative instrument, typically created by a trust established by a counterparty, that divides a municipal security into two securities: a short-term floating rate security and a long-term floating rate security which is referred to as an "inverse floater." The inverse floater pays interest at rates that move in the opposite direction of those on the short-term floating rate security. Inverse floaters produce less income when short-term interest rates rise (and may pay no income) and more income when short-term interest rates fall. Thus, if short-term interest rates rise after the issuance of the floater, any yield advantage is reduced or eliminated. Under certain circumstances a trust may be collapsed and the Fund may be required to repay the principal amount due on the short-term securities or the difference between the liquidation value of the underlying municipal bond and the principal amount due on those securities. Inverse floaters can be more volatile than conventional fixed-rate bonds. They also entail a degree of leverage and certain inverse floaters may require the Fund to provide collateral for payments on the short-term securities or to "unwind" the transaction.

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The Fund will not expose more than 20% of its total assets to the effects of leverage from its investments in inverse floaters.

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Who Is the Fund Designed For? The Fund is designed for investors seeking income exempt from federal income tax and alternative minimum tax. The Fund does not seek capital gains or growth. Investors should be willing to assume credit and interest rate risks and the special risks of bonds that are rated below investment-grade. Because it invests in tax-exempt securities, the Fund is not appropriate for a retirement plan or other tax-exempt or tax-deferred accounts. The Fund is not a complete investment program. You should carefully consider your own investment goals and risk tolerance before investing in the Fund.

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

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The Fund's Past Performance. The bar chart and table below provide some indication of the risks of investing in the Fund by showing changes in the Fund's performance from year to year and by showing how the Fund's average annual returns for 1, 5 and 10 years compare with those of a broad measure of market performance. The Fund's past investment performance (before and after taxes) is not necessarily an indication of how the Fund will perform in the future. More recent performance information is available by calling the toll-free number on the back of this prospectus and on the Fund's website:
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Sales charges and taxes are not included and the returns would be lower if they were. During the period shown, the highest return for a calendar quarter was 24.83% (3rd qtr 09) and the lowest return was -29.57% (4th qtr 08). For the period from January 1, 2010 to September 30, 2010 the cumulative return before sales charges and taxes was 9.23%.

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The following table shows the average annual total returns for each class of the Fund's shares. After-tax returns are calculated using the highest individual federal marginal income tax rates and do not reflect the impact of state or local taxes. Your actual after-tax returns, depending on your individual tax situation, may differ from those shown and after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts. After-tax returns are shown for only one class and after-tax returns for other classes will vary.

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No performance information is included for Class Y shares because they were not offered prior to the date of this prospectus.

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Average Annual Total Returns for the periods ended December 31, 2009	1 Year	5 Years	10 Years
Class A Shares (inception 10/27/76)
Return Before Taxes	35.91%	(3.53%)	1.56%
Return After Taxes on Distributions	35.91%	(3.53%)	1.56%
Return After Taxes on Distributions and Sale of Fund Shares	26.92%	(2.03%)	2.23%
Class B Shares (inception 3/16/93)	36.41%	(3.69%)	1.60%
Class C Shares (inception 8/29/95)	40.85%	(3.34%)	1.27%
Barclays Capital Municipal Bond Index	12.91%	4.32%	5.75%
(reflects no deduction for fees, expenses or taxes)
Consumer Price Index	2.72%	2.56%	2.52%
(reflects no deduction for fees, expenses or taxes)

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Investment Adviser. OppenheimerFunds, Inc. is the Fund's investment adviser (the "Manager").

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Portfolio Managers. Daniel G. Loughran is a Vice President of the Fund and has been a portfolio manager for the Fund since July 2002. Scott S. Cottier is a Vice President of the Fund and has been a portfolio manager for the Fund since September 2002. Troy E. Willis is a Vice President of the Fund and has been a portfolio manager for the Fund since June 2003. Mark R. DeMitry is a Vice President of the Fund and has been a portfolio manager for the Fund since September 2006. Marcus V. Franz has been a portfolio manager for the Fund since September 2006. Michael L. Camarella is a Vice President of the Fund and has been a portfolio manager for the Fund since January 2008. Charles S. Pulire has been a portfolio manager for the Fund since January 2010.

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Purchase and Sale of Fund Shares. In most cases, you can buy Fund shares with a minimum initial investment of $1,000 and make additional investments with as little as $50. For certain investment plans and retirement accounts, the minimum initial investment is $500 and, for some, the minimum additional investment is $25. For certain fee based programs the minimum initial investment is $250.

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Shares may be purchased through a financial intermediary or the Distributor or redeemed through a financial intermediary or the transfer agent on days the New York Stock Exchange is open for trading. Shareholders may purchase or redeem shares by mail, through the website at www.oppenheimerfunds.com or by calling 1.800.225.5677. Share transactions may be paid by check, by Federal funds wire or directly from or into your bank account.

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Taxes. Dividends paid from net investment income on tax-exempt municipal securities will be excludable from gross income for federal individual income tax purposes. Dividends that are derived from interest paid on certain "private activity bonds" may be an item of tax preference if you are subject to the federal alternative minimum tax. The tax treatment of dividends is the same whether they are taken in cash or reinvested. Certain distributions may be taxable as ordinary income or as capital gains.

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Payments to Broker-Dealers and Other Financial Intermediaries. If you purchase Fund shares through a broker-dealer or other financial intermediary (such as a bank), the Fund, the Manager, or their related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

MORE ABOUT THE FUND

About the Fund's Investments

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The allocation of the Fund's portfolio among different types of investments will vary over time and the Fund's portfolio might not always include all of the different types of investments described below. The Statement of Additional Information contains more detailed information about the Fund's investment policies and risks.

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THE FUND'S PRINCIPAL INVESTMENT STRATEGIES AND RISKS. The strategies and types of investments discussed in the Fund Summary are the ones that the Fund considers to be the most important in seeking to achieve its investment objective. Additionally, the following strategies and risks are those the Fund expects its portfolio to be subject to as a whole.

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The Manager tries to reduce risks by selecting a wide variety of municipal investments and by carefully researching securities before they are purchased. However, changes in the overall market prices of municipal securities and the income they pay can occur at any time. The yield and share prices of the Fund will change daily based on changes in interest rates and market conditions and in response to other economic events.

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MUNICIPAL SECURITIES. Municipal securities are issued to raise money for a variety of public or private purposes, including financing state or local governments, financing specific projects or financing public facilities. These debt obligations are issued by the state governments, as well as their political subdivisions (such as cities, towns, and counties) and their agencies and authorities. The Fund buys municipal bonds and notes, tax-exempt commercial paper, certificates of participation in municipal leases and other debt obligations. Municipal securities generally are classified as general or revenue obligations. General obligations are secured by the issuer's pledge of its full faith, credit and taxing power for the payment of principal and interest. Revenue obligations are bonds whose interest is payable only from the revenues derived from a particular facility or class of facilities, or a specific excise tax or other revenue source. Some revenue obligations are private activity bonds that pay interest that may be a tax preference item for investors subject to the federal AMT. However, the Fund selects investments the interest from which is not subject to AMT.
Additionally, there are times when an issuer will pledge its taxing power to offer additional security to a revenue bond. These securities are sometimes called "double-barreled bonds." See, for example, tobacco bonds with an appropriation pledge as discussed earlier in this prospectus.

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The Fund can buy both long-term and short-term municipal securities. Long-term securities have a maturity of more than one year. The Fund generally focuses on longer-term securities to seek higher income.

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Municipal Lease Obligations. Municipal leases are used by state and local governments to obtain funds to acquire land, equipment or facilities. The Fund can invest in certificates of participation that represent a proportionate interest in payments made under municipal lease obligations. Most municipal leases, while secured by the leased property, are not general obligations of the issuing municipality. They often contain "non-appropriation" clauses under which the municipal government has no obligation to make lease or installment payments in future years unless money is appropriated on a yearly basis.
If the municipal government stops making payments or transfers its payment obligations to a private entity, the obligation could lose value or become taxable. Although the obligation may be secured by the leased equipment or facilities, the disposition of the property in the event of non-appropriation or foreclosure might prove difficult, time consuming and costly, and may result in a delay in recovering or the failure to recover the original investment. Some lease obligations may not have an active trading market, making it difficult for the Fund to sell them quickly at an acceptable price.

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Tobacco Related Bonds. The Fund may invest in two types of tobacco related bonds: (i) tobacco settlement revenue bonds, for which payments of interest and principal are made solely from a state's interest in the Master Settlement Agreement ("MSA") and (ii) tobacco bonds subject to a state's appropriation pledge, for which payments may come from both the MSA revenue and the applicable state's appropriation pledge.

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Tobacco Settlement Revenue Bonds. For purposes of the Fund's industry concentration policy, the Fund may invest up to 25% of its total assets in tobacco settlement revenue bonds. Tobacco settlement revenue bonds are secured by an issuing state's proportionate share in the MSA, a litigation settlement agreement reached out of court in November 1998 between 46 states and six other U.S. jurisdictions and the four largest U.S. tobacco manufacturers at that time. Subsequently, a number of smaller tobacco manufacturers signed on to the MSA, which provides for annual payments by the manufacturers to the states and other jurisdictions in perpetuity. The MSA established a base payment schedule and a formula for adjusting payments each year. Tobacco manufacturers pay into a master escrow trust based on their market share and each state receives a fixed percentage of the payment.

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A number of states have securitized the future flow of those payments by selling bonds, some through distinct governmental entities created for such purpose. The bonds are backed by the future revenue flows from the tobacco manufacturers. Annual payments on the bonds, and thus the risk to the Fund, are highly dependent on the receipt of future settlement payments. The amount of future settlement payments is dependent on many factors including, but not limited to, annual domestic cigarette shipments, cigarette consumption, inflation and the financial capability of participating tobacco companies. As a result, payments made by tobacco manufacturers could be reduced if the decrease in tobacco consumption is significantly greater than the forecasted decline. A market share loss by the MSA companies to non-MSA participating tobacco manufacturers could also cause a downward adjustment in the payment amounts. A participating manufacturer filing for bankruptcy also could cause delays or reductions in bond payments, which could affect the Fund's net asset value.

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The MSA and tobacco manufacturers have been and continue to be subject to various legal claims and an adverse outcome could affect the payment streams associated with the MSA or cause delays or reductions in bond payments. The MSA itself has been subject to legal challenges and has, to date, withstood those challenges. The Statement of Additional Information contains more detailed information about the litigation related to the tobacco industry and the MSA.

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"Subject to Appropriation" (STA) Tobacco Bonds. In addition to the tobacco settlement bonds discussed above, the Fund also may invest in tobacco related bonds that are subject to a state's appropriation pledge ("STA Tobacco Bonds"). STA Tobacco Bonds rely on both the revenue source from the MSA and a state appropriation pledge. These STA Tobacco Bonds are part of a larger category of municipal bonds that are subject to state appropriation. Although specific provisions may vary among states, "government appropriation" or "subject to appropriation" bonds (also referred to as "appropriation debt") are typically payable from two distinct sources: (i) a dedicated revenue source such as a municipal enterprise, a special tax or, in the case of tobacco bonds, the MSA funds, and (ii) from the issuer's general funds.

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Appropriation debt differs from a state's general obligation debt in that general obligation debt is backed by the state's full faith, credit and taxing power, while appropriation debt requires the state to pass a specific periodic appropriation to pay interest and/or principal on the bonds. The appropriation is usually made annually. While STA Tobacco Bonds offer an enhanced credit support feature, that feature is generally not an unconditional guarantee of payment by a state and states generally do not pledge the full faith, credit or taxing power of the state. The Fund considers STA Tobacco Bonds to be "municipal securities" for purposes of its concentration policies.

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Ratings of Municipal Securities the Fund Buys. The Manager may rely to some extent on credit ratings by nationally recognized statistical rating organizations in evaluating the credit risk of securities selected for the Fund's portfolio. Credit ratings evaluate the expectation that scheduled interest and principal payments will be made in a timely manner. They do not reflect any judgment of market risk.
Rating organizations might not always change their credit rating of an issuer in a timely manner to reflect events that could affect the issuer's ability to make timely payments on its obligations. In selecting securities for its portfolio and evaluating their income potential and credit risk, the Fund does not rely solely on ratings by rating organizations but evaluates business, economic and other factors affecting issuers as well. Many factors affect an issuer's ability to make timely payments, and the credit risk of a particular security may change over time. The Manager also may use its own research and analysis. If a bond is insured, it will usually be rated by the rating agencies based on the financial strength of the insurer. The rating categories are described in an Appendix to the Statement of Additional Information.

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The Fund can invest up to 25% of its total assets in below-investment-grade securities (measured at the time of purchase). Therefore, most of the municipal securities the Fund buys are "investment-grade" at the time of purchase. "Investment-grade" securities are those rated within the four highest rating categories of Standard & Poor's, Moody's, Fitch or another nationally recognized statistical rating organization (or, in the case of unrated securities, determined by the Fund's investment adviser to be comparable to securities rated investment-grade). While securities rated within the fourth highest category by Standard & Poor's (meaning BBB+, BBB or BBB-) or by Moody's (meaning Baa1, Baa2 or Baa3) are considered "investment-grade," they have some speculative characteristics.

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     Unrated Securities . Because the Fund purchases securities that are not rated by any nationally recognized statistical rating organization, the Manager internally assigns ratings to those securities, after assessing their credit quality and other factors, in categories similar to those of nationally recognized statistical rating organizations. Unrated securities are considered "investment-grade" or "below-investment-grade" if judged by the Manager to be comparable to rated investment-grade or below-investment-grade securities. The Manager's rating does not constitute a guarantee of the credit quality. Some unrated securities may not have an active trading market, which means that the Fund might have difficulty selling them promptly at an acceptable price.
  In evaluating the credit quality of a particular security, whether rated or unrated, the Manager will normally take into consideration a number of factors. Among them, but not limited to, are the financial resources of the issuer, or the underlying source of funds for debt service on a security, the issuer's sensitivity to economic conditions and trends, any operating history of the facility financed by the obligation and the degree of community support for it, the capabilities of the issuer's management and regulatory factors affecting the issuer and particular facility.
  A reduction in the rating of a security after the Fund buys it will not require the Fund to dispose of the security. However, the Manager will evaluate such downgraded securities to determine whether to keep them in the Fund's portfolio.

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Land-Secured or "Dirt" Bonds (Special Tax or Special Assessment Bonds). The Fund can invest more than 25% of its total assets in municipal securities for similar types of projects that are issued in connection with special taxing districts that are organized to plan and finance infrastructure development to induce residential, commercial and industrial growth and redevelopment. The bonds financed by these methods, such as tax assessment, special tax or tax increment financing generally are payable solely from taxes or other revenues attributable to the specific projects financed by the bonds without recourse to the credit or taxing power of related or overlapping municipalities. These projects often are exposed to real estate development-related risks, such as the failure of property development, availability of financing, extended vacancies of properties, increased competition, limitations on rents, changes in neighborhood values and the demand of properties to tenants, and changes in interest rates. These real estate risks may be heightened in the event that these projects are in foreclosure. Additionally, upon foreclosure the Fund may pay certain maintenance or operating expenses or taxes relating to such projects. These expenses may increase the overall expenses of the Fund and reduce its returns.

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In addition, these projects can have more taxpayer concentration risk than general tax-supported bonds, such as general obligation bonds. Further, the fees, special taxes, or tax allocations and other revenues that are established to secure such financings generally are limited as to the rate or amount that may be levied or assessed and are not subject to increase pursuant to rate covenants or municipal or corporate guarantees. The bonds could default if development failed to progress as anticipated or if larger taxpayers failed to pay the assessments, fees and taxes as provided in the financing plans of the projects.

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Special Risks of Derivative Investments. The Fund can invest in different types of "derivative" investments that are consistent with its investment strategies. A derivative is an investment whose value depends on (or is derived from) the value of an underlying security, asset, interest rate, index or currency. Inverse floaters are the primary type of derivative the Fund can use.

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The Fund may use derivatives to seek income or capital gain or to hedge against the risks of other investments. Derivatives may allow the Fund to increase or decrease its exposure to certain markets or risks. Examples include, but are not limited to, interest rate swaps or municipal bond swaps. While the Fund may use derivatives for hedging purposes, it typically does not use hedging instruments, such as options, to hedge investment risks.

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Derivatives may be volatile and may involve significant risks. The underlying security or other instrument on which a derivative is based, or the derivative itself, may not perform the way the Manager expects it to. Some derivatives have the potential for unlimited loss, regardless of the size of the Fund's initial investment. The Fund may also lose money on a derivative investment if the issuer fails to pay the amount due. Certain derivative investments held by the Fund may be illiquid, making it difficult to close out an unfavorable position. Derivative transactions may require the payment of premiums and can increase portfolio turnover. As a result of these risks, the Fund could realize little or no income or lose money from its investment, or a hedge might be unsuccessful.

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Inverse Floaters. The Fund may invest in inverse floaters to seek greater income and total return. Inverse floaters, under ordinary circumstances, offer higher yields and thus provide higher income than fixed-rate bonds of comparable maturity and credit quality. An inverse floater is a derivative instrument, typically created by a trust, that divides a municipal security into two securities: a short-term tax-exempt floating rate security (sometimes referred to as a "tender option bond") and a long-term tax-exempt floating rate security (referred to as a "residual certificate" or "inverse floater") that pays interest at rates that move in the opposite direction of the yield on the short-term floating rate security. The purchaser of a "tender option bond" has the right to tender the security periodically for repayment of the principal value. As short-term interest rates rise, inverse floaters produce less current income (and, in extreme cases, may pay no income) and as short-term interest rates fall, inverse floaters produce more current income. Thus, if short-term interest rates rise after the issuance of the floater, any yield advantage is reduced or eliminated.

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To facilitate the creation of inverse floaters, the Fund may purchase a municipal security and subsequently transfer it to a broker-dealer (the sponsor), which deposits the municipal security in a trust. The trust issues the residual certificates and short-term floating rate securities. The trust documents enable the Fund to withdraw the underlying bond to unwind or "collapse" the trust (upon tendering the residual certificate and paying the value of the short-term bonds and certain other costs). The Fund may also purchase inverse floaters created by municipal issuers directly or by other parties that have deposited municipal bonds into a sponsored trust.

The Fund's investments in inverse floaters involve certain risks. The market value of an inverse floater residual certificate can be more volatile than that of a conventional fixed-rate bond having similar credit quality, maturity and redemption provisions. Typically, inverse floater residual certificates tend to underperform fixed-rate bonds when long-term interest rates are rising but tend to outperform fixed-rate bonds when long-term interest rates are stable or falling. Inverse floater residual certificates entail a degree of leverage because the trust issues short-term securities in a ratio to the residual certificates with the underlying long-term bond providing collateral for the obligation to pay the principal value of the short-term securities if and when they are tendered. If the Fund has created the inverse floater by depositing a long-term bond into a trust, it may be required to provide additional collateral for the short-term securities if the value of the underlying bond deposited in the trust falls.

An inverse floater that has a higher degree of leverage is typically more volatile with respect to its price and income than an inverse floater having a lower degree of leverage. Under inverse floater arrangements, if the remarketing agent that offers the short-term securities for sale is unable to sell them, or if the holders tender (or put) them for repayment of principal and the remarketing agent is unable to remarket them, the remarketing agent may cause the trust to be collapsed, and in the case of floaters created by the Fund, the Fund will then be required to repay the principal amount of the tendered securities. During times of market volatility, illiquidity or uncertainty, the Fund could be required to sell other portfolio holdings at a disadvantageous time to raise cash to meet that obligation.

Some inverse floaters may have a "cap," so that if interest rates rise above the cap, the security pays additional interest income. If rates do not rise above the cap, the Fund will have paid an additional amount for that feature that has proved worthless.

The Fund may also enter into "shortfall and forbearance" agreements with respect to inverse floaters. Under those agreements, upon liquidation of the trust, the Fund is committed to pay the trust the difference between the liquidation value of the underlying municipal bond on which the inverse floater is based and the principal amount payable to the holders of the short-term floating rate security that is based on the same underlying municipal security. Although the Fund has the risk that it may be required to make such additional payment, these agreements may offer higher interest payments than a standard inverse floater.

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Accounting Treatment of Inverse Floaters. Because of the accounting treatment for inverse floaters created by the Fund's transfer of a municipal bond to a trust, the Fund's financial statements will reflect these transactions as "secured borrowings," which affects the Fund's expense ratios, statements of income and assets and liabilities and causes the Fund's Statement of Investments to include the underlying municipal bond. The Fund's annual fund operating expenses, shown earlier in this prospectus, include certain expenses and fees related to the Fund's investments in inverse floaters. Some of those expenses are liabilities with respect to interest paid on short-term floating rate notes issued by the trusts whose inverse floater certificates are held by the Fund. Under accounting rules, the Fund also recognizes additional income in an amount that directly corresponds to these expenses and, as a result the Fund's net asset values per share and total returns have not been affected by these additional expenses.

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When-Issued and Delayed-Delivery Transactions. The Fund may purchase municipal securities on a "when-issued" basis and may purchase or sell such securities on a "delayed-delivery" basis. "When-issued" or "delayed-delivery" refers to securities whose terms and indenture are available and for which a market exists, but which are not available for immediate delivery. Between the purchase and settlement date, no payment is made for the security and no interest accrues to the buyer from the investment. There is a risk of loss to the Fund if the value of the security declines prior to the settlement date.
The securities are subject to changes in value from market fluctuations during the period until settlement and the value of the security on the delivery date may be more or less than the Fund paid. The Fund may lose money if the value of the security declines below the purchase price.

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Floating Rate/Variable Rate Obligations. Some municipal securities have variable or floating interest rates. Variable rates are adjustable at stated periodic intervals. Floating rates are automatically adjusted according to a specified market rate for those investments, such as, for example, the percentage of LIBOR, the SIFMA Municipal Swap Index or the percentage of the prime rate of a bank. These obligations may be secured by bank letters of credit or other credit support arrangements. Inverse floaters, discussed in this prospectus, are a type of variable rate obligation.

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OTHER INVESTMENT STRATEGIES AND RISKS. The Fund can also use the investment techniques and strategies described below. The Fund might not use all of these techniques or strategies or might only use them from time to time.

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Percentage of LIBOR Notes (PLNs). The Fund may invest in Percentage of LIBOR Notes ("PLNs") which are variable rate municipal securities based on the London Interbank Offered Rate ("LIBOR"), a widely used benchmark for short-term interest rates and used by banks for interbank loans with other banks. A PLN typically pays interest based on a percentage of a LIBOR rate for a specified time plus an established yield premium. Due to their variable rate features, PLNs will generally pay higher levels of income in a rising short-term interest rate environment and lower levels of income as short-term interest rates decline. In times of substantial market volatility, however, PLNs may not perform as anticipated. The value of a PLN also may decline due to other factors, such as changes in credit quality of the underlying bond.
Because the market for PLNs is relatively new and still developing, the Fund's ability to engage in transactions using such instruments may be limited. There is no assurance that a liquid secondary market will exist for any particular PLN or at any particular time, and so the Fund may not be able to close a position in a PLN when it is advantageous to do so. The Fund may also transfer a PLN to a sponsor to create an inverse floater, which may further increase the volatility of the market value of a PLN or the inverse floater.

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Defaulted Securities. The Fund may purchase defaulted securities if the Manager believes that there is potential for resumption of income payments or realization of income on the sale of the securities or the collateral or other advantageous developments appear likely in the near future. Notwithstanding the Manager's belief about the resumption of income payments or realization of income, the purchase of defaulted securities is highly speculative and involves a high degree of risk, including the risk of a substantial or complete loss of the Fund's investment. Defaulted securities are subject to the Fund's limitation on holding below-investment-grade securities. The Manager does not expect that this will be a significant investment strategy of the Fund.

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Illiquid 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. The Manager monitors holdings of illiquid securities on an ongoing basis to determine whether to sell any holdings.

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The Fund will not invest more than 15% of its net assets in illiquid securities.

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Zero-Coupon Securities. The Fund can invest without limit in zero-coupon securities. These debt obligations do not pay interest prior to their maturity date or else they do not start to pay interest at a stated coupon rate until a future date. They are issued and traded at a discount from their face amount. The discount varies as the securities approach their maturity date (or the date interest payments are scheduled to begin). When interest rates change, zero-coupon securities are subject to greater fluctuations in their value than securities that pay current interest. The Fund accrues the discount on zero-coupon bonds as tax-free income on a current basis. The Fund may have to pay out the imputed income on zero-coupon securities without receiving actual cash payments currently.

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Temporary Defensive and Interim Investments. For temporary defensive purposes in times of adverse or unstable market, economic or political conditions, the Fund can invest up to 100% of its assets in investments that may be inconsistent with the Fund's principal investment strategies. Generally, the Fund would invest in short-term municipal securities, but could also invest in U.S. Government securities or highly-rated corporate debt securities. The Fund might also hold these types of securities as interim investments pending the investment of proceeds from the sale of Fund shares or the sale of Fund portfolio securities or to meet anticipated redemptions of Fund shares. The income from some temporary defensive investments may not be tax-exempt, and therefore to the extent the Fund invests in these securities, it might not achieve its investment objective.

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Portfolio Turnover. A change in the securities held by the Fund is known as "portfolio turnover." The Fund may engage in active and frequent trading to try to achieve its investment objective and may have a portfolio turnover rate of over 100% annually. Increased portfolio turnover may result in higher brokerage fees or other transaction costs, which can reduce performance. However, the Fund ordinarily incurs little or no brokerage expense because most of the Fund's portfolio transactions are principal trades that do not require payment of brokerage commission. If the Fund realizes capital gains when it sells investments, it generally must pay those gains to shareholders, increasing its taxable distributions. The Financial Highlights table at the end of this prospectus shows the Fund's portfolio turnover rates during past fiscal years.

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Conflicts of Interest. The investment activities of the Manager and its affiliates in regard to other funds and accounts they manage may present conflicts of interest that could disadvantage the Fund and its shareholders. The Manager or its affiliates may provide investment advisory services to other funds and accounts that have investment objectives or strategies that differ from, or are contrary to, those of the Fund. That may result in another fund or account holding investment positions that are adverse to the Fund's investment strategies or activities. Other funds or accounts advised by the Manager or its affiliates may have conflicting interests arising from investment objectives that are similar to those of the Fund. Those funds and accounts may engage in, and compete for, the same types of securities or other investments as the Fund or invest in securities of the same issuers that have different, and possibly conflicting, characteristics. The trading and other investment activities of those other funds or accounts may be carried out without regard to the investment activities of the Fund and, as a result, the value of securities held by the Fund or the Fund's investment strategies may be adversely affected. The Fund's investment performance will usually differ from the performance of other accounts advised by the Manager or its affiliates and the Fund may experience losses during periods in which other accounts advised by the Manager or its affiliates achieve gains. The Manager has adopted policies and procedures designed to address potential conflicts of interest identified by the Manager; however, such policies and procedures may also limit the Fund's investment activities and affect its performance.

CHANGES TO THE FUND'S INVESTMENT POLICIES. The Fund's fundamental investment policies cannot be changed without the approval of a majority of the Fund's outstanding voting shares; however, the Fund's Board can change non-fundamental policies without a shareholder vote. Significant policy changes will be described in supplements to this prospectus. The Fund's investment objective is a fundamental policy. Other investment restrictions that are fundamental policies are listed in the Fund's Statement of Additional Information. An investment policy is not fundamental unless this prospectus or the Statement of Additional Information states that it is.

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PORTFOLIO HOLDINGS

The Fund's portfolio holdings are included in its semi-annual and annual reports that are distributed to its shareholders within 60 days after the close of the applicable reporting period. The Fund also discloses its portfolio holdings in its Statements of Investments on Form N-Q, which are public filings that are required to be made with the Securities and Exchange Commission within 60 days after the end of the Fund's first and third fiscal quarters. Therefore, the Fund's portfolio holdings are made publicly available no later than 60 days after the end of each of its fiscal quarters.

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

How the Fund is Managed

THE MANAGER. OppenheimerFunds, Inc., 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.

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The Manager has been an investment adviser since 1960. The Manager managed funds with approximately 6 million shareholder accounts as of September 30, 2010. The Manager is located at Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008.

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Advisory Fees. Under the investment advisory agreement, the Fund pays the Manager an advisory fee at an annual rate which declines as the Fund's assets grow: 0.60% of the first $200 million of average annual net assets, 0.55% of the next $100 million, 0.50% of the next $200 million, 0.45% of the next $250 million, 0.40% of the next $250 million, and 0.35% of average annual net assets over $1 billion. The Fund's management fee for its last fiscal year ended July 31, 2010, was 0.41% of average annual net assets for each class of shares.

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The Fund's transfer agent has voluntarily agreed to limit its fees to 0.35% of average annual net assets per fiscal year for all classes. This voluntary limitation may be amended or withdrawn at any time. For the Fund's fiscal year ended July 31, 2010, the transfer agent's fees did not exceed this expense limitation. The total annual fund operating expenses shown in the Annual Fund Operating Expenses table earlier in this prospectus include certain interest and related expenses from the Fund's investment in inverse floaters. Under accounting rules, the Fund recognized additional income in an amount that offsets those expenses. Therefore, the Fund's total expenses and net asset values were not affected. If the interest and related expenses from the Fund's investment in inverse floaters were excluded the expense ratios for the Fund would be 0.94% for Class A, 1.79% for Class B and 1.71% for Class C. The Fund's management fee and other annual operating expenses may vary in future years.

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A discussion regarding the basis for the Board of Trustees' approval of the investment advisory contracts for the Fund is available in the Fund's Semi-Annual Report to shareholders for the period ended January 31, 2010.

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Portfolio Managers. The Fund's portfolio is managed by a team of investment professionals, including Daniel G. Loughran, Scott S. Cottier, Troy E. Willis, Mark R. DeMitry, Marcus V. Franz, Michael L. Camarella and Charles S. Pulire, who are primarily responsible for the day-to-day management of the Fund's investments. Mr. Loughran is a Vice President of the Fund and has been a portfolio manager for the Fund since July 2002. Mr. Cottier is a Vice President of the Fund and has been a portfolio manager for the Fund since September 2002. Mr. Willis is a Vice President of the Fund and has been a portfolio manager for the Fund since May 2003. Mr. DeMitry is a Vice President of the Fund and has been a portfolio manager for the Fund since September 2006. Mr. Franz has been a portfolio manager for the Fund since September 2006. Mr. Carmarella is a Vice President of the Fund and has been a portfolio manager for the Fund since January 2008. Mr. Pulire has been a portfolio manager for the Fund since January 2010.

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Mr. Loughran has been a Senior Vice President of the Manager since July 2007 and a Senior Portfolio Manager of the Manager since December 2001. He was a Vice President of the Manager from April 2001 to June 2007. Mr. Loughran is a team leader, a portfolio manager, an officer, and a trader for the Fund and other Oppenheimer funds.

Mr. Cottier has been a Vice President and Senior Portfolio Manager of the Manager since September 2002. He is a portfolio manager, an officer, and a trader for the Fund and other Oppenheimer funds.

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Mr. Willis has been a Vice President of the Manager since July 2009 and a Senior Portfolio Manager of the Manager since January 2006. He was an Assistant Vice President of the Manager from July 2005 to June 2009 and an Associate Portfolio Manager of the Manager from June 2003 to December 2005. Mr. Willis is a portfolio manager, an officer, and a trader for the Fund and other Oppenheimer funds.

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Mr. DeMitry has been a Vice President and Senior Portfolio Manager of the Manager since July 2009. He was an Associate Portfolio Manager with the Manager from September 2006 to June 2009. He was a research analyst with the Manager from June 2003 to August 2006. He was a credit analyst with the Manager from June 2001 to May 2003. Mr. DeMitry is a portfolio manager, an officer and a trader for the Fund and other Oppenheimer funds.

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Mr. Franz has been a Vice President and Senior Portfolio Manager of the Manager since July 2009. He was a Portfolio Manager with the Manager from October 2006 to June 2009. He was a research analyst with the Manager from June 2003 to September 2006. Mr. Franz is a portfolio manager and a trader for the Fund and other Oppenheimer funds.

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Mr. Camarella has been an Assistant Vice President of the Manager since July 2009. He has been an Associate Portfolio Manager of the Manager since January 2008. He was a research analyst with the Manager from April 2006 to December 2007. He was a credit analyst with the Manager from June 2003 to March 2006. Mr. Camarella is a portfolio manager, an officer and a trader for the Fund and other Oppenheimer funds.

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Mr. Pulire has been a research analyst with the Manager since February 2008. He was a credit analyst with the Manager from May 2006 to February 2008. Mr. Pulire is a portfolio manager and trader for the Fund and other Oppenheimer funds.

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

MORE ABOUT YOUR ACCOUNT

About Your Account

Where Can You Buy Fund Shares? Oppenheimer funds may be purchased either directly or through a variety of "financial intermediaries" that offer Fund shares to their clients. Financial intermediaries include securities dealers, financial advisers, brokers, banks, trust companies, insurance companies and the sponsors of fund "supermarkets," fee-based advisory or wrap fee programs.

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WHAT CLASSES OF SHARES DOES THE FUND OFFER? The Fund offers investors four different classes of shares. The different classes of shares represent investments in the same portfolio of securities, but the classes are subject to different expenses and will usually have different share prices. When you buy shares, be sure to specify the class of shares you wish to purchase. If you do not choose a class, your investment will be made in Class A shares.

Class A Shares. If you buy Class A shares, you will pay an initial sales charge on investments up to $1 million for regular accounts or lesser amounts if you qualify for certain fee waivers. The amount of the sales charge will vary depending on the amount you invest. The sales charge rates for different investment amounts are listed in "About Class A Shares" below.
Class B Shares. If you buy Class B shares, you will pay no sales charge at the time of purchase, but you will pay an annual asset-based sales charge (distribution fee) over a period of approximately six years. If you sell your shares within six years after buying them, you will normally pay a contingent deferred sales charge. The amount of the contingent deferred sales charge varies depending on how long you own your shares, as described in "About Class B Shares" below.
Class C Shares. If you buy Class C shares, you will pay no sales charge at the time of purchase, but you will pay an ongoing asset-based sales charge. If you sell your shares within 12 months after buying them, you will normally pay a contingent deferred sales charge of 1.0%, as described in "About Class C Shares" below.
Class Y Shares. Class Y shares are offered only to certain institutional investors that have a special agreement with the Distributor and to present or former officers, directors, trustees and employees (and their eligible family members) of the Fund, the Manager and its affiliates, its parent company and the subsidiaries of its parent company, and retirement plans established for the benefit of such individuals. See "About Class Y Shares" below.

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Certain sales charge waivers may apply to purchases or redemptions of Class A, Class B, or Class C shares. More information about those waivers is available in the Fund's Statement of Additional Information, or by clicking on the hyperlink "Sales Charge Waivers" under the heading "Fund Information" on the OppenheimerFunds website at "www.oppenheimerfunds.com."

WHAT IS THE MINIMUM INVESTMENT? In most cases, you can buy Fund shares with a minimum initial investment of $1,000 and make additional investments with as little as $50. The minimum additional investment requirement does not apply to reinvested dividends from the Fund or from other Oppenheimer funds or to omnibus account purchases. A $25 minimum applies to additional investments through an Asset Builder Plan, an Automatic Exchange Plan or a government allotment plan established before November 1, 2002. Reduced initial minimums are available in certain circumstances, including under the following investment plans:

For an Asset Builder Plan or Automatic Exchange Plan or a government allotment plan, the minimum initial investment is $500.

For certain fee based programs that have an agreement with the Distributor, a minimum initial investment of $250 applies.

The minimum purchase amounts listed do not apply to omnibus accounts.

Minimum Account Balance. A $12 annual "minimum balance fee" is assessed on Fund accounts 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 for information about the circumstances under which this fee will not be assessed. Small accounts may be involuntarily redeemed by the Fund if the value has fallen below $500 for reasons other than a decline in the market value of the shares.

Choosing a Share Class

CHOOSING A SHARE CLASS. Once you decide that the Fund is an appropriate investment for you, the decision as to which class of shares is best suited to your needs depends on a number of factors that you should discuss with your financial adviser. The Fund's operating costs that apply to a share class and the effect of the different types of sales charges on your investment will affect your investment results over time. For example, the net asset value and the dividends of Class B and Class C shares will be reduced by additional expenses borne by those classes such as the asset-based sales charge.

Two of the factors to consider are how much you plan to invest and, while future financial needs cannot be predicted with certainty, how long you plan to hold your investment. For example, with larger purchases that qualify for a reduced initial sales charge on Class A shares, the effect of paying an initial sales charge on purchases of Class A shares may be less over time than the effect of the asset-based sales charges on Class B or Class C shares. If your goals and objectives change over time and you plan to purchase additional shares, you should re-evaluate each of the factors to see if you should consider a different class of shares.

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

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Investing for the Shorter Term. While the Fund is meant to be a long-term investment, if you have a relatively short-term investment horizon (that is, if you do not plan to hold your shares for six years or more), you should consider investing in Class C shares. That is because of the effect of the initial sales charge on Class A shares or the Class B contingent deferred sales charge if you redeem within six years.

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

Amount of Your Investment. Your choice will also depend on how much you plan to invest. For shorter-term investments of less than $100,000, Class C shares might be the appropriate choice because there is no initial sales charge on Class C shares, and the contingent deferred sales charge does not apply to shares you redeem after holding them for one year or more. However, if you plan to invest more than $100,000, and as your investment horizon increases toward six years, Class C shares might not be as advantageous as Class A shares. That is because over time the ongoing asset-based sales charge on Class C shares will have a greater impact on your account than the reduced front-end sales charge available for Class A share purchases of $100,000 or more. If you invest $1 million or more, in most cases Class A shares will be the most advantageous choice, no matter how long you intend to hold your shares.

<R> The Distributor normally will not accept purchase orders from a single investor for more than $100,000 of Class B shares or for $1 million or more of Class C shares. Dealers or other financial intermediaries are responsible for determining the suitability of a particular share class for an investor.</R>

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

How Do Share Classes Affect Payments to Your Financial Intermediary? The Class B and Class C contingent deferred sales charges and asset-based sales charges have the same purpose as the front-end sales charge or contingent deferred sales charge on Class A shares: to compensate the Distributor for concessions and expenses it pays to brokers, dealers and other financial intermediaries for selling Fund shares. Those financial intermediaries may receive different compensation for selling different classes of shares. The Manager or Distributor may also pay dealers or other financial intermediaries additional amounts from their own resources based on the value of Fund shares held by the intermediary for its own account or held for its customers accounts. For more information about those payments, see "Payments to Financial Intermediaries and Service Providers" below.

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ABOUT CLASS A SHARES. Class A shares are sold at their offering price, which is the net asset value of the shares (described below) plus, in most cases, an initial sales charge. The Fund receives the amount of your investment, minus the sales charge, to invest for your account. In some cases, Class A purchases may qualify for a reduced sales charge or a sales charge waiver, as described below and in the Statement of Additional Information.

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The Class A sales charge rate varies depending on the amount of your purchase. A portion or all of the sales charge may be retained by the Distributor or paid to your broker, dealer or other financial intermediary as a concession. The current sales charge rates and concessions paid are shown in the table below. There is no initial sales charge on Class A purchases of $1 million or more, but a contingent deferred sales charge (described below) may apply.

Amount of Purchase	Front-End Sales Charge As a Percentage of Offering Price	Front-End Sales Charge As a Percentage of Net Amount Invested	Concession As a Percentage of Offering Price
Less than $50,000	4.75%	4.98%	4.00%
$50,000 or more but less than $100,000	4.50%	4.71%	4.00%
$100,000 or more but less than $250,000	3.50%	3.63%	3.00%
$250,000 or more but less than $500,000	2.50%	2.56%	2.25%
$500,000 or more but less than $1 million	2.00%	2.04%	1.80%

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

Reduced Class A Sales Charges. Under a "Right of Accumulation" or a "Letter of Intent" you may be eligible to buy Class A shares of the Fund at the reduced sales charge rates that would apply to a larger purchase. The Fund reserves the right to modify or to cease offering these programs at any time.

Right of Accumulation. To qualify for the reduced Class A sales charge that would apply to a larger purchase than you are currently making, you can add the value of shares that you and your spouse currently own, and other purchases that you are currently making, to the value of your Class A share purchase of the Fund. You may count Class A, Class B and Class C shares of the Fund and other Oppenheimer funds and Class A, Class B, Class C, Class G and Class H units in adviser sold Section 529 plans, for which the Manager or the Distributor serves as the "Program Manager" or "Program Distributor." The Distributor or the financial intermediary through which you are buying shares will determine the value of the shares you currently own based on the greater of their current offering price or the amount you paid for the shares. For purposes of calculating that value, the Distributor will only take into consideration the value of shares owned as of December 31, 2007 and any shares purchased subsequently. The value of any shares that you have redeemed and the value of Class A shares of Oppenheimer Money Market Fund, Inc. or Oppenheimer Cash Reserves on which you have not paid a sales charge will not be counted for this purpose.

In totaling your holdings, you may count shares held in:

your individual accounts (including IRAs, 403(b) plans and eligible 529 plans),

your joint accounts with your spouse,

accounts you or your spouse hold as trustees or custodians on behalf of your children who are minors.

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A fiduciary can apply rights of accumulation to all shares purchased for a trust, estate or other fiduciary account that has multiple accounts (including employee benefit plans for the same employer and Single K plans for the benefit of a sole proprietor).

If you are buying shares directly from the Fund, you must inform the Distributor of your eligibility and holdings at the time of your purchase in order to qualify for the Right of Accumulation. If you are buying shares through a financial intermediary you must notify the intermediary of your eligibility for the Right of Accumulation at the time of your purchase.

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To count shares held in accounts at other firms, you may be requested to provide the Distributor or your current financial intermediary with a copy of account statements showing your current holdings of the Fund, other eligible Oppenheimer funds or qualifying 529 plans. Shares purchased under a Letter of Intent may also qualify as eligible holdings under a Right of Accumulation.

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Letter of Intent. You may also qualify for reduced Class A sales charges by submitting a Letter of Intent to the Distributor. A Letter of Intent is a written statement of your intention to purchase a specified value of Class A, Class B or Class C shares of the Fund or other Oppenheimer funds or Class A, Class B, Class C, Class G or Class H unit purchases in adviser sold Section 529 plans, for which the Manager or Distributor serves as the Program Manager or Program Distributor, over a 13-month period. The total amount of your intended purchases will determine the reduced sales charge rate that will apply to your Class A share purchases during that period. You must notify the Distributor or your financial intermediary of any qualifying 529 plan purchases or purchases through other financial intermediaries.

Purchases of Class N or Class Y shares, purchases made by reinvestment of dividends or capital gains distributions from other Oppenheimer funds, purchases of Class A shares with redemption proceeds under the "reinvestment privilege" described below, and purchases of Class A shares of Oppenheimer Money Market Fund, Inc. or Oppenheimer Cash Reserves on which a sales charge has not been paid do not count as "qualified shares" for satisfying the terms of a Letter.

Submitting a Letter of Intent does not obligate you to purchase the specified amount of shares. If you do not complete the anticipated purchases, you will be charged the difference between the sales charge that you paid and the sales charge that would apply to the actual value of shares you purchased. A certain portion of your shares will be held in escrow by the Fund's Transfer Agent for this purpose. Please refer to "How to Buy Shares – Letters of Intent" in the Fund's Statement of Additional Information for more complete information. You may also be able to apply the Right of Accumulation to purchases you make under a Letter of Intent.

Class A Contingent Deferred Sales Charge. There is no initial sales charge on Class A share purchases totaling $1 million or more of one or more of the Oppenheimer funds. However, those Class A shares may be subject to a 0.75% contingent deferred sales charge if they are redeemed within an 18-month "holding period" measured from the beginning of the calendar month in which they were purchased (except for shares in certain retirement plans). That sales charge will be calculated on the lesser of the original net asset value of the redeemed shares or the aggregate net asset value of the redeemed shares at the time of redemption.

The Class A contingent deferred sales charge does not apply to shares purchased by the reinvestment of dividends or capital gain distributions and will not exceed the aggregate amount of the concessions the Distributor pays on all of your purchases of Class A shares, of all Oppenheimer funds, that are subject to the contingent deferred sales charge.

The Distributor pays concessions from its own resources on certain purchases of Class A shares of one or more of the Oppenheimer funds that, in the aggregate, total $1 million or more. If purchases of a Fund's Class A shares are included in any such purchase, the Distributor will pay the concession on those Fund shares at the rate of 0.75% of their net asset value. A concession will not be paid on shares purchased by exchange or shares that were previously subject to a front-end sales charge and dealer concession.

ABOUT CLASS B SHARES. Class B shares are sold at net asset value per share without an initial sales charge. However, if Class B shares are redeemed within six years from the beginning of the calendar month in which they were purchased, a contingent deferred sales charge will be deducted from the redemption proceeds. Class B shares are also subject to an asset-based sales charge that is calculated daily based on an annual rate of 0.75%. The Class B contingent deferred sales charge and asset-based sales charge are paid to compensate the Distributor for providing distribution-related services to the Fund in connection with the sale of Class B shares.

The amount of the Class B contingent deferred sales charge will depend on the number of years since you invested, according to the following schedule:

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

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

Automatic Conversion of Class B Shares. Class B shares automatically convert to Class A shares six years (72 months) after you purchase them. This conversion eliminates the Class B asset-based sales charge, however, the shares will be subject to the ongoing Class A fees and expenses. 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 to Class A shares, all other Class B shares that were acquired by reinvesting dividends and distributions on the converted shares will also convert. For further information on the conversion feature and its tax implications, see "Class B Conversion" in the Statement of Additional Information.

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ABOUT CLASS C SHARES. Class C shares are sold at net asset value per share without an initial sales charge. However, if Class C shares are redeemed within a 12 month "holding period" from the beginning of the calendar month in which they were purchased, a contingent deferred sales charge of 1.00% may be deducted from the redemption proceeds. Class C shares are also subject to an asset-based sales charge that is calculated daily based on an annual rate of 0.75%. The Class C contingent deferred sales charge and asset-based sales charge are paid to compensate the Distributor for providing distribution-related services to the Fund in connection with the sale of Class C shares.

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ABOUT CLASS Y SHARES. Class Y shares are sold at net asset value per share without a sales charge directly to institutional investors that have special agreements with the Distributor for that purpose. They may include insurance companies, registered investment companies, employee benefit plans and Section 529 plans, among others.

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

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Present and former officers, directors, trustees and employees (and their eligible family members) of the Fund, the Manager, its affiliates, its parent company and the subsidiaries of its parent company, and retirement plans established for the benefit of such individuals, are also permitted to purchase Class Y shares of the Fund.

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The Price of Fund Shares

Shares may be purchased at their offering price which is the net asset value per share plus any initial sales charge that applies. Shares are redeemed at their net asset value per share less any contingent deferred sales charge that applies. The net asset value that applies to a purchase or redemption order is the next one calculated after the Distributor receives the order, in proper form as described in this prospectus, or after any agent appointed by the Distributor receives the order in proper form as described in this prospectus. Your financial intermediary can provide you with more information regarding the time you must submit your purchase order and whether the intermediary is an authorized agent for the receipt of purchase and redemption orders.

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Net Asset Value. The Fund calculates the net asset value of each class of shares as of the close of the New York Stock Exchange (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 are to "Eastern time."

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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. The Fund's assets generally trade in the over-the-counter market rather than on a securities exchange. Therefore, to determine net asset values, the Fund assets are generally valued at the mean between the bid and asked prices as determined by a pricing service. If the prices determined by the pricing service 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 price is received from the pricing service and before the time as of which the Fund's net asset values are calculated that day, 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 prices received from the pricing services are 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 prices of the securities of issuers held by the Fund. Those may include events affecting specific issuers or events affecting securities markets (for example, a securities market closes early because of a natural disaster). The Fund uses fair value pricing procedures to reflect what the Manager and the Board believe to be more accurate values for the Fund's portfolio securities, although it may not always be able to accurately determine such values. There can be no assurance that the Fund could obtain the fair value assigned to a security if it were to sell the security at the same time at which the Fund determines its net asset value per share.

Contingent Deferred Sales Charge. If you redeem shares during their applicable contingent deferred sales charge holding period, the contingent deferred sales charge generally will be deducted from the redemption proceeds. In some circumstances you may be eligible for one of the waivers described in "Sales Charge Waivers" below and in the "Special Sales Charge Arrangements and Waivers" Appendix to the Statement of Additional Information. You must advise the Transfer Agent or your financial intermediary of your eligibility for a waiver when you place your redemption request.

A contingent deferred sales charge will be based on the net asset value of the redeemed shares at the time of redemption or the original net asset value, whichever is lower. A contingent deferred sales charge is not imposed on:

any increase in net asset value over the initial purchase price,

shares purchased by the reinvestment of dividends or capital gains distributions, or

shares eligible for a sales charge waiver (see "Sales Charge Waivers" below).

The Fund redeems shares in the following order:

shares acquired by the reinvestment of dividends or capital gains distributions,

other shares that are not subject to the contingent deferred sales charge, and

shares held the longest during the holding period.

You are not charged a contingent deferred sales charge when you exchange shares of the Fund for shares of other Oppenheimer funds. However, if you exchange your shares within the applicable holding period, your original holding period will carry over to the shares you acquire, even if the new fund has a different holding period.

SALES CHARGE WAIVERS. The Fund and the Distributor offer the following opportunities to purchase shares without front-end or contingent deferred sales charges. The Fund reserves the right to amend or discontinue these programs at any time without prior notice.

Dividend Reinvestment. Dividends or capital gains distributions may be reinvested in shares of the Fund, or any of the other Oppenheimer funds into which shares of the Fund may be exchanged, without a sales charge.

Exchanges of Shares. There is no sales charge on exchanges of shares except for exchanges of Class A shares of Oppenheimer Money Market Fund, Inc. or Oppenheimer Cash Reserves on which you have not paid a sales charge.

Reinvestment Privilege. There is no sales charge on reinvesting the proceeds from redemptions of Class A shares or Class B shares that occurred within the previous six months if you paid an initial or contingent deferred sales charge on the redeemed shares. This reinvestment privilege does not apply to reinvestment purchases made through automatic investment options. You must advise the Distributor, the Transfer Agent or your financial intermediary that you qualify for the waiver at the time you submit your purchase order.

In addition, the "Special Sales Charge Arrangements and Waivers" Appendix to the Statement of Additional Information provides detailed information about certain other initial sales charge and contingent deferred sales charge waivers and arrangements. A description of those sales charge waivers and arrangements is available for viewing on the OppenheimerFunds website at www.oppenheimerfunds.com (follow the hyperlink "Sales Charges & Breakpoints," under the heading "Fund Information") and may also be ordered by calling 1.800.225.5677. You must advise the Distributor, the Transfer Agent or your financial intermediary that you qualify for one of those waivers at the time you submit your purchase order or redemption request.

How to Buy, Sell and Exchange Shares

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BUYING SHARES. You can buy shares in several ways. The Distributor has appointed certain financial intermediaries, including brokers, dealers and others, as servicing agents to accept purchase and redemption orders. The Distributor or servicing agent must receive your order, in proper form, by the close of the NYSE for you to receive that day's offering price. If your order is received on a day when the NYSE is closed or after it has closed, the order will receive the next offering price that is determined. To be in proper form, your purchase order must comply with the procedures described below. The Distributor, in its sole discretion, may reject any purchase order for the Fund's shares.

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Buying Shares Through a Financial Intermediary. You can buy shares through any servicing agent (a broker, dealer, or other financial intermediary) that has a sales agreement with the Distributor. Your servicing agent will place your order with the Distributor on your behalf. A servicing agent may charge a processing fee for that service. Your account information will be shared with the financial intermediary designated as the dealer of record for the account.

Buying Shares Through the Distributor. We recommend that you discuss your investment with a financial adviser before you make a purchase to be sure that the Fund is appropriate for you. If you want to purchase shares directly from the Distributor, complete an OppenheimerFunds new account application and mail it with a check payable in U.S. dollars to "OppenheimerFunds Distributor, Inc." to the address on the back cover. If you do not list a dealer on your application, the Distributor is designated as the broker-dealer of record, but solely for the purpose of acting as your agent to purchase the shares and Class A shares are your only purchase option. Class B or Class C shares may not be purchased by a new investor directly from the Distributor without the investor designating another registered broker-dealer. However, if a current investor no longer has a broker-dealer of record for an existing Class B or Class C account, the Distributor is automatically designated as the broker-dealer of record, but solely for the purpose of acting as your agent to purchase the shares. If you submit a purchase request to the Distributor without designating the fund you wish to invest in, your investment will be made in Class A shares of Oppenheimer Money Market Fund, Inc. This policy does not apply to purchases by or for certain retirement plans or accounts. For more information regarding undesignated investments, please call the Transfer Agent at the number on the back cover of this prospectus.

Involuntary Redemptions. In some circumstances, involuntary redemptions may be made to repay the Distributor for losses from the cancellation of share purchase orders.

Identification Requirements. 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 to open a corporate account or in certain other circumstances. The Fund or the Transfer Agent may use this information 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 verifying 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.

Suspension of Share Offering. The offering of Fund shares may be suspended during any period in which the determination of net asset value is suspended, and may be suspended by the Board at any time the Board believes it is in the Fund's best interest to do so.

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SELLING SHARES. You can generally redeem (sell) some or all of your shares on any regular business day. You may redeem your shares by writing a letter, by wire, by telephone or on the Internet. You can also set up an Automatic Withdrawal Plan to redeem shares on a regular basis. The redemption of Fund shares may be suspended under certain circumstances described in the Statement of Additional Information. 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 your financial intermediary or the Transfer Agent for assistance.

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Redemption Price. Your shares will be redeemed at net asset value less any applicable sales charge or other fees. The net asset value used will be the next one calculated after your order is received, in proper form, by the Transfer Agent or your authorized financial intermediary. To be in proper form, your redemption order must comply with the procedures described below. The redemption price for shares will change from day-to-day because the value of the securities in the Fund's portfolio and the Fund's expenses fluctuate. The redemption price will normally differ for each class of shares. The redemption price of your shares may be more or less than their original cost.

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Redemptions "In-Kind." Shares may be "redeemed in-kind" under certain circumstances (such as a lack of liquidity in the Fund's portfolio to meet redemptions). That means that the redemption proceeds will be paid in securities from the Fund's portfolio on a pro-rata basis, possibly including illiquid securities. If the Fund redeems your shares in-kind, you may bear transaction costs and will bear market risks until such securities are converted into cash.

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Options for Receiving Redemption Proceeds:

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By Check. The Fund will normally send redemption proceeds by check to the address on your account statement.

By AccountLink. If you have linked your Fund account to your bank account with AccountLink (described below), you may have redemption proceeds transferred directly into your account. Normally the transfer to your bank is initiated on the bank business day after the redemption. You will not receive dividends on the proceeds of redeemed shares while they are waiting to be transferred.

By Wire. You can arrange to have redemption proceeds sent by Federal Funds wire to an account at a bank that is a member of the Federal Reserve wire system. The redemption proceeds will normally be transmitted on the next bank business day after the shares are redeemed. You will not receive dividends on the proceeds of redeemed shares while they are waiting to be transmitted.

Checkwriting. To write checks against your Fund account, you may request that privilege on your account application. To establish checkwriting privileges for an existing account, contact the Transfer Agent for signature cards. The signature cards must be signed (with a signature guarantee) by all owners on the account and returned to the Transfer Agent. Shareholders with joint accounts may choose to have checks paid with only one owner's signature. If you previously signed a signature card to establish checkwriting in another Oppenheimer fund with the same registration, simply call the Transfer Agent (at the number on the back cover) to request checkwriting for this Fund. Checks will be sent to you when all of the required information is received.

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Effective January 1, 2011, you will no longer be able to establish checkwriting for a new or existing account and will no longer be able to order additional checks for accounts with checkwriting privileges.

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Beginning June 1, 2011, the Transfer Agent will no longer accept check drafts to redeem shares from your account. Check drafts received on or after this date will be returned without payment.

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Checks may be written to the order of whomever you wish, but may not be cashed at the bank the checks are payable through or by the Fund's custodian bank.

Checks must be written for at least $500. Checks will not be accepted if they are written for less than $500, including checks that indicate a $100 minimum.

Checks cannot be paid if they are written for more than your account value. Remember, your account may fluctuate in value and you should not write a check close to the total account value.

If your Fund account number has changed, don't use your existing checks. New checks will be sent to you.

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You may not write a check that would require the Fund to redeem shares that were purchased by check or Asset Builder Plan payments within the prior 5 business days.

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Checkwriting privileges are not available for Class Y accounts or accounts holding shares that are subject to a contingent deferred sales charge.

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Checkwriting privileges are not available for shares that are held in a retirement account.

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Payment Delays. Payment for redeemed shares is usually made within seven days after the Transfer Agent receives redemption instructions in proper form. For accounts registered in the name of a broker-dealer, payment will normally be forwarded to the broker-dealer within three business days. The Transfer Agent may delay processing redemption payments for recently purchased shares until the purchase payment has cleared. That delay may be as much as five business days from the date the shares were purchased. That delay may be avoided if you purchase shares by Federal Funds wire or certified check. Under unusual circumstances, the right to redeem shares or the payment of redemption proceeds may be delayed or suspended as permitted under the Investment Company Act of 1940.

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THE OPPENHEIMERFUNDS EXCHANGE PRIVILEGE. You can exchange all or part of your Fund shares for shares of the same class of other Oppenheimer funds that offer the exchange privilege. For example, you can exchange Class A shares of the Fund only for Class A shares of another fund. You can obtain a list of the Oppenheimer funds that are currently available for exchanges by calling a service representative at 1.800.CALL OPP (225.5677). The funds available for exchange can change from time to time. 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.

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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 its transaction and administrative costs and/or affect its performance, depending on various factors, such as the size of the Fund, the nature of its investments, the amount of Fund assets a portfolio manager maintains in cash or cash equivalents, the aggregate dollar amount and the number and frequency of trades.

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If large dollar amounts are involved in exchange or redemption transactions, the Fund might be required to sell portfolio securities at unfavorable times to meet those transaction requests, and the Fund's brokerage or administrative expenses might be increased. Therefore, the Manager and the Fund's Board have adopted the following policies and procedures to detect and prevent frequent and/or excessive exchanges or purchase and redemption activity, while addressing the needs of investors who seek liquidity in their investment and the ability to exchange shares as their investment needs change. There is no guarantee that those policies and procedures, described below, will be sufficient to identify and deter all excessive short-term trading.

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Limitations on Frequent Exchanges

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30-Day Hold. If a direct shareholder exchanges shares of another Oppenheimer fund account for shares of the Fund, his or her Fund account will be "blocked" from exchanges into any other fund for a period of 30 calendar days from the date of the exchange, subject to certain exceptions described below. Likewise, if a Fund shareholder exchanges Fund shares for shares of another eligible Oppenheimer fund, that fund account will be "blocked" from further exchanges for 30 calendar days, subject to the exception described below. 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 $2,000 from one fund into another fund in which the shareholder already owned shares worth $10,000, then, following the exchange and assuming no exception applied, the full account balance ($12,000 in this example) would be blocked from exchanges into another fund for a period of 30 calendar days. A shareholder whose account is registered on the Fund's books showing the name, address and tax ID number of the beneficial owner is a "direct shareholder."

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Exceptions to 30-Day Hold

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Exchanges Into Money Market Funds. A direct shareholder will be permitted to exchange shares of a stock or bond fund for shares of an eligible money market fund any time, even if the shareholder has exchanged shares into the stock or bond fund during the prior 30 days. However, until June 1, 2011 all of the shares held in that money market fund would then be blocked from further exchanges into another fund for 30 calendar days. Beginning June 1, 2011, exchanges into another fund from a money market fund will not be subject to the 30 calendar day block, but will continue to be monitored for excessive activity and the Transfer Agent may limit or refuse any exchange order from such money market fund in its discretion pursuant to the exchange policy of such money market fund.

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Dividend Reinvestments and Class B Share Conversions. The 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.

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Asset Allocation Programs. Investment programs by Oppenheimer "funds-of-funds" that entail rebalancing investments in underlying Oppenheimer funds will not be subject to these limits. However, 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 also be subject to the 30-day limit.

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.

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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 the Fund's prospectus.

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Limitations on Exchanges in Omnibus Accounts. If you hold your Fund shares through a financial advisor or other firm such as a broker-dealer, a bank, an insurance company separate account, an investment adviser, an administrator or a trustee of a retirement 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, may apply. The Fund, the Distributor, the Manager and the Transfer Agent encourage those financial intermediaries to apply the Fund's policies to their customers who invest indirectly in the Fund. However, the Transfer Agent may not be able to detect excessive short-term trading activity in accounts maintained in "omnibus" or "street name" form where the underlying beneficial owners are not identified. 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 the account activity, and to confirm to the Transfer Agent and the Fund that appropriate action has been taken to curtail any excessive trading activity.

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Other Limitations on Exchanges. There are a number of other special conditions and limitations that apply to certain types of exchanges. Those conditions and circumstances are described in the section "How to Exchange Shares" in the Statement of Additional Information. For information about sales charges that may apply to exchanges of shares see the sections "Contingent Deferred Sales Charge" and "Sales Charge Waivers" in the Fund's prospectus.

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Requirements for Exchanges of Shares. To exchange shares of the Fund, you must meet several conditions. The Fund may amend the following requirements at any time:

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

The selected fund must offer the exchange privilege.

You must meet the minimum purchase requirements for the selected fund.

Generally, exchanges may be made only between identically registered accounts, unless all account owners send written exchange instructions with a signature guarantee.

Before exchanging into a fund, you should obtain its prospectus and should read it carefully.

Timing of Exchange Transactions. 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 in order to receive that day's net asset value on the exchanged shares. For requests received after the close of the NYSE the shares being exchanged will be valued at the next net asset value calculated after the request is received. The Transfer Agent may delay transmitting the proceeds from an exchange for up to five business days, however, if it determines, in its discretion, that an earlier transmittal of the redemption proceeds would be detrimental to either the fund from which shares are being exchanged or the fund into which the exchange is being made. The exchange proceeds will be invested in the new fund at the next net asset value calculated after the proceeds are received. In the event that a delay in the reinvestment of proceeds occurs, the Transfer Agent will notify you or your financial intermediary.

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Taxes on Exchanges. 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. Therefore, an exchange may result in a capital gain or loss for tax purposes.

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OTHER LIMITS ON SHARE TRANSACTIONS. The Fund may impose other limits on transactions that it believes would be disruptive and may refuse any purchase or exchange order.

Right to Refuse Purchase and Exchange 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.

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Right to Terminate or Suspend Account Privileges. 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 policies outlined in the Fund's prospectus. As part of the Transfer Agent's procedures to detect and deter excessive trading activity, 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. The Transfer Agent may send a written warning to a shareholder that the Transfer Agent believes may be engaging in disruptive or excessive trading activity; however, the Transfer Agent reserves the right to suspend or terminate the ability to purchase or exchange shares, with or without warning, for any account that the Transfer Agent determines, in the exercise of its discretion, has engaged in such trading activity.

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SUBMITTING SHARE TRANSACTION REQUESTS. Share transactions may be requested by telephone or internet, in writing, through your financial intermediary, or by establishing one of the Investor Services plans described below. Certain transactions may also be submitted by fax. If an account has more than one owner, the Fund and the Transfer Agent may rely on instructions from any one owner or from the financial intermediary's representative of record for the account, unless that authority has been revoked.

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Internet and Telephone Transaction Requests. Purchase, redemption and exchange requests may be submitted on the OppenheimerFunds website, www.oppenheimerfunds.com. Those requests may also be made by calling the telephone number on the back cover and either speaking to a service representative or accessing PhoneLink, the OppenheimerFunds automated telephone system that enables shareholders to perform certain account transactions automatically using a touch-tone phone.

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You will need to obtain a user I.D. and password to execute transactions through PhoneLink or on the internet. Some internet and telephone transactions require the Oppenheimer AccountLink feature, described below, that links your Fund account with an account at a U.S. bank or other financial institution. The Transfer Agent will record any telephone calls to verify data concerning transactions.

The following policies apply to internet and telephone transactions:

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Purchases through AccountLink that are submitted through PhoneLink or on the internet are limited to $100,000.

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Purchases through AccountLink that are submitted by calling a service representative are limited to $250,000.

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Redemptions that are submitted by telephone or on the internet and request the proceeds to be paid by check, must be made payable to all owners of record of the shares and must be sent to the address on the account statement. Telephone or internet redemptions paid by check may not exceed $100,000 in any seven-day period. This service is not available within 15 days of changing the address on an account.

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Redemptions by telephone or on the internet that are sent to your bank account through AccountLink are not subject to any dollar limits.

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Exchanges submitted by telephone or on the internet may be made only between accounts that are registered with the same name(s) and address.

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Shares for which share certificates have been issued may not be redeemed or exchanged by telephone or on the internet.

Shares held in an OppenheimerFunds-sponsored qualified retirement plan account may not be redeemed or exchanged by telephone or on the internet.

The Transfer Agent has adopted procedures to confirm that telephone and internet instructions are genuine. Callers are required to provide service representatives with tax identification numbers and other account data and PhoneLink and internet users are required to use PIN numbers. The Transfer Agent will also send you written confirmations of share transactions. The Transfer Agent and the Fund will not be liable for losses or expenses that occur from telephone or internet instructions reasonably believed to be genuine.

Telephone or internet transaction privileges may be modified, suspended or terminated by the Fund at any time. The Fund will provide you notice of such changes whenever it is required to do so by applicable law.

Purchases and Redemptions by Federal Funds Wire. Shares purchased through the Distributor may be paid for by Federal Funds wire. Redemption proceeds may also be transmitted by wire. The minimum wire purchase or redemption is $2,500. There is a $10 fee for each wire redemption request. Before sending a wire purchase, call the Distributor's Wire Department at 1.800.225.5677 to notify the Distributor of the wire and to receive further instructions. To set up wire redemptions on your account or to arrange for a wire redemption, call the Transfer Agent at the telephone number on the back of this prospectus for information.

Written Transaction Requests. You can send purchase, exchange or redemption requests to the Transfer Agent at the address on the back cover. Your request must include:

The Fund's name;

For existing accounts, the Fund account number (from your account statement);

For new accounts, a completed account application;

For purchases, a check payable to the Fund or to OppenheimerFunds Distributor, Inc.;

For redemptions, any special payment instructions;

For redemptions or exchanges, the dollar amount or number of shares to be redeemed or exchanged;

For redemptions or exchanges, any share certificates that have been issued (exchanges or redemptions of shares for which certificates have been issued cannot be processed until the Transfer Agent receives the certificates);

For individuals, the names and signatures of all registered owners exactly as they appear in the account registration;

For corporations, partnerships or other businesses or as a fiduciary, the name of the entity as it appears in the account registration and the names and titles of any individuals signing on its behalf; and

Other documents requested by the Transfer Agent to assure that the person purchasing, redeeming or exchanging shares is properly identified and has proper authorization to carry out the transaction.

Certain Requests Require a Signature Guarantee. To protect you and the Fund from fraud, certain redemption requests must be in writing and must include a signature guarantee. A notary public seal will not be accepted for these requests (other situations might also require a signature guarantee):

You wish to redeem more than $100,000 and receive a check;

The redemption check is not payable to all shareholders listed on the account statement;

The redemption check is not sent to the address of record on your account statement;

Shares are being transferred to a Fund account with a different owner or name; or

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 signature guarantee from a number of financial institutions, including:

a U.S. bank, trust company, credit union or savings association,

a foreign bank that has a U.S. correspondent bank,

a U.S. registered dealer or broker in securities, municipal securities or government securities, or

a U.S. national securities exchange, a registered securities association or a clearing agency.

Fax Requests. You may send requests for certain types of account transactions to the Transfer Agent by fax. Please call the number on the back of this prospectus for information about which transactions may be handled this way. Transaction requests submitted by fax are subject to the same rules and restrictions as the written, telephone and internet requests described in this prospectus. However, requests that require a signature guarantee may not be submitted by fax.

Submitting Transaction Requests Through Your Financial Intermediary. You can submit purchase, redemption or exchange requests through any broker, dealer or other financial intermediary that has a special agreement with the Distributor. The broker, dealer or other intermediary will place the order with the Distributor on your behalf. A broker or dealer may charge a processing fee for that service. If your shares are held in the name of your financial intermediary, you must redeem them through that intermediary.

Intermediaries 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 intermediary performs any transaction erroneously or improperly.

Client Account Exchanges by Financial Intermediaries. The Fund and the Transfer Agent permit brokers, dealers and other financial intermediaries to submit exchange requests on behalf of their customers, unless that authority has been revoked. The Fund or the Transfer Agent may limit or refuse 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.

INVESTMENT PLANS AND 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 that is an Automated Clearing House (ACH) member. AccountLink lets you:

transmit funds electronically to purchase shares by internet, by telephone or automatically through an Asset Builder Plan. The purchase payment will be debited from your bank account.

have the Transfer Agent send redemption proceeds or dividends and distributions directly to your bank account.

AccountLink privileges should be requested on your account application or on your broker-dealer's settlement instructions if you buy your shares through a broker-dealer. For an established account, 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 the account as well as to the financial intermediary's representative of record unless and until the Transfer Agent terminates or receives written instructions terminating or changing those privileges. After you establish AccountLink for your account, any change you make to your bank account information must be made by signature-guaranteed instructions to the Transfer Agent signed by all shareholders on the account. Please call the Transfer Agent for more information.

Asset Builder Plan. Under an Asset Builder Plan, you may purchase shares of the Fund automatically. An Asset Builder Plan is available only if you have established AccountLink with a bank or other financial institution. Payments to purchase Fund shares will be debited from your linked account.

To establish an Asset Builder Plan at the time you initially purchase Fund shares, complete the "Asset Builder Plan" information on the account application. To add an Asset Builder Plan to an existing account, use the Asset Builder Enrollment Form. You may change the amount of your Asset Builder payment or you can terminate your automatic investments at any time by writing to the Transfer Agent. The Transfer Agent requires a reasonable period (approximately 10 days) after receipt of your instructions to implement the requested changes. For more details, see the account application, the Asset Builder Enrollment Form and the Statement of Additional Information. Those documents are available by contacting the Distributor or may be downloaded from our website at www.oppenheimerfunds.com. The Fund reserves the right to amend, suspend or discontinue offering Asset Builder Plans at any time without prior notice.

Automatic Redemption and Exchange Plans. The Fund has several plans that enable you to redeem shares automatically or exchange them for shares of another Oppenheimer fund on a regular basis. Please call the Transfer Agent or consult the Statement of Additional Information for details.

Less Paper, Less Waste. To avoid sending duplicate copies of Fund 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 lower printing costs and reduced mailing expense.

If you prefer to receive multiple copies of these materials, you may call the Transfer Agent at the number on the back of this prospectus or you may notify the Transfer Agent in writing. Multiple 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.

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You may also choose to receive your account documents electronically via eDocs Direct. Visit our website at www.oppenheimerfunds.com and click the hyperlink "Sign Up for Electronic Document Delivery" under the heading "I want to..." in the left hand column, or call 1.888.470.0862 for information and instructions.

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DISTRIBUTION AND SERVICE (12b-1) PLANS

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Service Plan for Class A Shares. The Fund has adopted a Service Plan for Class A shares that reimburses the Distributor for a portion of the costs of maintaining accounts and providing services to Class A shareholders. Reimbursement is made periodically at an annual rate of up to 0.25% of the Class A shares daily net assets. The Distributor currently uses all of those fees to pay brokers, dealers, banks and other financial intermediaries for providing personal service and maintaining the 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 periods. Because the service fee is paid out of the Fund's assets on an ongoing basis, over time it will increase the cost of your investment.

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Distribution and Service Plans for Class B and Class C Shares. The Fund has adopted Distribution and Service Plans for Class B and Class C shares to pay the Distributor for distributing those share classes, maintaining accounts and providing shareholder services. Under the plans, the Fund pays the Distributor an asset-based sales charge for Class B and Class C shares calculated at an annual rate of 0.75% of the daily net assets of those classes. The Fund also pays a service fee under the plans at an annual rate of 0.25% of the daily net assets of Class B and Class C. Altogether, these fees increase the Class B and Class C annual expenses by 1.00%, calculated on the daily net assets of the applicable class. Because these fees are paid out of the Fund's assets on an on going basis, over time they will increase the cost of your investment and may cost you more than other types of sales charges.

Use of Plan Fees: The Distributor uses the service fees to compensate brokers, dealers, banks and other financial intermediaries for maintaining accounts and providing personal services to Class B and Class C shareholders in the applicable share class. The Distributor normally pays intermediaries the 0.25% service fee in advance for the first year after shares are purchased and then pays that fee periodically.

Class B Shares: The Distributor currently pays a sales concession of 3.75% of the purchase price of Class B shares to dealers from its own resources at the time of sale. Including the advance of the service fee, the total amount paid by the Distributor to the dealer at the time of sale of Class B shares is therefore 4.00% of the purchase price. The Distributor normally retains the Class B asset-based sales charge. For ongoing purchases of Class B shares by certain retirement plans, the Distributor may pay the intermediary the asset-based sales charge and service fee during the first year after purchase instead of paying a sales concession and the first year's service fees at the time of purchase. See the Statement of Additional Information for exceptions.

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Class C Shares: At the time of a Class C share purchase, the Distributor generally pays financial intermediaries a sales concession of 0.75% of the purchase price from its own resources. Therefore, the total amount, including the advance of the service fee, that the Distributor pays the intermediary at the time of a Class C share purchase is 1.00% of the purchase price. The Distributor normally retains the asset-based sales charge on Class C share purchases during the first year and then pays that fee to the intermediary as an ongoing concession. See the Statement of Additional Information for exceptions to these arrangements.

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PAYMENTS TO FINANCIAL INTERMEDIARIES AND SERVICE PROVIDERS. The Manager and the Distributor, in their discretion, may also make payments to brokers, dealers and other financial intermediaries or to service providers for distribution and/or shareholder servicing activities. Those payments are made out of the Manager's and/or the Distributor's own resources and/or assets, including from the revenues or profits derived from the advisory fees the Manager receives from the Fund. Those cash payments, which may be substantial, are paid to many firms having business relationships with the Manager and Distributor and 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. Payments by the Manager or Distributor from their own resources are not reflected in the tables in the "Fees and Expenses of the Fund" section of this prospectus because they are not paid by the Fund.

The financial intermediaries that may receive those payments include firms that offer and sell Fund shares to their clients, or provide shareholder services to the Fund, or both, and receive compensation for those activities. The financial intermediaries that may receive payments include your securities broker, dealer or financial advisor, sponsors of fund "supermarkets," sponsors of fee-based advisory or wrap fee programs, sponsors of college and retirement savings programs, banks, trust companies and other intermediaries 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 intermediary, the average net assets of the Fund and other Oppenheimer funds attributable to the accounts of that intermediary and its clients, negotiated lump sum payments for distribution services provided, or similar fees. In some circumstances, revenue sharing payments may create an incentive for a financial intermediary or its representatives to recommend or offer shares of the Fund or 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, qualify the Fund for preferred status with the intermediary receiving the payment or 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 Financial Industry Regulatory Authority ("FINRA")) 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, 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 broker, dealer or other financial intermediary may charge you fees or commissions in addition to those disclosed in this prospectus. You should ask your 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.

Dividends, Capital Gains and Taxes

DIVIDENDS. The Fund intends to declare dividends separately for each class of shares from net tax-exempt income and/or net taxable investment income each regular business day and to pay those dividends monthly. Daily dividends will not be declared or paid on newly-purchased shares until Federal Funds are available to the Fund from the purchase payment for such shares.

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The Fund attempts to pay dividends on Class A shares at a constant level. There is no assurance that it will be able to do so. The Board of Trustees may change the targeted dividend level at any time, without prior notice to shareholders. The amount of those dividends and any other distributions paid on other classes of shares may vary over time, depending on market conditions, the composition of the Fund's portfolio, and expenses borne by the particular class of shares. Dividends and other distributions paid on Class A and Class Y shares will generally be higher than dividends for Class B and Class C shares, which normally have higher expenses than Class A. The Fund cannot guarantee that it will pay any dividends or other distributions.

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CAPITAL GAINS. Although the Fund does not seek capital gains, it 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 annually. The Fund may also make supplemental distributions of ordinary income and exempt-interest 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. Long-term capital gains will be separately identified in the tax information the Fund sends you after the end of the calendar year.

Options for Receiving Dividends and Distributions. When you open your Fund account, you can specify on your application how you want to receive distributions of dividends and capital gains. To change that option, you must notify the Transfer Agent. There are four payment options available:

Reinvest All Distributions in the Fund. You can elect to reinvest all dividends and capital gains distributions in additional shares of the Fund.

Reinvest Only Dividends or Capital Gains. You can elect to reinvest some types of distributions in the Fund while receiving the other types of distributions by check or having them sent to your bank account through AccountLink. Different treatment is available for distributions of dividends, short-term capital gains and long-term capital gains.

Receive All Distributions in Cash. You can elect to receive all dividends and capital gains distributions by check or have them sent to your bank through AccountLink.

Reinvest Your Distributions in Another Oppenheimer Fund. You can reinvest all of your dividends and capital gains distributions in another Oppenheimer fund that is available for exchanges. You must have an existing account in the same share class in the selected fund.

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TAXES. Dividends paid from net investment income earned by the Fund on tax-exempt municipal securities will be excludable from gross income for federal income tax purposes. All or a portion of the dividends paid by the Fund that are derived from interest paid on certain "private activity bonds" may be an item of tax preference if you are subject to the federal alternative minimum tax. The portion of the Fund's exempt-interest dividends that was a tax preference item for the most recent calendar year is available on the OppenheimerFunds website at www.oppenheimerfunds.com/redir/tax_table_amt.jsp. The tax preference amount will vary from year to year.

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Dividends and capital gains distributions may be subject to federal, state or local taxes. Any short-term capital gain distributions are taxable to you as ordinary income. Any long-term capital gain distributions are taxable to you as long-term capital gains, no matter how long you have owned shares in the Fund. The Fund may derive gains in part from municipal obligations the Fund purchased below their principal or face values. All, or a portion of these gains may be taxable to you as ordinary income rather than capital gains. Whether you reinvest your distributions in additional shares or take them in cash, the tax treatment is the same.

After the end of each calendar year the Fund will send you and the Internal Revenue Service statements showing the amount of any taxable distributions you received in the previous year and will separately identify any portion of these distributions that qualify for taxation as long-term capital gains or for any other special tax treatment.

If you are neither a lawful permanent resident nor a citizen of the United States, or if you are a foreign entity, the Fund's ordinary income dividends (which include distributions of net short-term capital gain) generally will be subject to a 30% U.S. withholding tax, unless a lower rate applies under an income tax treaty.

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By law, your dividends and redemption proceeds will be subject to a withholding tax if you are not a corporation and have not provided a taxpayer identification number or social security number or if the number you have provided is incorrect.

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Avoid "Buying a Distribution." If you buy shares on or just before the ex-dividend date, or just before the Fund declares a capital gains distribution, you will pay the full price for the shares, and then receive a portion of the price back as a taxable dividend or capital gain.

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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 receive when you sell or exchange them. Any capital gain is subject to capital gains tax.

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Returns of Capital Can Occur. In certain cases, distributions made by the Fund may be considered a non-taxable return of capital to shareholders, resulting in a reduction in the basis in their shares. If this occurs, the Fund will notify you.

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This information is only a summary of certain federal income tax information about your investment. You are encouraged to consult your tax adviser about the effect of an investment in the Fund on your particular tax situation and about any changes to the Internal Revenue Code that may occur from time to time. Additional information about the tax effects of investing in the Fund is contained in the Statement of Additional Information.

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Qualification as a Regulated Investment Company. The Fund intends to qualify each year as a "regulated investment company" under the Internal Revenue Code, by satisfying certain income, asset diversification and income distribution requirements, but it reserves the right not to qualify. The Fund qualified during its most recent 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.

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Other Taxability Risk Considerations. It is possible that, because of events occurring after the date of its issuance, a municipal security owned by the Fund will be determined to pay interest that is includable in gross income for purposes of the federal income tax, and that determination could be retroactive to the date of issuance. Such a determination may cause a portion of prior distributions to shareholders to be taxable to shareholders in the year of receipt.

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Legislation affecting tax-exempt municipal securities is often considered by the United States Congress and legislation affecting the exemption of interest or other income thereon for purposes of taxation by a state may be considered by the state's legislature. Court proceedings may also be filed, the outcome of which could modify the tax treatment of a state's municipal securities. There can be no assurance that legislation enacted or proposed, or actions by a court, after the date of issuance of a municipal security will not have an adverse effect on the tax status of interest or other income or the market value of that municipal security. Please consult your tax adviser regarding pending or proposed federal and state tax legislation, court proceedings and other tax considerations.

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Financial Highlights

The Financial Highlights Table is presented to help you understand the Fund's financial performance for the past five fiscal years. 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 KPMG 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 upon request.

FINANCIAL HIGHLIGHTS

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Class A Year Ended July 31,	2010¹	2009	2008	2007	2006
Per Share Operating Data
Net asset value, beginning of period	$5.51	$7.90	$10.04	$10.08	$10.16
Income (loss) from investment operations:
Net investment income²	.45	.50	.53	.51	.50
Net realized and unrealized gain (loss)	.89	(2.37)	(2.17)	(.07)	(.03)
Total from investment operations	1.34	(1.87)	(1.64)	.44	.47
Dividends and/or distributions to shareholders:
Dividends from net investment income	(.46)	(.52)	(.50)	(.48)	(.55)
Net asset value, end of period	$6.39	$5.51	$7.90	$10.04	$10.08

Total Return, at Net Asset Value³	24.64%	(23.57)%	(16.68)%	4.37%	4.78%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$2,081,580	$1,447,860	$1,605,257	$2,129,928	$1,494,775
Average net assets (in thousands)	$1,953,017	$1,234,468	$1,807,703	$1,838,511	$1,147,353
Ratios to average net assets:⁴
Net investment income	7.12%	8.67%	6.05%	4.93%	4.97%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings	0.71%	0.76%	0.71%	0.71%	0.75%
Interest and fees from borrowings	0.23%	0.92%	0.20%	0.08%	0.12%
Interest and fees on short-term floating rate notes issued⁵	0.22%	0.65%	0.73%	0.58%	0.62%
Total expenses	1.16%	2.33%	1.64%	1.37%	1.49%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses	1.16%	2.33%	1.64%	1.37%	1.49%
Portfolio turnover rate	21%	23%	60%	18%	16%

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1. July 30, 2010 represents the last business day of the Fund's 2010 fiscal year.

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

3. Assumes an initial 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 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 less than one full year.

5. Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

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Class B Year Ended July 31,	2010¹	2009	2008	2007	2006
Per Share Operating Data
Net asset value, beginning of period	$5.48	$7.87	$10.00	$10.04	$10.13
Income (loss) from investment operations:
Net investment income²	.39	.45	.46	.42	.42
Net realized and unrealized gain (loss)	.90	(2.38)	(2.17)	(.06)	(.04)
Total from investment operations	1.29	(1.93)	(1.71)	.36	.38
Dividends and/or distributions to shareholders:
Dividends from net investment income	(.41)	(.46)	(.42)	(.40)	(.47)
Net asset value, end of period	$6.36	$5.48	$7.87	$10.00	$10.04

Total Return, at Net Asset Value³	23.72%	(24.35)%	(17.34)%	3.56%	3.87%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$41,234	$28,789	$35,642	$54,645	$58,570
Average net assets (in thousands)	$37,974	$26,189	$43,378	$57,919	$50,695
Ratios to average net assets:⁴
Net investment income	6.26%	7.78%	5.21%	4.09%	4.19%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings	1.56%	1.64%	1.54%	1.51%	1.56%
Interest and fees from borrowings	0.23%	0.92%	0.20%	0.08%	0.12%
Interest and fees on short-term floating rate notes issued⁵	0.22%	0.65%	0.73%	0.58%	0.62%
Total expenses	2.01%	3.21%	2.47%	2.17%	2.30%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses	2.01%	3.21%	2.47%	2.17%	2.30%
Portfolio turnover rate	21%	23%	60%	18%	16%

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1. July 30, 2010 represents the last business day of the Fund's 2010 fiscal year.

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

4. Annualized for periods less than one full year.

5. Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

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Class C Year Ended July 31,	2010¹	2009	2008	2007	2006
Per Share Operating Data
Net asset value, beginning of period	$5.48	$7.87	$10.00	$10.04	$10.13
Income (loss) from investment operations:
Net investment income²	.40	.45	.47	.43	.42
Net realized and unrealized gain (loss)	.89	(2.37)	(2.17)	(.07)	(.04)
Total from investment operations	1.29	(1.92)	(1.70)	.36	.38
Dividends and/or distributions to shareholders:
Dividends from net investment income	(.41)	(.47)	(.43)	(.40)	(.47)
Net asset value, end of period	$6.36	$5.48	$7.87	$10.00	$10.04

Total Return, at Net Asset Value³	23.82%	(24.27)%	(17.29)%	3.60%	3.89%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$518,594	$310,593	$323,411	$416,347	$250,929
Average net assets (in thousands)	$465,652	$252,892	$361,518	$344,756	$159,084
Ratios to average net assets:⁴
Net investment income	6.32%	7.89%	5.30%	4.16%	4.17%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings	1.48%	1.55%	1.48%	1.47%	1.50%
Interest and fees from borrowings	0.23%	0.92%	0.20%	0.08%	0.12%
Interest and fees on short-term floating rate notes issued⁵	0.22%	0.65%	0.73%	0.58%	0.62%
Total expenses	1.93%	3.12%	2.41%	2.13%	2.24%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses	1.93%	3.12%	2.41%	2.13%	2.24%
Portfolio turnover rate	21%	23%	60%	18%	16%

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1. July 30, 2010 represents the last business day of the Fund's 2010 fiscal year.

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

4. Annualized for periods less than one full year.

5. Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

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INFORMATION AND SERVICES

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 (it is legally part of this prospectus).
ANNUAL AND SEMI-ANNUAL REPORTS. The Fund's Annual and Semi-Annual Reports provide additional information about the Fund's investments and performance. 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 Request More Information

You can request the above documents, the notice explaining the Fund's privacy policy, and other information about the Fund, without charge, by:

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Telephone:	Call OppenheimerFunds Services toll-free: 1.800.CALL OPP (1.800.225.5677)
Mail:	Use the following address for regular mail: OppenheimerFunds Services P.O. Box 5270 Denver, Colorado 80217-5270
	Use the following address for courier or express mail: OppenheimerFunds Services 12100 East Iliff Avenue Suite 300 Aurora, Colorado 80014
Internet:	You may request documents, and read or download certain documents at www.oppenheimerfunds.com

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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 1.202.551.8090. Reports and other information about the Fund are available on the EDGAR database on the SEC's 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. 20549-1520.

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.

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The Fund's SEC File No.: 811-2668

SP0310.001.1110

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Oppenheimer

AMT-Free Municipals

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NYSE Ticker Symbols
Class A	OPTAX
Class B	OTFBX
Class C	OMFCX
Class Y	OMFYX

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November 26, 2010

Statement of Additional Information

This document contains additional information about the Fund and supplements information in the prospectus dated November 26, 2010 (the "Prospectus").

This Statement of Additional Information ("SAI") is not a Prospectus. 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 below, or by downloading it from the OppenheimerFunds website at www.oppenheimerfunds.com.

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

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Table of contents
ABOUT THE FUND
Additional Information About the Fund's Investment Policies and Risks	3
The Fund's Main Investment Policies	3
Other Investments and Investment Strategies	11
Investment Restrictions	19
Disclosure of Portfolio Holdings	20
How the Fund is Managed	23
Board of Trustees and Oversight Committees	25
Trustees and Officers of the Fund	26
The Manager	39
Brokerage Policies of the Fund	41
Distribution and Service Arrangements	43
Payments to Financial Intermediaries	46
Performance of the Fund	49
ABOUT YOUR ACCOUNT
About Your Account	54
How to Buy Shares	55
How to Sell Shares	58
How to Exchange Shares	61
Distributions and Taxes	63
Additional Information About the Fund	68
Appendix A
Special Sales Charge Arrangements and Waivers	69
APPENDIX B
Municipal Bond Ratings Definitions	74
FINANCIAL INFORMATION ABOUT THE FUND
Report of Independent Registered Public Accounting Firm	80
Financial Statements	81

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Inside Front Cover

To Summary Prospectus

Additional Information About the Fund's Investment Policies and Risks

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The municipal securities that the Fund holds to maturity are redeemable by the security's issuer at their full principal value plus any accrued interest. During the time they are held in the Fund's portfolio, however, the values of those securities may be affected by changes in general interest rates and other factors. The current values of debt securities vary inversely with changes in prevailing interest rates, meaning that after a security is purchased if interest rates increase, the security will normally decline in value and if interest rates decrease, normally its value would increase. Those changes in value generally will not result in realized gains or losses unless the Fund sells a security prior to its maturity. However, if the Fund disposes of a security prior to its maturity, the Fund could realize a capital gain or loss on the sale.

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There are variations in the credit quality of municipal securities, both within a particular rating category and between categories. These variations depend on numerous factors. The factors affecting the yields of municipal securities include: general conditions in the municipal securities market, the size of a particular offering, the maturity of the obligation and the rating of the issue (if any).

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Unless the Prospectus or SAI states that an investment percentage restriction applies on an ongoing basis, it applies only at the time the Fund makes an investment (except for borrowing and investments in illiquid securities). That means the Fund does not have to buy or sell securities solely to meet percentage limits if those limits were exceeded because the value of the investment changed in proportion to the size of the Fund.

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

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

The Fund's Main Investment Policies

In selecting securities for the Fund's portfolio, the Manager evaluates the merits of particular securities primarily through the exercise of its own investment analysis. For example, with respect to inflation-indexed government bonds, that process may include, among other things, evaluation of the government's economic and monetary policy, the country's economic condition, and current inflation and interest rates.

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Municipal Securities. The types of municipal securities in which the Fund may invest and the Fund's principal investment strategies are described in the Prospectus under "Principal Investment Strategies" and "About the Fund's Investments". Municipal securities are generally classified as general obligation bonds, revenue bonds and notes. A discussion of the general characteristics of these principal types of municipal securities follows below.

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Municipal Bonds. Long-term municipal securities which have a maturity of more than one year (when issued) are classified as "municipal bonds." The principal classifications of long-term municipal bonds are "general obligation" bonds and "revenue" bonds (including "private activity" bonds). They may have fixed, variable or floating rates of interest or may be "zero-coupon" bonds, as described below.

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Some bonds may be "callable," allowing the issuer to redeem them before their maturity date. To protect bondholders, callable bonds may be issued with provisions that prevent them from being called for a period of time. Typically, that is 5 to 10 years from the issuance date. When interest rates decline, if the call protection on a bond has expired, it is more likely that the issuer may call the bond. If that occurs, the Fund might have to reinvest the proceeds of the called bond in investments that pay a lower rate of return, which could reduce the Fund's yield.

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General Obligation Bonds. The basic security behind general obligation bonds is the issuer's pledge of its full faith and credit and taxing power, if any, for the repayment of principal and the payment of interest. Issuers of general obligation bonds include states, counties, cities, towns, and regional districts. The proceeds of these obligations are used to fund a wide range of public projects, including construction or improvement of schools, highways and roads, and water and sewer systems. The rate of taxes that can be levied for the payment of debt service on these bonds may be limited or unlimited. Additionally, there may be limits on the rate or amount of special assessments that can be levied to meet these obligations.

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Revenue Bonds. The principal security for a revenue bond is generally the net revenues derived from a particular facility, group of facilities, or, in some cases, the proceeds of a special excise tax or other specific revenue source, such as a state's or local government's proportionate share of the tobacco Master Settlement Agreement ("MSA") (as described in the section titled "Tobacco Related Bonds"). Revenue bonds are issued to finance a wide variety of capital projects. Examples include electric, gas, water and sewer systems; highways, bridges, and tunnels; port and airport facilities; colleges and universities; and hospitals.

Although the principal security for revenue bonds may vary from bond to bond, many provide additional security in the form of a debt service reserve fund that may be used to make principal and interest payments on the issuer's obligations. Housing finance authorities have a wide range of security, including partially or fully insured mortgages, rent subsidized and/or collateralized mortgages, and/or the net revenues from housing or other public projects. Some authorities provide further security in the form of a state's ability (without obligation) to make up deficiencies in the debt service reserve fund.

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Private Activity Bonds. The Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"), includes rules governing tax-exemption for interest paid on certain types of municipal securities known as "private activity bonds" (referred to as "industrial development bonds" under pre-1986 law). The proceeds from private activity bonds are used to finance various non-governmental privately owned and/or operated facilities. Under the Internal Revenue Code, interest on private activity bonds can be excluded from gross income for federal income tax purposes if (i) the financed activities fall into one of seven categories of "qualified private activity bonds," consisting of mortgage bonds, veterans mortgage bonds, small issue bonds, student loan bonds, redevelopment bonds, "exempt facility bonds" and "501(c)(3) bonds," and (ii) certain tests are met. The types of facilities that may be financed with exempt facility bonds include airports, docks and wharves, water furnishing facilities, sewage facilities, solid waste disposal facilities, qualified residential rental projects, hazardous waste facilities and high speed intercity rail facilities. The types of facilities that may be financed with 501(c)(3) bonds include hospitals and educational facilities that are owned by 501(c)(3) tax-exempt organizations. The payment of the principal and interest on such qualified private activity bonds is dependant solely on the ability of the facility's user to meet its financial obligations, generally from the revenues derived from the operation of the financed facility, and the pledge, if any, of real and personal property financed by the bond as security for those payments.

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Whether a municipal security is a private activity bond (the interest on which is taxable unless it is a qualified private activity bond) depends on whether (i) more than a certain percentage (generally 10%) of (a) the proceeds of the security are used in a trade or business carried on by a non-governmental person and (b) the payment of principal or interest on the security is directly or indirectly derived from such private use, or is secured by privately used property or payments in respect of such property, or (ii) more than the lesser of 5% of the issue or $5 million is used to make or finance loans to non-governmental persons.

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Under Internal Revenue Code Section 147(a), certain types of private activity bonds that would otherwise be qualified tax-exempt private activity bonds will not be qualified for any period during which the bond is held by a person who is a "substantial user" of the facilities financed by the bond, or a "related person" of such a substantial user. Generally a "substantial user" is a non-exempt person who regularly uses part of a facility in a trade or business.

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Therefore, certain municipal securities could lose their tax-exempt status retroactively if the issuer or user fails to meet certain continuing requirements regarding the use and operation of the bond-financed facilities and the use and expenditure of the proceeds of such securities for the entire period during which the securities are outstanding. The Fund makes no independent investigation into the use of such facilities or the expenditure of such proceeds. If the Fund should hold a bond that loses its tax-exempt status retroactively, there might be an adjustment to the tax-exempt income previously distributed to shareholders.

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Tax-exempt interest on certain qualified private activity bonds may nonetheless be treated as a "tax preference" item subject to the alternative minimum tax (the "AMT"). If such qualified private activity bonds are held by the Fund, a proportionate share of the exempt-interest dividends paid by the Fund would constitute an item of tax preference to shareholders that are subject to the AMT.

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Limitations on the amount of private activity bonds that each state may issue may reduce the supply of such bonds. The value of the Fund's portfolio could be affected by these limitations if they reduce the availability of such bonds.

Municipal Notes. Municipal securities that have a maturity of less than one year (when the security is issued) are generally known as "municipal notes." Municipal notes generally are used to provide for short-term working capital needs. Some of the types of municipal notes the Fund can invest in are described below.

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Tax Anticipation Notes. These are issued to finance working capital needs of municipalities. Generally, they are issued in anticipation of various seasonal tax revenue, such as income, sales, use or other business taxes, and are payable from these specific future taxes.

Revenue Anticipation Notes. These are notes issued in expectation of receipt of other types of revenue, such as federal revenues available under federal revenue-sharing programs.

Bond Anticipation Notes. Bond anticipation notes are issued to provide interim financing until long-term financing can be arranged. The long-term bonds that are issued typically also provide the money for the repayment of the notes.

Construction Loan Notes. These are sold to provide project construction financing until permanent financing can be secured. After successful completion and acceptance of the project, it may receive permanent financing through public agencies, such as the Federal Housing Administration.

Tax-Exempt Commercial Paper. This type of short-term obligation (usually having a maturity of 270 days or less) is issued by a municipality to meet current working capital needs.

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Auction Rate Securities. Auction rate securities are municipal debt instruments with long-term nominal maturities for which the interest rate is reset at specific shorter frequencies (typically every 7-35 days) through a "dutch" auction process. A dutch auction is a competitive bidding process used to determine rates on each auction date. In a dutch auction, a broker-dealer submits bids, on behalf of current and prospective investors, to the auction agent. The winning bid rate is the rate at which the auction "clears," meaning the lowest possible interest rate at which all the securities can be sold at par. This "clearing rate" is paid on the entire issue for the upcoming period and includes current holders of the auction rate securities. Investors who bid a minimum rate above the clearing rate receive no securities, while those whose minimum bid rates were at or below the clearing rate receive the clearing rate for the next period.

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While the auction rate process is designed to permit the holder to sell the auction rate securities in an auction at par value at specified intervals, there is the risk that an auction will fail due to insufficient demand for the securities. Auction rate securities may be subject to changes in interest rates, including decreased interest rates. Failed auctions may impair the liquidity of auction rate securities.

Municipal Lease Obligations. The Fund's investments in municipal lease obligations may be through certificates of participation that are offered to investors by public entities. Municipal leases may take the form of a lease or an installment purchase contract issued by a state or local government authority to obtain funds to acquire a wide variety of equipment and facilities.

Some municipal lease securities may be deemed to be "illiquid" securities. The Manager may determine that certain municipal leases are liquid under specific guidelines that require the Manager to evaluate:

the frequency of trades and price quotations for such securities;

the number of dealers or other potential buyers willing to purchase or sell such securities;

the availability of market-makers; and

the nature of the trades for such securities.

While the Fund holds such securities, the Manager will also evaluate the likelihood of a continuing market for these securities and their credit quality.

Municipal leases have special risk considerations. Although lease obligations do not constitute general obligations of the municipality for which the municipality's taxing power is pledged, a lease obligation is ordinarily backed by the municipality's covenant to budget for, appropriate and make the payments due under the lease obligation. However, certain lease obligations contain "non-appropriation" clauses which provide that the municipality has no obligation to make lease or installment purchase payments in future years unless money is appropriated for that purpose on a yearly basis. While the obligation might be secured by the lease, it might be difficult to dispose of that property in case of a default.

Projects financed with certificates of participation generally are not subject to state constitutional debt limitations or other statutory requirements that may apply to other municipal securities. Payments by the public entity on the obligation underlying the certificates are derived from available revenue sources. That revenue might be diverted to the funding of other municipal service projects. Payments of interest and/or principal with respect to the certificates are not guaranteed and do not constitute an obligation of a state or any of its political subdivisions.

Municipal leases may also be subject to "abatement risk." The leases underlying certain municipal lease obligations may state that lease payments are subject to partial or full abatement. That abatement might occur, for example, if material damage to or destruction of the leased property interferes with the lessee's use of the property. However, in some cases that risk might be reduced by insurance covering the leased property, or by the use of credit enhancements such as letters of credit to back lease payments, or perhaps by the lessee's maintenance of reserve monies for lease payments.

In addition to the risk of "non-appropriation," municipal lease securities do not have as highly liquid a market as conventional municipal bonds. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment of interest or repayment of principal by the issuer. The ability of issuers of municipal leases to make timely lease payments may be adversely affected in general economic downturns and as relative governmental cost burdens are reallocated among federal, state and local governmental units. A default in payment of income would result in a reduction of income to the Fund. It could also result in a reduction in the value of the municipal lease and that, as well as a default in repayment of principal, could result in a decrease in the net asset value of the Fund.

TOBACCO RELATED BONDS. The Fund may invest in two types of tobacco related bonds: (i) tobacco settlement revenue bonds, for which payments of interest and principal are made solely from a state's interest in the MSA described below, and (ii) tobacco bonds subject to a state's appropriation pledge, for which payments may come from both the MSA revenue and the applicable state's appropriation pledge.

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Tobacco Settlement Revenue Bonds. The Fund may invest up to 25% (measured at the time of purchase) of its total assets in tobacco settlement revenue bonds. Tobacco settlement revenue bonds are secured by an issuing state's proportionate share in the MSA. The MSA is an agreement reached out of court in November 1998 between 46 states and six other U.S. jurisdictions (including Puerto Rico and Guam) and the four largest (now three) U.S. tobacco manufacturers (Philip Morris, RJ Reynolds, Brown & Williamson (merged with RJ Reynolds in 2004), and Lorillard). Subsequently, a number of smaller tobacco manufacturers signed on to the MSA. The MSA provides for payments annually by the manufacturers to the states and jurisdictions in perpetuity, in exchange for releasing all claims against the manufacturers and a pledge of no further litigation. The MSA established a base payment schedule and a formula for adjusting payments each year. Tobacco manufacturers pay into a master escrow trust based on their market share and each state receives a fixed percentage of the payment as set forth in the MSA.

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A number of states have securitized the future flow of those payments by selling bonds pursuant to indentures, some through distinct governmental entities created for such purpose. The bonds are backed by the future revenue flow that is used for principal and interest payments on the bonds. Annual payments on the bonds, and thus the risk to the Fund, are highly dependent on the receipt of future settlement payments by the state or its governmental entity, as well as other factors. The actual amount of future settlement payments is dependent on many factors including, but not limited to, annual domestic cigarette shipments, cigarette consumption, inflation and the financial capability of participating tobacco companies. As a result, payments made by tobacco manufacturers could be reduced if the decrease in tobacco consumption is significantly greater than the forecasted decline.

On June 22, 2009, President Obama signed into law the "Family Smoking Prevention and Tobacco Control Act" which extends the authority of the U.S. Food and Drug Administration to encompass the regulation of tobacco products. Among other things, the legislation authorizes the FDA to adopt product standards for tobacco products, restrict advertising of tobacco products, and impose stricter warning labels. FDA regulation of tobacco products could result in greater decreases in tobacco consumption than originally forecasted. On August 31, 2009, a number of tobacco manufacturers filed suit in federal court in Kentucky alleging that certain of the provisions of the FDA Tobacco Act restricting the advertising and marketing of tobacco products are inconsistent with the freedom of speech guarantees of the First Amendment of the United States Constitution. The suit does not challenge Congress' decision to giv e the FDA regulatory authority over tobacco products or the vast majority of the provisions of the law.

Because tobacco settlement bonds are backed by payments from the tobacco manufacturers, and generally not by the credit of the state or local government issuing the bonds, their creditworthiness depends on the ability of tobacco manufacturers to meet their obligations. A market share loss by the MSA companies to non-MSA participating tobacco manufacturers could also cause a downward adjustment in the payment amounts. A participating manufacturer filing for bankruptcy also could cause delays or reductions in bond payments, which could affect the Fund's net asset value.

The MSA and tobacco manufacturers have been and continue to be subject to various legal claims. An adverse outcome to any litigation matters relating to the MSA or affecting tobacco manufacturers could adversely affect the payment streams associated with the MSA or cause delays or reductions in bond payments by tobacco manufacturers. The MSA itself has been subject to legal challenges and has, to date, withstood those challenges.

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Tobacco Subject to Appropriation (STA) Bonds. In addition to the tobacco settlement bonds discussed above, the Fund also may invest in tobacco related bonds that are subject to a state's appropriation pledge ("STA Tobacco Bonds"). STA Tobacco Bonds rely on both the revenue source from the MSA and a state appropriation pledge.

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These STA Tobacco Bonds are part of a larger category of municipal bonds that are subject to state appropriation. Although specific provisions may vary among states, "subject to appropriation bonds" (also referred to as "appropriation debt") are typically payable from two distinct sources: (i) a dedicated revenue source such as a municipal enterprise, a special tax or, in the case of tobacco bonds, the MSA funds, and (ii) the issuer's general funds. Appropriation debt differs from a state's general obligation debt in that general obligation debt is backed by the state's full faith, credit and taxing power, while appropriation debt requires the state to pass a specific periodic appropriation to pay interest and/or principal on the bonds as the payments come due. The appropriation is usually made annually. While STA Tobacco Bonds offer an enhanced credit support feature, that feature is generally not an uncondi tional guarantee of payment by a state and states generally do not pledge the full faith, credit or taxing power of the state. The Fund considers the STA Tobacco Bonds to be "municipal securities" for purposes of its concentration policies.

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Litigation Challenging the MSA. The participating manufacturers and states in the MSA are subject to several pending lawsuits challenging the MSA and/or related state legislation or statutes adopted by the states to implement the MSA (referred to herein as the "MSA-related legislation"). One or more of the lawsuits allege, among other things, that the MSA and/or the states' MSA-related legislation are void or unenforceable under the Commerce Clause and certain other provisions of the U.S. Constitution, the federal antitrust laws, federal civil rights laws, state constitutions, consumer protection laws and unfair competition laws.

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To date, challenges to the MSA or the states' MSA-related legislation have not been ultimately successful, although several such challenges have survived initial appellate review of motions to dismiss or have proceeded to a stage of litigation where the ultimate outcome may be determined by, among other things, findings of fact based on extrinsic evidence as to the operation and impact of the MSA and the states' MSA-related legislation.

New York state officials are defendants in a lawsuit pending in the United States District Court for the Southern District of New York in which cigarette importers allege that the MSA and/or related legislation violates federal antitrust laws and the Commerce Clause of the United States Constitution. In a separate proceeding pending in the same court, plaintiffs assert the same theories against not only New York officials but also the Attorneys General for thirty other states. The United States Court of Appeals for the Second Circuit has held that the allegations in both actions, if proven, establish a basis for relief on antitrust and Commerce Clause grounds and that the trial courts in New York have personal jurisdiction sufficient to enjoin other states' officials from enforcing their MSA-related legislation. On remand in those two actions, one trial court has granted summary judgment for the New York offi cials and lifted a preliminary injunction against New York officials' enforcement against plaintiffs of the state's "allocable share" amendment to the MSA's Model Escrow Statute; the other trial court has held that plaintiffs are unlikely to succeed on the merits. The former decision is on appeal to the United States Court of Appeals for the Second Circuit.

In another action, the United States Court of Appeals for the Fifth Circuit reversed a trial court's dismissal of challenges to MSA-related legislation in Louisiana under the First and Fourteenth Amendments to the United States Constitution. On remand in that case, and in another case filed against the Louisiana Attorney General, trial courts have granted summary judgment for the Louisiana Attorney General. One of those decisions is on appeal to the United States Court of Appeals for the Fifth Circuit. The deadline to appeal the other decision has not yet expired.

The United States Courts of Appeals for the Sixth, Eighth, Ninth and Tenth Circuits have affirmed dismissals or grants of summary judgment in favor of state officials in four other cases asserting antitrust and constitutional challenges to the allocable share amendment legislation in those states.

Another proceeding has been initiated before an international arbitration tribunal under the provisions of the North American Free Trade Agreement. A hearing on the merits that was scheduled for June 2009 has been continued.

The MSA and states' MSA-related legislation may also continue to be challenged in the future. A determination that the MSA or states' MSA-related legislation is void or unenforceable would have a material adverse effect on the payments made by the participating manufacturers under the MSA.

Litigation Seeking Monetary Relief from Tobacco Industry Participants. The tobacco industry has been the target of litigation for many years. Both individual and class action lawsuits have been brought by or on behalf of smokers alleging that smoking has been injurious to their health, and by non-smokers alleging harm from environmental tobacco smoke, also known as "secondhand smoke." Plaintiffs seek various forms of relief, including compensatory and punitive damages aggregating billions of dollars, treble/multiple damages and other statutory damages and penalties, creation of medical monitoring and smoking cessation funds, disgorgement of profits, legal fees, and injunctive and equitable relief.

The MSA does not release participating manufacturers from liability in either individual or class action cases. Healthcare cost recovery cases have also been brought by governmental and non-governmental healthcare providers seeking, among other things, reimbursement for healthcare expenditures incurred in connection with the treatment of medical conditions allegedly caused by smoking. The participating manufacturers are also exposed to liability in these cases, because the MSA only settled healthcare cost recovery claims of the participating states. Litigation has also been brought against certain participating manufacturers and their affiliates in foreign countries.

The ultimate outcome of any pending or future lawsuit is uncertain. Verdicts of substantial magnitude that are enforceable as to one or more participating manufacturers, if they occur, could encourage commencement of additional litigation, or could negatively affect perceptions of potential triers of fact with respect to the tobacco industry, possibly to the detriment of pending litigation. An unfavorable outcome or settlement or one or more adverse judgments could result in a decision by the affected participating manufacturers to substantially increase cigarette prices, thereby reducing cigarette consumption beyond the forecasts under the MSA. In addition, the financial condition of any or all of the participating manufacturer defendants could be materially and adversely affected by the ultimate outcome of pending litigation, including bonding and litigation costs or a verdict or verdicts awarding substanti al compensatory or punitive damages. Depending upon the magnitude of any such negative financial impact (and irrespective of whether the participating manufacturer is thereby rendered insolvent), an adverse outcome in one or more of the lawsuits could substantially impair the affected participating manufacturer's ability to make payments under the MSA.

Credit Ratings of Municipal Securities. Ratings by ratings organizations such as Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's Ratings Services ("S&P"), and Fitch, Inc. ("Fitch") represent the respective rating agency's opinions of the credit quality of the municipal securities they undertake to rate. However, their ratings are general opinions and are not guarantees of quality. Municipal securities that have the same maturity, coupon and rating may have different yields, while other municipal securities that have the same maturity and coupon but different ratings may have the same yield.

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Below-investment-grade securities (also referred to as "junk bonds") may have a higher yield than securities rated in the higher rating categories. In addition to having a greater risk of default than higher-grade securities, there may be less of a market for these securities. As a result they may be harder to sell at an acceptable price. The additional risks mean that the Fund may not receive the anticipated level of income from these securities, and the Fund's net asset value may be affected by declines in the value of lower-grade securities.

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After the Fund buys a municipal security, the security may cease to be rated or its rating may be reduced. Neither event requires the Fund to sell the security, but the Manager will consider such events in determining whether the Fund should continue to hold the security. To the extent that ratings given by Moody's, S&P, or Fitch change as a result of changes in those rating organizations or their rating systems, the Fund will attempt to use similar ratings as standards for investments in accordance with the Fund's investment policies.

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The Fund may buy municipal securities that are "pre-refunded." The issuer's obligation to repay the principal value of the security is generally collateralized with U.S. Government securities placed in an escrow account. This causes the pre-refunded security to have essentially the same risks of default as a AAA-rated security.

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A list of the rating categories of Moody's, S&P and Fitch for municipal securities is contained in an Appendix to this SAI. Because the Fund may purchase securities that are unrated by nationally recognized rating organizations, the Manager will make its own assessment of the credit quality of those unrated issues. The Manager will use criteria similar to those used by the rating agencies and assign a rating category to a security that is similar to what the Manager believes a rating agency would assign to that security. However, the Manager's rating does not constitute a guarantee of the quality of a particular issue.

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In evaluating the credit quality of a particular security, whether it is rated or unrated, the Manager will normally take into consideration a number of factors. Among them are the financial resources of the issuer, or the underlying source of funds for debt service on a security, the issuer's sensitivity to economic conditions and trends, any operating history of the facility financed by the obligation and the degree of community support for it, the capabilities of the issuer's management and regulatory factors affecting the issuer and particular facility.

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Special Risks of Below-Investment-Grade Securities. The Fund may invest in municipal securities rated below-investment-grade up to the limits described in the Prospectus. Lower-grade securities may have a higher yield than securities rated in the higher rating categories. In addition to having a greater risk of default than higher-grade securities, there may be less of a market for these securities. As a result they may be harder to sell at an acceptable price. The additional risks mean that the Fund may not receive the anticipated level of income from these securities, and the Fund's net asset value may be affected by declines in the value of lower-grade securities.

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While securities rated "Baa" by Moody's or "BBB" by S&P are investment-grade, they may be subject to special risks and have some speculative characteristics.

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U.S. Territories, Commonwealths and Possessions. The Fund also may invest in municipal securities issued by certain territories, commonwealths and possessions of the United States that pay interest that is exempt (in the opinion of the issuer's legal counsel when the security is issued) from federal income tax. Therefore, the Fund's investments could be affected by the fiscal stability of, for example, Puerto Rico, the Virgin Islands, Guam, or the Northern Mariana Islands. Additionally, the Fund's investments could be affected by economic, legislative, regulatory or political developments affecting issuers in those territories, commonwealths or possessions. A discussion of the special considerations relating to the Fund's state municipal obligations and other factors or economic conditions in those territories, commonwealths or possessions is provided in an Appendix to this SAI.

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Inverse Floaters. The Fund invests in "inverse floaters" which are derivative instruments that pay interest at rates that move in the opposite direction of yields on short-term securities. As short-term interest rates rise, the interest rate on inverse floaters falls and they produce less current income. As short-term interest rates fall, the interest rates on the inverse floaters increase and they pay more current income. Their market value can be more volatile than that of a conventional fixed-rate security having similar credit quality, redemption provisions and maturity. The Fund can expose up to 20% of its total assets to the effects of leverage from its investments in inverse floaters.

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An inverse floater is typically created by a trust that divides a municipal security into two securities: a short-term tax-free floating rate security (sometimes referred to as a "tender option bond") and a long-term tax-exempt floating rate security (referred to as a residual certificate" or "inverse floater") that pays interest at rates that move in the opposite direction of the yield on the short-term floating rate security. The purchaser of a "tender option bond" has the right to tender the security periodically for repayment of the principal value. As short-term interest rates rise, inverse floaters produce less current income (and, in extreme cases, may pay no income) and as short-term interest rates fall, inverse floaters produce more current income.

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The Fund may also purchase inverse floaters created when another party transfers a municipal security to a trust. The trust then issues short-term floating rate notes to third parties and sells the inverse floater to the Fund. Under some circumstances, the Manager might acquire both portions of that type of offering, to reduce the effect of the volatility of the individual securities. This provides the Manager with a flexible portfolio management tool to vary the degree of investment leverage efficiently under different market conditions.

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Additionally, the Fund may be able to purchase inverse floaters created by municipal issuers directly. To provide investment leverage, a municipal issuer might issue two variable rate obligations instead of a single long-term, fixed-rate security. For example, the interest rate on one obligation reflecting short-term interest rates and the interest rate on the other instrument, the inverse floater, reflecting the approximate rate the issuer would have paid on a fixed-rate security, multiplied by a factor of two, minus the rate paid on the short-term instrument.

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Inverse floaters may offer relatively high current income, reflecting the spread between long-term and short-term tax-exempt interest rates. As long as the municipal yield curve remains positively sloped, and short-term rates remain low relative to long-term rates, owners of inverse floaters will have the opportunity to earn interest at above market rates. If the yield curve flattens and shifts upward, an inverse floater will lose value more quickly than a conventional long-term security having similar credit quality, redemption provisions and maturity.

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Some inverse floaters have a feature known as an interest rate "cap" as part of the terms of the investment. Investing in inverse floaters that have interest rate caps might be part of a portfolio strategy to try to maintain a high current yield for the Fund when the Fund has invested in inverse floaters that expose the Fund to the risk of short-term interest rate fluctuations. "Embedded" caps can be used to hedge a portion of the Fund's exposure to rising interest rates. When interest rates exceed a pre-determined rate, the cap generates additional cash flows that offset the decline in interest rates on the inverse floater. However, the Fund bears the risk that if interest rates do not rise above the pre-determined rate, the cap (which is purchased for additional cost) will not provide additional cash flows and will expire worthless.

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The Fund may enter into a "shortfall and forbearance" agreement with the sponsor of an inverse floater held by the Fund. Under such an agreement, on liquidation of the trust, the Fund would be committed to pay the trust the difference between the liquidation value of the underlying security on which the inverse floater is based and the principal amount payable to the holders of the short-term floating rate security that is based on the same underlying security. The Fund would not be required to make such a payment under the standard terms of a more typical inverse floater. Although entering into a "shortfall and forbearance" agreement would expose the Fund to the risk that it may be required to make the payment described above, the Fund may receive higher interest payments than under a typical inverse floater.

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An investment in inverse floaters may involve greater risk than an investment in a fixed-rate municipal security. All inverse floaters entail some degree of leverage. The interest rate on inverse floaters varies inversely at a pre-set multiple of the change in short-term rates. An inverse floater that has a higher multiple, and therefore more leverage, will be more volatile with respect to both price and income than an inverse floater with a lower degree of leverage or than the underlying security.

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Because of the accounting treatment for inverse floaters created by the Fund's transfer of a municipal bond to a trust, the Fund's financial statements will reflect these transactions as "secured borrowings," which affects the Fund's expense ratios, statements of income and assets and liabilities and causes the Fund's Statement of Investments to include the underlying municipal bond.

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Floating Rate and Variable Rate Obligations. Floating or variable rate obligations may have a demand feature that allows the Fund to tender the obligation to the issuer or a third party prior to its maturity. The tender may be at par value plus accrued interest, according to the terms of the obligations.

The interest rate on a floating rate demand note is based on a market rate, such as the percentage of LIBOR, the SIFMA Municipal Swap index or a bank's prime rate and is adjusted automatically each time such rate is adjusted. The interest rate on a variable rate demand note is also based on a specified market rate but is adjusted automatically at specified intervals of not less than one year. Generally, the changes in the interest rates on such securities reduce the fluctuation in their market value. As interest rates decrease or increase, the potential for capital appreciation or depreciation is less than that for fixed-rate obligations of the same maturity. The Manager may determine that an unrated floating rate or variable rate demand obligation meets the Fund's quality standards by reason of being backed by a letter of credit or guarantee issued by a bank that meets those quality standards.

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

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Borrowing and Leverage . The Fund can borrow from banks for investment-related purposes such as purchasing securities believed to be desirable by the Manager when available, funding amounts necessary to unwind or "collapse" trusts that issued inverse floaters to the Fund, or to contribute to such trusts to enable them to make tenders of their other securities by the holders. The Fund also can borrow from banks and other lenders to meet redemption obligations or for temporary and emergency purposes. When the Fund invests borrowed funds in portfolio securities, it is using a speculative investment technique known as "leverage." Under the Fund's investment policies, the Fund may not borrow money, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption from the Act that applies to the Fund. Currently, under the Investment Company Act, a mutual fund may borrow only from banks (for other than emergency purposes) and the maximum amount it may borrow is up to one-third of its total assets (including the amount borrowed) less all liabilities and indebtedness other than borrowings. When the Fund borrows, it identifies securities on its books in an amount equal to 300% of the amount borrowed to cover its obligation to repay the loan. If the value of the Fund's assets fails to meet this 300% asset coverage requirement, the Fund will reduce its bank debt within three days to meet the requirement. To do so, the Fund might have to sell a portion of its investments at a disadvantageous time.

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The Fund may also borrow up to 5% of its total assets for temporary or emergency purposes from any lender. 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.

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The Fund will pay interest on loans, and that interest expense will raise the overall expenses of the Fund and reduce its returns. If the Fund does borrow, its expenses will be greater than comparable funds that do not borrow. In the case of borrowing for leverage, the interest paid on a loan might be more (or less) than the yield on the securities purchased with the loan proceeds. Additionally, borrowing might cause the Fund's net asset value per share to fluctuate more than that of funds that do not borrow.

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The Fund participates in a secured line of credit (the "Line of Credit") with certain conduit facilities, Citibank, N.A., and other banks. The Line of Credit enables the Fund to participate with certain other Oppenheimer funds in a committed, secured borrowing facility which permits borrowings of up to $1,250,000,000, in the aggregate by the participants. The Line of Credit is required to be operated in compliance with the terms of an exemptive order issued by the SEC. That Line of Credit can be used to purchase securities for investment or for other business purposes. The Fund's Board determined that the Fund's participation in the Line of Credit is consistent with the Fund's investment objective and policies and is in the best interests of the Fund and its shareholders. To facilitate the lender's willingness to increase the amount availa ble to the Fund and other affiliated funds that are borrowers under that loan facility, the Manager has used its own resources to fund certain collateral accounts for the potential benefit of one of the lenders, Citibank, in connection with another investment program unrelated to the Fund or the loan. The Manager has received no compensation from the Fund or the lender for establishing that collateral account or in connection with the increase in the Line of Credit available to the Fund and its affiliated funds.

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Loans are typically secured by assets of the Fund. Liquidity support for loans from the Line of Credit facility is provided by banks obligated to make loans to the Fund in the event the conduit or conduits are unable or unwilling to make such loans. Interest is charged to the Fund, based on its borrowings, at current commercial rates. The Fund has paid its pro rata portion of a loan commitment fee for the Line of Credit, and pays additional fees annually to the lender on its outstanding borrowings to manage and administer the facility. The Fund can prepay such loans and terminate its participation in the Line of Credit at any time upon prior notice. As a borrower under the Line of Credit, the Fund has certain rights and remedies under state and federal law comparable to those it would have with respect to a loan from a bank.

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Other Investments and Investment Strategies

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The Fund may also use the following types of investments and investment strategies.

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The Fund also may invest in PLNs that are created when a broker-dealer/sponsor deposits a municipal bond into a trust created by the sponsor. The trust issues a percentage of LIBOR floating rate certificate (i.e., the PLN) to the Fund and a residual interest certificate to third parties who receive the remaining interest on the bond after payment of the interest distribution to the PLN holder and other fees.

Because the market for PLNs is relatively new and still developing, the Fund's ability to engage in transactions using such instruments may be limited. There is no assurance that a liquid secondary market will exist for any particular PLN or at any particular time, and so the Fund may not be able to close a position in a PLN when it is advantageous to do so.

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Defaulted Securities. The Fund may, from time to time, purchase defaulted securities if, the Manager believes that there is a potential for resumption of income payments or realization of income on the sale of the securities or the collateral or other advantageous developments appear likely in the near future. The purchase of defaulted securities is highly speculative and involves a high degree of risk. There is a risk of a substantial or complete loss of the Fund's investment in the event the issuer does not restructure or reorganize to enable it to resume paying interest and principal to holders. Issuers of defaulted securities may have substantial capital needs and may become involved in bankruptcy or reorganization proceedings and it may be difficult to obtain information about the condition of such issuers. Such bankruptcy or receivership proceedings may require participation by the Manager on behalf of the F und. Defaulted securities may be less actively traded than other securities, making it more difficult to dispose of substantial holdings of such securities at prevailing market prices. Their market prices also are subject to abrupt and erratic movements and above-average price volatility and the spread between the bid and asked prices may be greater than normally expected.

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

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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. Normally the settlement date is within six months of the purchase of municipal bonds and notes. However, the Fund may, from time to time, purchase municipal securities having a settlement date more than six months and possibly as long as two years or more after the trade date. The securities are subject to change in value from market fluctuation during the settlement period. 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 loss to the Fund. No income begins to accrue to the Fund on a when-issued security until the Fund receives the security at settlement of the trade.

The Fund will engage in when-issued transactions in order to secure what is considered to be an advantageous price and yield at the time of entering into the obligation. When the Fund engages in when-issued or delayed-delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain the security at a price and yield it considers advantageous.

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

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

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

Zero-Coupon Securities. The Fund may buy zero-coupon and delayed interest municipal 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. In the absence of threats to the issuer's credit quality, the discount typically decreases as the maturity date approaches. Some zero-coupon securities are convertible, in that they are zero-coupon securities until a predetermined date, at which time they convert to a security with a specified coupon rate.

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

The Fund's investment in zero-coupon securities may cause the Fund to recognize income and be required to 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.

Puts and Standby Commitments. The Fund may acquire "stand-by commitments" or "puts" with respect to municipal securities to enhance portfolio liquidity and to try to reduce the average effective portfolio maturity. These arrangements give the Fund the right to sell the securities at a set price on demand to the issuing broker-dealer or bank. However, securities having this feature may have a relatively lower interest rate.

When the Fund buys a municipal security subject to a standby commitment to repurchase the security, the Fund is entitled to same-day settlement from the purchaser. The Fund receives an exercise price equal to the amortized cost of the underlying security plus any accrued interest at the time of exercise. A put purchased in conjunction with a municipal security enables the Fund to sell the underlying security within a specified period of time at a fixed exercise price.

The Fund might purchase a standby commitment or put separately in cash or it might acquire the security subject to the standby commitment or put (at a price that reflects that additional feature). The Fund will enter into these transactions only with banks and securities dealers that, in the Manager's opinion, present minimal credit risks. The Fund's ability to exercise a put or standby commitment will depend on the ability of the bank or dealer to pay for the securities if the put or standby commitment is exercised. If the bank or dealer should default on its obligation, the Fund might not be able to recover all or a portion of any loss sustained from having to sell the security elsewhere.

Puts and standby commitments are not transferable by the Fund. They terminate if the Fund sells the underlying security to a third party. The Fund intends to enter into these arrangements to facilitate portfolio liquidity, although such arrangements might enable the Fund to sell a security at a pre-arranged price that may be higher than the prevailing market price at the time the put or standby commitment is exercised. However, the Fund might refrain from exercising a put or standby commitment if the exercise price is significantly higher than the prevailing market price, to avoid imposing a loss on the seller that could jeopardize the Fund's business relationships with the seller.

A put or standby commitment increases the cost of the security and reduces the yield otherwise available from the security. Any consideration paid by the Fund for the put or standby commitment will be reflected on the Fund's books as unrealized depreciation while the put or standby commitment is held, and a realized gain or loss when the put or commitment is exercised or expires. Interest income received by the Fund from municipal securities subject to puts or stand-by commitments may not qualify as tax-exempt in its hands if the terms of the put or stand-by commitment cause the Fund not to be treated as the tax owner of the underlying municipal securities.

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Repurchase Agreements. The Fund may acquire securities subject to repurchase agreements. Repurchase agreements may be acquired for temporary defensive purposes, to maintain liquidity to meet anticipated share redemptions, pending the investment of the proceeds from sales of shares, or pending the settlement of portfolio securities transactions. In a repurchase transaction, the purchaser 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. Vendors must meet credit requirements set by the Manager from time to time.

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The majority of repurchase transactions run from day-to-day and delivery pursuant to the resale typically occurs within one to five days of the purchase. Repurchase agreements that have a maturity beyond seven days are subject to limits on illiquid investments. There is no limit on the amount of assets that may be subject to repurchase agreements having maturities of seven days or less.

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Repurchase agreements are considered "loans" under the Investment Company Act and are collateralized by the underlying security. 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 repurchase price on the delivery date, there may be costs incurred in disposing of the collateral and losses if there is a delay in the 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.

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Pursuant to an Exemptive Order issued by the Securities and Exchange Commission (the "SEC"), the Fund, along with the affiliated entities managed by the Manager, may transfer uninvested cash balances into one or more joint repurchase agreement 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.

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Reverse Repurchase Agreements. The Fund may engage in reverse repurchase agreements. A reverse repurchase agreement is the sale of an underlying debt obligation and the simultaneous agreement to repurchase it at an agreed-upon price and date. These transactions involve the risk that the market value of the securities sold under a reverse repurchase agreement could decline below the cost of the obligation to repurchase them. The Fund will identify liquid assets on its books to cover its obligations under reverse repurchase agreements, including interest, until payment is made to the seller. These agreements are considered borrowings and are subject to the asset coverage requirement under policies on borrowing.

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Illiquid and Restricted Securities. Generally, an illiquid asset is an asset that cannot be sold or disposed of in the ordinary course of business within seven days at approximately the price at which it has been valued. Under the policies and procedures established by the Board, the Manager determines the liquidity of portfolio investments. The Manager monitors holdings of illiquid and restricted securities on an ongoing basis to determine whether to sell any holdings to maintain adequate liquidity. Among the types of illiquid securities are repurchase agreements maturing in more than seven days.

Restricted securities acquired through private placements have contractual restrictions on their public resale that might limit the ability to value or to dispose of the securities and might lower the price that could be realized on a sale. To sell a restricted security that is not registered under applicable securities laws, the securities might need to be registered. The expense of registering restricted securities may be negotiated with the issuer at the time of purchase. If the securities must be registered in order to be sold, a significant period may elapse between the time the decision is made to sell the security and the time the security is registered. There is a risk of downward price fluctuation during that period.

Limitations that apply to purchases of restricted securities do not limit purchases of restricted securities that are eligible for sale to qualified institutional buyers 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 the 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, holdings of that security may be considered to be illiquid.

Liquidity Facility. The Fund can participate in a program offered by ReFlow, LLC ("ReFlow") which provides additional liquidity to help the Fund meet shareholder redemptions without having to liquidate portfolio securities or borrow money, each of which imposes certain costs on the Fund. ReFlow is designed to provide an alternative source of funding to help meet shareholder redemptions while minimizing the Fund's costs and cash flow disruptions (compared to selling portfolio securities or other liquidity facilities such as a line of credit) and allowing the Fund to remain more fully invested. ReFlow provides this liquidity by being prepared to purchase Fund shares, at the Fund's closing net asset value, equal to the amount of the Fund's net redemptions on any given day. On subsequent days when the Fund experiences net subscriptions, ReFlow redeems its holdings at the Fund's net asset value on that day. When the Fu nd participates in the ReFlow program, it pays ReFlow a fee at a rate determined by a daily auction with other participating mutual funds in the ReFlow program. There is no assurance that ReFlow will have sufficient funds available to meet the Fund's liquidity needs on a particular day and ReFlow is prohibited from acquiring more than 3% of the outstanding shares of the Fund.

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Loans of Portfolio Securities. Securities lending pursuant to a Securities Lending Agency Agreement (the "Securities Lending Agreement") with Goldman Sachs Bank USA, doing business as Goldman Sachs Agency Lending ("Goldman Sachs"), may be used to attempt to increase income. Loans of portfolio securities must comply with all applicable regulations and with the Fund's Securities Lending Procedures adopted by the Board. The terms of any loans must also meet applicable tests under the Internal Revenue Code.

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There are certain risks in connection with securities lending, including possible delays in receiving additional collateral to secure a loan, or a delay or expenses in recovery of the loaned securities. Goldman Sachs has agreed, in general, to guarantee the obligations of borrowers to return loaned securities and to be responsible for certain expenses relating to securities lending. Under the Securities Lending Agreement, the Fund's securities lending procedures and applicable regulatory requirements (which are subject to change), the Fund must receive collateral from the borrower consisting of cash, bank letters of credit or securities of the U.S. Government (or its agencies or instrumentalities). On each business day, the amount of collateral that the Fund has received must at least equal the value of the loaned securities. If the Fund receives cash collateral from the borrower, the Manager, in its capacit y as the Fund's collateral administrator, may invest that cash in certain high quality, short-term investments, including in money market funds advised by the Manager. The Fund will be subject to its proportional share of the expenses of such money market funds, including the advisory fee payable to the Manager or its affiliate as adviser to such funds. The Manager may charge a collateral administration fee of 0.08% on the value of cash collateral invested in other securities. All of the Fund's collateral investments must comply with its securities lending procedures. The Fund will be responsible for the risks associated with the investment of cash collateral, including the risk that the Fund may lose money on the investment or may fail to earn sufficient income to meet its obligations to the borrower.

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The terms of the loans must permit the Fund to recall loaned securities on five business days' notice and the Fund will seek to recall loaned securities in time to vote on any matters that the Manager determines would have a material effect on the Fund's investment. The Securities Lending Agreement may be terminated by either Goldman Sachs or the Fund on 30 days' written notice.

Loans of portfolio securities are limited to not more than 25% of the value of the Fund's net assets.

Other Derivative Investments. Certain derivatives, such as options, futures, indexed securities and entering into swap agreements, can be used to increase or decrease the Fund's exposure to changing security prices, interest rates or other factors that affect the value of securities. However, these techniques could result in losses to the Funds if the Manager judges market conditions incorrectly or employs a strategy that does not correlate well with the Fund's other investments. These techniques can cause losses if the counterparty does not perform its promises. An additional risk of investing in municipal securities that are derivative investments is that their market value could be expected to vary to a much greater extent than the market value of municipal securities that are not derivative investments but have similar credit quality, redemption provisions and maturities.

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Hedging. The Fund may use hedging to attempt to protect against declines in the market value of its portfolio, to permit the Funds to retain unrealized gains in the value of portfolio securities that have appreciated, or to facilitate selling securities for investment reasons. To do so, the Fund may:

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sell interest rate futures or municipal bond index futures,

buy puts on such futures or securities, or

write covered calls on securities, broadly-based municipal bond indices, interest rate futures or municipal bond index futures.

Covered calls may also be written on debt securities to attempt to increase the Fund's income, but that income would not be tax-exempt. Therefore it is unlikely that the Fund would write covered calls for that purpose.

The Fund may also use hedging to establish a position in the debt securities market as a temporary substitute for purchasing individual debt securities. In that case the Fund will normally seek to purchase the securities, and then terminate that hedging position. For this type of hedging, the Fund may:

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buy interest rate futures or municipal bond index futures, or

buy calls on such futures or on securities.

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

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Futures. The Fund may buy and sell futures contracts relating to debt securities (these are called "interest rate futures"), and municipal bond indices (these are referred to as "municipal bond index futures").

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

A "municipal bond index" assigns relative values to the municipal bonds in the index, and is used as the basis for trading long-term municipal bond futures contracts. Municipal bond index futures are similar to interest rate futures except that settlement is made only in cash. The obligation under the contract may also be satisfied by entering into an offsetting contract. The strategies which the Fund employs in using municipal bond index futures are similar to those with regard to interest rate futures.

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No money is paid by 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 in cash or U.S. Government securities 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 certain specified conditions. As the future is marked to market (that is, its value on the Fund's books is changed) to reflect changes in its market value, subsequent margin payments, called variation margin, will be paid to or by the futures broker daily.

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At any time prior to the expiration of the future, the Fund may elect to close out its position by taking an opposite position at which time a final determination of variation margin is made and additional cash is required to be paid by or released to the Fund. Any gain or loss is then realized by the Fund on the future for tax purposes. Although interest rate futures by their terms call for settlement by the delivery of debt securities, in most cases the obligation is fulfilled without such delivery by entering into an offsetting transaction. All futures transactions are effected through a clearing house associated with the exchange on which the contracts are traded.

The Fund may concurrently buy and sell futures contracts in a strategy anticipating that the future the Fund purchased will perform better than the future the Fund sold. For example, the Fund might buy municipal bond futures and concurrently sell U.S. Treasury Bond futures (a type of interest rate future). The Fund would benefit if municipal bonds outperform U.S. Treasury Bonds on a duration-adjusted basis.

Duration is a volatility measure that refers to the expected percentage change in the value of a bond resulting from a change in general interest rates (measured by each 1% change in the rates on U.S. Treasury securities). For example, if a bond has an effective duration of three years, a 1% increase in general interest rates would be expected to cause the value of the bond to decline about 3%. There are risks that this type of futures strategy will not be successful. U.S. Treasury bonds might perform better on a duration-adjusted basis than municipal bonds, and the assumptions about duration that were used might be incorrect (in this case, the duration of municipal bonds relative to U.S. Treasury Bonds might have been greater than anticipated).

Put and Call Options. Put options (sometimes referred to as "puts") give the holder the right to sell an asset for an agreed-upon price. Call options (sometimes referred to as "calls") give the holder the right to buy an asset at an agreed-upon price.

Writing Covered Call Options. The Fund may write (that is, sell) call options. The Fund's call writing is subject to a number of restrictions:

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After the Fund writes a call, not more than 20% of the Fund's total assets may be subject to calls.
Calls the Fund sells must be listed on a securities or commodities exchange or quoted on NASDAQ®, the automated quotation system of The NASDAQ® Stock Market, Inc. or traded in the over-the-counter market.
Each call the Fund writes must be "covered" while it is outstanding. That means the Fund must own the investment on which the call was written.
The Fund may write calls on futures contracts whether or not it owns them.

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

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

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

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

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To terminate its obligation on a call it has written, the Fund may purchase a corresponding call in a "closing purchase transaction." The Fund will then realize a profit or loss, depending upon whether the net of the amount of the option transaction costs and the premium received on the call the Fund wrote was more or less than the price of the call the Fund purchased to close out the transaction. A profit may also be realized if the call lapses unexercised, because the Fund retains the underlying investment and the premium received. Any such profits are considered short-term capital gains for federal tax purposes, as are premiums on lapsed calls. When distributed by the Funds they are taxable as ordinary income.

Writing Uncovered Call Options on Futures Contracts. The Funds may also write calls on futures contracts without owning the futures contract or securities deliverable under the contract. To do so, at the time the call is written, the Fund must cover the call by segregating in escrow an equivalent dollar value of liquid assets. The Fund will segregate additional liquid assets if the value of the escrowed assets drops below 100% of the current value of the future. Because of this escrow requirement, in no circumstances would the Fund's receipt of an exercise notice as to that future put the Fund in a "short" futures position.

Purchasing Puts and Calls. The Fund may buy calls only on securities, broadly-based municipal bond indices, municipal bond index futures and interest rate futures. It may also buy calls to close out a call it has written, as discussed above. Calls the Fund buys must be listed on a securities or commodities exchange, or quoted on NASDAQ®, or traded in the over-the-counter market. A call or put option may not be purchased if the purchase would cause the value of all the Fund's put and call options to exceed 5% of its total assets.

When the Fund purchases a call (other than in a closing purchase transaction), it pays a premium. For calls on securities that the Fund buys, it has the right to buy the underlying investment from a seller of a corresponding call on the same investment during the call period at a fixed exercise price. The Fund benefits only if (1) the call is sold at a profit or (2) the call is exercised when the market price of the underlying investment is above the sum of the exercise price plus the transaction costs and premium paid for the call. If the call is not exercised nor sold (whether or not at a profit), it will become worthless at its expiration date. In that case the Fund will lose its premium payment and the right to purchase the underlying investment.

Calls on municipal bond indices, interest rate futures and municipal bond index futures are settled in cash rather than by delivering the underlying investment. Gain or loss depends on changes in the securities included in the index in question (and thus on price movements in the debt securities market generally) rather than on changes in price of the individual futures contract.

The Fund may buy only those puts that relate to securities that it owns, broadly-based municipal bond indices, municipal bond index futures or interest rate futures (whether or not the Fund owns the futures).

When the Fund purchases a put, it pays a premium. The Fund then has the right to sell the underlying investment to a seller of a corresponding put on the same investment during the put period at a fixed exercise price. Puts on municipal bond indices are settled in cash. Buying a put on a debt security, interest rate future or municipal bond index future the Fund owns enables it to protect itself during the put period against a decline in the value of the underlying investment below the exercise price. If the market price of the underlying investment is equal to or above the exercise price and as a result the put is not exercised or resold, the put will become worthless at its expiration date. In that case the Fund will lose its premium payment and the right to sell the underlying investment. A put may be sold prior to expiration (whether or not at a profit).

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Risks of Hedging with Options and Futures. The use of hedging instruments requires special skills and knowledge of investment techniques that are different than those required for normal portfolio management. These risks of using options and futures include the following:

Selection Risk. If the Manager uses an option at the wrong time or judges market conditions incorrectly, or if the prices of its options positions are not correlated with its other investments, a hedging strategy may reduce returns or cause losses. If a covered call option is sold on an investment that increases in value, if the call is exercised, no gain will be realized on the increase in the investment's value above the call price. A put option on a security that does not decline in value will cost the amount of the purchase price and without providing any benefit if it cannot be resold.

Liquidity Risk. Losses might also be realized if a position could not be closed out because of illiquidity in the market for an option. 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.

Leverage Risk. Premiums paid for options are small compared to the market value of the underlying investments. Consequently, options may involve large amounts of leverage, which could result in the Fund's net asset value being more sensitive to changes in the value of the underlying investments.

Correlation Risk. If the Fund sells futures or purchases puts on broadly-based indices or futures to attempt to protect against declines in the value of its portfolio securities, it may be subject to the risk that the prices of the futures or the applicable index will not correlate with the prices of those portfolio securities. For example, the market or the index might rise but the value of the hedged portfolio securities might decline. In that case, the Fund would lose money on the hedging instruments and also experience a decline in the value of the portfolio securities. Over time, however, the value of a diversified portfolio of securities will tend to move in the same direction as the indices upon which related hedging instruments are based.

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

Transaction Costs. Option activities might also affect portfolio turnover rates and brokerage commissions. The portfolio turnover rate might increase if the Fund is required to sell portfolio securities that are subject to call options it has sold or if it exercises put options it has bought. Although the decision to exercise a put it holds is within the Fund's control, holding a put might create an additional reason to purchase a security. There may also be a brokerage commission on each purchase or sale of a put or call option. Those commissions may be higher on a relative basis than the commissions for direct purchases or sales of the underlying investments. A brokerage commission may also be paid for each purchase or sale of an underlying investment in connection with the exercise of a put or call.

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Interest Rate Swaps. In an interest rate swap, the Fund and another party exchange their rights to receive interest payments on a security or other reference rate. For example, they might swap the right to receive floating rate payments for the right to receive fixed rate payments.

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Interest rate swap agreements entail both interest rate risk and credit risk. There is a risk that based on movements of interest rates, the payments made by the Fund under a swap agreement will be greater than the payments it receives. Credit risk is the risk that the counterparty might default. If the counterparty defaults, the Fund may lose the net amount of contractual interest payments that it has not yet received.

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The Fund can enter into swap transactions with certain counterparties pursuant to master netting agreements. A master netting agreement provides that all swaps done between the Fund and that counterparty shall be regarded as parts of an integral agreement. On any date, amounts payable in the same currency to or from the Fund in respect to one or more swap transactions will be combined and the Fund will receive or be obligated to pay the net amount.

The master netting agreement may also provide that if a counterparty defaults on one swap, the Fund can terminate all of the swaps with that counterparty. The gains and losses on all swaps are 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 are generally referred to as "aggregation."

The Fund may not enter into swaps with respect to more than 25% of its total assets.

Regulatory Aspects of Derivatives and Hedging Instruments. The Commodity Futures Trading Commission has 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 by claiming an exclusion from regulation as a commodity pool operator under the Commodity Exchange Act.

Options transactions 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 purchased, sold or held through one or more different exchanges or are held in one or more accounts or through one or more brokers. Thus, the number of options that can be sold by an investment company advised by the Manager may be affected by options written or held by other investment companies advised by the Manager or affiliated entities. 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 SEC staff interpretations regarding applicable provisions of the Investment Company Act, when a registered investment company purchases a future, it must identify cash or other liquid assets at its custodian bank in an amount equal to the purchase price of the future, less the margin deposit applicable to it.

Temporary Defensive and Interim Investments. The securities the Fund may invest in for temporary defensive purposes include the following:

short-term municipal securities;

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obligations issued or guaranteed by the U.S. Government or its agencies or instrumentalities;

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corporate debt securities rated within the three highest grades by a nationally recognized rating agency;

commercial paper rated "A-1" by S&P, or a comparable rating by another nationally recognized rating agency; and

certificates of deposit of domestic banks with assets of $1 billion or more.

The Fund also might hold these types of securities pending the investment of proceeds from the sale of portfolio securities or to meet anticipated redemptions of Fund shares. The income from some of the temporary defensive or interim investments may not be tax-exempt. Therefore, when making those investments, the Fund might not achieve its objective.

Portfolio Turnover. A change in the securities held by the Fund from buying and selling investments is known as "portfolio turnover." Short-term trading increases the rate of portfolio turnover and could increase the Fund's transaction costs. However, the Fund ordinarily incurs little or no brokerage expense because most of the Fund's portfolio transactions are principal trades that do not require payment of brokerage commissions.

The Fund ordinarily does not trade securities to achieve short-term capital gains, because such gains would not be tax-exempt income. To a limited degree, the Fund may engage in active and frequent short-term trading to attempt to take advantage of short-term market variations. It may also do so to dispose of a portfolio security prior to its maturity. That might be done if, on the basis of a revised credit evaluation of the issuer or other considerations, the Manager believes such disposition is advisable or it needs to generate cash to satisfy requests to redeem Fund shares. In those cases, the Fund may realize a capital gain or loss on its investments. The Fund's annual portfolio turnover rate normally is not expected to exceed 100%. The Financial Highlights table at the end of the Prospectus shows the Fund's portfolio turnover rates during the past five fiscal years.

Taxable Investments. While the Fund can invest up to 20% of its net assets (plus borrowings for investment purposes) in investments that generate income subject to income taxes, it does not anticipate investing substantial amounts of its assets in taxable investments under normal market conditions or as part of its normal trading strategies and policies. Taxable investments include, for example, hedging instruments, repurchase agreements, and many of the types of securities the Fund would buy for temporary defensive purposes.

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At times, in connection with the restructuring of a municipal bond issuer either outside of bankruptcy court in a negotiated workout or in the context of bankruptcy proceedings, the Fund may determine or be required to accept equity or taxable debt securities, or the underlying collateral (which may include real estate) from the issuer in exchange for all or a portion of the Fund's holdings in the municipal security. Although the Manager will attempt to sell those assets as soon as reasonably practicable in most cases, depending upon, among other things, the Manager's valuation of the potential value of such assets in relation to the price that could be obtained by the Fund at any given time upon sale thereof, the Fund may determine to hold such securities or assets in its portfolio for limited period of time in order to liquidate the assets in a manner that maximizes their value to the Fund.

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Investment Restrictions

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

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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

more than 50% of the outstanding shares.

The Fund's investment objective is a fundamental policy. Other policies described in the Prospectus or this SAI 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 SAI, as appropriate. The Fund's most significant investment policies are described in the Prospectus.

Other Fundamental Investment Restrictions. The following investment restrictions are fundamental policies of the Fund.

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

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

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

The Fund cannot invest 25% or more of its total assets in any industry. That limit does not apply to securities issued or guaranteed by the U.S. Government or its agencies and instrumentalities or securities issued by investment companies. Nor does that limit apply to municipal securities in general.

The Fund cannot invest in real estate, physical commodities or commodity contracts, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom, as such statute, rules or regulations may be amended or interpreted from time to time.

The Fund cannot issue senior securities, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom, as such statute, rules or regulations may be amended or interpreted from time to time.

The Fund may not underwrite securities issued by others, except to the extent that a Fund may be considered an underwriter within the meaning of the Securities Act of 1933, as amended, when reselling securities held in its portfolio.

Non-Fundamental Restrictions. The Fund has the following additional operating policies that are not "fundamental" and can be changed by the Board without shareholder approval.

The Fund cannot invest more than 15% of its net assets in illiquid or restricted securities (including repurchase agreements maturing beyond seven (7) days).

The Fund cannot invest in securities of other investment companies, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom, as such statute, rules or regulations may be amended or interpreted from time to time. Also, the Fund cannot invest in the securities of other registered investment companies or registered unit investment trusts in reliance on sub-paragraph (F) or (G) of section 12(d)(1) of the Investment Company Act. The Fund would be permitted under this policy to invest its assets in the securities of one or more open-end management investment companies for which the Manager, one of its affiliates or a successor is the investment advisor or sub-advisor. That fund must have substantially the same fundamental investment objective, policies and limitations as the Fund.

The Fund will not invest in municipal securities the interest on which (and thus a proportionate share of the exempt-interest dividends paid by the Fund) would be subject to the Federal alternative minimum tax on individuals and corporations.

Unless the Prospectus or this SAI states that a percentage restriction applies on an ongoing basis, it applies only at the time the Fund makes an investment. That means the Fund is not required to sell securities to meet the percentage limits if the value of the investment increases in proportion to the size of the Fund. Percentage limits on borrowing and investments in illiquid securities apply on an ongoing basis.

Diversification. The Fund intends to be "diversified" as defined in the Investment Company Act and to satisfy the restrictions against investing too much of its assets in any "issuer" as set forth in the restrictions above. In implementing this policy, the identification of the issuer of a municipal security depends on the terms and conditions of the security. When the assets and revenues of an agency, authority, instrumentality or other political subdivision are separate from those of the government creating it and the security is backed only by the assets and revenues of the subdivision, agency, authority or instrumentality, the latter would be deemed to be the sole issuer. Similarly, if an industrial development bond is backed only by the assets and revenues of the non-governmental user, then that user would be deemed to be the sole issuer. However, if in either case the creating government or some other entity guarantees a security, the guarantee would be considered a separate security and would be treated as an issue of such government or other entity.

Applying the Restriction Against Concentration. In implementing the Fund's policy not to concentrate its investments, the Manager will consider a non-governmental user of facilities financed by private activity bonds as being in a particular industry. That is done even though the bonds are municipal securities, as to which the Fund has no concentration limitation. The Manager categorizes tobacco industry related municipal bonds as either tobacco settlement revenue bonds or tobacco bonds that are subject to appropriation ("STA Bonds"). For purposes of the Funds' industry concentration policies, STA Bonds are considered to be "municipal" bonds, as distinguished from "tobacco" bonds. As municipal bonds, STA Bonds are not within any industry and are not subject to the Funds' industry concentration policies.

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Other types of municipal securities that are not considered a part of any "industry" under the Fund's industry concentration policy include: general obligation, government appropriation, municipal leases, special assessment and special tax bonds. Although these types of municipal securities may be related to certain industries, because they are issued by governments or their political subdivisions rather than non-governmental users, these types of municipal securities are not considered a part of an industry for purposes of the Fund's industry concentration policy.

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Therefore, the Fund may invest more than 25% of its total assets in these types of municipal securities, which may finance similar types of projects or from which the interest is paid from revenues of similar types of projects. "Similar types of projects" are projects that are related in such a way that economic, business or political developments tend to have the same impact on each similar project. For example, a change that affects one project, such as proposed legislation on the financing of the project, a shortage of the materials needed for the project, or a declining economic need for the project, would likely affect all similar projects, thereby increasing market risk. Thus, market changes that affect a security issued in connection with one project also would affect securities issued in connection with similar types of projects.

For purposes of the Fund's policy not to concentrate its investments as described above, the Fund has adopted classifications of industries and groups of related industries. These classifications are not fundamental polices.

Disclosure of Portfolio Holdings

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 processes, 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 a portfolio manager is trading on the Fund's behalf.

The Fund, the Manager, the Distributor and the Transfer Agent have therefore adopted policies and procedures regarding the dissemination of information about the Fund's portfolio holdings by employees, officers and directors or trustees of the Fund, the Manager, the Distributor and the Transfer Agent. These policies are designed to assure that non-public information about the Fund's portfolio securities holdings 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. It is a violation of the Code of Ethics for any covered person to release holdings in contravention of the portfolio holdings disclosure policies and pro cedures adopted by the Fund.

Portfolio Holdings Disclosure Policies. The Fund, the Manager, the Distributor and the Transfer Agent and their affiliates and subsidiaries, employees, officers, and directors or trustees, 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. Until publicly disclosed, the Fund's portfolio holdings are proprietary, confidential business information. After they are publicly disclosed, the Fund's portfolio holdings may be released in any appropriate manner.

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Public Disclosure. The Fund's portfolio holdings are made publicly available no sooner than 30 days after the close of each calendar month. In addition, the Fund's portfolio holdings are made publicly available in its annual and semi-annual report to shareholders and in its Statements of Investments on Form N-Q. Those documents are publicly available at the SEC. In addition, the top 20 month-end securities holdings, listed by security or by issuer, may be posted on the OppenheimerFunds' website (at www.oppenheimerfunds.com) with a 15-day delay. The Fund may delay posting its holdings, post a smaller list of holdings (e.g., the top five or top 10 portfolio holdings), or may not post any holdings, if the Manager believes that would be in the best interests of the Fund and its shareholders. Other general information about the Fund's portfolio investments, such as portfolio com position by asset class, industry, country, currency, credit rating or maturity, may also be publicly disclosed with a 15-day delay.

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

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 entities);

The Fund's independent registered public accounting firm;

Members of the Fund's Board and the Board's legal counsel;

The Fund's custodian bank;

A proxy voting service designated by the Fund and its Board;

Rating/ranking organizations (such as Lipper, Inc. and Morningstar, Inc.);

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Portfolio pricing services retained by the Manager to provide portfolio security prices;

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Brokers and dealers for purposes of providing portfolio analytic services;

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Brokers and dealers in connection with portfolio transactions (purchases and sales);

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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);

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Dealers to obtain price quotations where the fund is not identified as the owner; and

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Dealers, to obtain bids (price quotations if securities are not priced by the Fund's regular pricing services).

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Month-end lists of the Fund's complete portfolio holdings may be disclosed for legitimate business reasons, no sooner than 5 days after the relevant month end, pursuant to special requests and under limited circumstances discussed below, provided that:

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The third-party recipient must first submit a request for release of Fund portfolio holdings, explaining the business reason for the request;

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Senior officers (a Senior Vice President, Deputy General Counsel or above) in the Manager's Investment Operations and Legal departments must approve the completed request for release of Fund portfolio holdings; and

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Before receiving the data, the third-party recipient must sign the Manager's portfolio holdings non-disclosure agreement, agreeing to keep confidential the information that is not publicly available regarding the Fund's holdings and agreeing not to trade directly or indirectly based on the information.

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:

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;

Response to regulatory requests for information (from the SEC, the Financial Industry Regulatory Authority ("FINRA"), state securities regulators, and/or foreign securities authorities, including without limitation requests for information in inspections or for position reporting purposes);

To potential sub-advisers of portfolios (pursuant to confidentiality agreements);

To consultants for retirement plans for plan sponsors/discussions at due diligence meetings (pursuant to confidentiality agreements);

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 representatives.

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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.

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Any permitted release of otherwise non-public portfolio holdings information must be in accordance with the then-current policy on approved methods for communicating confidential information.

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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 reports to the Fund's Board any material violation of these policies and procedures during the previous period and makes 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.

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The Manager and 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:

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ABG Sundal Collier	Fortis Securities	Ned Davis Research Group
Advisor Asset Management	Fox-Pitt, Kelton, Inc.	Needham & Company
Alforma Capital Markets	Fraser Mackenzie	Neue Zurcher Bank
Altrushare	Friedman, Billings, Ramsey	Nomura Securities International, Inc.
Altus Investment Management	FTN Equity Capital Markets Corporation	Numis Securities Inc.
American Technology Research	Garp Research & Securities	Oddo Securities
Auerbach Grayson & Company	George K. Baum & Company	Omgeo LLC
Banc of America Securities	GMP Securities L.P.	Oppenheimer & Co., Inc.
Barclays Capital	Goldman Sachs & Company	Pacific Crest
Barnard Jacobs Mellet	Good Morning Securities	Paradigm Capital
BB&T Capital Markets	Goodbody Stockbrokers	Petercam/JPP Eurosecurities
Belle Haven Investments, Inc.	Handelsbanken Markets Securities	Piper Jaffray Company
Beltone Financial	Helvea Inc.	Prager Sealy & Company
Bergen Capital	Hewitt	R. Seelaus & Co., Inc.
Bloomberg	HJ Sims & Co., Inc.	Ramirez & Company
BMO Capital Markets	Howard Weil	Raymond James & Associates, Inc.
BNP Paribas	HSBC Securities	RBC Capital Markets
Brean Murray Carret & Company	Hyundai Securities America, Inc.	RBC Dain Rauscher
Brown Brothers Harriman & Company	ICICI Securities Inc.	Redburn Partners
Buckingham Research Group	Interactive Data	Renaissance Capital
Cabrera Capital	Intermonte	RiskMetrics Group
Callan Associates	Investec	Robert W. Baird & Company
Cambridge Associates	Janco Partners	Rocaton
Canaccord Adams, Inc.	Janney Montgomery Scott LLC	Rogers Casey
Caris & Company	Jefferies & Company	Roosevelt & Cross
Carnegie	Jennings Capital Inc.	Royal Bank of Scotland
Cazenove	Jesup & Lamont Securities	Russell/Mellon
Cheuvreux	JMP Securities	RV Kuhns
Citigroup	Johnson Rice & Company	Sal Oppenheim
Cleveland Research Company	JPMorgan Chase	Salman Partners
CLSA	Kaupthing Securities Inc.	Samsung Securities
Cogent	Keefe, Bruyette & Woods, Inc.	Sandler Morris Harris Group
Collins Stewart	Keijser Securities N.V.	Sandler O'Neill & Partners
Commerzbank	Kempen & Co. USA Inc.	Sanford C. Bernstein & Company, LLC
Contrarian Capital Management, LLC	Kepler Capital Markets	Santander Securities
Cormark Securities	KeyBanc Capital Markets	Scotia Capital
Cowen & Company	KPMG LLP	Seattle-Northwest Securities
Craig-Hallum Capital Group LLC	Kotak Mahindra Inc.	Sidoti & Company LLC
Credit Suisse	Lazard Capital	Siebert Brandford Shank & Company
Crews & Associates	LCG Associates	Simmons & Company
D.A. Davidson & Company	Lebenthal & Company	Societe Generale
Daewoo Securities Company, Ltd.	Leerink Swann	Standard & Poor's
Dahlman Rose & Company	Lipper	Sterne Agee
Daiwa Securities	Loop Capital Markets	Stifel, Nicolaus & Company
Davy	Macquarie Securities	Stone & Youngberg
DeMarche	MainFirst Bank AG	SunGard
DEPFA First Albany Corporation	MassMutual	Suntrust Robinson Humphrey
Desjardins Securities	Mediobanca Securities USA LLC	SWS Group, Inc.
Deutsche Bank	Merrill Lynch & Company, Inc.	Thomas Weisel Partners
Dougherty and Company LLC	Merrion Stockbrokers Ltd.	ThomsonReuters LLC
Dowling Partners	Mesirow Financial	Troika Dialog
Dresdner Kleinwort	MF Global Securities	UBS
Duncan Williams	Mirae Asset Securities	UOB Kay Hian (U.S.) Inc.
Dundee Securities	Mitsubishi Financial Securities	Vining & Sparks
DZ Financial Markets	Mizuho Securities USA	Vontobel Securities Ltd.
Edelweiss Securities Ltd.	ML Stern	Wachovia Securities Corporation
Emmet & Co., Inc.	Morgan Keegan	Watson Wyatt
Empirical Research	Morgan Stanley	Wedbush Morgan Securities
Enam Securities	Morningstar	Weeden & Company
Enskilda Securities	Motilal Oswal Securities	West LB
Evaluation Associates	MSCI Barra	WH Mell & Associates
Exane	M&T Securities	William Blair & Company
FactSet Research Systems	Multi-Bank Securities	Wilshire
FBR Capital Markets & Co.	Murphy & Durieu	Winchester Capital Partners, LLC
Fidelity Capital Markets	National Bank Financial	Ziegler Capital Markets Group
First Miami Securities	Natixis Bleichroeder Inc.

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How the Fund is Managed

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Organization and History. The Fund is an open-end, diversified management investment company with an unlimited number of authorized shares of beneficial interest. The Fund was organized as a Maryland corporation in 1976 but was reorganized as a Massachusetts business trust in February 1987. Prior to October 2003, the Fund's name was "Oppenheimer Municipal Bond Fund."

Classes of Shares. The Fund's Board of Trustees (the "Board") is authorized, without shareholder approval, to:

create new series and classes of shares;

reclassify unissued shares into additional series and classes; and

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.

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

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has its own dividends and distributions;

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

votes as a class on matters that affect that class alone.

Each share of each class:

represents an interest in the Fund proportionately equal to the interest of each other share of the same class;

is freely transferable;

has one vote at shareholder meetings, with fractional shares voting proportionally;

may be voted in person or by proxy at shareholder meetings; and

does not have cumulative voting rights, preemptive rights or subscription rights.

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Class Y Share Availability.

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Class Y shares are offered to fee-based clients of dealers that have a special agreement with the Distributor to offer these shares, and to certain institutional investors who have a special agreement with the Distributor.

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Class A to Class Y Voluntary Conversion. For shareholders who currently hold Class A shares but are authorized to purchase Class Y shares, those shareholders can convert existing Class A shares to Class Y shares of the same fund either through their dealer who has a special agreement with the Distributor or by submitting written instructions to the Transfer Agent. Under current interpretations of applicable federal income tax law by the Internal Revenue Service, this voluntary conversion of Class A to Class Y shares is not treated as a taxable event. If those laws or the IRS interpretation of those laws should change, this voluntary conversion feature may be suspended.

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Shareholder Meetings. As a Massachusetts business trust, the Fund is not required to hold regular annual meetings of shareholders and does not plan to do so. The Fund may hold shareholder meetings from time to time, however, on important matters or when required to do so by the Investment Company Act, or other applicable law.

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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.

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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.

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Shareholder and Trustee Liability. The Fund's Declaration of Trust contains an express disclaimer of shareholder and 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. The Fund's contractual arrangements state that any person doing business with the Fund (and each shareholder of the Fund) agrees under its Declaration of Trust to look solely to the assets of the Fund for satisfaction of any claim or demand that may arise out of any dealings with the Fund. Additionally, the Trustees shall have no personal liability to any such person, to the extent permit ted by law. Although Massachusetts law permits a shareholder of a business trust (such as the Fund) to be held personally liable as a "partner" under certain circumstances, 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.

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Board of Trustees and Oversight Committees

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The Fund is governed by a Board of Trustees, which is responsible for protecting the interests of shareholders under Massachusetts and federal law. The Board is led by Brian F. Wruble, an independent trustee, who is not an "interested person" of the Fund, as that term is defined in the Investment Company Act of 1940. The Board meets periodically throughout the year to oversee the Fund's activities, review its performance, oversee the potential conflicts that could affect the Fund, and review the actions of the Manager. The Board has an Audit Committee, a Regulatory & Oversight 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"). Mr. Wruble's practice is to attend all meetings of each of the three Committees of the board where he participates in deliberation b ut does not have a vote.

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During the Fund's fiscal year ended July 31, 2010, the Audit Committee held 4 meetings, the Regulatory & Oversight Committee held 5 meetings and the Governance Committee held 4 meetings.

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The members of the Audit Committee are David K. Downes (Chairman), Phillip A. Griffiths, Mary F. Miller, Joseph M. Wikler and Peter I. Wold. The Audit Committee selects an 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) maintaining a separate line of communication between the Fund's independent Auditors and the Independent Trustees/Directors; (v) reviewing the independence of the Fund's independent Auditors; and (vi) approving i n advance 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 Audit Committee also reviews reports concerning the valuation of certain investments.

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The members of the Regulatory & Oversight Committee are Matthew P. Fink (Chairman), David K. Downes, Phillip A. Griffiths, Joel W. Motley, Mary Ann Tynan and Joseph M. Wikler. The Regulatory & Oversight Committee evaluates and reports to the Board on the Fund's contractual arrangements, including the Investment Advisory and Distribution Agreements, Transfer Agency and Shareholder Service Agreements and custodian agreements as well as the policies and procedures adopted by the Fund to comply with the Investment Company Act and other applicable law. The Regulatory & Oversight Committee also reviews reports from the Manager's Risk Management Department and Chief Compliance Officer among other duties as set forth in the Regulatory & Oversight Committee's Charter. These reports, and others concerning investment, operational and other risks to the Funds are shared with, and discussed by , the full Board.

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The members of the Governance Committee are Joel W. Motley (Chairman), Matthew P. Fink, Mary F. Miller, Mary Ann Tynan and Peter I. Wold. The Governance Committee reviews the Fund's governance guidelines, the adequacy of the Fund's Codes of Ethics, and develops qualification criteria for Board members consistent with the Fund's governance guidelines, provides the Board with recommendations for voting portfolio securities held by the Fund, monitors the Fund's proxy voting, and coordinates with organizations representing the independent directors of mutual funds among other duties set forth in the Governance Committee's Charter.

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The Governance Committee's functions also include the nomination of Trustees/Directors, including Independent Trustees/Directors, for election to the Board. The full Board elects new Trustees/Directors except for those instances when a shareholder vote is required.

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The Governance Committee will consider nominees recommended by Independent Trustees/Directors or recommended by any other Board members including Board members affiliated with the Fund's Manager. The Governance Committee may consider the advice and recommendation of the Manager and its affiliates in selecting nominees, but need not do so. Upon Board approval, the Governance Committee may retain an executive search firm to assist in screening potential candidates and may also use the services of legal, financial, or other external counsel that it deems necessary or desirable in the screening process. To date, the Governance Committee has been able to identify from its own resources an ample number of qualified candidates. However, under the current policy of the Board, if the Board determines that a vacancy exists or is likely to exist, the Governance Committee will include candidates recommended by the Fund' s shareholders in its consideration of nominees.

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Shareholders wishing to submit a nominee for election to the Board may do so by mailing their submission to the offices of OppenheimerFunds, Inc., Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008, to the attention of the Board of Trustees/Directors of the applicable Fund, c/o the Secretary of the Fund. Submissions should, at a minimum, be accompanied by the following: (1) the name, address, and business, educational, and/or other pertinent background of the person being recommended; (2) a statement concerning whether the person is an "interested person" as defined in the Investment Company Act; (3) any other information that the Fund would be required to include in a proxy statement concerning the person if he or she was nominated; and (4) the name and address of the person submitting the recommendation and, if that person is a shareholder, the period for which that p erson held Fund shares. Shareholders should note that a person who owns securities issued by Massachusetts Mutual Life Insurance Company (the parent company of the Manager) would be deemed an "interested person" under the Investment Company Act. In addition, certain other relationships with Massachusetts Mutual Life Insurance Company or its subsidiaries, with registered broker-dealers, or with the Funds' outside legal counsel may cause a person to be deemed an "interested person."

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The Governance Committee has not established specific qualifications that it believes must be met by a nominee. In evaluating nominees, the Governance Committee considers, among other things, an individual's background, skills, and experience; whether the individual is an "interested person" as defined in the Investment Company Act; and whether the individual would be deemed an "audit committee financial expert" within the meaning of applicable SEC rules. The Governance Committee also considers whether the individual's background, skills, and experience will complement, and add to the diversity of, the background, skills, and experience of other Trustees/Directors, and will contribute to the Board's deliberations. There is no difference in the manner in which the Governance Committee evaluates a nominee based on whether the nominee is recommended by a shareholder. Candidates are expected to provide a mix of attributes, experience, perspective and skills necessary to effectively advance the interests of shareholders.

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Below is a brief discussion of the specific experience, qualifications, attributes or skills of each Board member that led the Board to conclude that he or she should serve as a Trustee/Director of the Fund.

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Each independent trustee/director has served on the Board for the number of years listed below, during the course of which he or she has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board's deliberations. Each Trustee's/Director's outside professional experience is outlined in the table of Biographical Information, below.

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Trustees and Officers of the Fund

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All of the Trustees are Independent Trustees. All of the Trustees are also Trustees of the following Oppenheimer funds (referred to as the "New York Board Funds"):

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Limited Term New York Municipal Fund	Oppenheimer Quest International Value Fund
Oppenheimer Absolute Return Fund	Oppenheimer Real Estate Fund
Oppenheimer AMT-Free Municipals	Oppenheimer Rising Dividends Fund
Oppenheimer AMT-Free New York Municipals	Oppenheimer Rochester Arizona Municipal Fund
Oppenheimer Balanced Fund	Oppenheimer Rochester Intermediate Term Municipal Fund
Oppenheimer Baring SMA International Fund	Oppenheimer Rochester Maryland Municipal Fund
Oppenheimer California Municipal Fund	Oppenheimer Rochester Massachusetts Municipal Fund
Oppenheimer Capital Appreciation Fund	Oppenheimer Rochester Michigan Municipal Fund
Oppenheimer Developing Markets Fund	Oppenheimer Rochester Minesota Municipal Fund
Oppenheimer Discovery Fund	Oppenheimer Rochester North Carolina Municipal Fund
Oppenheimer Equity Income Fund, Inc.	Oppenheimer Rochester Ohio Municipal Fund
Oppenheimer Global Fund	Oppenheimer Rochester Short Term Municipal Fund
Oppenheimer Global Allocation Fund	Oppenheimer Rochester Virginia Municipal Fund
Oppenheimer Global Opportunities Fund	Oppenheimer Select Value Fund
Oppenheimer Global Value Fund	Oppenheimer Series Fund, Inc.
Oppenheimer Gold & Special Minerals Fund	Oppenheimer Small- & Mid- Cap Growth Fund
Oppenheimer Institutional Money Market Fund	Oppenheimer Small- & Mid- Cap Value Fund
Oppenheimer International Diversified Fund	Oppenheimer Transition 2010 Fund
Oppenheimer International Growth Fund	Oppenheimer Transition 2015 Fund
Oppenheimer International Small Company Fund	Oppenheimer Transition 2020 Fund
Oppenheimer Limited Term California Municipal Fund	Oppenheimer Transition 2025 Fund
Oppenheimer Limited Term Municipal Fund	Oppenheimer Transition 2030 Fund
Oppenheimer Master International Value Fund, LLC	Oppenheimer Transition 2040 Fund
Oppenheimer Money Market Fund, Inc.	Oppenheimer Transition 2050 Fund
Oppenheimer Multi-State Municipal Trust	Oppenheimer U.S. Government Trust
Oppenheimer Portfolio Series	Rochester Fund Municipals
Oppenheimer Quest Opportunity Value Fund

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Messrs. Loughran, Cottier, Willis, DeMitry, Camarella, Stein, Glavin, Keffer, Petersen, Vandehey, Wixted, Zack, Legg and Edwards and Mss. Bloomberg, Ives, Ruffle and Bullington, who are officers of the Fund, hold the same offices with one or more of the other New York Board Funds.

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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. Present or former officers, directors, trustees and employees (and their eligible family members) of the Fund, the Manager and its affiliates, its parent company and the subsidiaries of its parent company, and retirement plans established for the benefit of such individuals, are also permitted to purchase Class Y shares of the Oppenheimer funds that offer Class Y shares.

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As of November 5, 2010, the Trustees and officers of the Fund, as a group, owned less than 1% of any class of shares of the Fund beneficially or of record. The foregoing statement does not reflect ownership of shares held of record by an employee benefit plan for employees of the Manager, other than the shares beneficially owned under that plan by the officers of the Fund. 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.

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The foregoing statement does not reflect ownership of shares held of record by an employee benefit plan for employees of the Manager, other than the shares beneficially owned under that plan by the officers of the Fund. In addition, none of the Independent Trustees/Directors (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.

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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 address of each Independent 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.

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Each Independent Trustee has served the Fund in the following capacities from the following dates:
	Position(s)	Length of Service
Brian F. Wruble	Board Chairman	Since 2007
	Trustee	Since 2006
David K. Downes	Trustee	Since 2007
Matthew P. Fink	Trustee	Since 2006
Phillip A. Griffiths	Trustee	Since 2006
Mary F. Miller	Trustee	Since 2006
Joel W. Motley	Trustee	Since 2006
Mary Ann Tynan	Trustee	Since 2008
Joseph M. Wikler	Trustee	Since 2006
Peter I. Wold	Trustee	Since 2006

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Independent Trustees
Name, Age, Position(s)	Principal Occupation(s) During the Past 5 Years; Other Trusteeship/Directorships Held	Portfolios Overseen in Fund Complex
Brian F. Wruble (67) Chairman of the Board, Trustee	Chairman (since August 2007) and Trustee (since August 1991) of the Board of Trustees of The Jackson Laboratory (non-profit); Director of Special Value Opportunities Fund, LLC (registered investment company) (affiliate of the Manager's parent company) (since September 2004); Member of Zurich Financial Investment Management Advisory Council (insurance) (since 2004); Treasurer (since 2007) and Trustee of the Institute for Advanced Study (non-profit educational institute) (since May 1992); General Partner of Odyssey Partners, L.P. (hedge fund) (September 1995-December 2007); Special Limited Partner of Odyssey Investment Partners, LLC (private equity investment) (January 1999-September 2004). Mr. Wruble has served on the Boards of certain Oppenheimer funds since April 2001, during which time he has become familiar with th e Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
David K. Downes (70) Trustee	Director of THL Credit Inc. (since June 2009); Independent Chairman GSK Employee Benefit Trust (since April 2006); Trustee of Employee Trusts (since January 2006); Chief Executive Officer and Board Member of Community Capital Management (investment management company) (since January 2004); President of The Community Reinvestment Act Qualified Investment Fund (investment management company) (since 2004); Director of Internet Capital Group (information technology company) (since October 2003); Director of Correctnet (January 2006-2007); Independent Chairman of the Board of Trustees of Quaker Investment Trust (registered investment company) (2004-2007); Chief Operating Officer and Chief Financial Officer of Lincoln National Investment Companies, Inc. (subsidiary of Lincoln National Corporation, a publicly traded company) and Delaware Investments U.S., Inc. (investment management subsidiary of Lincoln National Corporation) (1993-2003); President, Chief Executive Officer and Trustee of Delaware Investment Family of Funds (1993-2003); President and Board Member of Lincoln National Convertible Securities Funds, Inc. and the Lincoln National Income Funds, TDC (1993-2003); Chairman and Chief Executive Officer of Retirement Financial Services, Inc. (registered transfer agent and investment adviser and subsidiary of Delaware Investments U.S., Inc.) (1993-2003); President and Chief Executive Officer of Delaware Service Company, Inc. (1995-2003); Chief Administrative Officer, Chief Financial Officer, Vice Chairman and Director of Equitable Capital Management Corporation (investment subsidiary of Equitable Life Assurance Society) (1985-1992); Corporate Controller of Merrill L ynch Company (financial services holding company) (1977-1985); held the following positions at the Colonial Penn Group, Inc. (insurance company): Corporate Budget Director (1974-1977), Assistant Treasurer (1972-1974) and Director of Corporate Taxes (1969-1972); held the following positions at Price Waterhouse Company (financial services firm): Tax Manager (1967-1969), Tax Senior (1965-1967) and Staff Accountant (1963-1965); United States Marine Corps (1957-1959). Mr. Downes has served on the Boards of certain Oppenheimer funds since December 2005, during which time he has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Matthew P. Fink (69) Trustee	Trustee of the Committee for Economic Development (policy research foundation) (since 2005); Director of ICI Education Foundation (education foundation) (October 1991-August 2006); President of the Investment Company Institute (trade association) (October 1991-June 2004); Director of ICI Mutual Insurance Company (insurance company) (October 1991-June 2004). Mr. Fink has served on the Boards of ceratin Oppenheimer funds since January 2005, during which time he has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Phillip A. Griffiths (71) Trustee	Fellow of the Carnegie Corporation (since 2007); Distinguished Presidential Fellow for International Affairs (since 2002) and Member (since 1979) of the National Academy of Sciences; Council on Foreign Relations (since 2002); Director of GSI Lumonics Inc. (precision technology products company) (since 2001); Senior Advisor of The Andrew W. Mellon Foundation (since 2001); Chair of Science Initiative Group (since 1999); Member of the American Philosophical Society (since 1996); Trustee of Woodward Academy (since 1983); Foreign Associate of Third World Academy of Sciences (since 2002); Director of the Institute for Advanced Study (1991-2004); Director of Bankers Trust New York Corporation (1994-1999); Provost at Duke University (1983-1991). Mr. Griffiths has served on the Boards of certain Oppenheimer funds since June 199 9, during which time he has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Mary F. Miller (67) Trustee	Trustee of International House (not-for-profit) (since June 2007); Trustee of the American Symphony Orchestra (not-for-profit) (since October 1998); and Senior Vice President and General Auditor of American Express Company (financial services company) (July 1998-February 2003). Ms. Miller has served on the Boards of certain Oppenheimer funds since August 2004, during which time she has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Joel W. Motley (57) Trustee	Managing Director of Public Capital Advisors, LLC (privately-held financial advisor) (since January 2006); Managing Director of Carmona Motley, Inc. (privately-held financial advisor) (since January 2002); Director of Columbia Equity Financial Corp. (privately-held financial advisor) (2002-2007); Managing Director of Carmona Motley Hoffman Inc. (privately-held financial advisor) (January 1998-December 2001); Member of the Finance and Budget Committee of the Council on Foreign Relations, Chairman of the Investment Committee of the Episcopal Church of America, Member of the Investment Committee and Board of Human Rights Watch and Member of the Investment Committee and Board of Historic Hudson Valley. Mr. Motley has served on the Boards of certain Oppenheimer funds since October 2002, during which time he has become familia r with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Mary Ann Tynan (64) Trustee	Vice Chair of Board of Trustees of Brigham and Women's/Faulkner Hospitals (non-profit hospital) (since 2000); Chair of Board of Directors of Faulkner Hospital (non-profit hospital) (since 1990); Member of Audit and Compliance Committee of Partners Health Care System (non-profit) (since 2004); Board of Trustees of Middlesex School (educational institution) (since 1994); Board of Directors of Idealswork, Inc. (financial services provider) (since 2003); Partner, Senior Vice President and Director of Regulatory Affairs of Wellington Management Company, LLP (global investment manager) (1976-2002); Vice President and Corporate Secretary, John Hancock Advisers, Inc. (mutual fund investment adviser) (1970-1976). Ms. Tynan has served on the Boards of certain Oppenheimer funds since October 2008, during which time she has become fam iliar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Joseph M. Wikler (69) Trustee	Director of C-TASC (bio-statistics services) (since 2007); Director of the following medical device companies: Medintec (since 1992) and Cathco (since 1996); Member of the Investment Committee of the Associated Jewish Charities of Baltimore (since 1994); Director of Lakes Environmental Association (environmental protection organization) (1996-2008); Director of Fortis/Hartford mutual funds (1994-December 2001). Mr. Wikler has served on the Boards of certain Oppenheimer funds since August 2005, during which time he has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Boards' deliberations.	58
Peter I. Wold (62) Trustee	Director of Arch Coal, Inc. (since 2010); Director and Chairman of Wyoming Enhanced Oil Recovery Institute Commission (enhanced oil recovery study) (since 2004); President of Wold Oil Properties, Inc. (oil and gas exploration and production company) (since 1994); Vice President of American Talc Company, Inc. (talc mining and milling) (since 1999); Managing Member of Hole-in-the-Wall Ranch (cattle ranching) (since 1979); Director and Chairman of the Denver Branch of the Federal Reserve Bank of Kansas City (1993-1999); and Director of PacifiCorp. (electric utility) (1995-1999). Mr. Wold has served on the Boards of certain Oppenheimer funds since August 2005, during which time he has become familiar with the Fund's (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contrib uted to the Boards' deliberations.	58

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The addresses of the officers in the chart below are as follows: for Messrs. Loughran, Cottier, Willis, Camarella, DeMitry, Stein, Glavin, Zack, Keffer and Edwards and Mss. Bloomberg and Ruffle, Two World Financial Center, 225 Liberty Street, 11th Floor, New York, New York 10281-1008; for Messrs. Petersen, Vandehey, Legg and Wixted and Mss. Bullington and Ives, 6803 S. Tucson Way, Centennial, Colorado 80112-3924. Each officer serves for an annual term or until his or her resignation, retirement, death or removal.

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Each of the officers has served the Fund in the following capacities from the following dates:
	Position(s)	Length of Service
Daniel G. Loughran	Vice President and Senior Portfolio Manager	Since 2002
Scott S. Cottier	Vice President and Senior Portfolio Manager	Since 2002
Troy E. Willis	Vice President and Senior Portfolio Manager	Since 2003
Mark R. DeMitry	Vice President and Senior Portfolio Manager	Since 2006
Michael L. Camarella	Vice President and Associate Portfolio Manager	Since 2008
Richard A. Stein	Vice President	Since 2007
William F. Glavin, Jr.	President and Principal Executive Officer	Since 2009
Thomas W. Keffer	Vice President and Chief Business Officer	Since 2009
Mark S. Vandehey	Vice President and Chief Compliance Officer	Since 2006
Brian W. Wixted	Treasurer and Principal Financial & Accounting Officer	Since 2006
Brian Petersen	Assistant Treasurer	Since 2006
Stephanie Bullington	Assistant Treasurer	Since 2008
Robert G. Zack	Secretary	Since 2006
Kathleen T. Ives	Assistant Secretary	Since 2006
Lisa I. Bloomberg	Assistant Secretary	Since 2006
Taylor V. Edwards	Assistant Secretary	Since 2008
Randy G. Legg	Assistant Secretary	Since 2008
Adrienne M. Ruffle	Assistant Secretary	Since 2008

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Other Information About the Officers of the Fund
Name, Age, Position(s)	Principal Occupation(s) During the Last 5 Years	Portfolios Overseen in Fund Complex
William F. Glavin Jr. (51) President and Principal Executive Officer	Chairman of the Manager (since December 2009); Chief Executive Officer and Director of the Manager (since January 2009); President of the Manager (since May 2009); Director of Oppenheimer Acquisition Corp. ("OAC") (the Manager's parent holding company) (since June 2009); Executive Vice President (March 2006 - February 2009) and Chief Operating Officer (July 2007 - February 2009) of Massachusetts Mutual Life Insurance Company (OAC's parent company); Director (May 2004 - March 2006) and Chief Operating Officer and Chief Compliance Officer (May 2004 - January 2005), President (January 2005 - March 2006) and Chief Executive Officer (June 2005 - March 2006) of Babson Capital Management LLC; Director (March 2005 - March 2006), President (May 2003 - March 2006) and Chief Compliance Officer (July 2005 - March 2006) of Babson Capit al Securities, Inc. (a broker-dealer); President (May 2003 - March 2006) of Babson Investment Company, Inc.; Director (May 2004 - August 2006 of Babson Capital Europe Limited; Director (May 2004 - October 2006) of Babson Capital Guernsey Limited; Director (May 2004 - March 2006) of Babson Capital Management LLC; Non-Executive Director (March 2005 - March 2007) of Baring Asset Management Limited; Director (February 2005 - June 2006) Baring Pension Trustees Limited; Director and Treasurer (December 2003 - November 2006) of Charter Oak Capital Management, Inc.; Director (May 2006 -September 2006) of C.M. Benefit Insurance Company; Director (May 2008 -June 2009) and Executive Vice President (June 2007 -July 2009) of C.M. Life Insurance Company; President (March 2006 -May 2007) of MassMutual Assignment Company; Director (January 2005 -December 2006), Deputy Chairman (March 20 05 -December 2006) and President (February 2005 -March 2005) of MassMutual Holdings (Bermuda) Limited; Director (May 2008 -June 2009) and Executive Vice President (June 2007 - July 2009) of MML Bay State Life Insurance Company; Chief Executive Officer and President (April 2007 -January 2009) of MML Distributors, LLC.; and Chairman (March 2006 -December 2008) and Chief Executive Officer (May 2007 -December 2008) of MML Investors Services, Inc.	94

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Other Information about the Officers of the Fund
Name, Age, Position(s)	Principal Occupation(s) During the Past 5 Years	Portfolios Overseen in Fund Complex
Daniel G. Loughran (46) Vice President and Senior Portfolio Manager	Senior Vice President of the Manager (since July 2007); Vice President of the Manager (since April 2001); Team leader, a Senior Portfolio Manager, an officer and a trader for the Fund and other Oppenheimer funds.	20
Scott S. Cottier (38) Vice President and Senior Portfolio Manager	Vice President and Senior Portfolio Manager of the Manager (since September 2002); Portfolio Manager and trader at Victory Capital Management (1999-2002); Senior Portfolio Manager, an officer and trader for the Fund and other Oppenheimer funds.	20
Troy E. Willis (37) Vice President and Senior Portfolio Manager	Vice President of the Manager (since July 2009); Assistant Vice President of the Manager (July 2005-June 2009); Senior Portfolio Manager with the Manager (since January 2006); A corporate attorney for Southern Resource Group (1999-2003); Senior Portfolio Manager, an officer and a trader for the Fund and other Oppenheimer funds.	20
Mark R. DeMitry (34) Vice President and Senior Portfolio Manager	Vice President and Senior Portfolio Manager of the Manager (since July 2009); Associate Portfolio Manager (September 2006-June 2009); Research Analyst of the Manager (June 2003-August 2006); Credit Analyst of the Manager (July 2001-May 2003); Senior Portfolio Manager, an officer and a trader for the Fund and other Oppenheimer funds.	20
Michael L. Camarella (34) Vice President and Associate Portfolio Manager	Assistant Vice President of the Manager (since July 2009); Associate Portfolio Manager of the Manager (since January 2008); Research Analyst of the Manager (April 2006 - December 2007); Credit Analyst of the Manager (June 2003 - March 2006). He is an Associate Portfolio Manager, an officer and a trader for the Fund and other Oppenheimer funds.	20
Richard A. Stein (52) Vice President	Director of the Rochester Credit Analysis team (since 2004) and a Vice President of the Manager (since 1997); head of Rochester's Credit Analysis team (since 1993).	20

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Name, Age, Position(s)	Principal Occupation(s) During the Past 5 Years	Portfolios Overseen in Fund Complex
Thomas W. Keffer (55) Vice President and Chief Business Officer	Senior Vice President of the Manager (since March 1997); Director of Investment Brand Management of the Manager (since November 1997); Senior Vice President of OppenheimerFunds Distributor, Inc. (since December 1997).	94
Mark S. Vandehey (60) Vice President and Chief Compliance Officer	Senior Vice President and Chief Compliance Officer of the Manager (since March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management and Shareholder Services, Inc. (since March 2004); Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc. (since June 1983).	94
Brian W. Wixted (51) Treasurer and Principal Financial & Accounting Officer	Senior Vice President of the Manager (since March 1999); Treasurer of the Manager and the following: HarbourView Asset Management Corporation, Shareholder Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Management, Inc. and Oppenheimer Partnership Holdings, Inc. (March 1999-June 2008), OFI Private Investments, Inc. (March 2000-June 2008), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (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 (March 1999-June 2008).	94
Brian Petersen (40) Assistant Treasurer	Vice President of the Manager (since February 2007); Assistant Vice President of the Manager (August 2002-February 2007); Manager/Financial Product Accounting of the Manager (November 1998-July 2002).	94
Stephanie Bullington (33) Assistant Treasurer	Vice President of the Manager (since January 2010); Assistant Vice President of the Manager (October 2005-January 2010); Assistant Vice President of ButterField Fund Services (Bermuda) Limited, part of The Bank of N.T. Butterfield Son Limited (Butterfield) (February 2004-June 2005).	94
Robert G. Zack (62) Secretary	Executive Vice President (since January 2004) and General Counsel (since March 2002) of the Manager; General Counsel of the Distributor (since December 2001); General Counsel of Centennial Asset Management Corporation (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 Shareh older 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).	94
Kathleen T. Ives (45) Assistant Secretary	Senior Vice President (since May 2009), Deputy General Counsel (since May 2008) and Assistant Secretary (since October 2003) of the Manager; Vice President (since 1999) and Assistant Secretary (since October 2003) of the Distributor; Assistant Secretary of 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); Vice President of the Manager (June 1998-May 2009); Senior Counsel of the Manager (October 2003-May 2008).	94
Lisa I. Bloomberg (42) Assistant Secretary	Senior Vice President (since February 2010) and Deputy General Counsel (since May 2008) of the Manager; Vice President (May 2004-January 2010) and Associate Counsel of the Manager (May 2004-May 2008); First Vice President (April 2001-April 2004), Associate General Counsel (December 2000-April 2004) of UBS Financial Services, Inc.	94
Taylor V. Edwards (43) Assistant Secretary	Vice President (since February 2007) and Associate Counsel (since May 2009) of the Manager; Assistant Vice President (January 2006-January 2007) and Assistant Counsel (January 2006-April 2009) of the Manager; Associate at Dechert LLP (September 2000-December 2005).	94
Randy G. Legg (45) Assistant Secretary	Vice President (since June 2005) and Associate Counsel (since January 2007) of the Manager; Assistant Vice President (February 2004-June 2005) and Assistant Counsel (February 2004-January 2007) of the Manager.	94
Adrienne M. Ruffle (33) Assistant Secretary	Vice President (since February 2007) and Associate Counsel (since May 2009) of the Manager; Assistant Vice President (February 2005-January 2007) and Assistant Counsel (February 2005-April 2009) of the Manager; Associate (September 2002-February 2005) at Sidley Austin LLP.	94

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Trustees Share Ownership. The chart below shows 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").

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As of December 31, 2009
	Dollar Range of Shares Beneficially Owned in the Fund	Aggregate Dollar Range of Shares Beneficially Owned in Supervised Funds
Independent Trustees
Brian Wruble	None	Over $100,000
David K. Downes	None	Over $100,000
Matthew P. Fink	None	Over $100,000
Phillip A. Griffiths	None	Over $100,000
Mary F. Miller	None	Over $100,000
Joel W. Motley	None	Over $100,000
Mary Ann Tynan	None	$50,001 - $100,000
Joseph M. Wikler	None	Over $100,000
Peter I. Wold	None	Over $100,000

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Remuneration of the Officers and Trustees. The officers of the Fund, who are affiliated with the Manager, receive no salary or fee from the Fund. The Independent Trustees' total compensation from the Fund and fund complex represents compensation, including accrued retirement benefits, 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, 2009.

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Name and Other Fund Position(s) (as applicable)	Aggregate Compensation From the Fund¹	Retirement Benefits Accrued as Part of Fund Expenses	Estimated Annual Benefits Upon Retirement²	Total Compensation From the Fund and Fund Complex
	Fiscal Year Ended July 31, 2010	Fiscal Year Ended July 31, 2010		Year Ended December 31, 2009
Brian F. Wruble	$4,844	N/A	N/A	$306,793
Chairman of the Board
David Downes	$3,909	N/A	N/A	$270,557
Audit Committee Chairman and Regulatory & Oversight Committee Member
Matthew P. Fink	$3,909	N/A	N/A	$180,000
Regulatory & Oversight Committee Chairman and Governance Committee Member
Phillip A. Griffiths	$3,660 ³	N/A	N/A	$201,280
Audit Committee Member and Regulatory & Oversight Committee Member
Mary F. Miller	$3,660 ⁴	N/A	N/A	$168,000
Audit Committee Member and Governance Committee Member
Joel W. Motley	$3,909 ⁵	N/A	N/A	$180,000
Governance Committee Chairman and Regulatory & Oversight Committee Member
Russell S. Reynolds, Jr.⁶	$855	N/A	$77,238	$140,967

Mary Ann Tynan	$3,858 ⁷	N/A	N/A	$216,493
Regulatory & Oversight Committee Member and Governance Committee Member
Joseph M. Wikler	$3,6608 ⁸	N/A	N/A	$168,000
Audit Committee Member and Regulatory & Oversight Committee Member
Peter I. Wold	$3,660 ⁹	N/A	N/A	$168,000
Audit Committee Member and Governance Committee Member

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1. "Aggregate Compensation From the Fund" includes fees and amounts deferred under the "Compensation Deferral Plan" (described below), if any.
2. "Estimated Annual Benefits Upon Retirement" is based on a single life payment election with the assumption that a Trustee would retire at the age of 75 and would then have been eligible to receive retirement plan benefits with respect to certain New York Board Funds, and in the case of Messrs. Downes and Wruble, with respect to certain other Oppenheimer funds that prior to August 1, 2009, were not New York Board Funds (the "Former Board III Funds"). The New York Board Funds' retirement plan was frozen effective December 31, 2006, and each plan participant who had not yet commenced receiving retirement benefits subsequently received previously accrued benefits based upon the distribution method elected by such participant. A similar plan with respect to the Former Board III Funds was frozen effective December 31, 2007.
3. Includes $4,351 deferred by Mr. Griffiths under the Compensation Deferral Plan.
4. Includes $1,493 deferred by Ms. Miller under the Compensation Deferral Plan.
5. Includes $331 deferred by Mr. Motley under the Compensation Deferral Plan.
6. Mr. Reynolds retired from the Board of the New York Board Funds effective December 31, 2009.
7. Includes $660 deferred by Ms. Tynan under the Compensation Deferral Plan.
8. Includes $1,830 deferred by Mr. Wikler under the Compensation Deferral Plan.
9. Includes $3,099 deferred by Mr. Wold under the Compensation Deferral Plan.

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Retirement Plan for Trustees. The New York Board Funds adopted a retirement plan that provided for payments to retired Independent Trustees of up to 80% of the average compensation paid during a Trustee's five years of service in which the highest compensation was received. A Trustee needed to serve as director or trustee for any of the New York Board Funds for at least seven years to be eligible for retirement plan benefits and to serve for at least 15 years to be eligible for the maximum benefit. The Board discontinued the retirement plan with respect to new accruals as of December 31, 2006 (the "Freeze Date"). Each Trustee that continued to serve on the Board of any of the New York Board Funds after the Freeze Date (each such Trustee a "Continuing Board Member") was able to elect to have his accrued benefit as of that date (i.e., an amount equivalent to the actuarial present value o f his benefit under the retirement plan as of the Freeze Date) (i) paid at once or over time, (ii) rolled into the Compensation Deferral Plan described below, or (iii) in the case of Continuing Board Members having at least seven years of service as of the Freeze Date paid in the form of an annual benefit or joint and survivor annual benefit. The Board determined to freeze the retirement plan after considering a recent trend among corporate boards of directors to forego retirement plan payments in favor of current compensation.

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Compensation Deferral Plan. The Board of Trustees has adopted a Compensation Deferral 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 certain Funds. Under the plan, the compensation deferred by a Trustee is periodically adjusted as though an equivalent amount had been invested in shares of one or more Oppenheimer funds selected by the Trustee. The amount paid to the Trustee under the plan will be determined based on the amount of compensation deferred and the performance of the selected funds.

Deferral of the Trustees' fees under the plan will not materially affect a Fund's assets, liabilities or net income per share. The plan will not obligate a 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 SEC, a fund may invest in the funds selected by the Trustee under the plan without shareholder approval for the limited purpose of determining the value of the Trustee's deferred compensation account.

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Major Shareholders. As of November 5, 2010 the only persons or entities who owned of record, or who were known by the Fund to own beneficially, 5% or more of any class of the Fund's outstanding shares were:

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Name	Address	% Owned	Share Class
MLPF&S for the Sole Benefit of Its Customers ATTN: Fund Admin	4800 Deer Lake Dr. E. Fl 3 Jacksonville, FL 32246-6484	12.72%	A
UBS WM USA Omni Account M/F ATTN: Department Manager	499 Washington Blvd., Fl 9 Jersey City, NJ 07310-2055	6.92%	A
EDWARD D JONES & CO ATTN: Mutual Fund Shareholder Accounting	201 Progress Parkway Maryland Heights, MO 63043-3009	6.27%	A
CITIGROUP GLOBAL MKTS INC ATTN: Cindy Tempesta, 7th Floor	333 West 34th Street New York, NY 10001-2483	5.28%	A
MLPF&S for the Sole Benefit of Its Customers ATTN: Fund Admin	4800 Deer Lake Dr. E. Fl 3 Jacksonville, FL 32246-6484	14.69%	B
EDWARD D JONES & CO ATTN: Mutual Fund Shareholder Accounting	201 Progress Parkway Maryland Heights, MO 63043-3009	14.68%	B
MLPF&S for Sole Benefit of Its Customers ATTN: Fund Admin	4800 Deer Lake Dr. E. Fl 3 Jacksonville, FL 32246-6484	22.04%	C
UBS WM USA Omni Account M/F ATTN: Department Manager	499 Washington Blvd., Fl. 9 Jersey City, NJ 07310-2055	8.52%	C
CITIGROUP GLOBAL MKTS INC ATTN: Cindy Tempesta, 7th Floor	333 West 34th Street New York, 10001-2483	7.01%	C

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The Manager

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

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 portfolio managers and certain other employees ("covered persons") that could 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/or 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. It can be viewed as part of the Fund's registration statement on the SEC's EDGAR database at the SEC's website at www.sec.gov and can be reviewed and copied at the SEC's Public Reference Room in Washington, D.C.

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 principally responsible for the day-to-day management of the Fund's portfolio. Other members of the Manager's Equity Portfolio Department provide the portfolio managers with counsel and support in managing the Fund's portfolio.

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

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

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Fiscal Year ended 7/31	Management Fees Paid to OppenheimerFunds, Inc.
2008	$9,136,200
2009	$6,666,154
2010	$9,964,986

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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 in connection with matters to which the agreement relates.

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

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Pending Litigation. Since 2009, a number of lawsuits have been filed in federal courts against the Manager, the Distributor, and certain mutual funds advised by the Manager and distributed by the Distributor - including the Fund. The lawsuits naming the Fund as a defendant also name as defendants certain officers, trustees and former trustees of the Fund. The plaintiffs seek class action status on behalf of purchasers of shares of the Fund during a particular time period. The lawsuits raise claims under federal securities laws alleging that, among other things, the disclosure documents of the Fund contained misrepresentations and omissions, that the Fund's investment policies were not followed, and that the Fund and the other defendants violated federal securities laws and regulations and certain state laws. The plaintiffs seek unspecified damages, equitable relief and an award of attorneys' fees and litigation expenses. Litigation involving certain other Oppenheimer funds is similar in nature.

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In 2009, what are claimed to be derivative lawsuits were filed in state court against the Manager and a subsidiary (but not against the Fund), on behalf of the New Mexico Education Plan Trust. These lawsuits allege breach of contract, breach of fiduciary duty, negligence and violation of state securities laws, and seek compensatory damages, equitable relief and an award of attorneys' fees and litigation expenses.

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Other lawsuits have been filed since 2008 in various state and federal courts, against the Manager and certain of its affiliates. Those lawsuits were filed by investors who made investments through an affiliate of the Manager, and relate to the alleged investment fraud perpetrated by Bernard Madoff and his firm ("Madoff"). Those suits allege a variety of claims, including breach of fiduciary duty, fraud, negligent misrepresentation, unjust enrichment, and violation of federal and state securities laws and regulations, among others. They seek unspecified damages, equitable relief and an award of attorneys' fees and litigation expenses. None of the suits have named the Distributor, any of the Oppenheimer mutual funds or any of their independent Trustees or Directors as defendants. None of the Oppenheimer funds invested in any funds or accounts managed by Madoff.

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The Manager believes that the lawsuits described above are without legal merit and is defending against them vigorously. The Fund's Board of Trustees has also engaged counsel to represent the Fund and the present and former Independent Trustees named in those suits. While it is premature to render any opinion as to the outcome in these lawsuits, or whether any costs that the Fund may bear in defending the suits might not be reimbursed by insurance, the Manager believes that these suits should not have any material effect on the operations of the Fund, that the outcome of all of the suits together should not impair the ability of the Manager or the Distributor to perform their respective duties to the Fund, and that the outcome of all of the suits together should not have any material effect on the operations of any of the Oppenheimer funds.

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Portfolio Managers. The Fund's portfolio is managed by a team of investment professionals, including, Daniel G. Loughran, Scott S. Cottier, Troy E. Willis, Mark R. DeMitry, Michael L. Camarella, Marcus V. Franz and Charles S. Pulire (each is referred to as a "Portfolio Manager" and collectively they are referred to as the "Portfolio Managers") who are responsible for the day-to-day management of the Fund's investments.

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Other Accounts Managed. In addition to managing the Fund's investment portfolio, the members of the portfolio management team also manage other investment portfolios and other accounts on behalf of the Manager or its affiliates. The following table provides information regarding those portfolios and accounts as of July 31, 2010:

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Portfolio Manager	Registered Investment Companies Managed	Total Assets in Registered Investment Companies Managed¹	Other Pooled Investment Vehicles Managed	Total Assets in Other Pooled Investment Vehicles Managed¹	Other Accounts Managed	Total Assets in Other Accounts Managed²
Daniel G. Loughran	17	$27,588	0	$0	0	$0
Scott S. Cottier	17	$27,588	0	$0	0	$0
Troy E. Willis	17	$27,588	0	$0	0	$0
Mark R. DeMitry	17	$27,588	0	$0	0	$0
Michael L. Camarella	17	$27,588	0	$0	0	$0
Marcus V. Franz	17	$27,588	0	$0	0	$0
Charles S. Pulire	17	$27,588	0	$0	0	$0

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1. In millions.
2. Does not include personal accounts of the portfolio managers and their families, which are subject to the Code of Ethics.

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As indicated above, the Portfolio Managers may also manage other funds and accounts. At different times, the Fund's Portfolio Managers may manage other funds or accounts with investment objectives and strategies similar to those of the Fund, or they may manage funds or accounts with different investment objectives and strategies. At times, those responsibilities could potentially conflict with the interests of the Fund. That may occur whether the investment objectives and strategies of the other funds and 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 F und. 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 obligation 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.

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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, Fund performance is the most important element of compensation with a portion of annual cash compensation based on relative investment performance results of the funds or 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 the Fund's most recently completed year-end, the 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 stock appreciation rights in regard to the common stock of the Manager's holding company parent, as well as restricted shares of such common stock. Senior portfolio managers may be eligible to participate in the Manager's deferred compensation plan.

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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 majority (80%) is based on three and five year data, with longer periods weighted more heavily. Below median performance in all three periods' results in an extremely low, and in some cases no, performance based bonus. 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.

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The Lipper benchmark for the Portfolio Managers with respect to the Fund is Lipper-General Municipal Debt Funds. The compensation structure of the other funds and accounts managed by the Portfolio Managers are generally the same as the compensation structure of the Fund, described above.

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Ownership of Fund Shares. As of July 31, 2010, the Portfolio Manager(s) beneficially owned shares of the Fund as follows:

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Portfolio Manager		Range of Shares Beneficially Owned in the Fund
Daniel G. Loughran		$500,001 - $1,000,000
Scott S. Cottier		None
Troy E. Willis		$100,001 - 500,000
Mark R. DeMitry		$1 - $10,000
Michael L. Camarella		None
Marcus V. Franz		None
Charles S. Pulire		None

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Brokerage Policies of the Fund

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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 for that purpose. The advisory agreement authorizes the Manager to employ broker-dealers, including "affiliated brokers," as that term is defined in the Investment Company Act, that the Manager thinks, in its best judgment based on all relevant factors, will implement the policy of the Fund to obtain the "best execution" of the Fund's portfolio transactions. "Best execution" means executing trades in a manner that the total cost or proceeds is the most favorable under the circumstances. Some of the circumstances that may influence this decision are: cost (brokerage commission or dealer spread), size of order, difficulty of order, and the firm's ability to provide prompt and reliable execution.

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The Manager need not seek competitive commission bidding. However, the Manager 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. The Fund is not required to pay the lowest available commission. 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 both brokerage and research services to the Fund. 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.

Brokerage Practices Followed by the Manager. The Manager allocates brokerage for the Fund subject to the provisions of the investment advisory agreement and other applicable rules and procedures described below.

The Manager's portfolio managers directly place trades and allocate brokerage based upon their judgment as to the execution capability of the broker or dealer. The Manager's executive officers supervise the allocation of brokerage.

Most securities purchases made by the Fund are in principal transactions at net prices. (i.e., without commissions). The Fund usually deals directly with the selling or purchasing principal or market maker without incurring charges for the services of a broker on its behalf. Portfolio securities purchased from underwriters include a commission or concession paid by the issuer to the underwriter in the price of the security. Portfolio securities purchased from dealers include a spread between the bid and asked price. Therefore, the Fund generally does not incur substantial brokerage costs. On occasion, however, the Manager may determine that a better price or execution may be obtained by using the services of a broker on an agency basis. In that situation, the Fund would incur a brokerage commission.

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. When possible, the Manager tries to combine concurrent orders to purchase or sell the same security by more than one of the funds managed by the Manager or its affiliates. The transactions under those combined orders are generally allocated on a pro rata basis based on the fund's respective net asset sizes and other factors, including the fund's cash flow requirements, investment policies and guidelines and capacity.

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 a 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 execute portfolio securities transactions through 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.

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

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, analytical software 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.

Although the Manager currently does not do so, the Board of Trustees may permit 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 may also permit the Manager to use commissions on fixed-price offerings to obtain research in the same manner as is permitted for agency transactions.

The research services provided by brokers broaden the scope and supplement 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.

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During the fiscal years ended July 31, 2008, 2009 and 2010, the Fund paid no brokerage commissions. During the fiscal year ended July 31, 2010, the Fund did not execute any transactions through or pay any commissions to firms that provide research services.

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Distribution and Service Arrangements

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

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

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Fiscal Year Ended 7/31	Aggregate Front-End Sales Charges on Class A Shares	Class A Front-End Sales Charges Retained by Distributor¹	Concessions on Class A Shares Advanced by Distributor²	Concessions on Class B Shares Advanced by Distributor²	Concessions on Class C Shares Advanced by Distributor²
2008	$3,869,908	$529,729	$996,575	$129,282	$555,950
2009	$4,290,205	$666,145	$629,758	$268,028	$764,971
2010	$7,315,675	$974,914	$1,257,721	$440,327	$1,489,998

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1. Includes amounts retained by a broker-dealer that is an affiliate or a parent of the Distributor.
2. The Distributor advances concession payments to financial intermediaries for certain sales of Class A shares and for sales of Class B and Class C shares from its own resources at the time of sale.

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Contingent Deferred Sales Charges
Fiscal Year Ended 7/31	Class A Contingent Deferred Sales Charges Retained by Distributor	Class B Contingent Deferred Sales Charges Retained by Distributor	Class C Contingent Deferred Sales Charges Retained by Distributor
2008	$404,391	$139,173	$113,269
2009	$131,060	$76,173	$137,920
2010	$264,767	$79,079	$145,567

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Distribution and Service (12b-1) Plans. The Fund has adopted a Service Plan for Class A shares and Distribution and Service Plans for Class B and Class C shares under Rule 12b-1 of the Investment Company Act. Under those plans the Fund 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, including a majority of the Independent Trustees, cast in person at a meeting called for the purpose of voting on that plan. The Independent Trustees are not "interested persons" of the Fund and do not have any direct or indirect financial interest in the operation of the distribution plan or any agreement under the plan, in accordance with Rule 12b-1 of the Investment Company Act.

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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.

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A plan continues in effect from year to year only if the Fund's Board and its Independent Trustees/Directors vote annually to approve its continuance at an in person meeting called for that purpose. A plan may be terminated at any time by the vote of a majority of the Independent Trustees/Directors or by the vote of the holders of a "majority" (as defined in the Investment Company Act) of the outstanding shares of the Class of shares to which it applies.

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

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At least quarterly while the plans are in effect, the Treasurer of the Fund will provide the Board with separate written reports on the plans for its review. The reports will 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/Directors.

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While each plan is in effect, the Independent Trustees/Directors of the Fund will select and nominate any other Independent Trustees/Directors. This does not prevent the involvement of others in the selection and nomination process as long as the final decision is made by a majority of the Independent Trustees/Directors.

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No payment will be made to any recipient for any share class unless, during the applicable period, the aggregate net asset value of Fund shares of the class held by the recipient (for itself and its customers) exceeds a minimum amount that may be set by a majority of the Independent Trustees/Directors from time to time.

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Class A Service Plan. 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 (referred to as "recipients") for personal and account maintenance services they provide for their customers who hold Class A shares. Those services may include answering customer inquiries about the Fund, assisting in establishing and maintaining Fund accounts, 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 the Fund to reimburse the Distributor at an annual rate of up to 0.25% of the Class A average net assets. The Distributor makes payments to recipients periodically at an annual rate of not more than 0.25% of the Class A average net assets held in the accounts of the recipient or it customers.

The Distributor does not receive or retain the service fee for Class A share accounts for which the Distributor is listed as the broker-dealer of record. While the plan permits the Board to authorize payments to the Distributor to reimburse itself for those services, the Board has not yet done so, except with respect to shares purchased prior to March 1, 2007 by certain group retirement plans that were established prior to March 1, 2001 ("grandfathered retirement plans").

Prior to March 1, 2007, the Distributor paid the 0.25% first year service fee for grandfathered retirement plans in advance and retained the service fee paid by the Fund with respect to those shares for the first year. After those shares are held for a year, the Distributor pays the ongoing service fees to recipients on a periodic basis. If those shares were redeemed within the first year after their purchase, the recipient of the service fees on those shares was obligated to repay the Distributor a pro rata portion of the advance payment of the fees. If those shares were redeemed within 18 months, they were subject to a CDSC. For Class A shares purchased in grandfathered retirement plans on or after March 1, 2007, the Distributor does not make any payment in advance and does not retain the service fee for the first year and the shares are not subject to a CDSC.

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For the fiscal year ended July 31, 2010 payments under the Class A service plan totaled $4,720,463, of which $956 was retained by the Distributor under the arrangement described above, regarding grandfathered retirement accounts, including $97,146 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.

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Class B and Class C Distribution and Service Plans. Under the Class B and Class C Distribution and Service Plans (each a "Plan" and together the "Plans"), the Fund pays the asset-based sales charge (the "distribution fee") to the Distributor for its services in distributing Class B and Class C shares. The distribution fee allows investors to buy Class B and Class C shares without a front-end sales charge, while allowing the Distributor to compensate dealers that sell those shares. The Distributor may use the service fees it receives under the Plans to pay recipients for providing services similar to the services provided under the Class A service plan, described above.

Payments under the Plans are made in recognition that the Distributor:

pays sales concessions to authorized brokers and dealers at the time of sale or as an ongoing concession,

pays the service fees in advance or periodically, as described below,

may finance payment of sales concessions or the advance of the service fee payments to recipients under the Plans, or may provide such financing from its own resources or from the resources of an affiliate,

employs personnel to support distribution of Class B and Class C shares,

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bears the costs of sales literature, advertising and prospectuses (other than those furnished to current shareholders) and certain other distribution expenses,

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may not be able to adequately compensate dealers that sell Class B and Class C shares without receiving payment under the Plans and therefore may not be able to offer such Classes for sale absent the Plans,

receives payments under the Plans consistent with the service and distribution fees paid by other non-proprietary funds that charge 12b-1 fees,

may use the payments under the Plan to include the Fund in various third-party distribution programs that might increase sales of Fund shares,

may experience increased difficulty selling the Fund's shares if Plan payments were discontinued, because most competitor funds have plans that pay dealers as much or more for distribution services than the amounts currently being paid by the Fund, and

may not be able to continue providing the same quality of distribution efforts and services, or to obtain such services from brokers and dealers, if Plan payments were discontinued.

Distribution fees on Class B shares are generally retained by the Distributor. If a dealer has a special agreement with the Distributor, the Distributor may pay the Class B distribution fees to recipients periodically in lieu of paying the sales concession in advance at the time of purchase. The Distributor retains the distribution fee on Class C shares during the first year and then pays it as an ongoing concession to recipients.

Service fees for the first year after Class B and Class C shares are purchased, are generally paid to recipients in advance. After the first year, the Distributor pays the service fees to recipients periodically. Under the Plans, the Distributor is permitted to retain the service fees or to pay recipients the service fee on a periodic basis, without payment in advance. If a recipient has a special agreement with the Distributor, the Distributor may pay the Class B service fees to recipients periodically in lieu of paying the first year fee in advance. If Class B and Class C shares are redeemed during the first year after their purchase, a recipient of service fees on those shares will be obligated to repay a pro rata portion of the advance payment to the Distributor. Shares purchased by exchange do not qualify for the advance service fee payment.

Class B and Class C shares may not be purchased by a new investor directly from the Distributor without the investor designating another registered broker-dealer. If a current 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 distribution fees paid on Class B and Class C shares, but does not retain any service fees as to the assets represented by that account.

Each Plan provides for the Distributor to be compensated at a flat rate, whether the Distributor's distribution expenses for a period are more or less than the amounts paid by the Fund under the relevant Plan. During a calendar year, the Distributor's actual expenses in selling Class B and Class C shares may be more than the distribution fees paid to the Distributor under the Plans and the CDSC's collected on redeemed shares. Those excess expenses are carried over on the Distributor's books and may be recouped from distribution fees paid by the Fund in future years. However, the Distributor has voluntarily agreed to cap the amount that may be carried over from year to year and recouped for certain categories of expenses at 0.70% of annual gross sales of shares of the Fund. The capped expenses under the Plans are (i) expenses the Distributor has incurred that represent compensation and expenses o f its sales personnel and (ii) other direct distribution costs it has incurred, such as sales literature, state registration fees, advertising and prospectuses used to offer Fund shares. If those categories of expenses exceed the capped amount, the Distributor would bear the excess costs. If a Plan were to be terminated by the Fund, the Fund's Board may allow the Fund to continue payments of the distribution fees to the Distributor for its services in distributing shares before the Plan was terminated.

The distribution and service fees under each Plan 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. The distribution and service fees increase the annual Class B and Class C expenses by 1.00% of net assets.

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Distribution and Service Fees Paid to the Distributor for the Fiscal Year Ended 7/31/10
Class:	Total Payments Under Plan	Amount Retained by Distributor	Amount Paid to Affiliate	Distributor's Aggregate Unreimbursed Expenses Under Plan	Distributor's Unreimbursed Expenses as % of Net Assets of Class
Class B Plan	$378,571	$312,483	$997	$2,236,764	5.42%
Class C Plan	$4,635,653	$1,974,405	$21,793	$7,422,065	1.43%

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All payments under the Plans are subject to the limitations imposed by the Conduct Rules of FINRA on payments of distribution and service fees.

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Payments to Financial Intermediaries

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Financial intermediaries may receive various forms of compensation or reimbursement from the Fund in the form of distribution and service (12b-1) plan payments as described above. They may also receive payments or concessions from the Distributor, derived from sales charges paid by the financial intermediary's clients, also as described in this SAI. In addition, the Manager and the Distributor (including their affiliates) may make payments to financial intermediaries in connection with the intermediaries' offering and sales of Fund shares and shares of other Oppenheimer funds, or their provision of marketing or promotional support, transaction processing or administrative services. Among the financial intermediaries that may receive these payments are brokers or dealers who sell or hold shares of the Fund, banks (including bank trust departments), registered investment advisers, insurance companies, retiremen t plan or qualified tuition program administrators, third party administrators, recordkeepers or other institutions that have selling, servicing or similar arrangements with the Manager or the Distributor. The payments to financial intermediaries vary by the types of product sold, the features of the Fund share class and the role played by the intermediary.

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Types of payments to financial intermediaries may include, without limitation, all or portions of the following, and/or the Fund, or an investor buying or selling Fund shares may pay:

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an initial front-end sales charge, all or a portion of which is payable by the Distributor to financial intermediaries (see the "About Your Account" section in the Prospectus);

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ongoing asset-based distribution and/or service fees (described in the section "About the Fund - Distribution and Service (12b-1) Plans" above);

shareholder servicing expenses that are paid from Fund assets to reimburse the Manager or the Distributor for Fund expenses they incur for providing omnibus accounting, recordkeeping, networking, sub-transfer agency or other administrative or shareholder services (including retirement plan and 529 plan administrative services fees).

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In addition, the Manager or Distributor may, at their discretion, make the following types of payments from their own respective resources, which may include profits the Manager derives from investment advisory fees paid by the Fund. Payments are made based on the guidelines established by the Manager and Distributor, subject to applicable law. These payments are often referred to as "revenue sharing" payments, and may include:

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compensation for marketing support, support provided in offering shares in the Fund or other Oppenheimer funds through certain trading platforms and programs, and transaction processing or other services;

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other compensation to the extent the payment is not prohibited by law or by any self-regulatory agency, such as FINRA.

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

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

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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;

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;

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; or

firm support, such as business planning assistance, advertising, or educating a financial intermediary's sales personnel about the Oppenheimer funds and shareholder financial planning needs.

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 payments may exceed the cost of providing the services. 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 SAI. 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.

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For the year ended December 31, 2009, the following financial intermediaries and/or their affiliates (which in some cases are broker-dealers) offered shares of the Oppenheimer funds and received revenue sharing or similar distribution-related payments (subject to a $5,000 annual minimum threshold) from the Manager or the Distributor for marketing or program support:

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A.G. Edwards and Sons, Inc.	IFC Holdings Inc.	Prime Capital Services, Inc.
Advantage Capital Corporation	Independent Financial Group, LLC	Primevest Financial Services, Inc.
Aegon USA	ING Financial Advisers, LLC	Proequities, Inc.
Aetna Life Insurance & Annuity Company	ING Financial Partners	Protective Life and Annuity Insurance Company
AIG Advisor Group, Inc.	ING Life Insurance & Annuity Co.	Protective Life Insurance Company
AIG Life Variable Annuity Company	Invest Financial Corporation	Pruco Securities, LLC
Allianz Life Insurance Company	Investacorp, Inc.	Prudential Investment Management Services, Inc.
Allstate Life Insurance Company	Investment Centers of America	Raymond James & Associates, Inc.
American General Annuity Insurance Company	Janney Montgomery Scott LLC	Raymond James Financial Services, Inc.
American Portfolios Financial Services, Inc.	Jefferson Pilot Securities Corporation	RBC Capital Markets Corporation
Ameriprise Advisor Services, Inc.	JJB Hillard W.L. Lyons, Inc.	RBC Dain Rauscher
Ameriprise Financial Services, Inc.	JP Morgan Securities, Inc.	Robert W. Baird & Co.
Ameritas Life Insurance Company	Kemper Investors Life Insurance Company	Royal Alliance Associates, Inc.
Annuity Investors Life Insurance Company	KMS Financial Services Inc.	Sagepoint Financial Advisors
AXA Advisors, LLC	Lasalle Street Securities LLC	Securities America, Inc.
AXA Equitable Life Insurance Company	Legend Equities Corporation	Securities Service Network
Banc of America Investment Services, Inc.	Lincoln Benefit National Life	Security Benefit Life Insurance Company
Bank of New York Mellon	Lincoln Financial Advisors Corporation	Sigma Financial Corp.
Cadaret Grant & Co.	Lincoln Financial Securities Corporation	Signator Investments, Inc.
Cambridge Investment Research, Inc.	Lincoln Investment Planning, Inc.	SII Investments, Inc.
CCO Investment Services Corporation	Lincoln National Life Insurance Company	Sorrento Pacific Financial LLC
Chase Investment Services Corporation	LPL Financial Corporation	State Farm VP Management Corp.
Citigroup Global Markets, Inc.	Massachusetts Mutual Life Insurance Company	State Street Global Markets, LLC
CitiStreet Advisors LLC	Massmutual Financial Group	Stifel, Nicolaus & Company, Inc.
Citizens Bank of Rhode Island	Merrill Lynch Pierce Fenner & Smith Inc.	Sun Life Assurance Company of Canada (U.S.)
C.M. Life Insurance Company	MetLife Investors Insurance Company	Sun Life Financial Distributors, Inc.
Columbus Life Insurance Company	MetLife Investors Insurance Company - Security First	Sun Life Insurance and Annuity Company (Bermuda) Ltd.
Commonwealth Financial Network	MetLife Securities, Inc.	Sun Life Insurance and Annuity Company of New York
CUNA Brokerage Services, Inc.	Minnesota Life Insurance Company	Sun Life Insurance Company
CUNA Mutual Insurance Society	MML Bay State Life Insurance Company	Sun Trust Securities, Inc.
CUSO Financial Services, LP	MML Investor Services, Inc.	Sunamerica Securities, Inc.
E*TRADE Clearing LLC	MONY Life Insurance Company of America	SunGard Institutional Brokerage Inc.
Edward D. Jones and Company, LP	Morgan Stanley & Co., Incorporated	SunTrust Bank
Essex National Securities, Inc.	Morgan Stanley Dean Witter	Suntrust Investment Services, Inc.
Federal Kemper Life Assurance Company	Morgan Stanley Smith Barney LLC	Thrivent Financial for Lutherans
Financial Network Investment Corporation	Multi-Financial Securities Corporation	Thrivent Investment Management, Inc.
Financial Services Corporation	Nathan and Lewis Securities, Inc.	Towers Square Securities, Inc.
First Clearing LLC	National Planning Corporation	Transamerica Life Insurance Co.
First Global Capital Corporation	National Planning Holdings, Inc.	UBS Financial Services, Inc.
FSC Securities Corporation	Nationwide Financial Services, Inc.	Union Central Life Insurance Company
GE Financial Assurance	New England Securities, Inc.	United Planners' Financial Services of America
GE Life and Annuity Company	New York Life Insurance and Annuity Company	Uvest Investment Services
Genworth Financial, Inc.	NFP Securities Inc.	Valic Financial Advisors, Inc.
Glenbrook Life and Annuity Company	North Ridge Securities Corp.	Vanderbilt Securities LLC
GPC Securities Inc.	Northwestern Mutual Investment Services, LLC	VSR Financial Services, Inc.
Great West Life Insurance Company	NRP Financial, Inc.	Wachovia Securities, LLC
Guardian Insurance & Annuity Company	Oppenheimer & Co. Inc.	Walnut Street Securities, Inc.
H. Beck, Inc.	Pacific Life Insurance Co.	Wells Fargo Advisors, LLC
H.D. Vest Investment Services, Inc.	Park Avenue Securities LLC	Wells Fargo Investments, LLC
Hartford Life & Annuity Insurance Company	Pershing LLC	Wescom Financial Services
Hartford Life Insurance Company	PFS Investments, Inc.	Woodbury Financial Services, Inc.
Hewitt Associates LLC	Phoenix Life Insurance Company
HSBC Securities Inc.	PlanMember Securities

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For the year ended December 31, 2009, 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:

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A.G. Edwards and Sons, Inc.	First Southwest Company	Pershing LLC
Acensus, Inc.	First Trust Corp.	Plan Administrators Inc.
ACS HR Solutions LLC	Geller Group Ltd.	PlanMember Securities
ADP Broker-Dealer, Inc.	Genworth Financial, Inc.	Primevest Financial Services, Inc.
Aetna Life Insurance & Annuity Company	Great West Life Insurance Company	Principal Life Insurance
Alliance Benefit Group	H&R Block Financial Advisors, Inc.	Prudential Investment Management Services, Inc.
American Diversified Distribution, LLC	H.D. Vest Investment Services, Inc.	PSMI Group
American Funds	Hartford Life Insurance Company	Raymond James & Associates, Inc.
American United Life Insurance Co.	Hewitt Associates LLC	Reliance Trust Co.
Ameriprise Financial Services, Inc.	ICMA-RC Services LLC	Robert W. Baird & Co.
Ameritrade, Inc.	Ingham Group	RSM McGladrey, Inc.
AST Trust Company	Interactive Retirement Systems	Schwab Retirement Plan Services Company
AXA Equitable Life Insurance Company	Intuition Systems, Inc.	Scott & Stringfellow, Inc.
Benefit Administration Co.	Invest Financial Corporation	Scottrade, Inc.
Benefit Consultants Group	Janney Montgomery Scott LLC	SII Investments, Inc.
Benefit Plans Administrative Services, Inc.	JJB Hillard W. L. Lyons, Inc.	Southwest Securities, Inc.
Benetech, Inc.	John Hancock Life Insurance Company	Standard Insurance Co.
Boston Financial Data Services, Inc.	JP Morgan Securities, Inc.	Standard Retirement Services, Inc.
Charles Schwab & Co., Inc.	July Business Services	Stanley, Hunt, Dupree & Rhine
Citigroup Global Markets Inc.	Lincoln Benefit National Life	Stanton Group, Inc.
CitiStreet Advisors LLC	Lincoln Investment Planning Inc.	Sterne Agee & Leach, Inc.
City National Investments Trust	LPL Financial Corporation	Stifel Nicolaus & Company, Inc.
Clark Consulting	Marshall & Ilsley Trust Company, Inc.	Sun Trust Securities, Inc.
Columbia Management Distributors, Inc.	Massachusetts Mutual Life Insurance Company	Symetra Investment Services, Inc.
CPI Qualified Plan Consultants	Matrix Settlement & Clearance Services	T. Rowe Price
DA Davidson & Co.	Mercer HR Services	The Princeton Retirement Group
Daily Access. Com, Inc.	Merrill Lynch Pierce Fenner & Smith Inc.	The Retirement Plan Company, LLC
Davenport & Company, LLC	Mesirow Financial, Inc.	Transamerica Retirement Services
David Lerner Associates, Inc.	Mid Atlantic Capital Co.	TruSource
Digital Retirement Solutions	Milliman, Inc.	UBS Financial Services, Inc.
Diversified Advisors Investments Inc.	Morgan Stanley & Co., Incorporated	Unified Fund Services, Inc.
DR, Inc.	Morgan Stanley Dean Witter	Union Bank & Trust Company
Dyatech, LLC	Mutual of Omaha Insurance Company	US Clearing Co.
E*TRADE Clearing LLC	National City Bank	USAA Investment Management Co.
Edward D. Jones and Company, LP	National Deferred Compensation	USI Consulting Group
ExpertPlan.com	National Financial Services LLC	Valic Financial Advisors, Inc.
Ferris Baker Watts, Inc.	National Planning Holdings, Inc.	Vanguard Group
Fidelity Brokerage Services, LLC	New York Life Insurance and Annuity Company	Wachovia Securities, LLC
Fidelity Investments Institutional Operations Co.	Newport Retirement Services	Wedbush Morgan Securities
Financial Administrative Services Corporation	Northwest Plan Services Inc.	Wells Fargo Bank NA
First Clearing LLC	Oppenheimer & Co. Inc.	Wells Fargo Investments, LLC
First Global Capital Corporation	Peoples Securities, Inc.	Wilmington Trust Company

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Performance of the Fund

Explanation of Performance Calculations. The use of standardized performance calculations enables an investor to compare the Fund's performance to the performance of other funds for the same periods. The Fund's performance data in advertisements must comply with rules of the SEC, which 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. The Fund may use a variety of performance calculations, including "cumulative total return," "average annual total return," "average annual total return at net asset value," and "total return at net asset value." How these types of returns are calculated are described below.

A number of factors should be considered before using the Fund's performance information as a basis for comparison with other investments:

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

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

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

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

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

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

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

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

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

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

The symbols above represent the following factors:

a =dividends and interest earned during the 30-day period.
b =expenses accrued for the period (net of any expense assumptions).
c =the average daily number of shares of that class outstanding during the 30-day period that were entitled to receive dividends.
d =the maximum offering price per share of that class on the last day of the period, adjusted for undistributed net investment income.

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

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

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

The maximum offering price for Class A shares includes the current maximum initial sales charge. The maximum offering price for Class B and Class C shares is the net asset value per share, without considering the effect of contingent deferred sales charges. The Class A dividend yield may also be quoted without deducting the maximum initial sales charge.

Tax-Equivalent Yield. The "tax-equivalent yield" of a class of shares is the equivalent yield that would have to be earned on a taxable investment to achieve the after-tax results represented by the Fund's tax-equivalent yield. It adjusts the Fund's standardized yield, as calculated above, by a stated tax rate. Using different tax rates to show different tax equivalent yields shows investors in different tax brackets the tax equivalent yield of the Fund based on their own tax bracket.

The tax-equivalent yield is based on a 30-day period, and is computed by dividing the tax-exempt portion of the Fund's current yield (as calculated above) by one minus a stated income tax rate. The result is added to the portion (if any) of the Fund's current yield that is not tax-exempt.

The tax-equivalent yield may be used to compare the tax effects of income derived from the Fund with income from taxable investments at the tax rates stated. Your tax bracket is determined by your federal and state taxable income (the net amount subject to federal and state income tax after deductions and exemptions).

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The Fund's Yields for the 30-Day Periods Ended 7/31/10
	Standardized Yield		Dividend Yield
Class of Shares	Without Sales Charge	After Sales Charge	Without Sales Charge	After Sales Charge
Class A	6.65%	6.33%	6.75%	6.43%
Class B	5.76%	N/A	5.78%	N/A
Class C	5.87%	N/A	5.91%	N/A

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Total Return Information. "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 will differ and are measured separately.

There are different types of "total returns." "Cumulative total return" measures the change in value over the entire period (for example, ten years). "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 the methodology prescribed by the SEC to calculate its standardized total returns.

In calculating the Fund's total returns, the following sales charges are applied unless the returns are shown at "net asset value" as described below:

For Class A shares the current maximum sales charge of 4.75% as a percentage of the offering price is deducted from the initial investment ("P" in the formula below).

For Class B shares, the CDSC for the applicable period is deducted: 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% CDSC is deducted for returns for the one-year period.

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The Fund's returns are calculated based on the change in value of a hypothetical initial investment of $1,000 ("P" in the formulas below) held for a number of years ("n" in the formulas)

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Average Annual Total Return. The "average annual total return" for each class is an average annual compounded rate of return for each year in a specified number of years that, assuming all dividends and distributions are reinvested, results in an Ending Redeemable Value ("ERV") according to the following formula:

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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 that, assuming all dividends and distributions, adjusted to show the effect of federal taxes calculated using the highest individual marginal federal income tax rates in effect on any reinvestment date, are reinvested, results in an ending value ("ATVD") according to the following formula:

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 that, assuming all dividends and distributions, adjusted to show the effect of federal taxes calculated using the highest individual marginal federal income tax rates in effect on any reinvestment date, are reinvested, results in an ending value ("ATVDR") after taking into account the effect of capital gains taxes or capital loss tax benefits resulting from the redemption of the shares at the end of the period, each calculated using the highest federal individual capital gains tax rate in effect on the redemption date, according to the following formula:

Cumulative Total Return. The "cumulative total return" measures the change in value of a hypothetical investment over an entire period of years using 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 according to the following formula:

Total Returns at Net Asset Value. From time to time the Fund may also quote cumulative or average annual total returns for Class A, Class B, Class C or Class N shares "at net asset value" without deducting the front-end sales charge or CDSC, based on the difference in net asset value per share at the beginning and, taking into consideration the reinvestment of dividends and capital gains distributions, at the end of the specified period.

Hypothetical Investment Accounts. Fund advertisements or sales literature may also, from time to time, include performance of a hypothetical investment account that includes the total return of shares of the Fund and other Oppenheimer funds as part of an illustration of an asset allocation model or similar presentation.

A number of factors should be considered before using the Fund's performance information as a basis for comparison with other investments:

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

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

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

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

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

Performance Data. The charts below show the Fund's performance as of its most recent fiscal year end. You can obtain current performance information by visiting the OppenheimerFunds website at www.oppenheimerfunds.com or by calling the Fund's Transfer Agent at the telephone number shown on the cover of this SAI.

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

Total returns for any given past period represent historical performance information and are not, and should not be considered, a prediction of future returns.

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The Fund's Total Returns for the Periods Ended 7/31/10
	Cumulative Total Returns		Average Annual Total Returns
	10 Years or life of class, if less		1-Year		5-Year		10-Year
Class of Shares	After Sales Charge	Without Sales Charge	After Sales Charge	Without Sales Charge	After Sales Charge	Without Sales Charge	After Sales Charge	Without Sales Charge
Class A¹	17.97%	23.85%	18.72%	24.64%	(3.74%)	(2.79%)	1.67%	2.16%
Class B²	18.24%	18.24%	18.72%	23.72%	(3.90%)	(3.61%)	1.69%	1.69%
Class C³	14.60%	14.60%	22.82%	23.82%	(3.55%)	(3.55%)	1.37%	1.37%

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Average Annual Total Returns for Class A Shares (After Sales Charge) for the Periods Ended 7/31/10 ¹
	1-Year	5-Year	10-Year
After Taxes on Distributions	18.72%	(3.74%)	1.67%
After Taxes on Distributions and Redemption of Fund Shares	15.03%	(2.24%)	2.31%

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1. Inception of Class A: 10/27/76
2. Inception of Class B: 03/16/93
3. Inception of Class C: 08/29/95

Other Performance Comparisons. In its Annual Report to shareholders, the Fund compares its performance to that of one or more appropriate market indices. You can obtain that information by visiting the OppenheimerFunds website at www.oppenheimerfunds.com or by calling the Fund's Transfer Agent at the telephone number shown on the cover of this SAI. 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. The following are examples of some of those comparisons.

Lipper Rankings. From time to time the Fund may publish the ranking of the performance of its share classes by Lipper, Inc. ("Lipper"), a widely-recognized independent mutual fund monitoring service. Lipper monitors and ranks the performance of regulated investment companies for various periods in categories based on investment styles. Lipper also publishes "peer-group" indices and averages of the performance of all mutual funds in particular categories.

Morningstar Ratings. From time to time the Fund may publish the "star ratings" of its classes of shares by Morningstar, Inc. ("Morningstar"), an independent mutual fund monitoring service that rates and ranks mutual funds within their specialized market sectors. Morningstar proprietary star ratings reflect risk-adjusted historical total investment returns for funds with at least a three-year performance history. 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.

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 other similar publications. That information may include performance quotations from other sources, including Lipper and Morningstar or the Fund's performance may be compared to the performance of various market indices, other investments, or averages, performance rankings or other benchmarks prepared by recognized mutual fund statistical services. The Fund's advertisements and sales literature may also include, for illustrative or comparative purposes, statistical data or other information about general or specific market and economic conditions, for example:

information about the performance of certain securities or commodities markets or segments of those markets,

information about the performance of the economies of particular countries or regions,

the earnings of companies included in segments of particular industries, sectors, securities markets, countries or regions,

the availability of different types of securities or offerings of securities,

information relating to the gross national or gross domestic product of the United States or other countries or regions,

comparisons of various market sectors or indices to demonstrate performance, risk, or other characteristics of the Fund.

From time to time, the Fund may publish rankings or ratings of the Manager or Transfer Agent by third parties, including comparisons of investor services provided to shareholders of the Oppenheimer funds to those provided by other mutual fund families selected by the rating or ranking services. Those comparisons may be based on the opinions of the rating or ranking service itself, using its research or judgment, or may be based on surveys of investors, brokers, shareholders or others.

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, including certificates of deposit, ordinary interest-paying checking and savings accounts, and other forms of fixed or variable time deposits or 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.

About Your Account

The Fund's Prospectus describes how to buy, sell and exchange shares of the Fund and certain other Oppenheimer funds. The information below provides further details about the Fund's policies regarding those share transactions. It should be read in conjunction with the information in the Prospectus. Appendix A of this SAI provides more information about the special sales charge arrangements offered by the Fund, and the circumstances in which sales charges may be reduced or waived for certain investors and certain types of purchases or redemptions.

Determination of Net Asset Value Per Share. The net asset value ("NAV") per share for each class of shares of the Fund 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. The NAV is determined as of the close of business on the New York Stock Exchange ("NYSE") on each day that the NYSE is open. 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 SAI 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, Washington's Birthday (Presidents Day), Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. It may also close on o ther days.

Dealers other than NYSE members may conduct trading in municipal securities on days that 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 days when shareholders may not purchase or redeem shares.

Securities Valuation. The Fund's Board has established procedures for the valuation of the Fund's securities. In general those procedures are as follows:

Long-term debt securities having a remaining maturity of more than 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 or obtained by the Manager from two active market makers in the security on the basis of reasonable inquiry.

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 or obtained by the Manager from two active market makers in the security on the basis of reasonable inquiry:

debt instruments that have a maturity of more than 397 days when issued,
debt instruments that had a maturity of 397 days or less when issued and have a remaining maturity of more than 60 days, and
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.

The following securities are valued at cost, adjusted for amortization of premiums and accretion of discounts:

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money market debt securities held by a non-money market fund that had a maturity of less than 397 days when issued and that have a remaining maturity of 60 days or less, and
debt instruments held by a money market fund that have a remaining maturity of 397 days or less.

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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, or the "bid" price if no "asked" price is available.

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In the case of municipal securities the Manager uses pricing services approved by the Board. The pricing service may use "matrix" comparisons to the prices for comparable instruments on the basis of quality, yield and maturity. Other special factors may be involved (such as the tax-exempt status of the interest paid by municipal securities). The Manager will monitor the accuracy of the pricing services valuations. That monitoring may include comparing prices used for portfolio valuation to the actual sale prices of selected securities.

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Puts, calls, futures and municipal bond index futures are valued at the last sale price on the principal exchange on which they are traded, as determined by a pricing service approved by the Board or by the Manager.

Allocation of Expenses. The Fund pays expenses related to its daily operations, such as custodian fees, Board fees, transfer agency fees, legal fees and auditing costs. Those expenses are paid out of the Fund's assets, not directly by shareholders. However, those expenses reduce the net asset value of Fund shares, and therefore are borne indirectly by shareholders.

For calculating the Fund's net asset value, dividends and distributions, the Fund differentiates between 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. Those expenses are first allocated based on the percentage of the Fund's total assets that is represented by the assets of each share class. Such general expenses include management fees, legal, bookkeeping and audit fees, Board compensation, custodian expenses, share issuance costs, interest, taxes, brokerage commissions, and non-recurring expenses, such as litigation costs. Then the expenses allocated to a share class are allotted equally to each outstanding share within a given class.

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.

How to Buy Shares

The Oppenheimer Funds. The "Oppenheimer funds" are those mutual funds for which the Distributor acts as distributor and currently include the following:

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Oppenheimer AMT-Free Municipals	Money Market Funds:
Oppenheimer AMT-Free New York Municipals	Oppenheimer Cash Reserves
Oppenheimer Balanced Fund	Oppenheimer Institutional Money Market Fund
Oppenheimer Baring SMA International Fund	Oppenheimer Money Market Fund, Inc.
Oppenheimer Core Bond Fund
Oppenheimer California Municipal Fund	Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Appreciation Fund	Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Capital Income Fund	Oppenheimer Portfolio Series:
Oppenheimer Champion Income Fund	Active Allocation Fund
Oppenheimer Commodity Strategy Total Return Fund	Equity Investor Fund
Oppenheimer Corporate Bond Fund	Conservative Investor Fund
Oppenheimer Currency Opportunities Fund	Moderate Investor Fund
Oppenheimer Developing Markets Fund	Oppenheimer Portfolio Series Fixed Income Active
Oppenheimer Discovery Fund	Allocation Fund
Oppenheimer Emerging Markets Debt Fund	Oppenheimer Principal Protected Main Street Fund II
Oppenheimer Equity Fund, Inc.	Oppenheimer Principal Protected Main Street Fund III
Oppenheimer Equity Income Fund, Inc.	Oppenheimer Quest International Value Fund
Oppenheimer Global Fund	Oppenheimer Quest Opportunity Value Fund
Oppenheimer Global Allocation Fund	Oppenheimer Real Estate Fund
Oppenheimer Global Opportunities Fund	Oppenheimer Rising Dividends Fund
Oppenheimer Global Value Fund	Oppenheimer Rochester Arizona Municipal Fund
Oppenheimer Gold & Special Minerals Fund	Oppenheimer Rochester Maryland Municipal Fund
Oppenheimer International Bond Fund	Oppenheimer Rochester Massachusetts Municipal Fund
Oppenheimer International Diversified Fund	Oppenheimer Rochester Michigan Municipal Fund
Oppenheimer International Growth Fund	Oppenheimer Rochester Minnesota Municipal Fund
Oppenheimer International Small Company Fund	Oppenheimer Rochester National Municipals
Oppenheimer Limited Term California Municipal Fund	Oppenheimer Rochester North Carolina Municipal Fund
Oppenheimer Limited-Term Government Fund	Oppenheimer Rochester Ohio Municipal Fund
Oppenheimer Limited Term Municipal Fund	Oppenheimer Rochester Virginia Municipal Fund
Oppenheimer Main Street Fund	Oppenheimer Select Value Fund
Oppenheimer Main Street Select Fund	Oppenheimer Senior Floating Rate Fund
Oppenheimer Main Street Small- & Mid-Cap Fund	Oppenheimer Small- & Mid-Cap Growth Fund
	Oppenheimer Small- & Mid- Cap Value Fund
Oppenheimer LifeCycle Funds:	Oppenheimer Global Strategic Income Fund
Oppenheimer Transition 2010 Fund	Oppenheimer U.S. Government Trust
Oppenheimer Transition 2015 Fund	Oppenheimer Value Fund
Oppenheimer Transition 2020 Fund	Limited-Term New York Municipal Fund
Oppenheimer Transition 2025 Fund	Rochester Fund Municipals
Oppenheimer Transition 2030 Fund
Oppenheimer Transition 2040 Fund
Oppenheimer Transition 2050 Fund

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

The availability of different classes of shares permits an investor to choose the method of purchasing shares that is more appropriate for the investor. That may depend on the amount of the purchase, the length of time the investor expects to hold shares, and other relevant circumstances. Class A shares normally are sold subject to an initial sales charge. While Class B and Class C shares have no initial sales charge, the purpose of the deferred sales charge and asset-based sales charge on Class B and Class C shares is the same as that of the initial sales charge on Class A shares – to compensate the Distributor and brokers, dealers and financial institutions that sell shares of the Fund. A salesperson who is entitled to receive compensation from his or her firm for selling Fund shares may receive different levels of compensation for selling one class of shares rather than another.

The Distributor will not accept a purchase order of more than $100,000 for Class B shares or a purchase order of $1 million or more to purchase Class C shares on behalf of a single investor (not including dealer "street name" or omnibus accounts).

Class B or Class C shares may not be purchased by a new investor directly from the Distributor without the investor designating another registered broker-dealer.

Class A Sales Charges Reductions and Waivers. There is an initial sales charge on the purchase of Class A shares of each of the Oppenheimer funds except for the money market funds (under certain circumstances described in this SAI, redemption proceeds of certain money market fund shares may be subject to a CDSC). As discussed in the Prospectus, a reduced initial sales charge rate may be obtained for certain share purchases because of the reduced sales efforts and reduction in expenses realized by the Distributor, dealers or brokers in making such sales. Sales charge waivers may apply in certain other circumstances because the Distributor or dealer or broker incurs little or no selling expenses. Appendix A to this SAI includes additional information regarding certain of these sales charge reductions and waivers.

A reduced sales charge rate may be obtained for Class A shares under a Right of Accumulation or Letter of Intent because of the reduction in sales effort and expenses to the Distributor, dealers or brokers for those sales.

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Class B Conversion. Under current interpretations of applicable federal income tax law by the Internal Revenue Service (the "IRS"), the conversion of Class B shares to Class A shares 72 months after purchase is not treated as a taxable event for the shareholder. If those laws or the IRS' interpretation of those laws should change, the automatic conversion feature may be suspended. In that event, no further conversions of Class B shares would occur while that suspension remained in effect. Although Class B shares could then be exchanged for Class A shares on the basis of relative net asset value of the two classes, without the imposition of a sales charge or fee, such exchange could constitute a taxable event for the shareholder, and absent such exchange, Class B shares might continue to be subject to the asset-based sales charge for longer than six years.

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Letter of Intent. Under a Letter of Intent (a "Letter"), you may be able to reduce the initial sales charge rate that applies to your Class A share purchases of the Fund if you purchase Class A, Class B or Class C shares of the Fund or other Oppenheimer funds or Class A, Class B, Class C, Class G and Class H units of advisor sold Section 529 plans, for which the Manager or the Distributor serves as the Program Manager or Program Distributor.

A Letter is an investor's statement in writing to the Distributor of his or her intention to purchase a specified value of those shares or units during a 13 month period (the "Letter period"), which begins on the date of the investor's first share purchase following the establishment of the Letter. The sales charge on each purchase of Class A shares during the Letter period will be at the rate that would apply to a single lump-sum purchase of shares in the amount intended to be purchased. In submitting a Letter, the investor makes no commitment to purchase shares. However, if the investor does not fulfill the terms of the Letter within the Letter period, he or she agrees to pay the additional sales charges that would have been applicable to any purchases that are made. The investor agrees that shares equal in value to 2% of the intended purchase amount will be held in escrow by the Transfer Agent for that purpose, as described in "Terms of Escrow" below. It is the responsibility of the dealer of record and/or the investor to advise the Distributor about the Letter when placing purchase orders during the Letter period. The investor must also notify the Distributor or his or her financial intermediary of any qualifying 529 plan holdings.

To determine whether an investor has fulfilled the terms of a Letter, the Transfer Agent will count purchases of "qualified" Class A, Class B and Class C shares and Class A, Class B, Class C, Class G and Class H units during the Letter period. Purchases of Class N or Class Y shares, purchases made by reinvestment of dividends or capital gains distributions from the Fund or other Oppenheimer funds, purchases of Class A shares with redemption proceeds under the Reinvestment Privilege, and purchases of Class A shares of Oppenheimer Money Market Fund, Inc. or Oppenheimer Cash Reserves on which a sales charge has not been paid do not count as "qualified" shares for satisfying the terms of a Letter. An investor will also be considered to have fulfilled the Letter if the value of the investor's total holdings of qualified shares on the last day of the Letter period equals or exceeds the intended purchase amount.

If the terms of the Letter are not fulfilled within the Letter period, the concessions previously paid to the dealer of record for the account and the amount of sales charge retained by the Distributor will be adjusted on the first business day following the expiration of the Letter period to reflect the sales charge rates that are applicable to the actual total purchases.

If total eligible purchases during the Letter period exceed the intended purchase amount and also exceed the amount needed to qualify for the next sales charge rate reduction (stated in the Prospectus), the sales charges paid may be adjusted to that lower rate. That adjustment will only be made if and when the dealer returns to the Distributor the amount of the excess concessions allowed or paid to the dealer over the amount of concessions that are applicable to the actual amount of purchases. The reduced sales charge adjustment will be made by adding to the investors account the number of additional shares that would have been purchased if the lower sales charge rate had been used. Those additional shares will be determined using the net asset value per share in effect on the date of such adjustment.

By establishing a Letter, the investor agrees to be bound by the terms of the Prospectus, this SAI and the application used for a Letter, and if those terms are amended to be bound by the amended terms and that any amendments by the Fund will apply automatically to existing Letters. Group retirement plans qualified under section 401(a) of the Internal Revenue Code may not establish a Letter, however defined benefit plans and Single K sole proprietor plans may do so.

Terms of Escrow That Apply to Letters of Intent .

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1. Out of the initial purchase, or out of subsequent purchases if necessary, the Transfer Agent will hold in escrow Fund shares equal to 2% of the intended purchase amount specified in the Letter. For example, if the intended purchase amount is $50,000, the escrow amount would be shares valued at $1,000 (computed at the offering price for a $50,000 share purchase). Any dividends and capital gains distributions on the escrowed shares will be credited to the investor's account.

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2. If the Letter applies to more than one fund account, the investor can designate the fund from which shares will be escrowed. If no fund is selected, the Transfer Agent will escrow shares in the fund account that has the highest dollar balance on the date of the first purchase under the Letter. If there are not sufficient shares to cover the escrow amount, the Transfer Agent will escrow shares in the fund account(s) with the next highest balance(s). If there are not sufficient shares in the accounts to which the Letter applies, the Transfer Agent may escrow shares in other accounts that are linked for Right of Accumulation purposes. Additionally, if there are not sufficient shares available for escrow at the time of the first purchase under the Letter, the Transfer Agent will escrow future purchases until the escrow amount is met.

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3. If, during the Letter period, an investor exchanges shares of the Fund for shares of another fund (as described in the Prospectus section titled "The OppenheimerFunds Exchange Privilege"), the Fund shares held in escrow will automatically be exchanged for shares of the other fund and the escrow obligations will also be transferred to that fund.

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4. If the total purchases under the Letter are less than the intended purchases specified, on the first business day after the end of the Letter period, the Distributor will redeem escrowed shares equal in value to the difference between the dollar amount of the sales charges actually paid and the amount of the sales charges that would have been paid if the total purchases had been made at a single time. Any shares remaining after such redemption will be released from escrow.

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5. If the terms of the Letter are fulfilled, the escrowed shares will be promptly released to the investor at the end of the Letter period.

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6. By signing the Letter, the investor irrevocably constitutes and appoints the Transfer Agent as attorney-in-fact to surrender for redemption any or all escrowed shares.

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Share Certificates. When you purchase shares of the Fund, your ownership interest in the shares of the Fund will be recorded as a book entry on the records of the Fund. The Fund will not issue or re-register physical share certificates.

Cancellation of Purchase Orders. Cancellation of purchase orders for the Fund's shares (for example, when a purchase check is returned to the Fund unpaid) causes a loss to be incurred when the net asset values of the Fund's shares on the cancellation date is less than on the purchase date. That loss is equal to the amount of the decline in the net asset value per share multiplied by the number of shares in the purchase order. The investor is responsible for that loss. If the investor fails to compensate the Fund for the loss, the Distributor will do so. The Fund may reimburse the Distributor for that amount by redeeming shares from any account registered in that investor's name, or the Fund or the Distributor may seek other redress.

AccountLink. Shares purchased through AccountLink will be purchased at the net asset value calculated on the same regular business day if the Distributor is instructed to initiate the Automated Clearing House ("ACH") transfer to buy the shares before the close of the NYSE. The NYSE normally closes at 4:00 p.m., but may close earlier on certain days. If the Distributor is instructed to initiate the ACH transfer after the close of the NYSE, the shares will be purchased on the next regular business day.

Dividends will begin to accrue on the shares purchased through the ACH system on the business day the Fund receives Federal Funds before the close of the NYSE. The proceeds of ACH transfers are normally received by the Fund three days after a transfer is initiated. If Federal Funds are received on a business day after the close of the NYSE, dividends will begin to accrue on the next regular business day. If the proceeds of an ACH transfer are not received on a timely basis, the Distributor reserves the right to cancel the purchase order. The Distributor and the Fund are not responsible for any delays in purchasing shares resulting from delays in ACH transmissions.

The minimum purchase through AccountLink is generally $50, however for accounts established prior to November 1, 2002 the minimum purchase is $25.

Asset Builder Plans. As indicated in the Prospectus, you normally must establish your Fund account with $1,000 or more. However, you can open a Fund account for as little as $500 if you establish an Asset Builder Plan at the time of your initial share purchase to automatically purchase additional shares directly from a bank account.

An Asset Builder Plan is available only if your bank is an ACH member and you establish AccountLink. Under an Asset Builder Plan, payments to purchase shares of the Fund will be debited from your bank account automatically. Normally the debit will be made two business days prior to the investment dates you select on your application. Neither the Distributor, the Transfer Agent nor the Fund will be responsible for any delays in purchasing shares that result from delays in ACH transmissions.

To establish an Asset Builder Plan at the time you initially purchase Fund shares, complete the "Asset Builder Plan" information on the Account Application. To establish an Asset Builder Plan for an existing account, use the Asset Builder Enrollment Form. The Account Application and the Asset Builder Enrollment Form are available by contacting the Distributor or may be downloaded from our website at www.oppenheimerfunds.com. Before you establish a new Fund account under the Asset Builder Plan, you should obtain a prospectus of the selected Fund and read it carefully.

You may change the amount of your Asset Builder payment or you can terminate your automatic investments at any time by writing to the Transfer Agent. The Transfer Agent requires a reasonable period (approximately 10 days) after receipt of your instructions to implement them. The minimum additional purchase under an Asset Builder Plan is $50, except that for Asset Builder Plans established prior to November 1, 2002, the minimum additional purchase is $25. Shares purchased by Asset Builder Plan payments are subject to the redemption restrictions for recent purchases described in the Prospectus. An Asset Builder Plan may not be used to buy shares for OppenheimerFunds employer-sponsored qualified retirement accounts. The Fund reserves the right to amend, suspend or discontinue offering Asset Builder Plans at any time without prior notice.

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Electronic Document Delivery. To access your account documents electronically via eDocs Direct, please visit our website at www.oppenheimerfunds.com and click the hyperlink "Sign Up for Electronic Document Delivery (eDocs Direct)" under the heading "I want to..." in the left hand column, or call 1.888.470.0862 for instructions.

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How to Sell Shares

Receiving Redemption Proceeds by Federal Funds Wire. The Fund would normally authorize a Federal Funds wire of redemption proceeds to be made on its next regular business day following the redemption. A Federal Funds wire may be delayed if the Fund's custodian bank is not open for business on that day. In that case, the wire will not be transmitted until the next business day on which the bank and the Fund are both open for business. No dividends will be paid on the proceeds of redeemed shares awaiting transfer by Federal Funds wire.

Redeeming Shares Through Brokers or Dealers. The Distributor is the Fund's agent to repurchase its shares from authorized brokers or dealers 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 next net asset value computed after the Distributor or the broker or dealer receives the order. A repurchase will be processed at that day's net asset value if the order was received by the broker or dealer from its customer prior to the time the close of the NYSE. Normally, the NYSE closes at 4:00 p.m., but may do so earlier on some days.

For accounts redeemed through a broker-dealer, payment will ordinarily be made within three business days after the shares are redeemed. However, the Distributor must receive the required redemption documents in proper form, with the signature(s) of the registered shareholder(s) guaranteed as described in the Prospectus.

Payments "In Kind." As stated in the Prospectus, payment for redeemed shares is ordinarily made in cash. Under certain circumstances, however, the Board may determine that it would be detrimental to the best interests of the remaining shareholders for the Fund to pay for the redeemed shares 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 Fund's portfolio. The Fund will value securities used to pay a redemption in kind using the same method described above under "Determination of Net Asset Value Per Share." That valuation will be made as of the time the redemption price is determined. If shares are redeemed in kind, the redeeming shareholder might incur brokerage or other costs in selling the securities for cash.

The Fund has elected to be governed by Rule 18f-1 under the Investment Company Act. Under that rule, redemptions by a shareholder, of up to the lesser of $250,000 or 1% of the net assets of the Fund during any 90-day period, must be redeemed solely in cash.

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Automatic Withdrawal Plans. Under an Automatic Withdrawal Plan, investors who own Fund shares can authorize the Transfer Agent to redeem shares automatically on a monthly, quarterly, semi-annual or annual basis. The minimum periodic redemption amount under an Automatic Withdrawal Plan is $50. Shareholders having AccountLink privileges may have Automatic Withdrawal Plan payments deposited to their designated bank account. Payments may also be made by check, payable to all shareholders of record and sent to the address of record for the account. Automatic withdrawals may be requested by telephone for amounts up to $1,500 per month if the payments are to be made by checks sent to the address of record for the account. Telephone requests are not available if the address on the account has been changed within the prior 15 days.

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Fund shares will be redeemed as necessary to meet the requested withdrawal payments. Shares will be redeemed at the net asset value per share determined on the redemption date, which is normally three business days prior to the payment receipt date requested by the shareholder. The Fund cannot guarantee receipt of a payment on the date requested, however. Shares acquired without a sales charge will be redeemed first. Shares acquired with reinvested dividends and capital gains distributions will be redeemed next, followed by shares acquired with a sales charge, to the extent necessary to make withdrawal payments. Depending on the amount withdrawn, the investor's principal may be depleted. Payments made under these plans should not be considered as a yield or income on your investment.

Because of the sales charge assessed on Class A share purchases, shareholders should usually not make additional Class A share purchases while participating in an Automatic Withdrawal Plan. A shareholder whose Class B, Class C or Class N account is subject to a CDSC should usually not establish an automatic withdrawal plan because of the imposition of the CDSC on the withdrawals. If a CDSC does apply to a redemption, the amount of the check or payment will be reduced accordingly. Distributions of capital gains from accounts subject to an Automatic Withdrawal Plan must be reinvested in Fund shares. Dividends on shares held in the account may be paid in cash or reinvested. Required minimum distributions from OppenheimerFunds-sponsored retirement plans may not be arranged on this basis.

The shareholder may change the amount, the payment interval, the address to which checks are to be mailed, the designated bank account for AccountLink payments or may terminate a plan at any time by writing to the Transfer Agent. A signature guarantee may be required for certain changes. The requested change will usually be put into effect approximately two weeks after such notification is received. The shareholder may redeem all or any part of the shares in the account by written notice to the Transfer Agent. That notice must be in proper form in accordance with the requirements in the then-current Fund Prospectus.

The Transfer Agent will administer the Automatic Withdrawal Plan as agent for the shareholder(s) who executed the plan authorization and application submitted to the Transfer Agent. Neither the Fund nor the Transfer Agent shall incur any liability for any action taken or not taken by the Transfer Agent in good faith to administer the plan. Any share certificates must be surrendered unendorsed to the Transfer Agent with the plan application to be eligible for automatic withdrawal payments. If the Transfer Agent ceases to act as transfer agent for the Fund, the shareholder will be deemed to have appointed any successor transfer agent to act as agent in administering the plan.

The Transfer Agent will terminate a plan upon its receipt of evidence, satisfactory to it, that the shareholder has died or is legally incapacitated. The Fund may also give directions to the Transfer Agent to terminate a plan. Shares that have not been redeemed at the time a plan is terminated will be held in an account in the name of the shareholder. Share certificates will not be issued for any such shares and all dividends will be reinvested in the account unless and until different instructions are received, in proper form, from the shareholder, his or her executor or guardian, or another authorized person.

The Fund reserves the right to amend, suspend or discontinue offering these plans at any time without prior notice. By requesting an Automatic Withdrawal Plan, the shareholder agrees to the terms and conditions that apply to such plans. These provisions may be amended from time to time by the Fund and/or the Distributor. When adopted, any amendments will automatically apply to existing Plans.

Transfers of Shares. A shareholder will not be required to pay a CDSC when Fund shares are transferred to registration in the name of another person or entity. The transfer may occur 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 CDSC are transferred, the CDSC will continue to apply to the transferred shares and will be calculated as if the transferee had acquired the shares in the same manner and at the same time as the transferring shareholder.

If less than all of the shares held in an account are transferred, and some but not all shares in the account would be subject to a CDSC if redeemed at that time, the priorities for the imposition of the CDSC described in the Prospectus will be followed in determining the order in which the shares are transferred.

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Minimum Balance Fee. As stated in the Prospectus, a $12 annual "Minimum Balance Fee" is assessed on each Fund account with a share balance of less than $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 Minimum Balance Fee. These exceptions are subject to change:

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A fund account whose shares were acquired after September 30th of the prior year;

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 Class A share account balance may become subject to the Minimum Balance Fee;

Accounts of shareholders who elect to access their account documents electronically via eDoc Direct (to access account documents electronically via eDocs Direct, please visit our website at www.oppenheimerfunds.com and click the hyperlink "Sign Up for Electronic Document Delivery (eDocs Direct)" under the heading "I Want To," or call 1.888.470.0862 for instructions);

A fund account that has only certificated shares and, has a balance below $500 and is being escheated;

Accounts of shareholders that are held by broker-dealers under the NSCC Fund/SERV system in Networking level 1 and 3 accounts;

Accounts held under the Oppenheimer Legacy Program and/or holding certain Oppenheimer Variable Account Funds;

Omnibus accounts holding shares pursuant to the Pinnacle, Ascender, Custom Plus, Recordkeeper Pro and Pension Alliance Retirement Plan programs;

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; and

Accounts held in the OppenheimerFunds Portfolio Builder Program which is offered through certain broker/dealers to qualifying shareholders.

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 good faith compliance with those laws.

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The Fund reserves the authority to modify the Minimum Balance Fee in its discretion.

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Involuntary Redemptions. The Fund's Board has the right to involuntarily redeem shares held in any account with an aggregate net asset value of less than $200. The Board may change the amount of the aggregate net asset value to which an involuntary redemption may apply. 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 determine the requirements for any notice to be given to the shareholders (but not less than 30 days). Alternatively, the Board may set requirements for the shareholder to increase the investment, or set other terms and conditions so that the shares would not be involuntarily redeemed.

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Reinvestment Privilege. Within six months after redeeming Class A or Class B shares, a shareholder may reinvest all or part of the redemption proceeds without a sales charge if:

An initial sales charge was paid on the redeemed Class A shares or a Class A CDSC was paid when the shares were redeemed; or

The Class B CDSC was paid on the redeemed Class B shares.

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The reinvestment may only be made in Class A shares of the Fund or other Oppenheimer funds into which shares of the Fund are exchangeable, as described in "How to Exchange Shares" below. This privilege does not apply to Class C shares or Class Y shares or to purchases made through automatic investment options. The Fund may amend, suspend or cease offering this reinvestment privilege at any time for shares redeemed after the date of the amendment, suspension or cessation. The shareholder must request the reinvestment privilege from the Transfer Agent or his or her financial intermediary at the time of purchase.

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Reinvestment will be at the next net asset value computed after the Transfer Agent receives the reinvestment order. 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 was 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 after the 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, the sales charge would be added to the basis of the s hares acquired with the redemption proceeds.

How to Exchange Shares

Shares of the Fund (including shares acquired by reinvestment of dividends or distributions from other Oppenheimer funds or from a unit investment trust) may be exchanged for shares of certain other Oppenheimer funds at net asset value without the imposition of a sales charge, however a CDSC may apply to the acquired shares as described below. Shares of certain money market funds purchased without a sales charge may be exchanged for shares of other Oppenheimer funds offered with a sales charge upon payment of the sales charge. Exchanges into another Oppenheimer fund must meet any applicable minimum investment requirements of that fund.

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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. The prospectus of each of the Oppenheimer funds indicates which share class or classes that fund offers and provides information about limitations on the purchase of particular share classes, as applicable for the particular fund. Shareholders that own more than one class of shares of the Fund must specify which class of shares they wish to exchange.

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You can obtain a current list of the share classes offered by the funds by calling the toll-free phone number on the first page of this SAI.

The different Oppenheimer funds that are available for exchange have different investment objectives, policies and risks. A shareholder should determine whether the fund selected is appropriate for his or her investment goals 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. Some of the tax consequences of reinvesting redemption proceeds are discussed in "Reinvestment Privilege," above. 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.

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 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, however that notice is not required in extraordinary circumstances.

How Exchanges Affect Contingent Deferred Sales Charges. A CDSC is imposed on exchanges of shares in the following cases:

The Class A CDSC is imposed on the redemption of Class A shares acquired by the exchange of Class A shares that are subject to a Class A CDSC, if the acquired shares are redeemed within 18 months measured from the beginning of the calendar month in which the exchanged Class A shares were purchased.

The Class A CDSC is imposed on the redemption of Class A shares of Oppenheimer Rochester National Municipals and Rochester Fund Municipals acquired prior to October 22, 2007 by the exchange of Class A shares that are subject to a Class A CDSC, if the acquired shares are redeemed within 24 months measured from the beginning of the calendar month in which the exchanged Class A shares were purchased.

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The Class A CDSC is imposed on the redemption of Class A shares of Oppenheimer Cash Reserves and Oppenheimer Money Market Fund, Inc. acquired by the exchange of Class A shares that are subject to a Class A CDSC, if the acquired shares are redeemed within the holding period applicable to the exchanged Class A shares.

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The Class B CDSC is imposed on Class B shares acquired by exchange if they are redeemed within six years of the initial purchase of the exchanged shares, except:
(1) 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 acquired by exchange, the Class B CDSC is imposed on the acquired shares if they are redeemed within five years of the initial purchase of the exchanged Class B shares.
(2) With respect to Class B shares of Oppenheimer Cash Reserves acquired by the exchange of Class B shares of Oppenheimer Capital Preservation Fund, the Class B CDSC is imposed on the acquired shares if they are redeemed within five years of the initial purchase of the exchanged Class B shares.

The Class C CDSC is imposed on Class C shares acquired by exchange if they are redeemed within 12 months of the initial purchase of the exchanged shares.

When Class B or Class C shares are exchanged, the priorities for the imposition of the CDSC described in "How To Buy Shares" in the Prospectus will be followed in determining the order in which the shares are exchanged. Before exchanging shares, shareholders should consider how the exchange may affect any CDSC that might be imposed on the subsequent redemption of remaining shares.

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.

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Automatic Exchange Plans. Under an Automatic Exchange Plan, shareholders can authorize the Transfer Agent to exchange shares of the Fund for shares of other Oppenheimer funds automatically on a monthly, quarterly, semi-annual or annual basis. The minimum amount that may be exchanged to each other fund account is $50. Instructions regarding the exchange amount, the selected fund(s) and the exchange interval should be provided on the OppenheimerFunds account application or by signature-guaranteed instructions. Any requested changes will usually be put into effect approximately two weeks after notification of a change is received. Exchanges made under these plans are subject to the restrictions that apply to exchanges as set forth in this SAI and in "The OppenheimerFunds Exchange Privilege" in the Prospectus.

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The Transfer Agent will administer the Automatic Exchange Plan as agent for the shareholder(s). Neither the Fund nor the Transfer Agent shall incur any liability for any action taken or not taken by the Transfer Agent in good faith to administer the plan. Any share certificates must be surrendered unendorsed to the Transfer Agent with the plan application to be eligible for automatic exchanges. If the Transfer Agent ceases to act as transfer agent for the Fund, the shareholder will be deemed to have appointed any successor transfer agent to act as agent in administering the plan.

The Fund reserves the right to amend, suspend or discontinue offering automatic exchanges at any time without prior notice. By requesting an Automatic Exchange Plan, the shareholder agrees to the terms and conditions that apply to such plans. These provisions may be amended from time to time and any amendments will automatically apply to existing Plans.

Processing Exchange Requests. Shares to be exchanged are redeemed at the net asset value calculated on the regular business day the Transfer Agent receives an exchange request in proper form before the close of the NYSE (the "Redemption Date"). Normally, shares of the fund to be acquired are purchased on the Redemption Date, but such purchases may be delayed by up to five business days if it is determined that either fund 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, any special features of your account that are available in the new fund (such as an Asset Builder Plan or Automatic Withdrawal Plan) will be applied to the new fund account unless you tell the Transfer Agent not to do so.

Shares that are subject to a restriction cited in the Prospectus or this SAI and shares covered by a share certificate that is not tendered will not be exchanged. If an exchange request includes such shares, only the shares available without restrictions will be exchanged.

Distributions and Taxes

Dividends and Other Distributions. Dividends will be payable on shares held of record at the time of the previous determination of net asset value, or as otherwise described in "How to Buy Shares." Daily dividends will not be declared or paid on newly purchased shares until such time as Federal Funds (funds credited to a member bank's account at the Federal Reserve Bank) are available from the purchase payment for such shares. Normally, purchase checks received from investors are converted to Federal Funds on the next business day. Shares purchased through dealers or brokers normally are paid for by the third business day following the placement of the purchase order.

Shares redeemed through the regular redemption procedure will be paid dividends through and including the day on which the redemption request is received by the Transfer Agent in proper form. Dividends will be declared on shares repurchased by a dealer or broker for three business days following the trade date (that is, up to and including the day prior to settlement of the repurchase). If all shares in an account are redeemed, all dividends accrued on shares of the same class in the account will be paid together with the redemption proceeds.

The Fund's practice of attempting to pay dividends on Class A shares at a constant level requires the Manager to monitor the Fund's portfolio and, if necessary, to select higher-yielding securities when it is deemed appropriate to seek income at the level needed to meet the target. Those securities must be within the Fund's investment parameters, however. The Fund expects to pay dividends at a targeted level from its net investment income and other distributable income without any impact on the net asset values per share.

The distributions made by the Fund will vary depending on market conditions, the composition of the Fund's portfolio and Fund expenses. Distributions are calculated in the same manner, at the same time, and on the same day for each class of shares but will normally differ in amount. Distributions on Class B and Class C shares are expected to be lower than distributions on Class A shares and Class Y shares (if applicable) because of the effect of the asset-based sales charge on Class B and Class C shares. Whether they are reinvested in Fund shares or received in cash, distributions are taxable to shareholders, as discussed below, 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.

Returned checks for the proceeds of redemptions are invested in shares of Oppenheimer Money Market Fund, Inc. If a dividend check or a check representing an automatic withdrawal payment is returned to the Transfer Agent by the Postal Service as undeliverable, it will be reinvested in shares of the Fund. Reinvestments will be made as promptly as possible after the return of such checks to the Transfer Agent. 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.

Taxes. The federal tax treatment of the Fund and distributions to shareholders 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 SAI is based on tax laws in effect on the date of the Prospectus and SAI. Those laws and regulations may be changed by legislative, judicial, or administrative action, sometimes with retroactive effect. State and local tax treatment may differ from the treatment under the Internal Revenue Code as described below.

Before purchasing Fund shares, investors are urged to consult their tax advisers with reference to their own particular tax circumstances as well as the consequences of federal, state, local and any other jurisdiction's tax rules affecting an investment in the Fund.

Qualification and Taxation as a Regulated Investment Company. The Fund has elected to be taxed as a regulated investment company ("RIC") under Subchapter M of the Internal Revenue Code. As long as the Fund qualifies as a RIC, 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 capital gains over capital losses) that it distributed to shareholders.

If the Fund qualifies as a "regulated investment company" under the Internal Revenue Code, it will not be liable for federal income tax on amounts it pays as dividends and other distributions. That qualification enables the Fund to "pass through" its income and realized capital gains to shareholders without having to pay tax on them. The Fund qualified as a regulated investment company in its last fiscal year and intends to qualify in future years, but reserves the right not to qualify. The Internal Revenue Code contains a number of complex tests to determine whether the Fund qualifies. One or more Funds might not meet those tests in a particular year. If the Fund does not qualify, the Fund will be treated for tax purposes as an ordinary corporation and will receive no tax deduction for payments of dividends and other distributions made to shareholders. In such an instance, all of the Fund's dividends would b e taxable to shareholders.

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Qualifying as a RIC . To qualify as a RIC, the Fund must be a domestic corporation that is either registered under the Investment Company Act as a management company or unit investment trust or is otherwise described in the Internal Revenue Code as having a specific status under the Investment Company Act. The Fund must also satisfy certain tests with respect to (i) the composition of its gross income, (ii) the composition of its assets and (iii) the amount of its dividend distributions.

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Gross Income Test. To qualify as a RIC, the Fund must derive at least 90% of its gross income from dividends, interest, certain payments with respect to loans of securities, gains from the sale or other disposition of securities or foreign currencies, and certain other income derived with respect to its business of investing in such securities or currencies (including, but not limited to, gains from options, futures or forward contracts), and net income derived from interests in certain "qualified publicly traded partnerships."

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Asset Test. In addition, at the close of each quarter of its taxable year, the Fund must satisfy two asset tests. First, at least 50% of the value of the Fund's assets must consist of U.S. Government securities, securities of other RIC's, securities of other issuers ("Other Issuers") and cash or cash items (including receivables). The securities of an Other Issuer are not counted towards satisfying the 50% test if the Fund either invests more than 5% of the value of the Fund's assets in the securities of that Other Issuer or holds more than 10% of the outstanding voting securities of that Other Issuer. Second, no more than 25% of the value of the Fund's total assets may be invested in (1) the securities of any one issuer (other than U.S. Government securities and the securities of other RIC's), (2) the securities of two or more issuers (other than the securities of other RIC's) that the Fund controls and that are engaged in the same or similar trades or businesses, or (3) the securities of one or more qualified publicly traded partnerships. For purposes of these tests, obligations issued or guaranteed by certain agencies or instrumentalities of the U.S. Government are treated as U.S. Government securities.

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Dividend Distributions Test. During the taxable year or, under specified circumstances, within 12 months after the close of the taxable year, the Fund must distribute at least 90% of its investment company taxable income and at least 90% of its net tax-exempt income for the taxable year, which is generally its net investment income and the excess of its net short-term capital gain minus its net long-term capital loss.

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Excise Tax on Regulated Investment Companies. Under the Internal Revenue Code, the Fund must pay an annual, non-deductible excise tax unless, by December 31st each year, it distributes (1) 98% of its taxable investment income earned from January 1 through December 31, (2) 98% of its capital gain net income realized in the period from November 1 of the prior year through October 31 of the current year and (3) undistributed amounts from prior years. It is presently anticipated that the Fund will meet these distribution requirements, although to do so the Fund might be required to liquidate portfolio investments in certain circumstances. In some years, the Board and the Manager may determine that it would be in the shareholders' best interests for the Fund to pay the excise tax on undistributed amounts rather than making the required level of distributions. In that event, the tax may reduce the amount available for shareholder distributions.

Taxation of Fund Distributions. Distributions by the Fund will be treated in the manner described below regardless of whether the distributions are paid in cash or reinvested in additional shares of the Fund (or of another fund). The Fund's distributions will be treated as dividends to the extent paid from the Fund's earnings and profits (as determined under the Internal Revenue Code). Distributions in excess of the Fund's earnings and profits will first reduce the adjusted tax basis of a shareholder's shares and, after such tax basis is reduced to zero, will constitute capital gain to the shareholder (assuming the shares are held as a capital asset). The Fund's dividends will not be eligible for the dividends-received deduction for corporations. Shareholders reinvesting a distribution in shares of the distributing Fund, one of the other funds Fund or another fund 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.

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Exempt-Interest Dividends. The Fund intends to satisfy the requirements under the Internal Revenue Code during each fiscal year to pay "exempt-interest dividends" to its shareholders. To qualify, at the end of each quarter of its taxable year, at least 50% of the value of the Fund's total assets must consist of obligations described in Section 103(a) of the Internal Revenue Code, as amended. Dividends that are derived from net interest income earned by the Fund on tax-exempt municipal securities and designated as "exempt-interest dividends" in a written notice sent by the Fund to its shareholders within 60 days after the close of the Fund's taxable year will be excludable from gross income of shareholders for federal income tax purposes. To the extent any Fund fails to qualify to pay exempt-interest dividends in any given taxable year, such dividends would be included in the gross income of shar eholders for federal income tax purposes.

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The Fund will allocate interest from tax-exempt municipal securities (as well as ordinary income, capital gains, and tax preference items discussed below) among its shares according to a method that is based on the gross income allocable to each class of shareholders during the taxable year (or under another method, if prescribed by the IRS and SEC). The percentage of each distribution with respect to a taxable year of the Fund that is an exempt-interest dividend will be the same, even though that percentage may differ substantially from the percentage of the Fund's income that was tax-exempt during a particular portion of the year. This percentage normally will be designated after the close of the taxable year.

Exempt-interest dividends are excludable from a shareholder's gross income for federal income tax purposes. Interest on indebtedness incurred or continued to purchase or carry shares of a regulated investment company paying exempt-interest dividends, such as the Fund, will not be deductible by the investor for federal income tax purposes to the extent attributable to exempt-interest dividends. Shareholders receiving Social Security or railroad retirement benefits should be aware that exempt-interest dividends are a factor in determining whether, and to what extent, such benefits are subject to federal income tax.

A portion of the exempt-interest dividends paid by the Fund may give rise to liability under the federal alternative minimum tax for individual or corporate shareholders. Income on certain private activity bonds issued after August 7, 1986, while excludable from gross income for purposes of the federal income tax, is an item of "tax preference" that must be included in income for purposes of the federal alternative minimum tax for individuals and corporations. "Private activity bonds" are bonds that are used for purposes not generally performed by governmental entities and that benefit non-governmental entities. The amount of any exempt-interest dividends that is attributable to tax preference items for purposes of the alternative minimum tax will be identified when tax information is distributed by the Fund.

In addition, corporate taxpayers are subject to the federal alternative minimum tax based in part on certain differences between taxable income as adjusted for other tax preferences and the corporation's "adjusted current earnings," which more closely reflect a corporation's economic income. Because an exempt-interest dividend paid by the Fund will be included in adjusted current earnings, a corporate shareholder may be required to pay alternative minimum tax on exempt-interest dividends paid by the Fund.

Shareholders are advised to consult their tax advisers with respect to their liability for federal alternative minimum tax, and for advice concerning the loss of exclusion from gross income for exempt-interest dividends paid to a shareholder who would be treated as a "substantial user" or "related person" under Section 147(a) of the Internal Revenue Code with respect to property financed with the proceeds of an issue of private activity bonds held by the Fund.

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Ordinary Income Dividends. Distributions from income earned by the Fund from one or more of the following sources will be treated as ordinary income to the shareholder:

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certain taxable temporary investments (such as certificates of deposit, repurchase agreements, commercial paper and obligations of the U.S. Government, or its agencies and instrumentalities);

income from loans of portfolio securities;

income or gains from options or futures;

any net short-term capital gain; and

any market discount accrual on tax-exempt bonds.

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Capital Gain Distributions. The Fund may either retain or distribute to shareholders its net capital gain (the excess of net long-term capital gain over net short-term capital loss). Currently, the Fund intends to distribute these gains. Distributed net capital gain that is properly designated will be taxable to the Fund's shareholders as long-term capital gains. The amount of distributions designated as net capital gain will be reported to shareholders shortly after the end of each year. Such treatment will apply no matter how long the shareholder has held Fund shares and even if the gain was recognized by the Fund before the shareholder acquired Fund shares.

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If the Fund elects to retain its net capital gain for a taxable year, the Fund will be subject to tax on such gain at the highest corporate tax rate. Each shareholder of record on the last day of such taxable year will be informed of his or her portion of both the gain and the tax paid, will be required to report the gain as long-term capital gain, will be able to claim the tax paid as a refundable credit, and will increase the basis of his or her shares by the amount of the capital gain reported minus the tax credit.

Backup withholding. The Fund will be required in certain cases to withhold 28% of ordinary income dividends, capital gain 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 properly the receipt of interest or dividend income, 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 is identified in reports mailed to shareholders in January of each year with a copy sent to the IRS. Backup withholding is not an additional tax. Any amount withheld generally may be allowed as a refund or a credit against a shareholder's federal income tax liability, provided the required information is timely provided to the IRS.

Tax Consequences of Share Redemptions. If all or a portion of a shareholder's investment in the Fund is redeemed, the shareholder will recognize a gain or loss on the redeemed shares equal to the difference between the proceeds of the redeemed shares and the shareholder's adjusted tax basis in the shares. In general, any gain or loss from the redemption of shares of the Fund will be considered capital gain or loss if the shares were held as a capital asset and will be long-term capital gain or loss if the shares were held for more than one year. Any capital loss arising from the redemption of shares held for six months or less, however, 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. There are limits on the deductibili ty of capital losses in any year.

All or a portion of any loss on redeemed shares may be disallowed if the shareholder purchases other shares of the Fund within 30 days before or after the redemption (including purchases through the reinvestment of dividends). In that case, the basis of the acquired shares will be adjusted to reflect the disallowed loss. Losses realized by a shareholder on the redemption of Fund shares within six months of purchase will be disallowed for federal income tax purposes to the extent of exempt-interest dividends received on such shares. If a shareholder exercises the exchange privilege within 90 days after acquiring Fund shares, any loss that the shareholder recognizes on the exchange will be reduced, or any gain will be increased, to the extent that sales charge paid on the exchanged shares reduces any charges the shareholder would have incurred on the purchase of the new shares in the absence of the exchange privilege. Such sales charge will be treated as an amount paid for the new shares.

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Taxation of Foreign Shareholders. Taxation of a foreign shareholder depends primarily on whether the foreign shareholder'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. "Foreign shareholders" include, but are not limited to, a nonresident alien individual, a foreign trust, a foreign estate, a foreign corporation, or a foreign partnership.

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If a foreign shareholder fails to provide a properly completed and signed Certificate of Foreign Status, the Fund will be required to withhold U.S. tax on ordinary income dividends, capital gains distributions and the proceeds of the redemption of shares. Provided the Fund obtains a proper certification of foreign status, ordinary income dividends that are paid by the Fund to foreign shareholders and that are not "effectively connected income," will be subject to a U.S. withholding tax. The tax rate may be reduced if the foreign person's country of residence has an income tax treaty with the United States allowing for a reduced tax rate on ordinary income dividends paid by the Fund. If the ordinary income dividends from the Fund are effectively connected with the conduct of a U.S. trade or business, then the foreign shareholder may claim an exemption from the U.S. withholding tax described above provided the Fund obtains a properly completed and signed Certificate of Foreign Status. Any tax withheld by the Fund is remitted to the U.S. Treasury and all income and any tax withheld is identified in reports mailed to shareholders in the early part of each year with a copy sent to the IRS. Capital gain dividends are not subject to U.S. withholding tax unless the recipient is a nonresident alien who is present in the United States for 183 days or more during the taxable year in which the dividends are received. A foreign individual who is present in the United States for 183 days or more generally loses his or her status as a nonresident alien.

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For taxable years of the Fund beginning before January 1, 2010, properly designated dividends are generally exempt from U.S. federal withholding tax on foreign persons provided such dividends (i) are derived from the Fund's "qualified net interest income" (generally, the Fund's U.S. source interest income, other than certain contingent interest and interest from obligations of a corporation or partnership in which the Fund is a 10% or greater shareholder, reduced by expenses that are allocable to such income) or (ii) are derived from the Fund's "qualified short-term capital gains" (generally, the excess of the Fund's net short-term capital gain over the Fund's net long-term capital loss for such taxable year). In order to qualify for this exemption from withholding, a shareholder that is a foreign person must comply with applicable certification requirements relating to its non-U.S. status. However, depen ding on its circumstances, the Fund may designate some, all, or none of its potentially eligible dividends as interest-related dividends or as short-term capital gain dividends, and/or treat such dividends, in whole or in part, as ineligible for this exemption from withholding on foreign persons. In the case of shares held through an intermediary, the intermediary may withhold even if the Fund designates the payment as qualified net interest income or qualified short-term capital gain. Legislation to extend this exemption to tax years beginning on or after January 1, 2010 has not been enacted. Shareholders that are foreign persons should contact their intermediaries with respect to the application of these rules to their accounts.

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Under recently-enacted legislation, payments after 2012 of dividends on, and gross proceeds from the redemption of, shares of the Fund made to "foreign financial institutions" and certain other foreign entities will be subject to U.S. withholding tax at a rate of 30% unless various certification, information reporting, due diligence and other applicable requirements (different from, and in addition to, those described above) are satisfied. Payments that are taken into account as effectively connected income are not subject to these withholding rules. Foreign shareholders should consult their own tax advisors as to the applicability and consequences of this new legislation to them.

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The tax consequences to foreign persons entitled to claim the benefits of an applicable income tax treaty may be different from those described in this SAI. Foreign shareholders are urged to consult their tax advisers with respect to the particular tax consequences of an investment in the Fund, including the applicability of the U.S. withholding taxes described above.

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Recently-enacted legislation imposes information reporting requirements on individuals that hold any interest in a "specified foreign financial asset" if the aggregate value of all such assets held by such individual exceeds $50,000. Significant penalties can apply upon a failure to make the required disclosure and in respect to understatements of tax attributable to undisclosed foreign financial assets. This information reporting requirement is generally applicable for taxable years beginning after March 18, 2010. The scope of this reporting requirement is not entirely clear and all shareholders should consult their own tax advisors as to whether reporting may be required in respect of their indirect interests in the Fund's investments.

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Tax Shelter and Other Reporting Requirements. If a shareholder realizes a loss on the disposition of Fund shares of at least $2 million in any single taxable year or $4 million in any combination of taxable years (for an individual shareholder); or at least $10 million in any single taxable year or $20 million in any combination of taxable years (for a corporate shareholder), the shareholder must file with the Internal Revenue Service a disclosure statement on Form 8886. Shareholders should consult their tax advisers to determine the applicability of this requirement in light of their individual circumstances.

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Additional Information About the Fund

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The Distributor. The Fund's shares are sold through dealers, brokers and other financial institutions that have a sales agreement with OppenheimerFunds Distributor, Inc., a subsidiary of the Manager that acts as the Fund's Distributor. The Distributor also distributes shares of the other Oppenheimer funds.

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The Transfer Agent. OppenheimerFunds Services, the Fund's Transfer Agent, is a division of the Manager. It is responsible for maintaining the Fund's shareholder registry and shareholder accounting records, and for paying dividends and distributions to shareholders. It also handles shareholder servicing and administrative functions. It serves as the Transfer Agent for an annual per account fee. It also acts as shareholder servicing agent for the other Oppenheimer funds. Shareholders should direct inquiries about their accounts to the Transfer Agent at the address and toll-free numbers shown on the back cover.

The Custodian. Citibank, N.A. is the custodian of the Fund's assets. The custodian's responsibilities include safeguarding and controlling the Fund's portfolio securities and handling the delivery of such securities to and from the Fund. It is the practice of the Fund to deal with the custodian in a manner uninfluenced by any banking relationship the custodian may have with the Manager and its affiliates. The Fund's cash balances with the custodian in excess of $250,000 are not protected by the federal deposit insurance corporation ("FDIC"). The FDIC protected amount will fall to $100,000 on January 1, 2014 unless the higher limit is extended by legislation. Those uninsured balances at times may be substantial.

Independent Registered Public Accounting Firm. KPMG LLP serves as the independent registered public accounting firm for the Fund. KPMG LLP audits the Fund's financial statements and performs other related audit and tax services. KPMG LLP also acts as the independent registered public accounting firm for the Manager and certain other funds advised by the Manager and its affiliates. Audit and non-audit services provided by KPMG LLP to the Fund must be pre-approved by the Audit Committee.

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Special Sales Charge Arrangements and Waivers

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OppenheimerFunds Special Sales Charge Arrangements and Waivers

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In certain cases, the initial sales charge that applies to purchases of Class A shares of the Oppenheimer funds or the contingent deferred sales charge ("CDSC") that may apply to Class A, Class B, Class C or N shares may be waived. 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.

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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:

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plans created or qualified under Sections 401(a) or 401(k) of the Internal Revenue Code,
non-qualified deferred compensation plans,
employee benefit plans,¹
Group Retirement Plans,²
403(b)(7) custodial plan accounts, and
Individual Retirement Accounts ("IRAs"), including traditional IRAs, Roth IRAs, SEP-IRAs, SARSEPs or SIMPLE plans

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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).

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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 CDSC if redeemed within 18 months (24 months in the case of shares of Oppenheimer Rochester National Municipals and Rochester Fund Municipals shares purchased prior to 10/22/07) 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 CDSC, the Distributor will pay the applicable concession described in the Prospectus under "Class A Contingent Deferred Sales Charge."³ This waiver provision applies to:

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Purchases of Class A shares aggregating $1 million or more.

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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.

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Purchases by an OppenheimerFunds-sponsored Rollover IRA, if the purchases are made:

through a broker, dealer, bank or registered investment adviser that has made special arrangements with the Distributor for those purchases, or
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:

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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"). 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.
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.
The record keeping for a Retirement Plan is handled under a service agreement with Merrill Lynch and on the date of the plan sponsor signs that agreement, the Plan has 500 or more eligible employees (as determined by the Merrill Lynch plan conversion manager).

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II. Waivers of Class A Sales Charges of Oppenheimer Funds

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A. Waivers of Initial and Contingent Deferred Sales Charges for Certain Purchasers.

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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.

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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.

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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 advisers 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 advisers 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.

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Clients of investment advisers 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.

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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 adviser (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.

Effective October 1, 2005, taxable accounts established with the proceeds of Required Minimum Distributions from Retirement Plans.

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Purchases of Class A shares by former shareholders of Atlas Strategic Income Fund in any Oppenheimer fund into which shareholders of Oppenheimer Global Strategic Income Fund may exchange.

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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 CDSC is also waived if shares that would otherwise be subject to the CDSC 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:

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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.
To return excess contributions.
To return contributions made due to a mistake of fact.
Hardship withdrawals, as defined in the plan.⁴
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.
To meet the minimum distribution requirements of the Internal Revenue Code.
To make "substantially equal periodic payments" as described in Section 72(t) of the Internal Revenue Code.
For loans to participants or beneficiaries.
Separation from service.⁵
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.
Plan termination or "in-service distributions," if the redemption proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA.

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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.

At the sole discretion of the Distributor, the CDSC may be waived for redemptions of shares requested by the shareholder of record within 60 days following the termination by the Distributor of the selling agreement between the Distributor and the shareholder of record's broker-dealer of record for the account.

III. Waivers of Class B, Class C and Class N Sales Charges of Oppenheimer Funds

The Class B, Class C and Class N CDSCs 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 CDSCs 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 CDSCs are generally not waived following the death or disability of a grantor or trustee for a trust account. The CDSCs 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.

At the sole discretion of the Distributor, the CDSC may be waived for redemptions of shares requested by the shareholder of record within 60 days following the termination by the Distributor of the selling agreement between the Distributor and the shareholder of record's broker-dealer of record for the account.

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 B shares by a Retirement Plan that is either created or qualified under Section 401(a) or 401(k) (excluding owner-only 401(k) plans) of the Internal Revenue Code or that is a non-qualified deferred compensation plan, either (1) purchased after June 30, 2008, or (2) beginning on July 1, 2011, held longer than three years.

Redemptions by owner-only 401(k) plans of Class B shares purchased after June 30, 2008.

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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.

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Distributions⁶ from Retirement Plans or other employee benefit plans for any of the following purposes:

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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.
To return excess contributions made to a participant's account.
To return contributions made due to a mistake of fact.
To make hardship withdrawals, as defined in the plan.⁴
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.
To meet the minimum distribution requirements of the Internal Revenue Code.
To make "substantially equal periodic payments" as described in Section 72(t) of the Internal Revenue Code.
For loans to participants or beneficiaries.⁷
On account of the participant's separation from service.⁸
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.
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.
For distributions from a participant's account under an Automatic Withdrawal Plan after the participant reaches age 59½, as long as the aggregate value of the distributions does not exceed 10% of the account's value, adjusted annually.
For distributions from 401(k) plans sponsored by broker-dealers that have entered into a special arrangement with the Distributor allowing this waiver.

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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.

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The CDSC is also waived on Class B, Class C and Class N shares sold or issued in the following cases:

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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.

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IV. Special Sales Charge Arrangements for Former Shareholders of Quest for Value Funds

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For shareholders of the Quest for Value Funds who acquired shares prior to November 24, 1995 and still hold those shares (or shares of an Oppenheimer fund into which any Quest for Value Fund was reorganized), any initial and contingent deferred sales charges will be waived if requested by the shareholder.

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V. Special Sales Charge Arrangements for Former Shareholders of Connecticut Mutual Investment Accounts, Inc.

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For shareholders of the Connecticut Mutual Investment Accounts who acquired shares prior to March 1, 1996 and still hold those shares (or shares of an Oppenheimer fund into which any Connecticut Mutual Investment Account was reorganized), any initial and contingent deferred sales charges will be waived if requested by the shareholder.

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VI. Special Sales Charge Arrangements for Former Shareholders of Advance America Funds, Inc.

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For shareholders of the Advanced America Funds who acquired shares prior to October 18, 1991 and still hold those shares (or shares of an Oppenheimer fund into which any Advanced American Fund was reorganized), any initial and contingent deferred sales charges will be waived if requested by the shareholder.

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Footnotes to Appendix A:

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.

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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 Op penheimer fund or funds through a single investment dealer, broker or other financial institution that has made special arrangements with the Distributor.

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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.

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4.	This provision does not apply to IRAs.

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5.	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.

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6.	The distribution must be requested prior to Plan termination or the elimination of the Oppenheimer funds as an investment option under the Plan.

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7.	This provision does not apply to loans from 403(b)(7) custodial plans and loans from the OppenheimerFunds-sponsored Single K retirement plan.

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8.	This provision does not apply to 403(b)(7) custodial plans if the participant is less than age 55, nor to IRAs.

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Municipal Bond Ratings Definitions

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Municipal Bond Ratings Definitions

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Below are summaries of the rating definitions used by the nationally recognized rating agencies listed below for municipal securities. Those ratings represent the opinion of the agency as to the credit quality of issues that they rate. The summaries below are based upon publicly available information provided by the rating organizations.

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Moody's Investors Service, Inc. ("Moody's")

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LONG-TERM OBLIGATION RATINGS

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Moody's long-term obligation ratings are opinions of the relative credit risk of fixed-income obligations with an original maturity of one year or more. They address the possibility that a financial obligation will not be honored as promised. Such ratings reflect both the likelihood of default and any financial loss suffered in the event of default.

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Aaa: Obligations rated Aaa are judged to be of the highest quality, with minimal credit risk.

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Aa: Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.

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A: Obligations rated A are considered upper-medium grade and are subject to low credit risk.

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Baa: Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics.

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Ba: Obligations rated Ba are judged to have speculative elements and are subject to substantial credit risk.

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B: Obligations rated B are considered speculative and are subject to high credit risk.

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Caa: Obligations rated Caa are judged to be of poor standing and are subject to very high credit risk.

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Ca: Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.

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C: Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest.

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Moody's appends numerical modifiers "1", "2" and "3" to each generic rating classification from "Aa" through "Caa." The modifier "1" indicates that the obligation ranks in the higher end of its generic rating category; the modifier "2" indicates a mid-range ranking; and the modifier "3" indicates a ranking in the lower end of that generic rating category.

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US MUNICIPAL SHORT-TERM DEBT AND DEMAND OBLIGATION RATINGS

SHORT-TERM OBLIGATION RATINGS

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There are three rating categories for short-term municipal obligations that are considered investment grade. These ratings are designated as Municipal Investment Grade (MIG) and are divided into three levels - MIG 1 through MIG 3. In addition, those short-term obligations that are of speculative quality are designated SG, or speculative grade. MIG ratings expire at the maturity of the obligation.

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MIG 1: This designation denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for refinancing.

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MIG 2: This designation denotes strong credit quality. Margins of protection are ample, although not as large as in the preceding group.

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MIG 3: This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow, and market access for refinancing is likely to be less well-established.

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SG: This designation denotes speculative-grade credit quality. Debt instruments in this category may lack sufficient margins of protection.

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DEMAND OBLIGATION RATINGS

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In the case of variable rate demand obligations ("VRDOs"), a two-component rating is assigned; a long or short-term debt rating and a demand obligation rating. The first element represents Moody's evaluation of the degree of risk associated with scheduled principal and interest payments. The second element represents Moody's evaluation of the degree of risk associated with the ability to receive purchase price upon demand ("demand feature"), using a variation of the MIG rating scale, the Variable Municipal Investment Grade or VMIG rating.
When either the long- or short-term aspect of a VRDO is not rated, that piece is designated NR, e.g., Aaa/NR or NR/VMIG 1. VMIG rating expirations are a function of each issue's specific structural or credit features.

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VMIG 1: This designation denotes superior credit quality. Excellent protection is afforded by the superior short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.

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VMIG 2: This designation denotes strong credit quality. Good protection is afforded by the strong short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.

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VMIG 3: This designation denotes acceptable credit quality. Adequate protection is afforded by the satisfactory short-term credit strength of the liquidity provider and structural and legal protections that ensure the timely payment of purchase price upon demand.

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SG: This designation denotes speculative-grade credit quality. Demand features rated in this category may be supported by a liquidity provider that does not have an investment grade short-term rating or may lack the structural and/or legal protections necessary to ensure the timely payment of purchase price upon demand.

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Standard & Poor's Ratings Services ("Standard & Poor's"), a division of The McGraw-Hill Companies, Inc.

LONG-TERM ISSUE CREDIT RATINGS
Issue credit ratings are based in varying degrees, on the following considerations:

Likelihood of payment-capacity and willingness of the obligor to meet its financial commitment on an obligation in accordance with the terms of the obligation;

Nature of and provisions of the obligation; and

Protection afforded by, and relative position of, the obligation in the event of bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors' rights.

The issue ratings definitions are expressed in terms of default risk. As such, they pertain to senior obligations of an entity. Junior obligations are typically rated lower than senior obligations, to reflect the lower priority in bankruptcy, as noted above.

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AAA: An obligation rated 'AAA' has the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its financial commitment on the obligation is extremely strong.

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AA: An obligation rated 'AA' differs from the highest-rated obligations only in small degree. The obligor's capacity to meet its financial commitment on the obligation is very strong.

A: An obligation rated 'A' is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. However, the obligor's capacity to meet its financial commitment on the obligation is still strong.

BBB: An obligation rated 'BBB' exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

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BB, B, CCC, CC, and C: Obligations rated 'BB', 'B', 'CCC', 'CC', and 'C' are regarded as having significant speculative characteristics. 'BB' indicates the least degree of speculation and 'C' the highest. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions.

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BB: An obligation rated 'BB' is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions, which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation.

B: An obligation rated 'B' is more vulnerable to nonpayment than obligations rated 'BB', but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the obligation.

CCC: An obligation rated 'CCC' is currently vulnerable to nonpayment and are dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.

CC: An obligation rated 'CC' is currently highly vulnerable to nonpayment.

C: The 'C' rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been taken, but payments on this obligation are being continued.

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D: An obligation rated 'D' is in payment default. The 'D' rating category is used when payments on an obligation are not made on the date due even if the applicable grace period has not expired, unless Standard & Poor's believes that such payments will be made during such grace period. The 'D' rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on an obligation are jeopardized.

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The ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.

c: The 'c' subscript is used to provide additional information to investors that the bank may terminate its obligation to purchase tendered bonds if the long-term credit rating of the issuer is below an investment-grade level and/or the issuer's bonds are deemed taxable.

p: The letter 'p' indicates that the rating is provisional. A provisional rating assumes the successful completion of the project financed by the debt being rated and indicates that payment of debt service requirements is largely or entirely dependent upon the successful, timely completion of the project. This rating, however, while addressing credit quality subsequent to completion of the project, makes no comment on the likelihood of or the risk of default upon failure of such completion. The investor should exercise his own judgment with respect to such likelihood and risk.

Continuance of the ratings is contingent upon Standard & Poor's receipt of an executed copy of the escrow agreement or closing documentation confirming investments and cash flows.

r: The 'r' highlights derivative, hybrid, and certain other obligations that Standard & Poor's believes may experience high volatility or high variability in expected returns as a result of noncredit risks. Examples of such obligations are securities with principal or interest return indexed to equities, commodities, or currencies; certain swaps and options; and interest-only and principal-only mortgage securities. The absence of an 'r' symbol should not be taken as an indication that an obligation will exhibit no volatility or variability in total return.

N.R. Not rated.

Debt obligations of issuers outside the United States and its territories are rated on the same basis as domestic corporate and municipal issues. The ratings measure the creditworthiness of the obligor but do not take into account currency exchange and related uncertainties.

Bond Investment Quality Standards

Under present commercial bank regulations issued by the Comptroller of the Currency, bonds rated in the top four categories ('AAA', 'AA', 'A', and 'BBB', commonly known as investment-grade ratings) generally are regarded as eligible for bank investment. Also, the laws of various states governing legal investments impose certain rating or other standards for obligations eligible for investment by savings banks, trust companies, insurance companies, and fiduciaries in general.

SHORT-TERM ISSUE CREDIT RATINGS
Short-term ratings are generally assigned to those obligations considered short-term in the relevant market. In the U.S., for example, that means obligations with an original maturity of no more than 365 days-including commercial paper.

A-1: A short-term obligation rated "A-1" is rated in the highest category by Standard & Poor's. The obligor's capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor's capacity to meet its financial commitment on these obligations is extremely strong.

A-2: A short-term obligation rated "A-2" is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor's capacity to meet its financial commitment on the obligation is satisfactory.

A-3: A short-term obligation rated "A-3" exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

B: A short-term obligation rated "B" is regarded as having significant speculative characteristics. The obligor currently has the capacity to meet its financial commitment on the obligation; however, it faces major ongoing uncertainties which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation.

C: A short-term obligation rated "C" is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation.

D: A short-term obligation rated "D" is in payment default. The "D" rating category is used when payments on an obligation are not made on the date due even if the applicable grace period has not expired, unless Standard & Poor's believes that such payments will be made during such grace period. The "D" rating also will be used upon the filing of a bankruptcy petition or the taking of a similar action if payments on an obligation are jeopardized.

Notes. A Standard & Poor's note rating reflects the liquidity factors and market access risks unique to notes. Notes due in three years or less will likely receive a note rating. Notes maturing beyond three years will most likely receive a long-term debt rating. The following criteria will be used in making that assessment:

Amortization schedule-the larger the final maturity relative to other maturities, the more likely it will
be treated as a note; and

Source of payment-the more dependent the issue is on the market for its refinancing, the more likely
it will be treated as a note.

SP-1: Strong capacity to pay principal and interest. An issue with a very strong capacity to pay debt service is given a (+) designation.

SP-2: Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the term of the notes.

SP-3: Speculative capacity to pay principal and interest.

Fitch, Inc.
International credit ratings assess the capacity to meet foreign currency or local currency commitments. Both "foreign currency" and "local currency" ratings are internationally comparable assessments. The local currency rating measures the probability of payment within the relevant sovereign state's currency and jurisdiction and therefore, unlike the foreign currency rating, does not take account of the possibility of foreign exchange controls limiting transfer into foreign currency.

INTERNATIONAL LONG-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings.
Investment Grade:

AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of credit risk. They are assigned only in the case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.

AA: Very High Credit Quality. "AA" ratings denote a very low expectation of credit risk. They indicate a very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.

A: High Credit Quality. "A" ratings denote a low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to changes in circumstances or in economic conditions than is the case for higher ratings.

BBB: Good Credit Quality. "BBB" ratings indicate that there is currently a low expectation of credit risk. The capacity for timely payment of financial commitments is considered adequate, but adverse changes in circumstances and in economic conditions are more likely to impair this capacity. This is the lowest investment-grade category.

Speculative Grade:

BB: Speculative. "BB" ratings indicate that there is a possibility of credit risk developing, particularly as the result of adverse economic change over time. However, business or financial alternatives may be available to allow financial commitments to be met. Securities rated in this category are not investment grade.

B: Highly Speculative. "B" ratings indicate that significant credit risk is present, but a limited margin of safety remains. Financial commitments are currently being met. However, capacity for continued payment is contingent upon a sustained, favorable business and economic environment.

CCC, CC, and C: High Default Risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon sustained, favorable business or economic developments. A "CC" rating indicates that default of some kind appears probable. "C" ratings signal imminent default.

DDD, DD, and D: Default. The ratings of obligations in this category are based on their prospects for achieving partial or full recovery in a reorganization or liquidation of the obligor. While expected recovery values are highly speculative and cannot be estimated with any precision, the following serve as general guidelines. "DDD" obligations have the highest potential for recovery, around 90%-100% of outstanding amounts and accrued interest. "DD" indicates potential recoveries in the range of 50%-90%, and "D" the lowest recovery potential, i.e., below 50%.

Entities rated in this category have defaulted on some or all of their obligations. Entities rated "DDD" have the highest prospect for resumption of performance or continued operation with or without a formal reorganization process. Entities rated "DD" and "D" are generally undergoing a formal reorganization or liquidation process; those rated "DD" are likely to satisfy a higher portion of their outstanding obligations, while entities rated "D" have a poor prospect for repaying all obligations.
Plus (+) and minus (-) signs may be appended to a rating symbol to denote relative status within the major rating categories. Plus and minus signs are not added to the "AAA" category or to categories below "CCC," nor to short-term ratings other than "F1" (see below).

INTERNATIONAL SHORT-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings. A short-term rating has a time horizon of less than 12 months for most obligations, or up to three years for U.S. public finance securities, and thus places greater emphasis on the liquidity necessary to meet financial commitments in a timely manner.

F1: Highest credit quality. Strongest capacity for timely payment of financial commitments. May have an added "+" to denote any exceptionally strong credit feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of safety is not as great as in the case of higher ratings.

F3: Fair credit quality. Capacity for timely payment of financial commitments is adequate. However, near-term adverse changes could result in a reduction to non-investment grade.

B: Speculative. Minimal capacity for timely payment of financial commitments, plus vulnerability to near-term adverse changes in financial and economic conditions.

C: High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely reliant upon a sustained, favorable business and economic environment.

D: Default. Denotes actual or imminent payment default.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Trustees and Shareholders of Oppenheimer AMT-Free Municipals:

We have audited the accompanying statement of assets and liabilities of Oppenheimer AMT-Free Municipals, including the statement of investments, as of July 30, 2010, and the related statement of operations and cash flows for the year then ended, the statements of changes in net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended. 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of July 30, 2010, by correspondence with the custodian and brokers, or by other appropriate auditing procedures where replies from brokers were not received. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our 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 AMT-Free Municipals as of July 30, 2010, the results of its operations and its cash flows for the year then ended, the changes in its net assets for each of the years in the two-year period then ended, and the financial highlights for each of the years in the five-year period then ended, in conformity with U.S. generally accepted accounting principles.

KPMG llp

Denver, Colorado
September 17, 2010

STATEMENT OF INVESTMENTS July 30, 2010*


Principal
Amount			Coupon			Maturity		Value

Municipal Bonds and Notes - 117.4%
Alabama-1.4%
$	30,000	AL 21st Century Authority Tobacco Settlement		5.500	%		12/01/2021	$	29,897
	50,000	AL DCH Health Care Authority (Health Care Facilities)¹		5.000			06/01/2021		50,010
	15,000	AL HFA (Pelican)¹		6.550			03/20/2030		15,008
	12,000,000	AL Public School & College Authority²		5.000			05/01/2029		14,671,080
	1,325,000	AL Space Science Exhibit Finance Authority¹		6.000			10/01/2025		1,110,496
	3,000,000	Birmingham, AL Baptist Medical Centers (Baptist Health System)¹		5.250			11/15/2020		2,976,240
	35,000	Birmingham, AL Baptist Medical Centers (Baptist Health System)¹		5.625			11/15/2015		35,990
	15,000	Birmingham, AL Baptist Medical Centers (Baptist Health System)¹		5.875			11/15/2024		15,057
	400,000	Birmingham, AL Private Educational Building Authority (Birmingham-Southern College)¹		6.125			12/01/2025		384,784
	15,000	Birmingham, AL Special Care Facilities (Children's Hospital of Alabama)¹		5.500			06/01/2022		15,012
	90,000	Birmingham, AL Special Care Facilities Financing Authority (Daughters of Charity)¹		5.000			11/01/2025		90,275
	235,000	Cooperative District, AL Fort Deposit¹		6.000			02/01/2036		176,776
	3,500,000	Cullman County, AL Health Care Authority (Cullman Regional Medical Center)¹		6.750			02/01/2029		3,628,065
	6,250,000	Cullman County, AL Health Care Authority (Cullman Regional Medical Center)¹		7.000			02/01/2036		6,513,750
	185,000	Fayette, AL Waterworks		5.250			10/01/2016		185,117
	280,000	Greater Montgomery, AL Educational Building Authority (Huntingdon College)¹		5.100			05/01/2016		284,777
	10,000	Jefferson County, AL Sewer		4.500			02/01/2012		5,279
	100,000	Jefferson County, AL Sewer		5.000			02/01/2018		39,651
	150,000	Jefferson County, AL Sewer		5.000			02/01/2020		59,252
	4,060,000	Jefferson County, AL Sewer		5.375			02/01/2027		1,553,234
	35,000	Jefferson County, AL Sewer		5.625			02/01/2018		13,869
	280,000	Jefferson County, AL Sewer		5.625			02/01/2022		113,084
	1,950,000	Tuscaloosa, AL Educational Building Authority (Stillman College)¹		5.000			06/01/2026		1,768,962
	5,000,000	Tuscaloosa, AL Educational Building Authority (Stillman College)¹		5.250			06/01/2037		4,376,350

									38,112,015

Alaska-1.4%
	10,000	AK HFC¹		5.200			06/01/2021		10,101
	40,000	AK HFC (Veterans Mtg.)¹		6.150			06/01/2039		40,038
	8,000,000	AK HFC, Series A²		5.000			12/01/2033		8,038,640

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Alaska Continued
$	750,000	AK Industrial Devel. & Export Authority (Anchorage Sportsplex/Grace Community Church Obligated Group)		6.150	%		08/01/2031	$	225,855
	600,000	AK Industrial Devel. & Export Authority Community Provider (Boys & Girls Home)		5.875			12/01/2027		382,734
	29,090,000	AK Northern Tobacco Securitization Corp. (TASC)¹		5.000			06/01/2032		21,991,458
	11,005,000	AK Northern Tobacco Securitization Corp. (TASC)¹		5.000			06/01/2046		7,116,163

									37,804,989

Arizona-4.9%
	1,000,000	Buckeye, AZ Watson Road Community Facilities District¹		5.750			07/01/2022		883,020
	1,415,000	Buckeye, AZ Watson Road Community Facilities District¹		6.000			07/01/2030		1,169,356
	200,000	Centerra, AZ Community Facilities District¹		5.150			07/15/2031		153,598
	365,950	Central AZ Irrigation & Drain District, Series A¹		6.000			06/01/2013		366,462
	305,000	Estrella Mountain Ranch, AZ Community Facilities District¹		5.450			07/15/2021		287,917
	200,000	Estrella Mountain Ranch, AZ Community Facilities District¹		5.625			07/15/2025		183,412
	600,000	Estrella Mountain Ranch, AZ Community Facilities District¹		5.800			07/15/2030		549,012
	1,015,000	Estrella Mountain Ranch, AZ Community Facilities District¹		5.900			07/15/2022		982,865
	330,000	Estrella Mountain Ranch, AZ Community Facilities District¹		6.125			07/15/2027		313,490
	500,000	Estrella Mountain Ranch, AZ Community Facilities District¹		6.200			07/15/2032		473,090
	496,000	Festival Ranch, AZ Community Facilities District¹		5.750			07/01/2032		406,938
	595,000	Festival Ranch, AZ Community Facilities District¹		5.800			07/15/2032		546,632
	250,000	Gladden Farms, AZ Community Facilities District¹		5.500			07/15/2031		200,250
	800,000	Litchfield Park, AZ Community Facility District¹		6.375			07/15/2026		755,296
	1,145,000	Maricopa County, AZ IDA (Christian Care Apartments)¹		6.500			01/01/2036		1,094,322
	2,000,000	Maricopa County, AZ IDA (Christian Care Mesa II)		6.625			01/01/2034		1,626,600
	500,000	Maricopa County, AZ IDA (Immanuel Campus Care)¹		8.500			04/20/2041		467,025
	1,500,000	Maricopa County, AZ IDA (Sun King Apartments)¹		6.750			11/01/2018		1,340,550
	785,000	Maricopa County, AZ IDA (Sun King Apartments)¹		6.750			05/01/2031		603,995
	835,000	Maricopa County, AZ School District No. 24 (Gila Bend)¹		5.500			07/01/2022		797,709
	200,000	Marley Park, AZ Community Facilities District¹		5.300			07/15/2031		158,654
	460,000	Merrill Ranch, AZ Community Facilities District No. 1 Special Assessment Lien¹		5.300			07/01/2030		351,491
	375,000	Palm Valley, AZ Community Facility District No. 3¹		5.300			07/15/2031		297,476
	980,000	Palm Valley, AZ Community Facility District No. 3¹		5.800			07/15/2032		823,112
	750,000	Phoenix, AZ IDA (Career Success Schools)¹		7.000			01/01/2029		774,458
	5,425,000	Phoenix, AZ IDA (Christian Care)¹		5.500			07/01/2035		4,870,131
	500,000	Phoenix, AZ IDA (Espiritu Community Devel. Corp.)¹		6.250			07/01/2036		423,995
	375,000	Pima County, AZ IDA (Arizona Charter School)¹		6.300			07/01/2031		348,146
	1,380,000	Pima County, AZ IDA (Arizona Charter School)¹		6.500			07/01/2023		1,371,582
	1,315,000	Pima County, AZ IDA (Arizona Charter School)¹		6.750			07/01/2031		1,289,660
	115,000	Pima County, AZ IDA (CECS/TAT/EICS Obligated Group)		6.300			07/01/2031		132,259


Principal
Amount			Coupon			Maturity		Value

Arizona Continued
$	1,500,000	Pima County, AZ IDA (Center for Academic Success)¹		5.500	%		07/01/2037	$	1,283,430
	1,830,000	Pima County, AZ IDA (Christian Senior Living)¹		5.050			01/01/2037		1,638,710
	500,000	Pima County, AZ IDA (Facility Choice Education & Devel. Corp.)¹		6.250			06/01/2026		434,240
	1,200,000	Pima County, AZ IDA (Facility Choice Education & Devel. Corp.)¹		6.375			06/01/2036		989,880
	12,400,000	Pima County, AZ IDA (Metro Police Facility)²		5.375			07/01/2039		12,807,340
	500,000	Pima County, AZ IDA (P.L.C. Charter Schools)		6.750			04/01/2036		459,340
	120,000	Pima County, AZ IDA (Paradise Education Center)¹		5.875			06/01/2033		98,153
	250,000	Pima County, AZ IDA (Paradise Education Center)¹		6.000			06/01/2036		205,000
	2,845,000	Pima County, AZ IDA (Phoenix Advantage Charter School)		5.600			07/01/2023		2,023,905
	500,000	Pima County, AZ IDA (Sonoran Science Academy)¹		5.670			12/01/2027		429,730
	650,000	Pima County, AZ IDA (Sonoran Science Academy)¹		5.750			12/01/2037		530,699
	1,000,000	Pima County, AZ IDA (Valley Academy)¹		6.500			07/01/2038		999,930
	500,000	Quail Creek, AZ Community Facilities District¹		5.550			07/15/2030		410,130
	18,385,000	Salt Verde, AZ Financial Corp.¹		5.000			12/01/2037		16,390,595
	510,000	Salt Verde, AZ Financial Corp.¹		5.250			12/01/2028		495,062
	29,030,000	Salt Verde, AZ Financial Corp.¹		5.500			12/01/2037		26,796,722
	30,200,000	Salte Verde, AZ Financial Corp.¹		5.000			12/01/2032		27,563,540
	55,000	Show Low Bluff, AZ Community Facilities District Special Assessment¹		5.200			07/01/2017		50,625
	1,655,000	Tartesso West, AZ Community Facilities District¹		5.900			07/15/2032		1,408,074
	3,000,000	Verrado, AZ Community Facilities District No. 1¹		5.350			07/15/2031		2,395,860
	4,775,000	Verrado, AZ Community Facilities District No. 1¹		6.500			07/15/2027		4,530,854
	1,775,000	Vistancia, AZ Community Facilities District¹		6.750			07/15/2022		1,858,851
	500,000	Westpark, AZ Community Facilities District¹		5.250			07/15/2031		393,960

									128,237,133

Arkansas-0.1%
	300,000	Arkadelphia, AR Public Education Facilities Board (Ouachita Baptist University)¹		5.375			03/01/2038		298,062
	2,515,000	Cave Springs, AR Municipal Property (Creeks Special Sewer District)¹		6.250			02/01/2038		2,095,724

									2,393,786

California-24.0%
	2,800,000	Adelanto, CA Public Utility Authority¹		6.750			07/01/2039		2,894,416
	1,400,000	Antelope Valley, CA Healthcare District¹		5.250			09/01/2017		1,397,480
	1,370,000	Azusa, CA Special Tax Community Facilities District No. 05-1¹		5.000			09/01/2027		1,057,284
	4,410,000	Azusa, CA Special Tax Community Facilities District No. 05-1¹		5.000			09/01/2037		3,093,439

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

California Continued
$	20,000	Beaumont, CA Financing Authority, Series B¹		5.875	%		09/01/2023	$	20,064
	2,750,000	CA ABAG Finance Authority for NonProfit Corporations (Casa De Las Campanas)¹		6.000			09/01/2037		2,804,010
	18,330,000	CA Access to Loans for Learning Student Loan Corp.^3,4		7.000			01/01/2036		9,276,263
	16,500,000	CA County Tobacco Securitization Agency		5.714	⁵		06/01/2046		580,800
	7,000,000	CA County Tobacco Securitization Agency		6.500	⁵		06/01/2046		246,400
	6,000,000	CA County Tobacco Securitization Agency		6.650	⁵		06/01/2046		204,120
	129,820,000	CA County Tobacco Securitization Agency		6.700	⁵		06/01/2050		2,650,924
	7,875,000	CA County Tobacco Securitization Agency		7.234	⁵		06/01/2033		915,311
	38,650,000	CA County Tobacco Securitization Agency		7.550	⁵		06/01/2055		353,261
	8,000,000	CA County Tobacco Securitization Agency		7.750	⁵		06/01/2046		281,600
	100,000	CA County Tobacco Securitization Agency (TASC)¹		0.000	⁶		06/01/2028		77,584
	5,000,000	CA County Tobacco Securitization Agency (TASC)¹		0.000	⁶		06/01/2036		3,602,450
	160,000	CA County Tobacco Securitization Agency (TASC)¹		0.000	⁶		06/01/2046		112,662
	9,060,000	CA County Tobacco Securitization Agency (TASC)¹		5.125			06/01/2038		6,752,146
	2,715,000	CA County Tobacco Securitization Agency (TASC)¹		5.125			06/01/2038		2,023,408
	5,000,000	CA County Tobacco Securitization Agency (TASC)¹		5.875			06/01/2043		3,879,750
	21,000,000	CA County Tobacco Securitization Agency (TASC)¹		6.000			06/01/2042		16,635,990
	93,000,000	CA County Tobacco Securitization Agency (TASC)		6.650	⁵		06/01/2046		2,807,670
	15,000,000	CA Dept. of Veterans Affairs Home Purchase²		4.500			12/01/2023		14,939,700
	1,750,000	CA Educational Facilities Authority (Fresno Pacific University)¹		6.750			03/01/2019		1,765,243
	7,855,000	CA GO¹		5.750			04/01/2031		8,409,013
	11,000,000	CA GO¹		6.000			03/01/2033		11,933,790
	5,000,000	CA GO¹		6.000			11/01/2035		5,370,150
	25,605,000	CA GO¹		6.000			04/01/2038		27,423,723
	12,925,000	CA GO¹		6.000			11/01/2039		13,901,742
	41,375,000	CA GO¹		6.500			04/01/2033		46,624,660
	4,335,000	CA Golden State Tobacco Securitization Corp.¹		5.000			06/01/2036		3,214,923
	2,500,000	CA Golden State Tobacco Securitization Corp.¹		5.000			06/01/2045		2,285,275
	70,970,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		0.000	⁶		06/01/2037		43,078,080
	1,185,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		5.000			06/01/2033		905,636
	1,980,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		5.000			06/01/2045		1,809,938
	5,500,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		5.000			06/01/2045		5,272,300
	26,235,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		5.125			06/01/2047		16,938,890
	10,000,000	CA Golden State Tobacco Securitization Corp. (TASC)¹		5.750			06/01/2047		7,122,600
	414,000,000	CA Golden State Tobacco Securitization Corp. (TASC)		5.973	⁵		06/01/2047		13,276,980
	110,000,000	CA Golden State Tobacco Securitization Corp. (TASC)		6.000	⁵		06/01/2047		3,064,600
	20,000,000	CA Health Facilities Financing Authority (SJHS/SJHCN/SJHE/SJHO Obligated Group)²		5.750			07/01/2039		20,994,400


Principal
Amount			Coupon			Maturity		Value

California Continued
$	20,000,000	CA Health Facilities Financing Authority (Sutter Health/California Pacific Medical Center)²		5.250	%		11/15/2046	$	19,889,000
	2,400,000	CA Health Facilities Financing Authority (Sutter Health/California Pacific Medical Center)¹		5.250			11/15/2046		2,386,680
	25,000	CA HFA (Home Mtg.)¹		5.450			08/01/2033		25,076
	590,000	CA Independent Cities Lease Finance Authority (Morgan Hill-Hacienda Valley)¹		5.950			11/15/2039		559,473
	2,500,000	CA M-S-R Energy Authority¹		6.500			11/01/2039		2,746,650
	5,000,000	CA M-S-R Energy Authority¹		6.500			11/01/2039		5,493,300
	30,000,000	CA M-S-R Energy Authority¹		7.000			11/01/2034		34,716,900
	2,000,000	CA Municipal Finance Authority (CHCC/FCHMC/FHH/SHF Obligated Group)¹		5.500			02/01/2039		1,874,320
	750,000	CA Municipal Finance Authority (Eisenhower Medical Center)⁷		5.750			07/01/2040		748,875
	250,000	CA Municipal Finance Authority (Harbor Regional Center)¹		8.500			11/01/2039		267,970
	2,500,000	CA Public Works¹		5.750			03/01/2030		2,589,275
	5,375,000	CA Public Works¹		6.000			03/01/2035		5,564,738
	12,570,000	CA Public Works¹		6.125			11/01/2029		13,423,754
	2,500,000	CA Public Works¹		6.375			11/01/2034		2,673,550
	25,750,000	CA Public Works¹		6.625			11/01/2034		28,118,743
	2,500,000	CA Public Works (Various Community Colleges)¹		5.750			10/01/2030		2,586,175
	2,000,000	CA Statewide CDA (Aspire Public Schools)¹		6.000			07/01/2040		2,010,380
	2,100,000	CA Statewide CDA (Sutter Health Obligated Group)¹		5.625			08/15/2042		2,115,414
	1,615,000	Chino, CA Community Facilities District Special Tax No. 2005-1¹		5.000			09/01/2027		1,133,924
	200,000	Chino, CA Community Facilities District Special Tax No. 2009-19-1¹		6.500			09/01/2029		203,536
	5,015,000	Chino, CA Community Facilities District Special Tax No. 2005-1¹		5.000			09/01/2036		3,170,433
	500,000	Chino, CA Community Facilities District SpecialTax No. 2009-19-1¹		6.750			09/01/2040		507,625
	2,000,000	Corona-Norco, CA Unified School District Community Facilities No. 04-1¹		5.200			09/01/2036		1,601,260
	2,000,000	Corona-Norco, CA Unified School District Public Financing Authority Special Tax¹		5.000			09/01/2036		1,552,940
	560,000	Coyote Canyon, CA Public Facilities Community Facilities District No. 2004-1¹		6.625			09/01/2039		573,182
	1,000,000	Davis, CA Special Tax Community Facilities District No. 2007-2¹		5.200			09/01/2027		836,150
	2,000,000	Davis, CA Special Tax Community Facilities District No. 2007-2¹		5.250			09/01/2037		1,567,400

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

California Continued
$	970,000	Elk Grove, CA Special Tax Community Facilities District No. 2005-1X¹		5.250	%		09/01/2037	$	662,093
	420,000	Hemet, CA Unified School District¹		5.050			09/01/2026		373,603
	250,000	Hemet, CA Unified School District¹		5.125			09/01/2036		208,433
	500,000	Hemet, CA Unified School District Community Facilities District No. 2005-3¹		5.750			09/01/2039		429,325
	60,000,000	Inland, CA Empire Tobacco Securitization Authority (TASC)		6.625	⁵		06/01/2036		3,020,400
	120,000,000	Inland, CA Empire Tobacco Securitization Authority (TASC)		6.750	⁵		06/01/2047		1,422,000
	360,655,000	Inland, CA Empire Tobacco Securitization Authority (TASC)		7.000	⁵		06/01/2057		1,283,932
	345,750,000	Inland, CA Empire Tobacco Securitization Authority (TASC)		8.001	⁵		06/01/2057		1,078,740
	2,345,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 14¹		6.000			09/01/2027		2,111,063
	5,175,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 14¹		6.150			09/01/2037		4,498,058
	745,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 14¹		6.200			09/01/2037		651,927
	1,425,000	Jurupa, CA Community Services "District Special Tax Community Facilities District No. 14¹		6.200			09/01/2037		1,246,975
	1,685,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 17¹		5.200			09/01/2036		1,430,043
	150,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 29¹		8.250			09/01/2029		160,563
	250,000	Jurupa, CA Community Services District Special Tax Community Facilities District No. 29¹		8.625			09/01/2039		270,190
	175,000	Jurupa, CA Public Financing Authority⁷		6.000			09/01/2028		176,173
	155,000	Jurupa, CA Public Financing Authority⁷		6.000			09/01/2029		155,223
	135,000	Jurupa, CA Public Financing Authority⁷		6.000			09/01/2030		134,371
	150,000	Jurupa, CA Public Financing Authority⁷		6.000			09/01/2031		147,870
	205,000	Jurupa, CA Public Financing Authority⁷		6.000			09/01/2032		201,304
	25,000	Lake Elsinore, CA Public Financing Authority¹		6.375			10/01/2033		24,596
	1,270,000	Lake Elsinore, CA Special Tax¹		5.150			09/01/2025		1,142,771
	1,245,000	Lake Elsinore, CA Special Tax¹		5.250			09/01/2030		1,068,011
	2,450,000	Lake Elsinore, CA Special Tax¹		5.250			09/01/2035		2,036,587
	200,000	Lake Elsinore, CA Special Tax¹		5.350			09/01/2036		168,158
	1,000,000	Lake Elsinore, CA Special Tax Community Facilities District No. 2006-3¹		6.625			09/01/2039		1,020,070
	650,000	Lake Elsinore, CA Unified School District Community Facilities District No. 04-3¹		5.250			09/01/2029		438,412
	1,000,000	Lancaster, CA Financing Authority (School District)¹		5.000			02/01/2026		885,200
	3,950,000	Loma Linda, CA Redevel. Agency Tax Allocation¹		5.250			07/01/2030		3,878,071
	15,000,000	Los Angeles, CA Community College District²		5.000			08/01/2033		15,418,200
	12,000,000	Los Angeles, CA Dept. of Airports, Series A²		5.250			05/15/2039		12,571,200


Principal
Amount			Coupon			Maturity		Value

California Continued
$	2,000,000	Los Angeles, CA Regional Airports Improvement Corp. (American Airlines)¹		7.125	%		12/01/2024	$	1,997,060
	4,175,000	Los Angeles, CA Regional Airports Improvement Corp. (Delta Airlines)¹		6.350			11/01/2025		3,958,025
	16,000,000	Los Angeles, CA Unified School District²		5.250			07/01/2034		16,820,287
	365,000	Menifee, CA Union School District Special Tax Community Facilities District No. 2006-3¹		5.000			09/01/2037		278,663
	2,500,000	Modesto, CA Special Tax Community Facilities District No. 4¹		5.150			09/01/2036		1,917,225
	5,000,000	Moreno Valley, CA Community Redevel. Agency		5.000			08/01/2032		4,517,850
	660,000	Moreno Valley, CA Unified School District Community Facilities District Special Tax No. 2004-3¹		5.000			09/01/2027		538,679
	1,250,000	Moreno Valley, CA Unified School District Community Facilities District Special Tax No. 2004-3¹		5.000			09/01/2037		942,100
	5,000,000	Northern CA Tobacco Securitization Authority (TASC)¹		5.500			06/01/2045		3,432,450
	4,250,000	Oakland, CA GO¹		6.000			01/15/2034		4,568,920
	955,000	Orange, CA Community Facilities District Special Tax (Del Rio Public Improvements)⁷		5.750			10/01/2030		952,651
	7,000,000	Palomar Pomerado, CA Health Care District COP¹		6.625			11/01/2029		7,601,370
	1,000,000	Palomar Pomerado, CA Health Care District COP¹		6.750			11/01/2039		1,093,380
	570,000	Perris, CA Community Facilities District Special Tax No. 2001¹		5.000			09/01/2026		478,412
	1,590,000	Perris, CA Community Facilities District Special Tax No. 2001¹		5.000			09/01/2037		1,213,901
	660,000	Perris, CA Community Facilities District Special Tax No. 2005-1¹		5.000			09/01/2037		503,884
	1,260,000	Rialto, CA Special Tax Community Facilities District No. 2006-1¹		5.350			09/01/2036		1,059,395
	2,700,000	Riverside, CA (Recovery Zone Facility) COP¹		5.500			03/01/2040		2,738,232
	5,000,000	Sacramento County, CA Airport¹		6.000			07/01/2041		5,362,300
	1,620,000	San Gorgonio, CA Memorial Health Care District¹		7.000			08/01/2027		1,804,388
	7,000,000	Santa Rosa, CA Rancheria Tachi Yokut Tribe Enterprise¹		6.625			03/01/2018		6,659,590
	24,150,000	Southern CA Tobacco Securitization Authority¹		5.125			06/01/2046		15,504,300
	13,675,000	Southern CA Tobacco Securitization Authority		6.400	⁵		06/01/2046		465,224
	47,250,000	Southern CA Tobacco Securitization Authority		7.100	⁵		06/01/2046		1,296,540
	5,000,000	Southern CA Tobacco Securitization Authority (TASC)¹		5.000			06/01/2037		3,668,000
	940,000	Stockton, CA Public Financing Authority, Series A¹		5.000			09/01/2016		904,647
	645,000	Stockton, CA Public Financing Authority, Series A¹		5.000			09/01/2018		607,268
	5,135,000	Stockton, CA Public Financing Authority, Series A¹		5.250			09/01/2031		4,103,943
	235,000	Temecula Valley, CA Unified School District Community Facilities District No. 2004¹		5.000			09/01/2037		194,216

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

California Continued
$	2,000,000	Temecula, CA Public Financing Authority Community Facilities District (Roripaugh)¹		5.450	%		09/01/2026	$	1,176,020
	1,000,000	Temecula, CA Public Financing Authority Community Facilities District (Roripaugh)¹		5.500			09/01/2036		518,680
	10,500,000	University of California (Regents Medical Center)²		5.000			05/15/2037		10,850,175
	16,000,000	University of California (Regents Medical Center)²		5.250			05/15/2039		17,241,600
	100,000	Victor Valley, CA Union High School District¹		5.050			09/01/2025		86,793
	1,160,000	Victor Valley, CA Union High School District¹		5.100			09/01/2035		896,622
	2,025,000	Westside, CA Union School District Community Facilities District Special Tax No. 2005-2¹		5.000			09/01/2036		1,532,662

									634,734,412

Colorado-2.6%
	185,000	Arkansas River, CO Power Authority¹		5.000			10/01/2043		160,867
	500,000	CO Andonea Metropolitan District No. 2¹		6.125			12/01/2025		419,880
	1,000,000	CO Andonea Metropolitan District No. 3¹		6.250			12/01/2035		766,440
	2,800,000	CO Arista Metropolitan District¹		6.750			12/01/2035		2,064,104
	4,415,000	CO Broomfield Village Metropolitan District No. 2¹		6.250			12/01/2032		3,616,106
	945,000	CO Central Marksheffel Metropolitan District¹		7.250			12/01/2029		938,659
	6,700,000	CO Compark Business Campus Metropolitan District¹		5.600			12/01/2034		5,303,519
	500,000	CO Copperleaf Metropolitan District No. 2¹		5.850			12/01/2026		378,305
	625,000	CO Copperleaf Metropolitan District No. 2¹		5.950			12/01/2036		433,488
	500,000	CO Crystal Crossing Metropolitan District¹		6.000			12/01/2036		349,290
	10,000	CO Deer Creek Metropolitan District¹		5.000			12/01/2026		10,155
	125,000	CO E-470 Public Highway Authority		6.814	⁵		09/01/2025		49,036
	500,000	CO Educational and Cultural Facilities Authority (Carbon Valley Academy Charter School)¹		5.625			12/01/2036		412,610
	300,000	CO Educational and Cultural Facilities Authority (Crown Point Charter School)¹		5.000			07/15/2039		283,779
	2,250,000	CO Educational and Cultural Facilities Authority (Free Horizon Charter School)¹		6.125			06/15/2040		2,369,903
	5,000,000	CO Educational and Cultural Facilities Authority (Inn at Auraria)		6.000			07/01/2042		2,851,900
	10,000	CO Educational and Cultural Facilities Authority (University of Northern Colorado)¹		5.000			07/01/2031		9,684
	500,000	CO Elbert and Highway 86 Metropolitan District¹		5.750			12/01/2036		364,365
	1,000,000	CO Elkhorn Ranch Metropolitan District¹		6.375			12/01/2035		801,010
	500,000	CO Fallbrook Metropolitan District¹		5.625			12/01/2026		394,245
	10,000	CO Health Facilities Authority (Denver Options)¹		5.375			02/01/2022		8,652
	30,000	CO Health Facilities Authority (Denver Options)¹		5.625			02/01/2032		24,886
	10,000	CO Health Facilities Authority (National Jewish Medical & Research Center)¹		5.375			01/01/2023		9,791


Principal
Amount			Coupon			Maturity		Value

Colorado Continued
$	500,000	CO Heritage Todd Creek Metropolitan District¹		5.500	%		12/01/2037	$	345,920
	500,000	CO High Plains Metropolitan District¹		6.250			12/01/2035		383,220
	333,000	CO Horse Creek Metropolitan District¹		5.750			12/01/2036		240,203
	13,000,000	CO Hsg. & Finance Authority (Single Family)²		5.500			11/01/2029		13,824,590
	500,000	CO Huntington Trails Metropolitan District¹		6.250			12/01/2036		484,280
	480,000	CO International Center Metropolitan District No. 3¹		6.500			12/01/2035		360,542
	500,000	CO Liberty Ranch Metropolitan District¹		6.250			12/01/2036		381,935
	625,000	CO Madre Metropolitan District No. 2¹		5.500			12/01/2036		381,250
	2,770,000	CO Murphy Creek Metropolitan District No. 3		6.000			12/01/2026		1,419,043
	2,850,000	CO Murphy Creek Metropolitan District No. 3		6.125			12/01/2035		1,460,084
	2,665,000	CO North Pines Metropolitan District¹		6.750			12/01/2036		2,174,800
	1,945,000	CO North Range Metropolitan District No. 1¹		5.000			12/15/2024		1,355,860
	1,250,000	CO North Range Metropolitan District No. 2¹		5.500			12/15/2018		1,149,663
	500,000	CO North Range Metropolitan District No. 2¹		5.500			12/15/2037		389,140
	1,000,000	CO Northwest Metropolitan District No. 3¹		6.125			12/01/2025		839,760
	1,875,000	CO Northwest Metropolitan District No. 3¹		6.250			12/01/2035		1,477,163
	125,000	CO Potomac Farms Metropolitan District¹		0.000	⁶		12/01/2023		116,131
	750,000	CO Potomac Farms Metropolitan District¹		7.250			12/01/2037		558,465
	485,000	CO Prairie Center Metropolitan District No. 3¹		5.250			12/15/2021		423,982
	815,000	CO Prairie Center Metropolitan District No. 3¹		5.400			12/15/2031		645,659
	750,000	CO Regency Metropolitan District¹		5.750			12/01/2036		549,038
	15,000	CO Ridges Metropolitan District Mesa County¹		6.100			10/15/2013		15,051
	1,000,000	CO Serenity Ridge Metropolitan District No. 2		7.500			12/01/2034		480,000
	270,000	CO Silver Dollar Metropolitan District¹		5.100			12/01/2030		217,871
	500,000	CO Silver Peaks Metropolitan District¹		5.750			12/01/2036		355,835
	1,000,000	CO Sorrell Ranch Metropolitan District		5.940			12/15/2036		834,500
	681,000	CO Tallgrass Metropolitan District¹		5.250			12/01/2037		547,810
	540,000	CO Tallyns Reach Metropolitan District No. 3¹		5.100			12/01/2026		496,649
	500,000	CO Traditions Metropolitan District No. 2¹		5.750			12/01/2036		360,665
	1,129,000	CO Wheatlands Metropolitan District¹		6.000			12/01/2025		935,704
	500,000	CO Wheatlands Metropolitan District¹		6.125			12/01/2035		383,040
	250,000	CO Woodmen Heights Metropolitan District No. 1		6.750			12/01/2020		229,910
	4,500,000	CO Woodmen Heights Metropolitan District No. 1		7.000			12/01/2030		3,862,845
	10,000,000	Ebert, CO Metropolitan District¹		5.350			12/01/2037		7,150,700
	175,000	Fairplay, CO Sanitation District¹		5.250			12/15/2031		141,951
	180,000	Jefferson County, CO (Section 14 Metropolitan District)¹		5.000			12/01/2018		185,906
	2,570,000	Loveland, CO Special Assessment¹		5.625			07/01/2029		1,947,212
	25,000	Public Authority for CO (Natural Gas Energy)¹		6.250			11/15/2028		26,858
	500,000	Tabernash Meadows, CO Water & Sanitation District¹		7.125			12/01/2034		511,440

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Colorado Continued
$	30,000	University of Colorado Hospital Authority¹		5.200	%		11/15/2017	$	30,038
	20,000	University of Colorado Hospital Authority¹		5.250			11/15/2022		20,011

									69,715,398

Connecticut-0.3%
	75,000	CT Devel. Authority (Church Homes)¹		5.800			04/01/2021		74,993
	785,000	CT H&EFA (Bridgeport Hospital)¹		6.625			07/01/2018		795,299
	35,000	CT H&EFA (Bridgeport Hospital/Bridgeport Hospital Foundation Obligated Group)¹		5.250			07/01/2015		35,059
	15,000	CT H&EFA (DKH)		5.375			07/01/2016		15,042
	220,000	CT H&EFA (DKH/CHHC/HNE Obligated Group)¹		5.375			07/01/2026		220,189
	230,000	CT H&EFA (Ethel Walker School)¹		6.000			07/01/2039		229,048
	15,000	CT H&EFA (Lawrence & Memorial Hospital)¹		5.000			07/01/2013		15,024
	50,000	CT H&EFA (Middlesex Hospital)¹		5.125			07/01/2017		50,043
	10,000	CT H&EFA (Sacred Heart University)¹		5.000			07/01/2028		9,848
	60,000	CT HFA¹		5.600			06/15/2017		60,087
	500,000	Georgetown, CT Special Taxing District		5.125			10/01/2036		256,440
	10,150,000	Mashantucket, CT Western Pequot Tribe, Series B		5.750			09/01/2027		5,201,672

									6,962,744

Delaware-0.2%
	3,900,000	Bridgeville, DE Special Obligation (Heritage Shores)¹		5.450			07/01/2035		2,737,059
	1,000,000	Kent County, DE Student Hsg. (Delaware State University Student Hsg. Foundation)¹		5.000			07/01/2025		739,170
	630,000	Kent County, DE Student Hsg. (Delaware State University Student Hsg. Foundation)¹		5.000			07/01/2030		429,975
	2,310,000	Millsboro, DE Special Obligation (Plantation Lakes)¹		5.450			07/01/2036		1,669,922

									5,576,126

District of Columbia-0.6%
	720,000	District of Columbia Tobacco Settlement Financing Corp.¹		6.750			05/15/2040		715,327
	72,125,000	District of Columbia Tobacco Settlement Financing Corp. (TASC)		6.375	⁵		06/15/2046		1,798,076
	304,205,000	District of Columbia Tobacco Settlement Financing Corp. (TASC)		6.924	⁵		06/15/2046		9,305,631
	6,500,000	Metropolitan Washington D.C. Airport Authority (Dulles Toll Road)		1.060	⁵		10/01/2041		4,853,225

									16,672,259

Florida-15.9%
	770,000	Aberdeen, FL Community Devel. District		5.250			11/01/2015		419,573
	755,000	Aberdeen, FL Community Devel. District		5.500			05/01/2036		413,393
	100,000	Alachua County, FL Health Facilities Authority (Shands Teaching Hospital & Clinics/Shands at Lake Shore Obligated Group)¹		6.750			12/01/2030		109,801


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	2,000,000	Amelia Concourse, FL Community Devel. District^3,⁴		5.750	%		05/01/2038	$	784,520
	700,000	Amelia Walk, FL Community Devel. District Special Assessment³		5.500			05/01/2037		350,581
	13,325,000	Arborwood, FL Community Devel. District (Centex Homes)¹		5.250			05/01/2016		11,406,200
	1,130,000	Arlington Ridge, FL Community Devel. District		5.500			05/01/2036		451,209
	105,000	Atlantic Beach, FL Health Care Facilities (Fleet Landing)¹		6.000			10/01/2029		88,900
	1,385,000	Avelar Creek, FL Community Devel. District¹		5.375			05/01/2036		1,014,249
	435,000	Avignon Villages, FL Community Devel. District^3,4		5.300			05/01/2014		108,359
	250,000	Avignon Villages, FL Community Devel. District^3,4		5.400			05/01/2037		62,275
	395,000	Bahia Lakes, FL Community Devel. District¹		5.450			05/01/2037		290,961
	1,580,000	Bainebridge, FL Community Devel. District¹		5.500			05/01/2038		1,073,784
	65,000	Baker County, FL Hospital Authority¹		5.300			12/01/2023		55,474
	1,815,000	Bay Laurel Center, FL Community Devel. District¹		5.450			05/01/2037		1,556,235
	1,485,000	Baywinds, FL Community Devel. District¹		5.250			05/01/2037		775,645
	1,200,000	Beacon Lakes, FL Community Devel. District Special Assessment¹		6.200			05/01/2038		1,052,700
	50,000	Boynton Beach, FL Multifamily Hsg. (Clipper Cove Apartments)¹		5.300			01/01/2023		47,173
	1,950,000	Boynton Village, FL Community Devel. District Special Assessment¹		6.000			05/01/2038		1,479,368
	2,450,000	Brevard County, FL Industrial Devel. Revenue (Tuff Florida Tech)¹		6.500			11/01/2029		2,528,694
	10,975,000	Brevard County, FL Industrial Devel. Revenue (Tuff Florida Tech)¹		6.750			11/01/2039		11,312,042
	25,000	Broward County, FL Educational Facilities Authority (Nova Southeastern University)¹		5.625			04/01/2034		25,084
	200,000	Cape Coral, FL Health Facilities Authority (Gulf Care)¹		5.625			10/01/2027		192,012
	195,000	Cape Coral, FL Health Facilities Authority (Gulf Care)¹		6.000			10/01/2025		194,988
	1,300,000	Cascades, FL Groveland Community Devel. District¹		5.300			05/01/2036		901,238
	2,960,000	Century Gardens at Tamiami, FL Community Devel. District (Century Gardens at Tamiami)³		6.125			05/01/2012		1,775,911
	6,650,000	Century Gardens at Tamiami, FL Community Devel. District (Century Gardens at Tamiami)³		6.250			05/01/2037		3,792,296
	3,400,000	Chapel Creek, FL Community Devel. District Special Assessment^3,4		5.500			05/01/2038		1,118,940
	1,500,000	City Center, FL Community Devel. District³		6.000			05/01/2038		663,030
	1,675,000	Clearwater Cay, FL Community Devel. District³		5.500			05/01/2037		673,451
	2,220,000	Colonial Country Club, FL Community Devel.¹		6.400			05/01/2033		2,290,241
	3,370,000	Concorde Estates, FL Community Devel. District^3,4		5.850			05/01/2035		1,499,313
	1,245,000	Connerton West, FL Community Devel. District³		5.125			05/01/2016		472,976
	1,520,000	Copperstone, FL Community Devel. District¹		5.200			05/01/2038		1,122,444

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	2,685,000	Cordoba Ranch, FL Community Devel. District Special Assessment^3,4		5.550	%		05/01/2037	$	1,025,375
	405,000	Coronado, FL Community Devel. District¹		6.000			05/01/2038		385,556
	4,365,000	Creekside, FL Community Devel. District^3,4		5.200			05/01/2038		1,829,808
	875,000	Crosscreek, FL Community Devel. District¹		5.500			05/01/2017		419,300
	415,000	Crosscreek, FL Community Devel. District¹		5.600			05/01/2039		198,868
	5,690,000	Cypress Creek of Hillsborough County, FL Community Devel. District		5.350			05/01/2037		2,791,116
	1,000,000	Dade County, FL IDA (Miami Cerebral Palsy Residence)¹		8.000			06/01/2022		956,650
	10,000	Dania, FL Sales Tax¹		5.000			10/01/2025		10,001
	25,000	Destin, FL Community Redevel. Agency (Town Center Area)¹		5.300			05/01/2027		19,860
	1,815,000	Dupree Lakes, FL Community Devel. District¹		5.375			05/01/2037		1,447,481
	940,000	Durbin Crossing, FL Community Devel. District Special Assessment		5.250			11/01/2015		684,743
	10,000	Duval County, FL HFA (C.A.U. Eagles Point North/C.A.U. Cedars Obligated Group)¹		5.650			07/01/2022		9,872
	375,000	East Homestead, FL Community Devel. District³		5.000			05/01/2011		282,900
	2,400,000	East Homestead, FL Community Devel. District¹		5.375			05/01/2036		1,939,728
	1,365,000	East Homestead, FL Community Devel. District¹		5.450			11/01/2036		1,202,237
	500,000	Enclave at Black Point Marina, FL Community Devel. District		5.200			05/01/2014		401,005
	225,000	Enclave at Black Point Marina, FL Community Devel. District		5.400			05/01/2037		161,957
	710,000	Escambia County, FL Health Facilities Authority¹		5.950			07/01/2020		734,140
	10,000	Escambia County, FL Utilities Authority¹		6.250			01/01/2015		11,200
	7,470,000	Fiddler's Creek, FL Community Devel. District No.2³		6.000			05/01/2038		2,836,359
	395,000	FL Capital Trust Agency (AHF Florida LLC)		8.125			10/01/2038		71,092
	2,550,000	FL Capital Trust Agency (American Opportunity)¹		5.875			06/01/2038		1,106,369
	5,665,000	FL Capital Trust Agency (Atlantic Hsg. Foundation)³		7.000			07/15/2032		2,837,712
	1,875,000	FL Capital Trust Agency (Atlantic Hsg. Foundation)³		8.260			07/15/2038		936,469
	10,440,000	FL COP (Dept. of Management Services)²		5.250			08/01/2028		11,121,732
	20,000	FL Correctional Private Commission (350 Bed Youthful) COP¹		5.000			08/01/2017		20,032
	235,000	FL Gateway Services Community Devel. District (Sun City Center)¹		6.500			05/01/2033		225,553
	1,750,000	FL Gulf Coast University Hsg. Finance Corp.¹		5.125			02/01/2035		1,734,320
	7,630,000	FL Island at Doral III Community Devel. District Special Assessment¹		5.900			05/01/2035		5,483,376
	1,100,000	FL Lake Ashton II Community Devel. District¹		5.375			05/01/2036		839,047
	1,000,000	FL New Port Tampa Bay Community Devel. District³		5.300			11/01/2012		307,200
	7,220,000	FL New Port Tampa Bay Community Devel. District³		5.875			05/01/2038		2,217,984
	500,000	FL Parker Road Community Devel. District		5.350			05/01/2015		264,850


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	485,000	FL Parker Road Community Devel. District		5.600	%		05/01/2038	$	258,035
	950,000	FL Principal One Community Devel. District¹		5.650			05/01/2035		885,353
	60,000	FL State Board of Education¹		5.000			06/01/2024		60,205
	3,945,000	Flora Ridge, FL Educational Facilities Benefit District¹		5.300			05/01/2037		3,029,997
	2,065,000	Fontainbleau Lakes, FL Community Devel. District³		6.000			05/01/2015		1,053,150
	910,000	Fontainbleau Lakes, FL Community Devel. District³		6.000			05/01/2038		452,943
	621,868	Forest Creek, FL Community Devel. District		5.450			05/01/2036		404,538
	155,000	Forest Creek, FL Community Devel. District³		5.450			05/01/2036		139,393
	10,000,000	Grand Bay at Doral, FL Community Devel. District		6.000			05/01/2017		3,799,000
	3,000,000	Grand Bay at Doral, FL Community Devel. District		6.000			05/01/2039		1,139,700
	3,580,000	Greater Lakes/Sawgrass Bay, FL Community Devel. District³		5.500			05/01/2038		1,713,460
	16,000,000	Greater Orlando, FL Aviation Authority²		5.000			10/01/2032		16,442,080
	3,645,000	Harrison Ranch, FL Community Devel. District¹		5.300			05/01/2038		2,657,715
	375,000	Hawks Point, FL Community Devel. District¹		5.300			05/01/2039		262,605
	915,000	Heritage Harbour South, FL Community Devel. District¹		6.500			05/01/2034		923,043
	195,000	Heritage Isles, FL Community Devel. District³,⁴		7.100			10/01/2023		78,378
	1,215,000	Heritage Plantation, FL Community Devel. District		5.400			05/01/2037		485,879
	10,000	Hialeah, FL Hsg. Authority¹		5.800			06/20/2033		10,284
	310,000	Highland Meadows, FL Community Devel. District Special Assessment, Series A³,⁴		5.500			05/01/2036		124,825
	785,000	Highlands, FL Community Devel. District³		5.000			05/01/2011		390,852
	5,600,000	Highlands, FL Community Devel. District^3,4		5.550			05/01/2036		2,917,376
	745,000	Hillsborough County, FL IDA (Senior Care Group)¹		6.750			07/01/2029		737,110
	25,000	Hillsborough County, FL IDA (Tampa General Hospital)¹		5.400			10/01/2028		25,252
	5,000,000	Hillsborough County, FL IDA (University Community Hospital)¹		8.000			08/15/2032		5,738,050
	875,000	Indigo, FL Community Devel. District¹		5.750			05/01/2036		499,118
	10,000	Jacksonville, FL Electric Authority (Water and Sewer)¹		5.250			10/01/2039		10,028
	35,000	Jacksonville, FL Health Facilities Authority (Daughters of Charity Health Services of Austin)¹		5.250			08/15/2027		35,114
	25,000	Jacksonville, FL Sales Tax¹		5.000			10/01/2030		25,225
	3,885,000	K-Bar Ranch, FL Community Devel. District Special Assessment³		5.450			05/01/2036		2,659,826
	5,500,000	Keys Cove, FL Community Devel. District¹		5.500			05/01/2036		4,560,765
	225,000	Lake Frances, FL Community Devel. District Special Assessment³		5.300			05/01/2037		95,999
	75,000	Lakeland, FL Hospital System (Lakeland Regional Medical Center)¹		5.250			11/15/2025		75,023
	250,000	Lakeside Landings, FL Devel. District^3,4		5.500			05/01/2038		102,425
	4,915,000	Lakewood Ranch, FL Stewardship District¹		5.500			05/01/2036		3,504,297

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	3,935,000	Lakewood Ranch, FL Stewardship District (Country Club East Investors)¹		5.400	%		05/01/2037	$	2,799,241
	1,000,000	Landmark at Doral, FL Community Devel. District Special Assessment^3,4		5.500			05/01/2038		319,200
	4,500,000	Lee County, FL IDA (Cypress Cove Healthpark)¹		6.750			10/01/2032		4,012,875
	500,000	Legends Bay, FL Community Devel. District		5.500			05/01/2014		373,650
	500,000	Legends Bay, FL Community Devel. District		5.875			05/01/2038		351,670
	2,020,000	Lucaya, FL Community Devel. District¹		5.375			05/01/2035		1,604,446
	2,490,000	Madeira, FL Community Devel. District		5.250			11/01/2014		1,684,834
	2,465,000	Madeira, FL Community Devel. District		5.450			05/01/2039		1,616,054
	530,000	Madison County, FL Mtg. (Twin Oaks)¹		6.000			07/01/2025		480,827
	1,775,000	Magnolia Creek, FL Community Devel. District³		5.900			05/01/2039		887,323
	1,430,000	Magnolia West, FL Community Devel. District Special Assessment¹		5.350			05/01/2037		872,028
	8,975,000	Meadow Pines, FL Community Devel. District Special Assessment¹		6.250			05/01/2034		7,729,270
	1,500,000	Meadow Woods, FL Community Devel. District Special Assessment¹		6.050			05/01/2035		789,660
	4,375,000	Mediterranea, FL Community Devel. District Special Assessment		5.600			05/01/2037		2,825,813
	2,390,000	Miami Beach, FL Health Facilities Authority (Mt. Sinai Medical Center)¹		6.800			11/15/2031		2,412,801
	50,000	Miami, FL Health Facilities Authority (Catholic Health East)¹		5.250			11/15/2028		50,296
	5,000,000	Miami-Dade County, FL Aviation⁷		5.000			10/01/2041		4,914,350
	6,440,000	Miromar Lakes, FL Community Devel. District¹		6.875			05/01/2035		5,410,566
	3,380,000	Miromar Lakes, FL Community Devel. District¹		7.375			05/01/2032		3,070,054
	3,800,000	Monterey/Congress, FL Community Devel. District Special Assessment¹		5.375			05/01/2036		3,029,436
	9,385,000	Moody River, FL Estates Community Devel. District¹		5.350			05/01/2036		5,629,592
	10,930,000	Myrtle Creek, FL Improvement District Special Assessment¹		5.200			05/01/2037		7,126,360
	190,000	Naples, FL Hospital Revenue (Naples Community Hospital)¹		5.250			10/01/2014		190,279
	580,000	Naturewalk, FL Community Devel. District		5.300			05/01/2016		359,084
	485,000	Naturewalk, FL Community Devel. District		5.500			05/01/2038		251,720
	1,800,000	Northern Palm Beach, FL Improvement District¹		5.350			08/01/2041		1,316,556
	470,000	Oak Creek, FL Community Devel. District Special Assessment¹		5.800			05/01/2035		378,839
	7,475,000	Oakland, FL Charter School¹		6.950			12/01/2032		7,348,523
	1,345,000	Oakmont Grove, FL Community Devel. District Special Assessment^3,4		5.250			05/01/2012		469,674
	500,000	Oakmont Grove, FL Community Devel. District Special Assessment^3,4		5.400			05/01/2038		174,600


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	300,000	Orange County, FL Health Facilities Authority (GF Orlando/CFGH Obligated Group)¹		8.875	%		07/01/2021	$	309,612
	800,000	Orange County, FL Health Facilities Authority (GF Orlando/CFGH Obligated Group)¹		9.000			07/01/2031		825,984
	10,000,000	Orange County, FL Health Facilities Authority (Nemours Foundation)²		5.000			01/01/2039		10,178,400
	250,000	Orange County, FL Health Facilities Authority (Orlando Lutheran Tower)¹		5.500			07/01/2032		217,315
	10,000,000	Orange County, FL School Board COP²		5.500			08/01/2034		10,733,500
	1,250,000	Palm Bay, FL Educational Facilities (Patriot Charter School)^3,4		7.000			07/01/2036		624,775
	125,000	Palm Beach County, FL Health Facilities Authority (Boca Raton Community Hospital)¹		5.500			12/01/2021		116,494
	25,000	Palm Beach County, FL Health Facilities Authority (Boca Raton Community Hospital)¹		5.625			12/01/2031		21,715
	2,040,000	Palm Coast Park, FL Community Devel. District Special Assessment¹		5.700			05/01/2037		1,240,708
	1,270,000	Palm Glades, FL Community Devel. District¹		4.850			05/01/2011		823,849
	2,400,000	Palm Glades, FL Community Devel. District¹		5.300			05/01/2036		1,821,240
	460,000	Palm River, FL Community Devel. District^3,4		5.150			05/01/2013		193,062
	245,000	Palm River, FL Community Devel. District^3,4		5.375			05/01/2036		102,827
	4,510,000	Palma Sola Trace, FL Community Devel. District¹		5.750			05/01/2035		3,965,598
	2,510,000	Parkway Center, FL Community Devel. District, Series A¹		6.125			05/01/2024		2,136,236
	2,205,000	Parkway Center, FL Community Devel. District, Series A¹		6.300			05/01/2034		1,737,099
	1,425,000	Pine Ridge Plantation, FL Community Devel. District³		5.400			05/01/2037		920,365
	1,500,000	Pinellas County, FL Health Facility Authority (St. Mark Village)¹		5.650			05/01/2037		1,234,710
	430,000	Poinciana West, FL Community Devel. District Special Assessment¹		6.000			05/01/2037		383,711
	25,000	Port Everglades, FL Authority, Series A¹		5.000			09/01/2016		26,226
	705,000	Port St. Lucie, FL Special Assessment (Peacock & Lowry)¹		5.350			07/01/2027		594,357
	670,000	Portico, FL Community Devel. District		5.450			05/01/2037		323,751
	2,670,000	Portofino Cove, FL Community Devel. District Special Assessment³		5.250			05/01/2012		1,067,199
	490,000	Portofino Cove, FL Community Devel. District Special Assessment³		5.500			05/01/2038		195,853
	285,000	Portofino Landings, FL Community Devel. District Special Assessment^3,4		5.200			05/01/2017		113,915
	980,000	Portofino Landings, FL Community Devel. District Special Assessment³		5.400			05/01/2038		391,706
	265,000	Portofino Springs, FL Community Devel. District Special Assessment³		5.500			05/01/2038		113,950
	6,150,000	Quarry, FL Community Devel. District¹		5.250			05/01/2016		5,034,575

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	405,000	Quarry, FL Community Devel. District¹		5.250	%		05/01/2036	$	251,465
	45,425,000	Quarry, FL Community Devel. District¹		5.500			05/01/2036		29,327,743
	10,840,000	Renaissance Commons, FL Community Devel. District, Series A¹		5.600			05/01/2036		8,744,411
	1,710,000	Reunion East, FL Community Devel. District		5.800			05/01/2036		961,584
	6,025,000	Reunion East, FL Community Devel. District, Series A		7.375			05/01/2033		4,329,927
	2,405,000	Reunion West, FL Community Devel. District		6.250			05/01/2036		997,714
	635,000	Ridgewood Trails, FL Community Devel. District¹		5.650			05/01/2038		333,947
	2,500,000	River Glen, FL Community Devel. District Special Assessment^3,4		5.450			05/01/2038		1,004,900
	1,165,000	Riverwood Estates, FL Community Devel. District Special Assessment^3,4		5.350			05/01/2037		208,652
	160,000	Rolling Hills, FL Community Devel. District¹		5.450			05/01/2037		99,773
	400,000	Santa Rosa Bay, FL Bridge Authority		6.250			07/01/2028		226,024
	4,535,000	Sarasota County, FL Educational Facilities (School of Arts & Sciences)¹		6.500			07/01/2040		4,544,524
	3,505,000	Sarasota County, FL Educational Facilities (School of Arts & Sciences)¹		6.750			07/01/2030		3,634,194
	16,500,000	Sarasota, FL National Community Devel. District Special Assessment³		5.300			05/01/2039		4,034,250
	2,285,000	Shingle Creek, FL Community Devel. District^3,4		6.100			05/01/2025		1,084,690
	6,340,000	Shingle Creek, FL Community Devel. District^3,4		6.125			05/01/2037		3,009,598
	2,875,000	Six Mile Creek, FL Community Devel. District		5.875			05/01/2038		933,225
	1,985,000	South Bay, FL Community Devel. District^3,4		5.125			11/01/2009		594,111
	2,750,000	South Bay, FL Community Devel. District^3,4		5.375			05/01/2013		823,075
	5,400,000	South Bay, FL Community Devel. District^3,4		5.950			05/01/2036		1,616,220
	2,885,000	St. John's Forest, FL Community Devel. District, Series A¹		6.125			05/01/2034		2,501,901
	1,500,000	St. Johns County, FL IDA (Presbyterian Retirement)⁷		5.875			08/01/2040		1,501,680
	1,500,000	St. Johns County, FL IDA (Presbyterian Retirement)⁷		6.000			08/01/2045		1,506,705
	400,000	St. Johns County, FL IDA (St. John's County Welfare Federation)¹		5.250			10/01/2041		298,104
	965,000	Stonebrier, FL Community Devel. District¹		5.500			05/01/2037		701,111
	845,000	Stonegate, FL Community Devel. District¹		6.000			05/01/2024		844,121
	995,000	Stonegate, FL Community Devel. District¹		6.125			05/01/2034		980,801
	2,520,000	Stoneybrook, FL South Community Devel. District		5.800			05/01/2039		1,120,039
	695,000	Summerville, FL Community Devel. District		5.500			05/01/2036		314,640
	10,000	Sunrise, FL Utility System¹		5.250			10/01/2019		10,007
	2,000,000	Sweetwater Creek, FL Community Devel. District		5.500			05/01/2038		905,180
	105,000	Tavares, FL Water & Sewer¹		5.500			10/01/2030		105,092
	2,535,000	Tern Bay, FL Community Devel. District^3,4		5.000			05/01/2015		759,740
	500,000	Tern Bay, FL Community Devel. District^3,4		5.375			05/01/2037		149,850


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	4,745,000	Town Center, FL at Palm Coast Community Devel. District¹		6.000	%		05/01/2036	$	3,172,554
	235,000	Turnbull Creek, FL Community Devel. District Special Assessment¹		5.250			05/01/2037		151,497
	9,135,000	Turnbull Creek, FL Community Devel. District Special Assessment¹		5.800			05/01/2035		7,315,947
	9,020,000	Two Creeks, FL Community Devel. District¹		5.250			05/01/2037		5,874,546
	5,650,000	Verandah East, FL Community Devel. District¹		5.400			05/01/2037		2,690,361
	4,380,000	Verandah, FL Community Devel District¹		5.250			05/01/2036		3,389,332
	1,050,000	Verano Center, FL Community Devel. District¹		5.375			05/01/2037		602,175
	9,105,000	Verona Walk, FL Community Devel. District¹		5.375			05/01/2037		7,003,384
	1,000,000	Villa Portofino East, FL Community Devel. District¹		5.200			05/01/2037		773,670
	2,565,000	Villa Vizcaya, FL Community Devel. District Special Assessment		5.350			05/01/2017		1,653,450
	420,000	Villa Vizcaya, FL Community Devel. District Special Assessment		5.550			05/01/2039		219,530
	1,575,000	Villages of Westport, FL Community Devel. District		5.700			05/01/2035		926,226
	6,795,000	Villagewalk of Bonita Springs, FL Community Devel. District¹		5.150			05/01/2038		4,195,845
	4,945,000	Vista, FL Community Devel. District Special Assessment¹		5.375			05/01/2037		3,711,470
	1,500,000	Waterford Estates, FL Community Devel. District Special Assessment^3,4		5.125			05/01/2013		487,050
	2,470,000	Waterford Estates, FL Community Devel. District Special Assessment^3,4		5.500			05/01/2037		802,009
	3,630,000	Watergrass, FL Community Devel. District Special Assessment¹		4.875			11/01/2010		2,936,670
	1,250,000	Watergrass, FL Community Devel. District Special Assessment¹		5.125			11/01/2014		736,875
	785,000	Watergrass, FL Community Devel. District Special Assessment¹		5.375			05/01/2039		404,220
	5,860,000	Watergrass, FL Community Devel. District Special Assessment¹		5.500			05/01/2036		3,132,580
	950,000	Waterlefe, FL Community Devel. District Golf Course³		8.125			10/01/2025		8,313
	6,605,000	Waters Edge, FL Community Devel. District¹		5.300			05/01/2036		5,105,269
	810,000	Waters Edge, FL Community Devel. District		5.350			05/01/2039		395,888
	250,000	Waters Edge, FL Community Devel. District¹		5.400			05/01/2039		123,235
	1,785,000	Waterstone, FL Community Devel. District^3,4		5.500			05/01/2018		691,509
	3,895,000	Wentworth Estates, FL Community Devel. District³		5.125			11/01/2012		1,235,884
	3,670,000	Wentworth Estates, FL Community Devel. District³		5.625			05/01/2037		1,164,491
	655,000	West Villages, FL Improvement District		5.350			05/01/2015		492,115
	4,085,000	West Villages, FL Improvement District³		5.500			05/01/2037		1,891,110
	3,425,000	West Villages, FL Improvement District		5.500			05/01/2038		1,769,287
	7,350,000	West Villages, FL Improvement District		5.800			05/01/2036		3,762,833
	4,925,000	Westridge, FL Community Devel. District^3,4		5.800			05/01/2037		1,870,023

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Florida Continued
$	5,840,000	Westside, FL Community Devel. District		5.650	%		05/01/2037	$	2,467,400
	690,000	World Commerce, FL Community Devel. District Special Assessment^3,4		5.500			05/01/2038		228,597
	5,345,000	World Commerce, FL Community Devel. District Special Assessment¹		6.125			05/01/2035		4,635,237
	2,800,000	World Commerce, FL Community Devel. District Special Assessment^3,4		6.500			05/01/2036		926,996
	2,250,000	Wyld Palms, FL Community Devel. District³		5.400			05/01/2015		695,475
	1,445,000	Wyld Palms, FL Community Devel. District³		5.500			05/01/2038		446,650
	450,000	Zephyr Ridge, FL Community Devel. District^3,4		5.250			05/01/2013		179,105
	990,000	Zephyr Ridge, FL Community Devel. District^3,4		5.625			05/01/2037		395,307

									420,965,461

Georgia-2.0%
	12,990,000	Atlanta, GA Devel. Authority Student Hsg. (Clark Atlanta University)¹		6.000			07/01/2036		9,259,012
	2,470,000	Atlanta, GA Devel. Authority Student Hsg. (Clark Atlanta University)¹		6.250			07/01/2036		1,822,984
	10,000	Atlanta, GA HDC (Bedford Tower)¹		6.250			01/01/2015		10,028
	1,500,000	Atlanta, GA Tax Allocation (Beltline)¹		7.500			01/01/2031		1,557,600
	255,000	Atlanta, GA Tax Allocation (Beltline)¹		7.500			01/01/2031		262,010
	1,000,000	Chatham County, GA Hospital Authority (Memorial Health University Medical Center)¹		5.375			01/01/2026		951,150
	20,000	Chatham County, GA Hospital Authority (Memorial Health University Medical Center)¹		5.500			01/01/2034		18,327
	10,000	Clark County, GA Hospital Authority (Athens Regional Medical)¹		5.250			01/01/2029		10,036
	15,000	Dalton, GA Devel. Authority (Hamilton Health Care System)¹		5.000			08/15/2028		13,794
	30,000	Dalton, GA Devel. Authority (Hamilton Health Care System/Hamilton Medical Center Obligated Group)¹		5.375			08/15/2016		30,030
	8,820,000	DeKalb County, GA Devel. Authority Public Purpose¹		5.500			12/10/2023		7,984,746
	4,000,000	DeKalb County, GA Hospital Authority (DeKalb Medical Center)¹		6.000			09/01/2030		4,100,120
	10,000	DeKalb County, GA Hsg. Authority (Spring Chase Apartments)¹		5.400			11/01/2030		10,007
	3,665,000	East Point, GA (Camp Creek), Series B¹		8.000			02/01/2026		3,729,651
	5,445,000	East Point, GA (Camp Creek), Series B¹		8.000			02/01/2026		5,541,050
	100,000	Fulton County, GA Hospital Authority (Northside Hospital)¹		5.125			10/01/2016		100,064
	10,000	Fulton County, GA Hospital Authority (Northside Hospital)¹		5.375			10/01/2012		10,019
	3,000,000	Fulton County, GA Residential Care Facilities (Lenbrook Square Foundation)¹		5.125			07/01/2042		1,892,850
	225,000	GA Hsg. and Finance Authority (Hunters Grove)¹		5.850			01/01/2017		225,407


Principal
Amount			Coupon			Maturity		Value

Georgia Continued
$	5,000,000	GA Main Street Natural Gas¹		5.500	%		09/15/2026	$	5,082,700
	15,000	GA Medical Center Hospital Authority (CRH/MCM/DLS/AS/WCNT/LD&M/PHS Obligated Group)¹		5.500			08/01/2019		15,136
	25,000	GA Municipal Electric Authority¹		6.600			01/01/2018		29,511
	5,000	GA Private Colleges & University Authority (Mercer University)¹		5.375			06/01/2031		4,542
	1,875,000	Northwestern Gwinnett County, GA Facilities Corp. COP (Dept. of Labor)¹		5.000			06/15/2021		1,959,263
	775,000	Northwestern Gwinnett County, GA Facilities Corp. COP (Dept. of Motor Vehicle Safety)¹		5.000			06/15/2021		809,829
	3,540,000	Northwestern Gwinnett County, GA Facilities Corp. II COP (Georgia Dept. of Driver Services)¹		5.000			06/15/2028		3,539,788
	2,200,000	Northwestern Gwinnett County, GA Facilities Corp. II COP (Georgia Dept. of Driver Services)¹		5.000			06/15/2029		2,194,544
	500,000	Savannah, GA EDA (Skidway Health & Living Services)¹		7.400			01/01/2024		509,300
	30,000	Ware County, GA Hospital Authority (Southeast Health Unit)¹		6.625			03/01/2017		30,050

									51,703,548

Hawaii-0.0%
	750,000	HI Dept. of Budget & Finance Special Purpose (15 Craigside)		9.000			11/15/2044		845,168

ldaho-0.3%
	55,000	ID Hsg. Agency (Multifamily Hsg.)¹		6.700			07/01/2024		55,075
	5,000	ID Hsg. Agency (Single Family Mtg.)¹		5.800			07/01/2025		5,005
	5,360,000	Pocatello, ID Devel. Authority Revenue Allocation Tax Increment, Series A¹		6.000			08/01/2028		4,558,734
	2,980,000	Twin Falls, ID Urban Renewal Agency, Series A¹		5.450			08/01/2022		2,692,043

									7,310,857

Illinois - 9.0%
	600,000	Annawan, IL Tax Increment (Patriot Renewable Fuels)¹		5.625			01/01/2018		469,596
	1,825,000	Bedford Park, IL Tax¹		5.125			12/30/2018		1,654,819
	3,570,000	Bourbonnais, IL Industrial (Olivet NazareneUniversity)¹		5.500			11/01/2040		3,533,300
	1,500,000	Bourbonnais, IL Industrial (Olivet NazareneUniversity)¹		6.000			11/01/2035		1,556,835
	355,000	Carol Stream, IL Tax (Geneva Crossing)¹		5.000			12/30/2021		323,476
	235,000	Chicago, IL Midway Airport, Series B¹		5.000			01/01/2035		230,603
	12,000,000	Chicago, IL O'Hare International Airport (American Airlines\AMR Corp. Obligated Group)		5.500			12/01/2030		8,956,200
	5,000,000	Chicago, IL Tax (Pilsen Redevel.)¹		6.750			06/01/2022		5,041,250
	2,400,000	Cook County, IL Community School District GO¹		7.125			06/01/2024		2,491,416
	949,000	Cortland, IL Special Tax (Sheaffer System)		5.500			03/01/2017		587,013

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Illinois Continued
$	168,000	Du Page County, IL Special Service Area No. 31 Special Tax (Monarch Landing)¹		5.400	%		03/01/2016	$	163,188
	320,000	Du Page County, IL Special Service Area No. 31 Special Tax (Monarch Landing)¹		5.625			03/01/2036		255,178
	1,250,000	Gilberts, IL Special Service Area No. 19 Special Tax (Conservancy)³		5.375			03/01/2016		679,263
	1,100,000	Hampshire, IL Special Service Area No. 16 (Crown Devel.-Prairie Ridge)¹		6.000			03/01/2046		754,248
	2,500,000	Hampshire, IL Special Service Area No. 17 (Crown Devel.-Oakstead)¹		6.000			03/01/2045		1,717,550
	1,500,000	Hampshire, IL Special Service Area No. 19 (Crown Devel.-Prairie Ridge East)¹		6.000			03/01/2046		1,028,520
	2,225,000	Harvey, IL GO¹		5.500			12/01/2027		2,129,014
	1,000,000	Harvey, IL GO¹		5.625			12/01/2032		958,840
	5,700,000	Harvey, IL Hotel Motel Tax & Sales (Hotel & Conference Center)¹		6.875			08/01/2028		4,525,914
	65,000	IL Devel. Finance Authority (Community Rehabilitation Providers)¹		5.700			07/01/2019		64,238
	2,200,000	IL Educational Facilities Authority (Robert Morris College)¹		5.800			06/01/2030		2,200,264
	1,920,000	IL Finance Authority (Bethel Terrace Apartments)¹		5.125			09/01/2025		1,720,378
	750,000	IL Finance Authority (Franciscan Communities)¹		5.500			05/15/2027		628,748
	750,000	IL Finance Authority (Franciscan Communities)¹		5.500			05/15/2037		565,965
	155,000	IL Finance Authority (Illinois Institute of Technology)¹		6.500			02/01/2023		169,262
	2,215,000	IL Finance Authority (Illinois Institute of Technology)¹		7.125			02/01/2034		2,453,666
	500,000	IL Finance Authority (Luther Oaks)¹		5.700			08/15/2028		423,640
	500,000	IL Finance Authority (Luther Oaks)¹		6.000			08/15/2039		420,470
	1,000,000	IL Finance Authority (Lutheran Social Services of Illinois/Vesper Management Corp. Obligated Group)¹		5.125			08/15/2028		766,530
	2,290,188	IL Finance Authority (Monarch Landing)⁸		0.586			12/01/2027		309,633
	3,893,320	IL Finance Authority (Monarch Landing)⁸		0.586			12/01/2037		526,377
	1,750,000	IL Finance Authority (Noble Network Charter Schools)¹		5.000			09/01/2027		1,329,580
	2,000,000	IL Finance Authority (Noble Network Charter Schools)¹		5.000			09/01/2031		1,452,620
	2,745,000	IL Finance Authority (Noble Network Charter Schools)¹		5.000			09/01/2032		1,972,804
	20,000,000	IL Finance Authority (Northwestern Memorial Hospital)²		6.000			08/15/2039		21,943,200
	100,000	IL Finance Authority (Northwestern Memorial Hospital)¹		6.000			08/15/2039		104,471
	10,190,000	IL Finance Authority (Provena Health)¹		7.750			08/15/2034		11,837,417
	15,000,000	IL Finance Authority (Resurrection Health Care)²		5.250			05/15/2029		15,161,250
	5,000,000	IL Finance Authority (Resurrection Health)¹		6.125			05/15/2025		5,159,850
	3,250,000	IL Finance Authority (Roosevelt University)¹		5.500			04/01/2032		3,197,220
	1,000,000	IL Finance Authority (Roosevelt University)¹		5.500			04/01/2037		968,670
	5,395,000	IL Finance Authority (Roosevelt University)¹		5.750			04/01/2024		5,588,896


Principal
Amount			Coupon			Maturity		Value

Illinois Continued
$	26,415,000	IL Finance Authority (Roosevelt University)¹		6.500	%		04/01/2039	$	27,804,957
	5,755,000	IL Finance Authority (Roosevelt University)¹		6.500			04/01/2044		6,033,600
	3,750,000	IL Finance Authority (Sedgebrook)⁸		6.000			11/15/2027		939,750
	10,000,000	IL Finance Authority (Sedgebrook)⁸		6.000			11/15/2037		2,506,000
	10,000,000	IL Finance Authority (Sedgebrook)⁸		6.000			11/15/2042		2,506,000
	10,645,000	IL Finance Authority (Silver Cross Hospital and Medical Centers)¹		7.000			08/15/2044		11,422,191
	4,765,000	IL Finance Authority (Swedish Covenant Hospital)¹		5.750			08/15/2029		4,820,655
	3,000,000	IL Finance Authority Student Hsg. (MJH Education Assistance)³		5.125			06/01/2035		1,650,030
	5,000,000	IL Health Facilities Authority (Covenant Retirement Communities)¹		5.625			12/01/2032		4,735,200
	60,000	IL Health Facilities Authority (Decatur Memorial Hospital)¹		5.375			11/15/2021		60,043
	60,000	IL Health Facilities Authority (EMH/EMHH/EMHS Obligated Group)¹		5.625			01/01/2028		58,662
	10,000	IL Health Facilities Authority (Holy Family Medical Center)¹		5.000			08/15/2027		9,192
	35,000	IL Health Facilities Authority (Holy Family Medical Center)¹		5.125			08/15/2022		34,760
	75,000	IL Health Facilities Authority (Loyola University)¹		5.000			07/01/2024		73,161
	15,000	IL Health Facilities Authority (Northwestern Medical Faculty Foundation)¹		5.125			11/15/2028		14,711
	80,000	IL Health Facilities Authority (Rockford Memorial Hospital/Rockford Memorial Health Services Corp. Obligated Group)¹		5.000			08/15/2021		73,910
	25,000	IL Health Facilities Authority (Sarah Bush Lincoln Health Center)¹		5.500			02/15/2016		25,034
	85,000	IL Health Facilities Authority (Sarah Bush Lincoln Health Center)¹		5.750			02/15/2022		85,060
	5,680,000	IL Health Facilities Authority (Sherman Health System)¹		5.250			08/01/2022		5,649,044
	15,415,000	IL Health Facilities Authority (Sinai Health System)²		5.100			08/15/2033		15,626,794
	70,000	Lake County, IL HFC, Series A¹		6.700			11/01/2014		70,230
	4,442,000	Lakemoor Village, IL Special Tax¹		5.000			03/01/2027		3,844,551
	2,725,000	Lincolnshire, IL Special Service Area No. 1 Special Tax (Sedgebrook)¹		6.250			03/01/2034		2,416,203
	500,000	Lombard, IL Public Facilities Corp. (Conference Center & Hotel)¹		5.500			01/01/2036		329,650
	1,455,000	Manhattan, IL Special Service Area Special Tax (Groebe Farm-Stonegate)¹		6.125			03/01/2040		736,361
	480,000	Markham, IL GO¹		5.750			02/01/2028		487,589
	1,250,000	Plano, IL Special Service Area No. 5¹		6.000			03/01/2036		1,039,125
	500,000	Southwestern IL Devel. Authority (Eden Retirement Center)¹		5.850			12/01/2036		415,655
	5,390,000	Southwestern IL Devel. Authority (Local Government Programming)¹		7.000			10/01/2022		5,155,912

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Illinois Continued
$	2,215,000	Southwestern IL Devel. Authority (Village of Sauget)¹		5.625	%		11/01/2026	$	1,628,091
	30,000	Springfield, IL Water¹		5.400			03/01/2015		30,097
	12,000,000	University of Illinois (Auxiliary Facilities System)²		5.750			04/01/2038		13,238,280
	1,975,000	Vernon Hills, IL Tax Increment (Town Center)¹		6.250			12/30/2026		1,738,889
	985,000	Volo Village, IL Special Service Area (Lancaster Falls)¹		5.750			03/01/2036		800,470
	3,914,000	Volo Village, IL Special Service Area (Remington Pointe)¹		6.450			03/01/2034		3,558,217
	1,800,000	Yorkville, IL United City Special Services Area Special Tax (Bristol Bay)¹		5.875			03/01/2036		1,629,450
	1,634,000	Yorkville, IL United City Special Services Area Special Tax (Raintree Village II)¹		6.250			03/01/2035		916,723

									238,185,619

Indiana-1.1%
	2,500,000	Anderson, IN Redevel. District¹		6.000			02/01/2026		2,450,650
	6,300,000	Carmel, IN Redevel. District COP¹		7.750			01/15/2030		6,522,012
	5,075,000	Carmel, IN Redevel. District COP¹		8.000			01/15/2035		5,249,580
	4,080,000	Dekalb City, IN Hospital Authority (Dekalb Memorial Hospital)¹		5.000			08/01/2016		3,800,887
	1,000,000	Hammond, IN Local Public Improvement District¹		6.500			08/15/2030		1,009,770
	1,000,000	Hammond, IN Local Public Improvement District¹		6.750			08/15/2035		1,010,560
	325,000	IN Finance Authority Educational Facilities (Irvington Community)¹		9.000			07/01/2039		388,580
	30,000	IN Health Facility Financing Authority (Community Hospital of Anderson)¹		6.000			01/01/2023		30,031
	15,000	IN Health Facility Financing Authority (Deaconess Hospital)¹		5.500			03/01/2029		15,015
	150,000	IN Health Facility Financing Authority (Kings Daughters Hospital Assoc.)¹		5.625			08/15/2027		150,096
	50,000	IN Municipal Power Agency, Series A¹		5.300			01/01/2023		50,166
	2,000,000	Indianapolis, IN Multifamily Hsg. (Stonekey Apartments)¹		7.000			02/01/2039		2,095,100
	70,000	Marion County, IN Convention & Recreational Facilities Authority¹		5.000			06/01/2027		70,032
	55,000	Marion County, IN Convention & Recreational Facilities Authority¹		5.000			06/01/2027		55,029
	4,750,000	North Manchester, IN (Estelle Peabody Memorial Home)³		7.125			07/01/2022		2,956,163
	2,250,000	Shelbyville, IN Redevel. District Tax Increment (Central Shelbyville Economic)¹		6.500			07/01/2022		2,053,080
	100,000	St. Joseph County, IN Economic Devel. (Madison Center)¹		5.500			02/15/2021		92,398

									27,999,149


Principal
Amount			Coupon			Maturity		Value

Iowa-2.0%
$	1,000,000	Dickinson County, IA Hsg. (Spirit Lake)		5.875	%		12/01/2036	$	810,020
	25,000	Hills, IA (Mercy Hospital)¹		5.000			08/15/2028		25,008
	750,000	IA Finance Authority (Amity Fellowserve)¹		6.500			10/01/2036		670,725
	400,000	IA Finance Authority (Boys & Girls Home and Family Services)		5.900			12/01/2028		251,988
	500,000	IA Finance Authority Retirement Community (Friendship Haven)¹		5.750			11/15/2019		497,290
	1,000,000	IA Finance Authority Retirement Community (Friendship Haven)¹		6.000			11/15/2024		964,600
	900,000	IA Finance Authority Retirement Community (Friendship Haven)¹		6.125			11/15/2032		816,534
	500,000	IA Finance Authority Senior Hsg. (Wedum Walnut Ridge)¹		5.375			06/01/2025		364,525
	525,000	IA Higher Education Loan Authority (Upper Iowa University)¹		5.750			09/01/2030		528,161
	600,000	IA Higher Education Loan Authority (Upper Iowa University)¹		6.000			09/01/2039		608,712
	7,975,000	IA Tobacco Settlement Authority¹		5.375			06/01/2038		5,720,069
	3,250,000	IA Tobacco Settlement Authority¹		5.500			06/01/2042		2,331,745
	53,520,000	IA Tobacco Settlement Authority (TASC)¹		5.625			06/01/2046		38,723,326

									52,312,703

Kansas-0.2%
	1,400,000	Hays, KS Sales Tax¹		6.000			01/01/2025		1,256,500
	95,000	La Cygne, KS Pollution Control (Kansas Gas & Electric Company)¹		5.100			03/01/2023		95,069
	731,000	Overland Park, KS Transportation Devel. District (Grass Creek)¹		4.850			09/01/2016		683,529
	2,435,000	Pittsburgh, KS Special Obligation (North Broadway Redevel.)¹		4.900			04/01/2024		1,841,444

									3,876,542

Kentucky-0.0%
	30,000	Jefferson County, KY Health Facilities (Alliant Health System)¹		5.125			10/01/2027		29,049
	75,000	Jefferson County, KY Health Facilities (University Medical Center)¹		5.250			07/01/2022		75,036
	970,000	Kenton County, KY Airport (Delta Airlines)³		8.000			12/01/2015		10
	5,000	KY EDFA (Pikeville Medical Center)¹		5.700			02/01/2028		5,002
	80,000	KY Hsg. Corp.¹		5.200			07/01/2022		81,204
	15,000	Springfield, KY Educational Devel. (St. Catherine College)¹		5.750			10/01/2035		13,928

									204,229

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Louisiana-3.2%
$	15,730,000	Jefferson Parish, LA Finance Authority (Single Family Mtg.)²		5.250	%		12/01/2032	$	16,566,403
	8,280,000	LA HFA (La Chateau)¹		6.875			09/01/2029		8,552,909
	5,000,000	LA HFA (La Chateau)¹		7.250			09/01/2039		5,187,950
	2,000,000	LA Local Government EF&CD Authority (Baton Rouge Student Hsg.)		5.250			09/01/2018		825,940
	35,000	LA Local Government EF&CD Authority (Baton Rouge Student Hsg.)		5.250			09/01/2035		14,169
	3,085,000	LA Local Government EF&CD Authority (Baton Rouge Student Hsg.)		5.500			09/01/2022		1,259,420
	1,000,000	LA Local Government EF&CD Authority (Bellemont Apartments)¹		6.000			09/01/2022		885,690
	1,750,000	LA Local Government EF&CD Authority (Bellemont Apartments)¹		6.000			09/01/2027		1,456,700
	3,925,000	LA Local Government EF&CD Authority (Bellemont Apartments)¹		6.000			09/01/2035		3,080,576
	650,000	LA Local Government EF&CD Authority (Bellemont Apartments)¹		7.500			09/01/2016		611,624
	1,240,000	LA Local Government EF&CD Authority (Capital Projects and Equipment)¹		6.550			09/01/2025		1,135,704
	6,375,000	LA Local Government EF&CD Authority (Woman's Hospital Foundation)¹		6.000			10/01/2040		6,436,328
	25,000	LA Public Facilities Authority (Dillard University)¹		5.300			08/01/2026		27,352
	13,000,000	LA Public Facilities Authority (Ochsner Clinic Foundation)¹		5.375			05/15/2043		12,109,760
	18,250,000	LA Public Facilities Authority (OLOLRMC/OLOLMC Obligated Group)¹		6.750			07/01/2039		20,083,213
	45,000	LA Public Facilities Authority (Touro Infirmary)¹		5.500			08/15/2019		42,665
	2,500,000	Lakeshore Villages, LA Master Community Devel. District		5.250			07/01/2017		1,530,675
	20,000	New Orleans, LA Exhibit Hall Special Tax (Ernest N. Morial)¹		5.000			07/15/2025		19,486
	75,000	New Orleans, LA Exhibit Hall Special Tax (Ernest N. Morial)¹		5.000			07/15/2027		64,437
	140,000	New Orleans, LA Exhibit Hall Special Tax (Ernest N. Morial)¹		5.500			07/15/2018		139,996
	290,000	New Orleans, LA Exhibit Hall Special Tax (Ernest N. Morial)¹		5.600			07/15/2025		271,576
	40,000	New Orleans, LA Public Improvement District¹		5.125			12/01/2026		40,158
	40,000	Orleans Parish, LA Parishwide School District¹		5.125			09/01/2018		40,168
	20,000	Orleans Parish, LA Parishwide School District¹		5.375			09/01/2021		20,088
	25,000	Orleans Parish, LA School Board¹		5.300			09/01/2013		25,109
	170,000	Orleans Parish, LA School Board¹		5.375			09/01/2018		170,748
	160,000	Pointe Coupee Parish, LA Pollution Control (Gulf State Utilities Company)¹		6.700			03/01/2013		160,016
	4,145,000	St. John Baptist Parish, LA (Marathon Oil Company)¹		5.125			06/01/2037		4,005,769
	500,000	St. Tammany Parish, LA Hospital Service District (St. Tammany Parish Hospital)¹		5.000			07/01/2022		490,740

									85,255,369


Principal
Amount			Coupon			Maturity		Value

Maryland-0.3%
$	10,000	Baltimore, MD Wastewater¹		5.125	%		07/01/2042	$	10,112
	25,000	MD EDC Student Hsg. (Allegheny College Hsg.)¹		5.750			09/01/2020		22,102
	40,000	MD EDC Student Hsg. (Allegheny College Hsg.)¹		6.000			09/01/2032		31,974
	4,900,000	MD EDC Student Hsg. (Bowie State University)¹		5.375			06/01/2033		4,140,598
	620,000	MD EDC Student Hsg. (Collegiate Hsg. Foundation)¹		5.750			06/01/2029		620,744
	520,000	MD EDC Student Hsg. (Collegiate Hsg. Foundation)¹		6.000			06/01/2030		506,433
	50,000	MD EDC Student Hsg. (Morgan State University)¹		6.000			07/01/2034		46,526
	2,000,000	MD EDC Student Hsg. (University of Maryland)¹		5.625			10/01/2023		1,517,960
	65,000	MD EDC Student Hsg. (University Village at Sheppard Pratt)¹		6.000			07/01/2033		57,226
	65,000	MD H&HEFA (Johns Hopkins Hospital)¹		5.375			07/01/2020		65,072
	979,000	Prince Georges County, MD Special District (Victoria Falls)¹		5.250			07/01/2035		802,986
	750,000	Salisbury, MD Special Obligation (Villages at Aydelotte Farm)¹		5.250			01/01/2037		462,353

									8,284,086

Massachusetts-0.3%
	100,000	MA Devel. Finance Agency (Boston Biomedical Research)¹		5.750			02/01/2029		94,405
	260,000	MA Devel. Finance Agency (Evergreen Center)¹		5.500			01/01/2035		230,399
	50,000	MA Devel. Finance Agency (Northern Berkshire Community Services)¹		6.250			08/15/2029		39,609
	50,000	MA Devel. Finance Agency (Orchard Cove)¹		5.250			10/01/2037		38,654
	1,275,000	MA Devel. Finance Agency (Pacific Rim Charter Public School)¹		5.125			06/01/2031		1,107,720
	25,000	MA H&EFA (Beverly Hospital Corp.)¹		5.250			07/01/2023		24,872
	4,500,000	MA H&EFA (Boston Medical Center)¹		5.250			07/01/2038		4,194,765
	450,000	MA H&EFA (North Adams Regional Hospital)¹		6.625			07/01/2018		435,339
	225,000	MA H&EFA (Tufts Medical Center)¹		5.000			05/15/2022		225,261
	60,000	MA H&EFA (VC/TC/FRS/VCS Obligated Group)¹		5.300			11/15/2028		54,624
	265,000	MA Industrial Finance Agency (Avon Associates)¹		5.375			04/01/2020		265,236

									6,710,884

Michigan-2.9%
	30,000	Clare County, MI Sewer Disposal System¹		5.850			11/01/2021		30,746
	680,000	Detroit, MI GO¹		5.250			04/01/2016		650,073
	10,000	Detroit, MI Local Devel. Finance Authority¹		5.500			05/01/2021		5,746
	2,250,000	Detroit, MI Sewer Disposal System¹		6.500			07/01/2024		2,528,258
	2,850,000	Detroit, MI Sewer Disposal System¹		7.500			07/01/2033		3,440,834
	170,000	Flint, MI Hospital Building Authority (Hurley Medical Center)¹		5.375			07/01/2018		166,119
	2,200,000	Grand Traverse Academy, MI Public School Academy¹		4.625			11/01/2027		1,778,612
	1,000,000	Grand Traverse Academy, MI Public School Academy¹		4.750			11/01/2032		778,890

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Michigan Continued
$	500,000	Grand Traverse Academy, MI Public School Academy¹		5.000	%		11/01/2022	$	449,375
	300,000	Highland Park, MI Building Authority¹		7.750			05/01/2018		321,549
	50,000	Howell, MI Public Schools¹		5.000			05/01/2025		51,188
	5,000	Kalamazoo, MI Hospital Finance Authority (Bronson Methodist Hospital)¹		5.250			05/15/2018		5,006
	1,000,000	Kent, MI Hospital Finance Authority¹		6.250			07/01/2040		940,890
	285,000	Meridian, MI EDC (Burcham Hills)¹		5.250			07/01/2026		251,521
	155,000	MI Hospital Finance Authority (BGH/ZHCC/BCCC/CEMS Obligated Group)¹		5.000			02/15/2018		154,997
	2,175,000	MI Hospital Finance Authority (Detroit Medical Center Obligated Group)¹		5.250			08/15/2027		2,014,137
	10,000	MI Hospital Finance Authority (OHC/OUH Obligated Group)¹		5.000			08/15/2018		10,011
	75,000	MI Hospital Finance Authority (OHC/OUH Obligated Group)¹		5.000			08/15/2031		75,014
	265,000	MI Hospital Finance Authority (Port Huron Hospital/Marwood Manor Nursing Home)		5.500			07/01/2015		265,776
	10,000	MI Hospital Finance Authority (Sisters of Mercy Health System)¹		5.250			08/15/2021		10,033
	14,600,000	MI Hospital Finance Authority (Trinity Health)²		6.125			12/01/2023		16,308,200
	15,000	MI Hsg. Devel. Authority (Walled Lake Villa)¹		6.000			04/15/2018		15,030
	340,000	MI John Tolfree Health System Corp.¹		6.000			09/15/2023		290,493
	20,000,000	MI Municipal Bond Authority		9.500			08/20/2010		19,993,400
	1,155,000	MI Public Educational Facilities Authority (Old Redford Academy)¹		6.000			12/01/2035		1,053,014
	11,420,428	MI Strategic Fund Limited Obligation (Wolverine Human Services)¹		5.850			08/31/2027		9,933,031
	488,500	MI Strategic Fund Limited Obligation (Wolverine Human Services)¹		7.875			08/31/2028		466,332
	1,323,000,000	MI Tobacco Settlement Finance Authority		9.838⁵			06/01/2058		13,243,230
	250,000	Monroe County, MI Hospital Finance Authority (Mercy Memorial Hospital Corp.)¹		5.500			06/01/2035		210,998
	120,000	Mount Clemens, MI Hsg. Corp. (FHA Section 8), Series A¹		6.600			06/01/2022		120,214
	40,000	Northern MI University¹		5.000			12/01/2025		40,015
	15,000	Oakland County, MI Sewer Disposal (White Lake Township)¹		6.000			05/01/2013		15,145
	400,000	Plymouth, MI Educational Center Charter School (Public School Academy)¹		5.375			11/01/2030		345,244
	1,325,000	Plymouth, MI Educational Center Charter School (Public School Academy)¹		5.625			11/01/2035		1,155,400
	405,000	Pontiac, MI Tax Increment Finance Authority¹		6.250			06/01/2022		265,761


Principal
Amount			Coupon			Maturity		Value

Michigan Continued
$	40,000	Royal Oak, MI Hospital Finance Authority (William Beaumont Hospital)¹		5.250	%		11/15/2031	$	38,947
	10,000	Royal Oak, MI Hospital Finance Authority (William Beaumont Hospital)¹		5.250			11/15/2035		9,581
	100,000	Wayne County, MI Building Authority		5.250			06/01/2016		100,362

									77,533,172

Minnesota-0.9%
	885,000	Columbia Heights, MN EDA Tax Increment (Huset Park Area Redevel.)¹		5.375			02/15/2032		703,823
	750,000	Minneapolis, MN Tax Increment (St. Anthony Falls)¹		5.750			02/01/2027		681,585
	11,865,000	MN HFA (Residential Hsg.)²		5.050			07/01/2034		12,112,579
	985,000	Mound, MN Hsg. & Redevel. Authority (Metroplaines)¹		5.000			02/15/2027		920,758
	1,615,000	St. Anthony, MN Hsg. & Redevel. Authority (Silver Lake Village)¹		5.000			02/01/2031		1,282,455
	250,000	St. Anthony, MN Hsg. & Redevel. Authority (Silver Lake Village)¹		5.375			08/01/2021		233,535
	1,500,000	St. Anthony, MN Hsg. & Redevel. Authority (Silver Lake Village)¹		5.625			02/01/2031		1,294,740
	216,000	St. Paul, MN Hsg. & Redevel. Authority (Great Northern Lofts)¹		6.250			03/01/2029		190,322
	6,814,000	St. Paul, MN Hsg. & Redevel. Authority (Upper Landing)¹		7.000			03/01/2029		6,814,750
	520,000	St. Paul, MN Port Authority (Great Northern)¹		6.000			03/01/2030		482,180

									24,716,727

Mississippi-0.2%
	80,000	Gulfport, MS Hospital Facility (Memorial Hospital at Gulfport)¹		5.750			07/01/2031		80,607
	45,000	Gulfport, MS Hospital Facility (Memorial Hospital at Gulfport)¹		6.200			07/01/2018		45,072
	60,000	Lowndes County, MS Solid Waste Disposal & Pollution Control (Weyerhaeuser Company)¹		6.800			04/01/2022		64,739
	1,000,000	Meridian, MS Tax Increment (Meridian Crossroads)¹		8.750			12/01/2024		1,025,440
	5,145,000	MS Home Corp. (Valley State Student Hsg.)		5.500			12/01/2035		2,084,805
	1,900,000	MS Hospital Equipment & Facilities Authority (Southwest Mississippi Regional Medical Center)¹		5.750			04/01/2023		1,864,679

									5,165,342

Missouri-2.8%
	95,000	Bates County, MO Hospital (Bates County Memorial Hospital)¹		5.650			03/01/2021		94,998
	5,000	Bates County, MO Hospital (Bates County Memorial Hospital)¹		5.750			03/01/2031		4,636
	200,000	Belton, MO Tax Increment (Belton Town Center)¹		5.625			03/01/2025		179,310

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Missouri Continued
$	310,000	Branson Hills, MO Infrastructure Facilities¹		5.000	%		04/01/2013	$	299,696
	250,000	Branson Hills, MO Infrastructure Facilities¹		5.500			04/01/2027		187,923
	900,000	Branson, MO IDA (Branson Hills Redevel.)¹		5.750			05/01/2026		762,345
	365,000	Branson, MO IDA (Branson Hills Redevel.)¹		7.050			05/01/2027		330,967
	1,875,000	Branson, MO IDA (Branson Landing)¹		5.250			06/01/2021		1,627,181
	7,900,000	Branson, MO IDA (Branson Shoppe Redevel.)¹		5.950			11/01/2029		6,598,712
	675,000	Broadway-Fairview, MO Transportation Devel. District (Columbia)¹		5.875			12/01/2031		452,885
	400,000	Chillicothe, MO Tax Increment (South U.S. 65)¹		5.500			04/01/2021		367,788
	400,000	Chillicothe, MO Tax Increment (South U.S. 65)¹		5.625			04/01/2027		345,636
	250,000	Cottleville, MO COP		5.100			08/01/2023		238,740
	300,000	Cottleville, MO COP		5.125			08/01/2026		275,841
	60,000	Fenton, MO Tax Increment (Dierbergs)¹		7.000			10/01/2015		60,133
	855,000	Hawk Ridge, MO Transportation Devel. District¹		4.650			02/01/2017		704,340
	3,840,000	Hawk Ridge, MO Transportation Devel. District¹		5.000			02/01/2030		2,309,376
	13,500,000	Hazelwood, MO Transportation Devel. District (370/ Missouri Bottom Road/Tausig Road)¹		7.200			05/01/2033		13,127,670
	2,575,000	Independence, MO 39th Street Transportation¹		6.875			09/01/2032		2,547,422
	1,245,000	Kansas City, MO Tax Increment (Briarcliff West)¹		5.150			06/01/2016		1,209,269
	1,250,000	Kansas City, MO Tax Increment (Briarcliff West)¹		5.400			06/01/2024		1,090,488
	3,210,000	Kansas City, MO Tax Increment (Southtown)¹		6.000			03/01/2017		3,133,249
	550,000	Lees Summit, MO IDA (Kensington Farms)¹		5.500			03/01/2021		496,238
	250,000	Lees Summit, MO IDA (Kensington Farms)¹		5.750			03/01/2029		208,903
	1,025,000	Liberty, MO Tax Increment (Liberty Triangle)¹		5.875			10/01/2029		910,128
	2,100,000	Maplewood, MO Tax (Maplewood South Redevel.)¹		5.750			11/01/2026		1,864,086
	355,000	MO Grindstone Plaza Transportation Devel. District¹		5.500			10/01/2031		246,161
	10,000	MO H&EFA (FHS/FNH Obligated Group)		5.375			02/15/2014		10,028
	10,280,678	MO Hanley/Eager Road Transportation Devel. District, Series A		7.750⁵			12/01/2023		3,739,185
	20,000	MO HDC (Single Family Mtg.)¹		5.550			03/01/2029		20,016
	240,000	Northwoods, MO Transportation Devel. District¹		5.850			02/01/2031		193,330
	1,675,000	Osage Beach, MO Tax Increment (Prewitts Point)¹		4.800			05/01/2016		1,589,039
	1,500,000	Osage Beach, MO Tax Increment (Prewitts Point)¹		5.000			05/01/2023		1,267,470
	350,000	Ozark Centre, MO Transportation Devel. District¹		5.375			09/01/2032		284,155
	1,500,000	Raymore, MO Tax Increment¹		5.375			03/01/2020		1,224,030
	2,750,000	Raymore, MO Tax Increment¹		5.625			03/01/2028		1,970,018
	2,500,000	Richmond Heights, MO Tax Increment & Transportation Sales Tax¹		5.625			11/01/2025		2,245,400
	7,750,000	St. Joseph, MO IDA (Living Community of St. Joseph)¹		7.000			08/15/2032		7,480,300
	1,000,000	St. Joseph, MO IDA, Series B¹		5.375			11/01/2023		936,370


Principal
Amount			Coupon			Maturity		Value

Missouri Continued
$	905,000	St. Joseph, MO IDA, Series B¹		5.500	%		11/01/2027	$	827,613
	995,000	St. Louis, MO IDA (Southtown Redevel.)¹		5.125			05/01/2026		810,328
	481,000	St. Louis, MO Tax Increment (1505 Missouri Avenue Redevel.)		6.000			08/04/2025		371,154
	852,000	St. Louis, MO Tax Increment (1601 Washington Redevel.)¹		6.000			08/21/2026		645,867
	1,879,000	St. Louis, MO Tax Increment (1619 Washington Redevel.)¹		5.500			03/09/2027		1,335,086
	662,000	St. Louis, MO Tax Increment (Pet Building Redevel.)		5.500			05/29/2028		459,276
	545,000	St. Louis, MO Tax Increment (Printers Lofts)		6.000			08/21/2026		413,143
	803,000	St. Louis, MO Tax Increment (Washington East Condominiums)¹		5.500			01/20/2028		557,226
	500,000	St. Louis, MO Tax Increment (Washington East Condominiums)¹		5.500			01/20/2028		346,965
	1,080,000	St. Louis, MO Tax Increment Financing (Ludwig Lofts)¹		6.690			04/21/2029		855,112
	373,000	St. Louis, MO Tax Increment Financing, Series A		5.500			09/02/2028		257,169
	3,261,000	St. Louis, MO Tax Increment, Series A¹		6.600			01/21/2028		2,575,603
	620,000	Stone Canyon, MO Improvement District (Infrastructure)¹		5.700			04/01/2022		507,724
	320,000	Stone Canyon, MO Improvement District (Infrastructure)¹		5.750			04/01/2027		242,976
	435,000	Suemandy, MO Mid-Rivers Community Improvement District¹		7.000			10/01/2019		441,695
	950,000	Suemandy, MO Mid-Rivers Community Improvement District¹		7.500			10/01/2029		964,298
	35,000	University of Missouri (System Facilities)¹		5.000			11/01/2018		35,126
	1,000,000	University Place, MO Transportation Devel. District¹		5.000			03/01/2026		778,560
	2,500,000	University Place, MO Transportation Devel. District¹		5.000			03/01/2032		1,788,650

									74,847,033

Montana-0.3%
	11,070,000	Hardin, MT Tax Increment Industrial Infrastructure Devel. (Rocky Mountain Power)¹		0.000⁶			09/01/2031		6,412,851
	375,000	MT Facilities Finance Authority (St. John's Lutheran)¹		6.000			05/15/2025		341,708

									6,754,559

Nebraska-0.9%
	2,915,000	NE Educational Facilities Authority (Midland Lutheran College)¹		5.600			09/15/2029		2,482,676
	1,150,000	NE Educational Finance Authority (Concordia University)¹		5.000			10/01/2037		951,430
	16,460,000	Omaha, NE Public Facilities Corp. (Baseball Stadium)²		5.000			06/01/2036		17,323,327
	2,200,000	Santee Sioux Nation, NE Tribal Health Care (Indian Health Service)¹		8.750			10/01/2020		2,239,226
	40,000	Scotts Bluff County, NE Hospital Authority (Regional West Medical Center)¹		5.250			11/15/2028		40,011

									23,036,670

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Nevada-2.6%
$	15,000,000	Clark County, NV Airport²		5.750	%		07/01/2042	$	16,039,650
	2,000,000	Clark County, NV Airport¹		5.750			07/01/2042		2,138,620
	325,000	Clark County, NV Improvement District¹		5.000			02/01/2026		241,118
	260,000	Clark County, NV Improvement District¹		5.050			02/01/2031		179,387
	20,000,000	Clark County, NV Water Reclamation District²		5.250			07/01/2038		21,272,600
	5,105,000	Director of the State of NV Dept. of Business & Industry (Las Vegas Monorail)		6.850⁵			01/01/2019		758,705
	1,000,000	Director of the State of NV Dept. of Business & Industry (Las Ventanas Retirement)^3,4		7.000			11/15/2034		534,410
	1,155,000	Las Vegas, NV Local Improvement Bonds¹		6.250			06/01/2024		1,032,766
	6,200,000	Las Vegas, NV Paiute Tribe, Series A¹		6.625			11/01/2017		5,306,332
	1,615,000	Las Vegas, NV Special Improvement District (Sumerlin Village)¹		5.875			06/01/2021		1,347,540
	9,270,000	Las Vegas, NV Special Improvement District (Sumerlin Village)¹		6.125			06/01/2031		6,856,185
	90,000	Mesquite, NV Special Improvement District (Canyon Creek)¹		5.200			08/01/2016		75,800
	135,000	Mesquite, NV Special Improvement District (Canyon Creek)¹		5.250			08/01/2017		109,785
	280,000	Mesquite, NV Special Improvement District (Canyon Creek)¹		5.300			08/01/2018		223,572
	610,000	Mesquite, NV Special Improvement District No. 07-01 (Anthem at Mesquite)¹		5.850			08/01/2018		579,726
	1,000,000	Mesquite, NV Special Improvement District No. 07-01 (Anthem at Mesquite)¹		6.000			08/01/2023		897,430
	535,000	Mesquite, NV Special Improvement District No. 07-01 (Anthem at Mesquite)¹		6.000			08/01/2027		459,972
	755,000	Mesquite, NV Special Improvement District No. 07-01 (Anthem at Mesquite)¹		6.150			08/01/2037		614,079
	25,000	Reno, NV Capital Improvement¹		5.125			06/01/2026		24,824
	3,280,000	Sparks, NV Redevel. Agency (Redevel Area No. 2)¹		6.400			06/01/2020		3,168,414
	7,420,000	Sparks, NV Redevel. Agency (Redevel Area No. 2)¹		6.700			06/01/2028		6,819,945

									68,680,860

New Hampshire-2.3%
	305,000	Manchester, NH Hsg. & Redevel. Authority, Series B		5.650⁵			01/01/2029		66,765
	3,220,000	Manchester, NH Hsg. & Redevel. Authority, Series B		5.700⁵			01/01/2030		643,034
	495,000	Manchester, NH Hsg. & Redevel. Authority, Series B		6.000⁵			01/01/2023		184,204
	1,000,000	Manchester, NH Hsg. & Redevel. Authority, Series B¹		6.750			01/01/2015		989,810
	500,000	NH Business Finance Authority (Huggins Hospital)¹		6.875			10/01/2039		510,110
	120,000	NH H&EFA (Catholic Medical Center)¹		6.125			07/01/2032		120,758
	4,010,000	NH H&EFA (Franklin Pierce College)¹		6.050			10/01/2034		3,353,403
	21,000,000	NH H&EFA (LRG Healthcare)²		7.000			04/01/2038		24,173,940


Principal
Amount			Coupon			Maturity		Value

New Hampshire Continued
$	22,000,000	NH H&EFA (LRGHealthcare)²		5.500	%		10/01/2034	$	23,079,980
	1,235,000	NH H&EFA (LRGHealthcare)¹		5.500			10/01/2034		1,295,626
	1,980,000	NH H&EFA (Portsmouth Christian Academy)¹		5.750			07/01/2023		1,660,210
	6,115,000	NH H&EFA (Portsmouth Christian Academy)¹		5.850			07/01/2033		4,660,242
	40,000	NH H&EFA (St. Joseph Hospital/Youville House/Cove)¹		5.500			07/01/2034		40,236
	1,205,000	NH HE&HFA (Franklin Pierce College)¹		5.300			10/01/2028		949,179

									61,727,497

New Jersey-3.7%
	5,610,000	NJ Health Care Facilities Financing Authority (Deborah Heart & Lung Center)¹		6.300			07/01/2023		5,185,099
	10,510,000	NJ Tobacco Settlement Financing Corp.¹		4.625			06/01/2026		8,660,030
	22,275,000	NJ Tobacco Settlement Financing Corp.¹		4.750			06/01/2034		15,784,288
	74,740,000	NJ Tobacco Settlement Financing Corp.¹		5.000			06/01/2029		59,487,061
	11,300,000	NJ Tobacco Settlement Financing Corp.¹		5.000			06/01/2041		7,447,717

									96,564,195

New Mexico-0.5%
	1,495,000	Cabezon, NM Public Improvement District¹		6.300			09/01/2034		1,323,434
	6,455,000	Eldorado, NM Area Water and Sanitation District¹		6.000			02/01/2023		5,858,042
	20,000	Farmington, NM Hospital (San Juan Medical Center/Interface, Inc. Obligated Group)¹		5.000			06/01/2016		20,017
	500,000	Mariposa East, NM Public Improvement District¹		6.000			09/01/2032		391,920
	300,000	Montecito Estates, NM Public Improvement District¹		7.000			10/01/2037		267,810
	3,380,000	NM Educational Assistance Foundation¹		5.900			09/01/2031		3,396,359
	25,000	NM Finance Authority (Workers Compensation Administration Building)¹		5.600			09/01/2014		25,077
	1,925,000	NM Trails Public Improvement District¹		7.750			10/01/2038		1,775,870
	5,000	Santa Fe, NM Educational Facilities (St. John's College)¹		5.500			03/01/2024		5,000
	100,000	Santa Fe, NM Educational Facilities (St. John's College)¹		5.500			03/01/2024		95,304

									13,158,833

New York-1.2%
	19,665,000	NYC GO²		5.375			04/01/2036		21,434,035
	10,000,000	NYS DA (St. Mary's Hospital for Children)^1,7		7.875			11/15/2041		10,160,400

									31,594,435

North Carolina-0.0%
	20,000	NC Eastern Municipal Power Agency, Series B¹		6.250			01/01/2023		20,036
	20,000	NC Medical Care Commission (ARC/HDS Alamance Hsg. Corp.)¹		5.800			10/01/2034		20,265
	625,000	NC Medical Care Commission Retirement Facilities (Village at Brookwood)¹		5.250			01/01/2032		483,050

									523,351

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

North Dakota-0.0%
$	25,000	Parshall, ND Water¹		5.500	%		09/01/2024	$	25,009
	40,000	Williston, ND Water Utility¹		5.100			05/01/2013		40,108

									65,117

Ohio-6.1%
	3,440,000	Bowling Green, OH Student Hsg. (CFP I-Bowling Green State University)¹		5.750			06/01/2031		3,419,050
	2,250,000	Bowling Green, OH Student Hsg. (CFP I-Bowling Green State University)¹		6.000			06/01/2045		2,243,250
	5,000,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		0.000⁶			06/01/2037		3,262,150
	13,980,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		5.125			06/01/2024		11,723,069
	175,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		5.375			06/01/2024		150,595
	7,690,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		5.750			06/01/2034		5,755,350
	10,610,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		5.875			06/01/2030		8,376,171
	9,275,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		5.875			06/01/2047		6,573,656
	9,750,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		6.000			06/01/2042		7,232,843
	56,620,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)¹		6.500			06/01/2047		44,113,774
	970,100,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)		7.251⁵			06/01/2047		27,997,086
	743,000,000	Buckeye, OH Tobacco Settlement Financing Authority (TASC)		7.501⁵			06/01/2052		14,064,990
	2,165,000	Centerville, OH Health Care (Bethany Lutheran Village)¹		6.000			11/01/2038		1,914,141
	40,000	Cleveland, OH Airport System		5.000			01/01/2031		40,020
	190,000	Cleveland, OH Rock Glen Hsg. Assistance Corp. (Ambleside Apartments)¹		7.000			06/01/2018		190,025
	15,000	Cuyahoga County, OH Hospital (Metro Health System)¹		5.500			02/15/2027		15,000
	700,000	Erie County, OH Hospital Facilities (Firelands Regional Medical Center)¹		5.000			08/15/2036		605,045
	5,950,000	Erie County, OH Hospital Facilities (Firelands Regional Medical Center)¹		5.250			08/15/2046		5,190,245
	295,000	Glenwillow Village, OH GO¹		5.875			12/01/2024		309,045
	25,000	Greene County, OH Economic Devel. (YMCA)¹		6.000			12/01/2023		18,929
	1,500,000	Greene County, OH University Hsg. (Central State University)¹		5.625			09/01/2032		1,029,645


Principal
Amount			Coupon			Maturity		Value

Ohio Continued
$	1,620,000	Grove City, OH Tax Increment Financing¹		5.125	%		12/01/2016	$	1,500,509
	2,500,000	Grove City, OH Tax Increment Financing¹		5.375			12/01/2031		1,821,200
	1,105,000	Jeffrey Place, OH New Community Authority (Jeffrey Place Redevel.)¹		5.000			12/01/2022		853,756
	150,000	Lucas County, OH Health Care Facilities (Sunset Retirement Communities)¹		6.625			08/15/2030		151,199
	10,000	Muskingum County, OH Hospital Facilities (BHA/Careserve/PP/SSNH/BHC/BCG/Carelife/BCC Obligated Group)¹		5.400			12/01/2016		10,011
	4,500,000	OH Higher Education Facility Commission (Ashland University)¹		6.250			09/01/2024		4,573,710
	3,075,000	Port of Greater Cincinnati, OH Devel. Authority (Public Parking Infrastructure)¹		6.300			02/15/2024		2,204,744
	5,860,000	Port of Greater Cincinnati, OH Devel. Authority (Public Parking Infrastructure)¹		6.400			02/15/2034		3,798,569
	655,000	Summit County, OH Port Authority (Twinsburg Township)¹		5.125			05/15/2025		572,712
	665,000	Toledo-Lucas County, OH Port Authority (Town Square at Levis Commons)¹		5.400			11/01/2036		631,012

									160,341,501

Oklahoma-0.4%
	15,000	Grady County, OK Industrial Authority (Correctional Facilities)¹		6.000			11/01/2029		14,565
	500,000	Grady County, OK Industrial Authority (Correctional Facilities)		7.800			11/01/2014		394,010
	4,000,000	Langston, OK EDA (Langston University)¹		5.000			05/01/2030		3,692,560
	5,575,000	Langston, OK EDA (Langston University)¹		5.000			05/01/2035		5,012,538
	770,000	Langston, OK EDA (Langston University)¹		5.250			05/01/2026		771,825
	20,000	Texas County, OK Devel Authority Student Hsg. (OPSU-Goodwell)¹		5.450			11/01/2034		17,063

									9,902,561

Oregon-0.0%
	25,000	Clackamas County, OR Hospital Facility Authority (Williamette Falls Hospital)¹		6.000			04/01/2019		25,141
	10,000	OR GO (Elderly & Disabled Hsg.)¹		5.500			08/01/2026		10,029
	10,000	OR GO (Veterans Welfare)¹		5.250			10/01/2042		10,086
	40,000	OR GO (Veterans Welfare)¹		6.000			04/01/2032		40,034
	100,000	OR Health & Science University, Series A¹		5.250			07/01/2028		100,017
	25,000	OR Hsg. & Community Services Dept. (Single Family Mtg.)¹		6.400			07/01/2018		25,053

									210,360

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Pennsylvania-1.5%
$	15,000,000	Allegheny County, PA HDA (WPAHS/AG/Forbes Health System/WPH/WPAON Obligated Group)¹		5.000	%		11/15/2028	$	11,877,900
	75,000	Blair County, PA IDA (The Village at Penn State Retirement Community)³		6.900			01/01/2022		60,343
	500,000	Chester County, PA H&EFA (Chester County Hospital)¹		6.750			07/01/2031		502,365
	1,000,000	Cumberland County, PA Municipal Authority (Diakon Lutheran Ministries)¹		5.000			01/01/2036		882,200
	500,000	Luzerne County, PA IDA¹		7.500			12/15/2019		501,435
	500,000	Luzerne County, PA IDA¹		7.750			12/15/2027		504,165
	5,000,000	Montgomery County, PA IDA¹		5.750			08/01/2030		5,270,350
	25,000	Northumberland County, PA IDA (NHS Youth Services)¹		5.500			02/15/2033		19,135
	3,675,000	Northumberland County, PA IDA (NHS Youth Services)¹		7.750			02/15/2029		3,732,110
	2,230,000	PA EDFA (Northwestern Human Services)¹		5.250			06/01/2028		1,809,355
	5,000,000	PA HEFA (MCP/HUHS/AUS Obligated Group)¹		5.875			11/15/2016		5,000,500
	3,500,000	PA HEFA (MCP/HUHS/AUS Obligated Group)¹		5.875			11/15/2021		3,430,455
	1,000,000	Philadelphia, PA H&HEFA (Centralized Comprehensive Human Services)¹		7.250			01/01/2021		995,450
	4,750,000	Philadelphia, PA H&HEFA (Temple University Hospital)¹		6.625			11/15/2023		4,750,000

									39,335,763

Rhode Island-0.4%
	5,000,000	Central Falls, RI Detention Facility¹		7.250			07/15/2035		4,333,550
	50,000	Providence, RI HDC (Barbara Jordan Apartments)¹		6.750			07/01/2025		50,075
	25,000	Providence, RI Public Building Authority¹		5.400			12/15/2012		25,093
	110,000	RI Health & Educational Building Corp. (Johnson & Wales University)¹		6.100			04/01/2026		110,084
	40,000	RI Hsg. & Mtg. Finance Corp. (Homeownership Opportunity)¹		6.500			04/01/2027		40,058
	33,305,000	RI Tobacco Settlement Financing Corp. (TASC)		6.125⁵			06/01/2052		465,937
	211,125,000	RI Tobacco Settlement Financing Corp. (TASC)		6.580⁵			06/01/2052		3,274,549
	10,375,000	RI Tobacco Settlement Financing Corp. (TASC)		6.750⁵			06/01/2052		121,388
	1,400,000	Tiverton, RI Special Obligation Tax (Mount Hope Bay Village)¹		6.875			05/01/2022		1,393,672

									9,814,406

South Carolina-1.3%
	500,000	Allendale County, SC School District Energy Savings Special Obligation¹		8.500			12/01/2018		528,895
	30,000	Charleston County, SC (Care Alliance Health Services)¹		5.000			08/15/2019		30,179
	45,000	Edgefield County, SC Water and Sewer Authority¹		5.000			01/01/2028		43,875
	35,000	Horry County, SC Hospital Facilities (Conway Hospital)¹		5.000			07/01/2028		31,976
	1,240,000	Lancaster County, SC (Edenmoor Improvement District)³		5.375			12/01/2016		408,828
	1,460,000	Lancaster County, SC (Edenmoor Improvement District)³		5.750			12/01/2037		481,362


Principal
Amount			Coupon			Maturity		Value

South Carolina Continued
$	1,955,000	Lancaster County, SC (Sun City Carolina Lakes)¹		5.450	%		12/01/2037	$	1,565,955
	8,565,000	Lee County, SC School Facilities, Series 2006¹		6.000			12/01/2027		8,814,670
	35,000	Piedmont, SC Municipal Power Agency¹		5.000			01/01/2018		35,048
	15,000	Piedmont, SC Municipal Power Agency¹		5.000			01/01/2022		15,011
	5,838,000	Richland County, SC Assessment Revenue (Village at Sandhill Improvement District)¹		6.200			11/01/2036		4,745,185
	600,000	SC Connector 2000 Assoc. Toll Road, Series B		5.535⁵			01/01/2020		57,000
	6,565,000	SC Connector 2000 Assoc. Toll Road, Series B		5.781⁵			01/01/2021		588,881
	11,240,000	SC Connector 2000 Assoc. Toll Road, Series B		6.697⁵			01/01/2026		753,080
	5,285,000	SC Educational Facilities Authority (Benedict College)¹		5.600			07/01/2022		4,447,169
	2,320,000	SC Educational Facilities Authority (Benedict College)¹		5.625			07/01/2031		1,762,643
	550,000	SC Educational Facilities Authority (Southern Wesleyan University)¹		5.750			03/01/2029		536,492
	45,000	SC Hsg. Finance & Devel. Authority, Series A-1¹		5.300			07/01/2031		45,018
	2,500,000	SC Jobs-EDA (Coastal Hsg. Foundation)¹		6.250			04/01/2035		2,591,475
	2,000,000	SC Jobs-EDA (Coastal Hsg. Foundation)¹		6.500			04/01/2042		2,096,260
	2,750,000	SC Jobs-EDA (Lutheran Homes)¹		5.500			05/01/2028		2,446,620
	935,000	SC Jobs-EDA (Palmetto Health)¹		5.375			08/01/2022		975,869
	2,000,000	SC Jobs-EDA (Palmetto Health)¹		5.500			08/01/2026		2,028,920
	30,000	SC State Budget & Control Board (Harden Street Facilities)¹		6.000			12/01/2011		30,120

									35,060,531

South Dakota-0.0%
	10,000	SD H&EFA (Prairie Lakes Health Care System)¹		5.650			04/01/2022		10,004

Tennessee-1.3%
	5,000	Jackson, TN Health Educational & Hsg. Facilities Board (Lambuth University)¹		5.900			09/01/2015		5,006
	15,000	Johnson City, TN H&EFB (Johnson City Medical Center)¹		5.250			07/01/2028		15,118
	5,000,000	TN Energy Acquisition Corp.¹		5.000			02/01/2022		5,035,700
	8,400,000	TN Energy Acquisition Corp., Series B¹		5.625			09/01/2026		8,085,756
	9,810,000	TN Energy Acquisition Gas Corp.¹		5.000			02/01/2023		9,817,259
	5,000,000	TN Energy Acquisition Gas Corp.¹		5.000			02/01/2025		4,961,800
	5,000,000	TN Energy Acquisition Gas Corp.¹		5.250			09/01/2026		5,018,650

									32,939,289

Texas-10.4%
	1,305,000	Anson, TX Education Facilities Corp. Student Hsg. (University of Texas/Waterview Park)¹		5.100			01/01/2034		887,687
	19,705,000	Austin, TX Independent School District²		5.000			08/01/2033		20,967,672
	6,035,000	Beasley, TX Higher Education Finance Corp., Series A¹		5.125			12/01/2034		5,164,331

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Texas Continued
$	3,090,000	Bexar County, TX HFC (American Opportunity Hsg.-Nob Hill Apartments)		6.000	%		06/01/2021	$	2,355,414
	6,625,000	Bexar County, TX HFC (American Opportunity Hsg.-Nob Hill Apartments)		6.000			06/01/2031		4,396,483
	5,765,000	Bexar County, TX HFC (American Opportunity Hsg.-Waterford/Kingswood)¹		7.000			12/01/2036		5,517,797
	400,000	Bexar County, TX HFC (Doral Club)¹		8.750			10/01/2036		287,100
	40,000	Brazoria County, TX Municipal Utility District No. 18¹		5.300			09/01/2028		39,313
	20,000	Brazos County, TX HFDC (Franciscan Services Corp.)¹		5.375			01/01/2032		20,002
	60,000	Collin County, TX HFC (Community College District Foundation)¹		5.250			06/01/2031		35,293
	5,000	Cypress Hill, TX Municipal Utility District No. 1¹		5.250			09/01/2025		5,000
	25,000	Dallas-Fort Worth, TX International Airport Facility¹		5.200			01/15/2031		25,012
	18,550,000	Dallas-Fort Worth, TX International Airport Facility (American Airlines)		6.000			11/01/2014		17,437,928
	700,000	Danbury, TX Higher Education Finance Corp. (Island Foundation)¹		6.250			02/15/2036		622,034
	7,650,000	Donna, TX GO¹		6.250			02/15/2037		5,919,264
	255,000	El Paso County, TX HFC (American Village Communities), Series A¹		6.250			12/01/2020		255,905
	335,000	El Paso County, TX HFC (El Paso American Hsg. Foundation), Series A¹		6.375			12/01/2032		315,798
	5,390,000	Escondido, TX Public Improvement District (Horseshoe Bay)¹		7.250			10/01/2033		5,120,554
	20,000	Harris County, TX HFDC (Texas Children's Hospital)¹		5.250			10/01/2029		20,265
	45,000	Harris County-Houston, TX Sports Authority¹		5.000			11/15/2025		44,998
	16,000,000	Houston, TX Airport System, Series A²		5.500			07/01/2039		17,215,360
	2,345,000	Lubbock, TX HFC (Las Colinas Quail Creek Apartments)¹		6.000			07/01/2022		1,987,130
	1,530,000	Lubbock, TX HFC (Las Colinas Quail Creek Apartments)¹		6.000			07/01/2025		1,244,288
	770,000	Lubbock, TX HFC (Las Colinas Quail Creek Apartments)¹		6.000			07/01/2032		581,219
	2,900,000	Lufkin, TX Health Facilities Devel. Corp. (Memorial Health System of East Texas)¹		6.250			02/15/2037		2,943,935
	700,000	Maverick County, TX GO COP¹		8.750			03/01/2034		711,249
	2,350,000	Maverick County, TX GO COP¹		8.750			03/01/2034		2,370,210
	12,000,000	McLennan County, TX Public Facility Corp.¹		6.625			06/01/2035		13,138,200
	230,000	Midlothian, TX Devel. Authority Tax Increment¹		5.125			11/15/2026		205,390
	75,000	Mission, TX EDC¹		6.600			01/01/2020		75,248
	12,000,000	North Central TX HFDC (Children's Medical Center)²		5.750			08/15/2039		12,612,360
	15,000	North TX Tollway Authority (Dallas North Tollway System)¹		5.000			01/01/2023		15,010
	50,000	Port of Corpus Christi, TX (Union Pacific Corp.)¹		5.350			11/01/2010		50,062
	50,000	Richardson, TX Hospital Authority (Baylor/Richardson)¹		5.625			12/01/2028		47,081


Principal
Amount			Coupon			Maturity		Value

Texas Continued
$	3,695,000	Sabine, TX River Authority Pollution Control (TXU Electric Company)		6.150	%		08/01/2022	$	1,911,091
	16,000,000	Tarrant County, TX Cultural Education Facilities Finance Corp. (Baylor Health Care System)²		6.250			11/15/2029		17,977,440
	980,000	Tom Green County, TX HFDC (Shannon Health System/Shannon Medical Center)¹		6.750			05/15/2021		1,002,628
	2,500,000	Tomball, TX Hospital Authority (Tomball Regional Hospital)		5.000			07/01/2020		2,433,200
	20,000	Tomball, TX Hospital Authority (Tomball Regional Hospital)¹		6.000			07/01/2025		19,960
	25,000	Tomball, TX Hospital Authority (Tomball Regional Hospital)¹		6.000			07/01/2029		24,446
	6,958,000	Trophy Club, TX Public Improvement (Highlands Trophy Club)¹		7.750			10/01/2037		6,528,552
	110,000	TX Dormitory Finance Authority (Temple Junior College Foundation)		5.750			09/01/2027		66,673
	485,000	TX Dormitory Finance Authority (Temple Junior College Foundation)		6.000			09/01/2033		293,672
	10,000,000	TX Multifamily Housing Options (Affordable Hsg.)		0.580⁹			01/01/2039		3,243,000
	1,990,000	TX Municipal Gas Acquisition & Supply Corp.¹		1.810⁹			12/15/2026		1,423,387
	95,000,000	TX Municipal Gas Acquisition & Supply Corp.²		6.250			12/15/2026		102,565,800
	545,000	TX Panhandle HFA (Amarillo Affordable Hsg.)^3,4		6.625			03/01/2020		273,399
	3,065,000	TX Panhandle HFA (Amarillo Affordable Hsg.)^3,4		6.750			03/01/2031		1,538,324
	3,000,000	TX Private Activity Bond Surface Transportation Corp.¹		7.000			06/30/2040		3,134,460
	1,750,000	TX Public Finance Authority Charter School Finance Corp. (Cosmos Foundation)¹		6.000			02/15/2030		1,780,450
	660,000	TX Public Finance Authority Charter School Finance Corp. (Ed-Burnham Wood)¹		6.250			09/01/2036		603,920
	2,400,000	Tyler, TX HFDC (Mother Frances Hospital Regional Health Care Center)¹		5.000			07/01/2033		2,152,536
	4,205,000	Wichita County, TX HFDC (Wichita Falls Retirement Foundation)¹		6.250			01/01/2028		3,868,306

									273,475,836

U.S. Possessions-3.1%
	40,000	Guam GO¹		5.400			11/15/2018		39,725
	13,620,000	Puerto Rico Aqueduct & Sewer Authority¹		6.000			07/01/2038		14,260,821
	5,000,000	Puerto Rico Commonwealth GO¹		5.250			07/01/2032		5,041,500
	10,000,000	Puerto Rico Commonwealth GO¹		6.000			07/01/2039		10,627,000
	5,000,000	Puerto Rico Commonwealth GO¹		6.500			07/01/2037		5,551,250
	1,120,000	Puerto Rico Highway & Transportation Authority¹		5.500			07/01/2023		1,190,896
	65,000	Puerto Rico Infrastructure¹		5.000			07/01/2041		62,670
	850,000	Puerto Rico Infrastructure¹		5.500			07/01/2024		925,676
	8,000,000	Puerto Rico Infrastructure		7.075⁵			07/01/2030		2,240,800
	8,000,000	Puerto Rico Public Buildings Authority¹		5.625			07/01/2039		8,202,480

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

U.S. Possessions Continued
$	7,550,000	Puerto Rico Public Buildings Authority¹		6.250	%		07/01/2026	$	8,207,907
	1,000,000	Puerto Rico Public Buildings Authority¹		6.250			07/01/2031		1,134,950
	1,500,000	Puerto Rico Sales Tax Financing Corp., Series A¹		6.500			08/01/2044		1,667,250
	14,000,000	Puerto Rico Sales Tax Financing Corp., Series A		6.530⁵			08/01/2047		1,394,820
	50,000,000	Puerto Rico Sales Tax Financing Corp., Series A		7.280⁵			08/01/2034		10,996,500
	3,200,000	Puerto Rico Sales Tax Financing Corp., Series C¹		6.000			08/01/2039		3,465,184
	7,100,000	Puerto Rico Sales Tax Financing Corp., Series C¹		6.000			08/01/2042		7,630,938

									82,640,367

Utah-0.1%
	285,000	Utah County, UT Charter School (Lincoln Academy)¹		5.875			06/15/2037		243,039
	275,000	Utah County, UT Charter School (Renaissance Academy)¹		5.625			07/15/2037		226,287
	1,500,000	West Valley City, UT Sewer (East Hollywood High School)¹		5.625			06/15/2037		1,211,745

									1,681,071

Vermont-0.0%
	30,000	VT E&HBFA (Mary Hitchcock Memorial Hospital/Cooley Dickenson Hospital Obligated Group)		5.000			11/15/2022		30,005
	85,000	VT EDA (Wake Robin Corp.)¹		6.300			03/01/2033		84,781
	790,524	VT Educational & Health Buildings Financing Agency (Marlboro College)¹		2.779			04/01/2019		630,285
	125,000	VT Student Assistance Corp.¹		5.000			03/01/2026		127,208

									872,279

Virginia-2.0%
	2,300,000	Buena Vista, VA Public Recreational Facilities Authority (Golf Course)¹		5.250			07/15/2025		2,087,848
	825,000	Buena Vista, VA Public Recreational Facilities Authority (Golf Course)¹		5.500			07/15/2035		725,233
	625,000	Celebrate, VA North Community Devel. Authority Special Assessment¹		6.750			03/01/2034		470,800
	100,000	Danville, VA IDA Educational Facilities (Averett University)¹		6.000			03/15/2016		101,005
	762,000	Farms New Kent, VA Community Devel. Authority Special Assessment¹		5.125			03/01/2036		544,975
	3,000,000	Farms New Kent, VA Community Devel. Authority Special Assessment¹		5.450			03/01/2036		2,228,790
	750,000	Farms New Kent, VA Community Devel. Authority Special Assessment¹		5.800			03/01/2036		579,375
	25,000	Greensville County, VA IDA (Georgia-Pacific Corp.)¹		5.300			08/01/2014		25,049
	345,000	Manassas Park, VA Economic Devel. Authority¹		6.000			07/15/2035		347,819
	900,000	New Port, VA CDA¹		5.600			09/01/2036		553,365
	65,000	Norton, VA IDA (Norton Community Hospital)¹		6.000			12/01/2022		65,202
	3,475,000	Peninsula, VA Town Center Community Devel. Authority Special Obligation¹		6.450			09/01/2037		3,371,028


Principal
Amount			Coupon			Maturity		Value

Virginia Continued
$	880,000	Stafford County & Staunton, VA IDA (Virginia Municipal League/Mt. Rogers)¹		6.500	%		08/01/2028	$	883,098
	2,850,000	Stafford County & Staunton, VA IDA (Virginia Municipal League/Mt. Rogers)¹		6.500			08/01/2038		2,729,873
	675,000	Suffolk, VA IDA (Lake Prince Center)¹		5.300			09/01/2031		593,926
	3,600,000	VA Celebrate South CDA Special Assessment¹		6.250			03/01/2037		2,526,948
	1,000,000	VA College Building Authority (Regent University)¹		5.000			06/01/2026		930,510
	1,035,000	VA College Building Authority Educational Facilities (Regent University)¹		5.000			06/01/2036		931,127
	3,700,000	VA Small Business Financing Authority (Hampton Roads Proton)¹		9.000			07/01/2039		3,887,294
	36,870,000	VA Tobacco Settlement Authority¹		5.000			06/01/2047		23,989,466
	35,170,000	VA Tobacco Settlement Authority		5.670⁵			06/01/2047		1,147,597
	162,770,000	VA Tobacco Settlement Authority		5.770⁵			06/01/2047		4,951,463

									53,671,791

Washington-2.4%
	1,000,000	Bremerton, WA Hsg. Authority¹		5.300			06/01/2026		941,660
	4,145,000	Bremerton, WA Hsg. Authority¹		5.500			06/01/2037		3,519,768
	35,000	Pierce County, WA Hsg. Authority¹		5.800			12/01/2023		28,259
	100,000	Port Camas, WA Public Industrial Corp. (James River Corp. of Virginia)¹		6.700			04/01/2023		100,007
	75,000	Radford, WA Court Properties Student Housing¹		5.000			06/01/2027		75,398
	2,460,000	Seattle, WA Hsg. Authority (Gamelin House & Genesee)¹		5.700			11/01/2035		2,189,351
	165,000	Skagit Valley, WA College¹		5.625			11/01/2017		165,210
	140,000	Skagit Valley, WA College¹		5.750			11/01/2023		140,081
	500,000	Vancouver, WA Downtown Redevel. Authority (Conference Center)¹		5.250			01/01/2028		396,700
	1,800,000	Vancouver, WA Downtown Redevel. Authority (Conference Center)¹		5.250			01/01/2034		1,368,234
	55,000	Vancouver, WA Hsg. Authority¹		5.500			03/01/2028		55,048
	25,000	WA COP (Dept. of General Administration)		5.300			10/01/2010		25,092
	33,785,000	WA Health Care Facilities Authority (Catholic Health Initiatives)²		6.375			10/01/2036		37,440,943
	15,000,000	WA Health Care Facilities Authority (Providence Health System-Washington)²		5.250			10/01/2033		15,777,300
	115,000	WA Health Care Facilities Authority (Swedish Health System)¹		5.125			11/15/2022		115,132
	90,000	WA Health Care Facilities Authority (Yakima Valley Memorial Hospital Assoc.)¹		5.250			12/01/2020		88,237
	145,000	WA Health Care Facilities Authority (Yakima Valley Memorial Hospital Assoc.)¹		5.375			12/01/2027		135,304

STATEMENT OF INVESTMENTS Continued


Principal
Amount			Coupon			Maturity		Value

Washington Continued
$	10,000	WA HFC (Nickerson Area Properties)¹		5.250	%		01/01/2023	$	8,380
	25,000	WA Tobacco Settlement Authority (TASC)¹		6.625			06/01/2032		24,897
	80,000	White Salmon, WA Water & Sewer¹		6.000			07/01/2015		80,171

									62,675,172

West Virginia-0.1%
	50,000	Pleasants County, WV Pollution Control (Monongahela Power Company)¹		6.150			05/01/2015		50,089
	500,000	Wheeling, WV Tax Increment (Stone Building Renovation)¹		5.200			06/01/2025		413,755
	1,500,000	Wheeling, WV Tax Increment (Stone Building Renovation)¹		5.500			06/01/2033		1,178,370
	1,720,000	WV Hospital Finance Authority (Charleston Area Medical Center)¹		5.500			09/01/2025		1,771,634

									3,413,848

Wisconsin-0.2%
	1,750,000	Sokaogon, WI Chippewa Community (Gaming)¹		7.000			01/01/2026		1,071,263
	1,500,000	WI H&EFA (Aurora Health Care)¹		5.600			02/15/2029		1,499,925
	350,000	WI H&EFA (Beloit College)¹		6.125			06/01/2035		356,825
	350,000	WI H&EFA (Beloit College)¹		6.125			06/01/2039		354,113
	5,000	WI H&EFA (Froedert & Community)¹		5.375			10/01/2030		5,088
	280,000	WI H&EFA (Kenosha Hospital & Medical Center)¹		5.625			05/15/2029		280,098
	185,000	WI H&EFA (Medical College of Wisconsin)¹		5.500			12/01/2026		185,118
	2,140,000	WI H&EFA (Richland Hospital)¹		5.375			06/01/2028		1,879,910

									5,632,340


Total Municipal Bonds and Notes (Cost $3,550,722,301)									3,099,907,387

Corporate Bonds and Notes-0.0%
	109,631	Delta Air Lines, Inc., Sr. Unsec. Nts.^1,10 (Cost $108,535)		8.000			12/01/2015		84,667

Shares

Common Stocks-0.0%
	918	Delta Air Lines, Inc.^4,10 (Cost $5,407)							10,906
Total Investments, at Value (Cost $3,550,836,243)-117.4%									3,100,002,960
Liabilities in Excess of Other Assets-(17.4)									(458,594,765	)

Net Assets-100.0%								$	2,641,408,195

Footnotes to Statement of Investments


*		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

1.		All or a portion of the security position has been segregated for collateral to cover borrowings. See Note 6 of accompanying Notes.

2.		Security represents the underlying municipal bond on an inverse floating rate security. The bond was purchased by the Fund and subsequently segregated and transferred to a trust. See Note 1 of accompanying Notes.

3.		Issue is in default. See Note 1 of accompanying Notes.

4.		Non-income producing security.

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

6.		Denotes a step bond: a zero coupon bond that converts to a fixed or variable interest rate at a designated future date.

7.		When-issued security or delayed delivery to be delivered and settled after July 30, 2010. See Note 1 of accompanying Notes.

8.		Restricted security. The aggregate value of restricted securities as of July 30, 2010 was $6,787,760, which represents 0.26% of the Fund's net assets. See Note 5 of accompanying Notes. Information concerning restricted securities is as follows:


	Acquisition						Unrealized
Security	Dates		Cost		Value		Depreciation

IL Finance Authority (Monarch Landing)		6/11/09	$	1,574,866	$	309,633	$	1,265,233
IL Finance Authority (Monarch Landing)		6/11/09		2,487,481		526,377		1,961,104
IL Finance Authority (Sedgebrook)		5/5/09-6/12/09		5,721,033		2,506,000		3,215,033
IL Finance Authority (Sedgebrook)		6/11/09		2,314,101		939,750		1,374,351
IL Finance Authority (Sedgebrook)		6/11/09-6/12/09		5,420,400		2,506,000		2,914,400

			$	17,517,881	$	6,787,760	$	10,730,121


9.		Represents the current interest rate for a variable or increasing rate security.

10.		Received as a result of a corporate action.

Valuation Inputs

Various data inputs are used in determining the value of each of the Fund's investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

	1)		Level 1-unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)

	2)		Level 2-inputs other than unadjusted quoted prices that are observable for the asset (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)

	3)		Level 3-significant unobservable inputs (including the Manager's own judgments about assumptions that market participants would use in pricing the asset).

The table below categorizes amounts that are included in the Fund's Statement of Assets and Liabilities as of July 30, 2010 based on valuation input level:


					Level 3-
	Level 1-		Level 2-		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted prices		Observable Inputs		Inputs		Value

Assets Table
Investments, at Value:
Municipal Bonds and Notes
Alabama	$	-	$	38,112,015	$	-	$	38,112,015
Alaska		-		37,804,989		-		37,804,989
Arizona		-		128,237,133		-		128,237,133
Arkansas		-		2,393,786		-		2,393,786
California		-		634,734,412		-		634,734,412
Colorado		-		69,715,398		-		69,715,398

STATEMENT OF INVESTMENTS Continued

Footnotes to Statement of Investments Continued


					Level 3-
	Level 1-		Level 2-		Significant
	Unadjusted		Other Significant		Unobservable
	Quoted prices		Observable Inputs		Inputs		Value

Assets Table Continued
Connecticut	$	-	$	6,962,744	$	-	$	6,962,744
Delaware		-		5,576,126		-		5,576,126
District of Columbia		-		16,672,259		-		16,672,259
Florida		-		420,965,461		-		420,965,461
Georgia		-		51,703,548		-		51,703,548
Hawaii		-		845,168		-		845,168
Idaho		-		7,310,857		-		7,310,857
Illinois		-		238,185,619		-		238,185,619
Indiana		-		27,999,149		-		27,999,149
Iowa		-		52,312,703		-		52,312,703
Kansas		-		3,876,542		-		3,876,542
Kentucky		-		204,219		10		204,229
Louisiana		-		85,255,369		-		85,255,369
Maryland		-		8,284,086		-		8,284,086
Massachusetts		-		6,710,884		-		6,710,884
Michigan		-		77,533,172		-		77,533,172
Minnesota		-		24,716,727		-		24,716,727
Mississippi		-		5,165,342		-		5,165,342
Missouri		-		74,847,033		-		74,847,033
Montana		-		6,754,559		-		6,754,559
Nebraska		-		23,036,670		-		23,036,670
Nevada		-		68,680,860		-		68,680,860
New Hampshire		-		61,727,497		-		61,727,497
New Jersey		-		96,564,195		-		96,564,195
New Mexico		-		13,158,833		-		13,158,833
New York		-		31,594,435		-		31,594,435
North Carolina		-		523,351		-		523,351
North Dakota		-		65,117		-		65,117
Ohio		-		160,341,501		-		160,341,501
Oklahoma		-		9,902,561		-		9,902,561
Oregon		-		210,360		-		210,360
Pennsylvania		-		39,335,763		-		39,335,763
Rhode Island		-		9,814,406		-		9,814,406
South Carolina		-		35,060,531		-		35,060,531
South Dakota		-		10,004		-		10,004
Tennessee		-		32,939,289		-		32,939,289
Texas		-		270,232,836		3,243,000		273,475,836
U.S. Possessions		-		82,640,367		-		82,640,367
Utah		-		1,681,071		-		1,681,071
Vermont		-		872,279		-		872,279
Virginia		-		53,671,791		-		53,671,791
Washington		-		62,675,172		-		62,675,172
West Virginia		-		3,413,848		-		3,413,848
Wisconsin		-		5,632,340		-		5,632,340
Corporate Bonds and Notes		-		84,667		-		84,667
Common Stocks		10,906		-		-		10,906

Total Assets	$	10,906	$	3,096,749,044	$	3,243,010	$	3,100,002,960

Currency contracts and forwards, if any, are reported at their unrealized appreciation/depreciation at measurement date, which represents the change in the contract's value from trade date. Futures, if any, are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

See the accompanying Notes for further discussion of the methods used in determining value of the Fund's investments, and a summary of changes to the valuation methodologies, if any, during the reporting period.

To simplify the listings of securities, abbreviations are used per the table below:



ABAG		Association of Bay Area Governments
AG		Allegheny General Hospital
AHF		American Housing Foundation
ARC		Assoc. of Retarded Citizens
AS		Ambulatory Services
AUS		Allegheny United Hospital
BCC		Bethesda Company Care, Inc.
BCCC		Botsford Continuing Care Corp.
BCG		Bethesda Care Givers
BGH		Botsford General Hospital
BHA		Bethesda Hospital Assoc.
BHC		Bethesda Home Care
CDA		Communities Devel. Authority
CECS		Carden Elementary Charter School
CEMS		Community Emergency Medical Services
CFGH		Central Florida Group Homes
CHCC		Community Hospitals of Central California
CHHC		Community Health & Home Care
COP		Certificates of Participation
CRH		Columbus Regional Healthcare
DA		Dormitory Authority
DKH		Day Kimball Hospital
DLS		Diagnostic Laboratory Services
DRIVERS		Derivative Inverse Tax Exempt Receipts
E&HBFA		Educational Health Buildings Financing Agency
EDA		Economic Devel. Authority
EDC		Economic Devel. Corp.
EDFA		Economic Devel. Finance Authority
EF&CD		Environmental Facilities and Community Devel.
EICS		E-Institute Charter School
EMH		Elmhurst Memorial Hospital
EMHH		Elmhurst Memorial Home Health
EMHS		Elmhurst Memorial Health System
FCHMC		Fresno Community Hospital & Medical Center
FHA		Federal Housing Agency/Authority
FHH		Fresno Heart Hospital
FHS		Freeman Health System
FNH		Freeman Neosho Hospital
FRS		Family Rehabilitation Services (Hancock Manor)
GO		General Obligation
H&EFA		Health and Educational Facilities Authority
H&EFB		Health and Educational Facilities Board
H&HEFA		Hospitals and Higher Education Facilities Authority
HDA		Hospital Devel. Authority
HDC		Housing Devel. Corp.
HE&HFA		Higher Education and Health Facilities Authority
HEFA		Higher Education Facilities Authority
HFA		Housing Finance Agency
HFC		Housing Finance Corp.
HFDC		Health Facilities Devel. Corp.
HNE		Healthnet of New England
HUHS		Hahnemann University Hospital System
IDA		Industrial Devel. Agency
LD&M		Locklando Door and Millwork
MCM		Managed Care Management
MCP		Medical College Of Pennsylvania
M-S-R		Modesto Irrigation District of the City of Santa Clara and the City of Reddings
NH		Northgate Housing
NYC		New York City
NYS		New York State
OHC		Oakwood Hospital Corp.
OLOLMC		Our Lady of Lake Medical Center
OLOLRMC		Our Lady of Lourdes Regional Medical Center
OPSU		Oklahoma Panhandle State University
OUH		Oakwood United Hospitals
PHS		Pinnacle Health System
PP		Professionals PRN, Inc.
RITES		Residual Interest Tax Exempt Security
ROLS		Residual Option Longs
SHF		Sierra Hospital Foundation
SJHCN		St. Joseph Home Care Network
SJHE		St. Joseph Hospital of Eureka
SJHO		St. Joseph Hospital of Orange
SJHS		St. Joseph Health System
SSNH		Sunny Slope Nursing Home
TASC		Tobacco Settlement Asset-Backed Bonds
TAT		The Academy of Tuscson
TC		Travis Corp. (People Care)
VC		VinFen Corp.
VCS		VinFen Clinical Services
WCNT		Wessex Corporation of New Tazewell
WPAHS		West Penn Allegheny Health System
WPAON		West Penn Allegheny Oncology Network
WPH		Western Pennsylvania Hospital
YMCA		Young Men's Christian Assoc.
ZHCC		Zieger Health Care Corp.

See accompanying Notes to Financial Statements.

STATEMENT OF ASSETS AND LIABILITIES July 30, 2010¹



Assets
Investments, at value (cost $3,550,836,243)-see accompanying statement of investments	$	3,100,002,960
Cash		941,266
Receivables and other assets:
Interest		45,743,356
Investments sold (including $7,307,005 sold on a when-issued or delayed delivery basis)		13,262,152
Shares of beneficial interest sold		6,912,283
Other		443,962

Total assets		3,167,305,979

Liabilities
Payables and other liabilities:
Payable for short-term floating rate notes issued (See Note 1)		452,120,000
Payable on borrowings (See Note 6)		38,300,000
Investments purchased (including $20,435,442 purchased on a when-issued or delayed delivery basis)		27,385,517
Shares of beneficial interest redeemed		4,679,763
Dividends		2,075,256
Distribution and service plan fees		515,003
Trustees' compensation		285,658
Transfer and shareholder servicing agent fees		107,680
Shareholder communications		81,795
Interest expense on borrowings		15,267
Other		331,845

Total liabilities		525,897,784

Net Assets	$	2,641,408,195


Composition of Net Assets
Par value of shares of beneficial interest	$	413,483
Additional paid-in capital		3,439,015,315
Accumulated net investment income		1,526,627
Accumulated net realized loss on investments		(348,713,947	)
Net unrealized depreciation on investments		(450,833,283	)

Net Assets	$	2,641,408,195



Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets of $2,081,579,667 and 325,501,982 shares of beneficial interest outstanding)	$	6.39
Maximum offering price per share (net asset value plus sales charge of 4.75% of offering price)	$	6.71
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $41,234,167 and 6,478,365 shares of beneficial interest outstanding)	$	6.36
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $518,594,361 and 81,503,051 shares of beneficial interest outstanding)	$	6.36


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

STATEMENT OF OPERATIONS For the Year Ended July 30, 2010¹



Investment Income
Interest	$	203,305,446
Other income		3,470

Total investment income		203,308,916

Expenses
Management fees		9,964,986
Distribution and service plan fees:
Class A		4,720,463
Class B		378,571
Class C		4,635,653
Transfer and shareholder servicing agent fees:
Class A		810,438
Class B		49,206
Class C		285,087
Shareholder communications:
Class A		149,853
Class B		7,188
Class C		43,335
Interest expense and fees on short-term floating rate notes issued (See Note 1)		5,498,188
Borrowing fees		5,410,392
Interest expense on borrowings		217,619
Trustees' compensation		48,201
Custodian fees and expenses		23,328
Other		261,923

Total expenses		32,504,431
Less waivers and reimbursements of expenses		(41,990	)

Net expenses		32,462,441

Net Investment Income		170,846,475

Realized and Unrealized Gain
Net realized gain on investments		137,994
Net change in unrealized appreciation/depreciation on investments		306,249,859

Net Increase in Net Assets Resulting from Operations	$	477,234,328


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

STATEMENTS OF CHANGES IN NET ASSETS


Year Ended July 31,	2010¹			2009

Operations
Net investment income	$	170,846,475		$	129,032,751
Net realized gain (loss)		137,994			(222,514,462	)
Net change in unrealized appreciation/depreciation		306,249,859			(346,205,255	)

Net increase (decrease) in net assets resulting from operations		477,234,328			(439,686,966	)

Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Class A		(140,989,649	)		(107,860,111	)
Class B		(2,428,029	)		(2,060,558	)
Class C		(30,007,016	)		(20,224,854	)

		(173,424,694	)		(130,145,523	)

Beneficial Interest Transactions
Net increase in net assets resulting from beneficial interest transactions:
Class A		387,853,947			306,983,058
Class B		7,705,230			3,492,388
Class C		154,797,434			82,288,783

		550,356,611			392,764,229

Net Assets
Total increase (decrease)		854,166,245			(177,068,260	)
Beginning of period		1,787,241,950			1,964,310,210

End of period (including accumulated net investment income of $1,526,627 and $5,140,568, respectively)	$	2,641,408,195		$	1,787,241,950


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

STATEMENT OF CASH FLOWS For the Year Ended July 30, 2010¹



Cash Flows from Operating Activities
Net increase in net assets from operations	$	477,234,328
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities:
Purchase of investment securities		(1,062,320,414	)
Proceeds from disposition of investment securities		570,420,306
Short-term investment securities, net		3,277,872
Premium amortization		1,899,125
Discount accretion		(30,895,783	)
Net realized gain on investments		(137,994	)
Net change in unrealized appreciation/depreciation on investments		(306,249,859	)
Change in assets:
Decrease in receivable for securities sold		3,518,067
Decrease in other assets		1,493,786
Increase in interest receivable		(9,419,147	)
Change in liabilities:
Increase in payable for securities purchased		6,093,142
Decrease in other liabilities		(12,272	)

Net cash used in operating activities		(345,098,843	)

Cash Flows from Financing Activities
Proceeds from bank borrowings		796,500,000
Payments on bank borrowings		(917,400,000	)
Proceeds from short-term floating rate notes issued		77,640,000
Proceeds from shares sold		1,103,925,800
Payments on shares redeemed		(645,336,942	)
Cash distributions paid		(70,180,666	)

Net cash provided by financing activities		345,148,192
Net increase in cash		49,349
Cash, beginning balance		891,917

Cash, ending balance	$	941,266

Supplemental disclosure of cash flow information:

Noncash financing activities not included herein consist of reinvestment of dividends and distributions of $102,617,283.

Cash paid for interest on bank borrowings-$297,956.

Cash paid for interest on short-term floating rate notes issued-$5,498,188.


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

See accompanying Notes to Financial Statements.

FINANCIAL HIGHLIGHTS


Class A Year Ended July 31,	2010¹			2009			2008			2007			2006

Per Share Operating Data
Net asset value, beginning of period	$	5.51		$	7.90		$	10.04		$	10.08		$	10.16

Income (loss) from investment operations:
Net investment income²		.45			.50			.53			.51			.50
Net realized and unrealized gain (loss)		.89			(2.37	)		(2.17	)		(.07	)		(.03	)

Total from investment operations		1.34			(1.87	)		(1.64	)		.44			.47

Dividends and/or distributions to shareholders:
Dividends from net investment income		(.46	)		(.52	)		(.50	)		(.48	)		(.55	)

Net asset value, end of period	$	6.39		$	5.51		$	7.90		$	10.04		$	10.08


Total Return, at Net Asset Value³		24.64	%		(23.57	)%		(16.68	)%		4.37	%		4.78	%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	2,081,580		$	1,447,860		$	1,605,257		$	2,129,928		$	1,494,775

Average net assets (in thousands)	$	1,953,017		$	1,234,468		$	1,807,703		$	1,838,511		$	1,147,353

Ratios to average net assets:⁴
Net investment income		7.12	%		8.67	%		6.05	%		4.93	%		4.97	%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings		0.71	%		0.76	%		0.71	%		0.71	%		0.75	%
Interest and fees from borrowings		0.23	%		0.92	%		0.20	%		0.08	%		0.12	%
Interest and fees on short-term floating rate notes issued⁵		0.22	%		0.65	%		0.73	%		0.58	%		0.62	%

Total expenses		1.16	%		2.33	%		1.64	%		1.37	%		1.49	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.16	%		2.33	%		1.64	%		1.37	%		1.49	%

Portfolio turnover rate		21	%		23	%		60	%		18	%		16	%


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

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

3.		Assumes an initial 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 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 less than one full year.

5.		Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

See accompanying Notes to Financial Statements.

FINANCIAL HIGHLIGHTS Continued


Class B Year Ended July 31,	2010¹			2009			2008			2007			2006

Per Share Operating Data
Net asset value, beginning of period	$	5.48		$	7.87		$	10.00		$	10.04		$	10.13

Income (loss) from investment operations:
Net investment income²		.39			.45			.46			.42			.42
Net realized and unrealized gain (loss)		.90			(2.38	)		(2.17	)		(.06	)		(.04	)

Total from investment operations		1.29			(1.93	)		(1.71	)		.36			.38

Dividends and/or distributions to shareholders:
Dividends from net investment income		(.41	)		(.46	)		(.42	)		(.40	)		(.47	)

Net asset value, end of period	$	6.36		$	5.48		$	7.87		$	10.00		$	10.04


Total Return, at Net Asset Value³		23.72	%		(24.35	)%		(17.34	)%		3.56	%		3.87	%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	41,234		$	28,789		$	35,642		$	54,645		$	58,570

Average net assets (in thousands)	$	37,974		$	26,189		$	43,378		$	57,919		$	50,695

Ratios to average net assets:⁴
Net investment income		6.26	%		7.78	%		5.21	%		4.09	%		4.19	%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings		1.56	%		1.64	%		1.54	%		1.51	%		1.56	%
Interest and fees from borrowings		0.23	%		0.92	%		0.20	%		0.08	%		0.12	%
Interest and fees on short-term floating rate notes issued⁵		0.22	%		0.65	%		0.73	%		0.58	%		0.62	%

Total expenses		2.01	%		3.21	%		2.47	%		2.17	%		2.30	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		2.01	%		3.21	%		2.47	%		2.17	%		2.30	%

Portfolio turnover rate		21	%		23	%		60	%		18	%		16	%


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

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

3.		Assumes an initial 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 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 less than one full year.

5.		Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

See accompanying Notes to Financial Statements.


Class C Year Ended July 31,	2010¹			2009			2008			2007			2006

Per Share Operating Data
Net asset value, beginning of period	$	5.48		$	7.87		$	10.00		$	10.04		$	10.13

Income (loss) from investment operations:
Net investment income²		.40			.45			.47			.43			.42
Net realized and unrealized gain (loss)		.89			(2.37	)		(2.17	)		(.07	)		(.04	)

Total from investment operations		1.29			(1.92	)		(1.70	)		.36			.38

Dividends and/or distributions to shareholders:
Dividends from net investment income		(.41	)		(.47	)		(.43	)		(.40	)		(.47	)

Net asset value, end of period	$	6.36		$	5.48		$	7.87		$	10.00		$	10.04


Total Return, at Net Asset Value³		23.82	%		(24.27	)%		(17.29	)%		3.60	%		3.89	%

Ratios/Supplemental Data
Net assets, end of period (in thousands)	$	518,594		$	310,593		$	323,411		$	416,347		$	250,929

Average net assets (in thousands)	$	465,652		$	252,892		$	361,518		$	344,756		$	159,084

Ratios to average net assets:⁴
Net investment income		6.32	%		7.89	%		5.30	%		4.16	%		4.17	%
Expenses excluding interest and fees on short-term floating rate notes issued and interest and fees from borrowings		1.48	%		1.55	%		1.48	%		1.47	%		1.50	%
Interest and fees from borrowings		0.23	%		0.92	%		0.20	%		0.08	%		0.12	%
Interest and fees on short-term floating rate notes issued⁵		0.22	%		0.65	%		0.73	%		0.58	%		0.62	%

Total expenses		1.93	%		3.12	%		2.41	%		2.13	%		2.24	%
Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses		1.93	%		3.12	%		2.41	%		2.13	%		2.24	%

Portfolio turnover rate		21	%		23	%		60	%		18	%		16	%


1.		July 30, 2010 represents the last business day of the Fund's 2010 fiscal year. See Note 1 of the accompanying Notes.

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

3.		Assumes an initial 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 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 less than one full year.

5.		Interest and fee expense relates to the Fund's liability for short-term floating rate notes issued in conjunction with inverse floating rate security transactions.

See accompanying Notes to Financial Statements.

NOTES TO FINANCIAL STATEMENTS

1. Significant Accounting Policies

Oppenheimer AMT-Free Municipals (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund's investment objective is to seek as high a level of current interest income exempt from federal income taxes as is available from investing in municipal securities, while attempting to preserve capital. The Fund's investment adviser is OppenheimerFunds, Inc. (the "Manager").

The Fund offers Class A, Class B and Class C shares. Class A shares are sold at their offering price, which is normally net asset value plus a front-end sales charge. Class B and Class C shares are sold without a front-end sales charge but may be subject to a contingent deferred sales charge ("CDSC"). All classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. Class A, B and C have separate distribution and/or service plans. Class B shares will automatically convert to Class A shares 72 months after the date of purchase.

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

Fiscal Year End. Since July 30, 2010 represents the last day during the Fund's 2010 fiscal year on which the New York Stock Exchange was open for trading, the Fund's financial statements have been presented through that date to maintain consistency with the Fund's net asset value calculations used for shareholder transactions.

Securities Valuation. The Fund calculates the net asset value of its shares 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 trading.

Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Unadjusted quoted prices in active markets for identical securities are classified as "Level 1," inputs other than unadjusted quoted prices for an asset that are observable are classified as "Level 2" and significant unobservable inputs, including the Manager's judgment about the assumptions that a market participant would use in pricing an asset or liability, are classified as "Level 3." The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. A table summarizing the Fund's investments under these levels of classification is included following the Statement of Investments.

Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by portfolio pricing services approved by the Board of Trustees or dealers.

Securities traded on a registered U.S. securities exchange are valued based on the last sale price of the security reported on the principal exchange on which it is traded, prior to the time when the Fund's assets are valued. Securities whose principal exchange is NASDAQ are valued based on the official closing prices reported by NASDAQ prior to

the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the last sale price on the prior trading day, if it is within the spread of the current day's closing "bid" and "asked" prices, and if not, at the current day's closing bid price. A foreign security traded on a foreign exchange is valued based on the last sale price on the principal exchange on which the security is traded, as identified by the portfolio pricing service used by the Manager, prior to the time when the Fund's assets are valued. In the absence of a sale, the security is valued at the most recent official closing price on the principal exchange on which it is traded.

Shares of a registered investment company that are not traded on an exchange are valued at that investment company's net asset value per share.

U.S. domestic and international debt instruments (including corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and "money market-type" debt instruments with a remaining maturity in excess of sixty days are valued at the mean between the "bid" and "asked" prices utilizing price quotations obtained from independent pricing services or broker-dealers. Such prices are typically determined based upon information obtained from market participants including reported trade data, broker-dealer price quotations and inputs such as benchmark yields and issuer spreads from identical or similar securities.

"Money market-type" debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value.

In the absence of a readily available unadjusted quoted market price, including for securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Fund's assets are valued but after the close of the securities' respective exchanges, the Manager, acting through its internal valuation committee, in good faith determines the fair valuation of that asset using consistently applied procedures under the supervision of the Board of Trustees (which reviews those fair valuations by the Manager). Those procedures include certain standardized methodologies to fair value securities. Such methodologies include, but are not limited to, pricing securities initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be adjusted for any discounts related to resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

There have been no significant changes to the fair valuation methodologies of the Fund during the period.

Securities on a When-Issued or Delayed Delivery Basis. The Fund may purchase securities on a "when-issued" basis, and may purchase or sell securities on a "delayed delivery" basis. "When-issued" or "delayed delivery" refers to securities whose terms and indenture

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

are available and for which a market exists, but which are not available for immediate delivery. Delivery and payment for securities that have been purchased by the Fund on a when-issued basis normally takes place within six months and possibly as long as two years or more after the trade date. During this period, such securities do not earn interest, are subject to market fluctuation and may increase or decrease in value prior to their delivery. The purchase of securities on a when-issued basis may increase the volatility of the Fund's net asset value to the extent the Fund executes such transactions while remaining substantially fully invested. When the Fund engages in when-issued or delayed delivery transactions, it relies on the buyer or seller, as the case may be, to complete the transaction. Their failure to do so may cause the Fund to lose the opportunity to obtain or dispose of the security at a price and yield it considers advantageous. The Fund may also sell securities that it purchased on a when-issued basis or forward commitment prior to settlement of the original purchase.

As of July 30, 2010, the Fund had purchased securities issued on a when-issued or delayed delivery basis and sold securities issued on a delayed delivery basis as follows:


	When-Issued or Delayed Delivery
	Basis Transactions

Purchased securities	$	20,435,442
Sold securities		7,307,005

Inverse Floating Rate Securities. The Fund invests in inverse floating rate securities that pay interest at a rate that varies inversely with short-term interest rates. Certain of these securities may be leveraged, whereby the interest rate varies inversely at a multiple of the change in short-term rates. As interest rates rise, inverse floaters produce less current income. The price of such securities is more volatile than comparable fixed rate securities. The Fund may expose up to 20% of its total assets to the effects of leverage from its investments in inverse floaters. The Fund's exposure to the effects of leverage from its investments in inverse floaters amount to $452,120,000 as of July 30, 2010, which represents 14.27% of the Fund's total assets.

Certain inverse floating rate securities are created when the Fund purchases and subsequently transfers a municipal bond security (the "municipal bond") to a broker dealer. The municipal bond is typically a fixed rate security. The broker dealer (the "sponsor") creates a trust (the "Trust") and deposits the municipal bond. The Trust issues short-term floating rate notes available to third parties and a residual interest in the municipal bond (referred to as an "inverse floating rate security") to the Fund. The terms of these inverse floating rate securities grant the Fund the right to require that the Trust issuing the inverse floating rate security compel a tender of the short-term floating rate notes to facilitate the Fund's repurchase of the underlying municipal bond. Following such a request, the Fund pays the sponsor the principal amount due to the holders of the short-term floating rate notes issued by the Trust and exchanges the inverse floating rate security for the underlying municipal bond. These transactions are considered secured borrowings for financial reporting purposes. As a result of such accounting treatments, the Fund includes the municipal bond

position on its Statement of Investments (but does not separately include the inverse floating rate securities received). The Fund also includes the value of the municipal bond and a payable amount equal to the short-term floating rate notes issued by the Trust on its Statement of Assets and Liabilities. The interest rates on these short-term floating rate notes reset periodically, usually weekly. The holders of these short-term floating rate notes have the option to tender their investment, to the sponsor or the Trust's liquidity provider, for redemption at par at each reset date. Income from the municipal bond position and the interest expense on the payable for the short-term floating rate notes issued by the Trust are recorded on the Fund's Statement of Operations. At July 30, 2010, municipal bond holdings with a value of $685,379,037 shown on the Fund's Statement of Investments are held by such Trusts and serve as collateral for the $452,120,000 in short-term floating rate notes issued and outstanding at that date.

The Fund's investments in inverse floaters involve certain risks. The market value of an inverse floating rate security can be more volatile than that of a conventional fixed-rate bond having similar credit quality, maturity and redemption provisions. Typically, an inverse floating rate security tends to underperform fixed rate bonds when long-term interest rates are rising but tends to outperform fixed rate bonds when long-term interest rates are stable or falling. An inverse floating rate security entails a degree of leverage because the trust issues short-term securities in a ratio to the inverse floating rate security with the underlying long-term bond providing collateral for the obligation to pay the principal value of the short-term securities if and when they are tendered. If the Fund has created the inverse floater by depositing a long-term bond into a trust, it may be required to provide additional collateral for the short-term securities if the value of the underlying bond deposited in the trust falls.

At July 30, 2010, the Fund's residual exposure to these types of inverse floating rate securities were as follows:


Principal			Coupon			Maturity
Amount		Inverse Floater¹	Rate²			Date		Value

$	2,000,000	AK HFC ROLs		14.981	%		12/1/33	$	2,038,640
	3,000,000	AL Public School & College Authority ROLs³		14.671			5/1/29		5,671,080
	4,930,000	Austin, TX Independent School District ROLs³		10.831			8/1/33		6,192,672
	5,000,000	CA Dept. of Veterans Affairs Home Purchase ROLs³		9.942			12/1/23		4,939,700
	5,000,000	CA Health Facilities Financing Authority (Sutter Health/California Pacific Medical Center Obligated Group) DRIVERS		15.185			11/15/46		4,889,000
	5,000,000	CA Health Facilities Financing Authority ROLs³		17.308			7/1/39		5,994,400
	3,750,000	Clark County, NV Airport ROLs³		17.158			7/1/42		4,789,650
	5,000,000	Clark County, NV Water Reclamation District DRIVERS		15.342			7/1/38		6,272,600
	3,250,000	CO Hsg. & Finance Authority (Single Family) DRIVERS		15.908			11/1/29		4,074,590
	3,480,000	FL COP (Dept. of Management Services) DRIVERS		11.728			8/1/28		4,161,732
	4,000,000	Greater Orlando, FL Aviation Authority ROLs³		14.701			10/1/32		4,442,080
	4,000,000	Houston, TX Airport System ROLs³		16.439			7/1/39		5,215,360

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued


Principal			Coupon			Maturity
Amount		Inverse Floater¹	Rate²			Date		Value

$	5,000,000	IL Finance Authority (Northwestern Memorial Hospital) DRIVERS		17.941	%		8/15/39	$	6,943,200
	3,750,000	IL Finance Authority ROLs		15.750			5/15/29		3,911,250
	3,855,000	IL Health Facilities Authority ROLs		15.264			8/15/33		4,066,794
	3,955,000	Jefferson Parish, LA Finance Authority (Single Family Mtg.) ROLs		15.725			12/1/32		4,791,403
	3,750,000	Los Angeles, CA Community College District ROLs³		14.701			8/1/33		4,168,200
	3,000,000	Los Angeles, CA Dept. of Airports ROLs³		15.570			5/15/39		3,571,200
	5,330,000	Los Angeles, CA Unified School District RITES		12.113			7/1/34		6,150,287
	3,650,000	MI Hospital Finance Authority ROLs³		17.982			12/1/23		5,358,200
	2,970,000	MN HFA ROLs³		14.857			7/1/34		3,217,579
	11,000,000	NH H&EFA (LRG Healthcare) DRIVERS		8.519			10/1/34		12,079,980
	5,250,000	NH H&EFA ROLs³		21.593			4/1/38		8,423,940
	3,000,000	North Central Texas HFDC (Children's Medical Center) DRIVERS		17.075			8/15/39		3,612,360
	4,920,000	NYC GO DRIVERS		15.764			4/1/36		6,689,035
	4,115,000	Omaha, NE Public Facilities Corp. ROLs³		14.701			6/1/36		4,978,327
	2,500,000	Orange County, FL Health Facilities Authority ROLS³		14.851			1/1/39		2,678,400
	2,500,000	Orange County, FL School Board ROLs³		16.379			8/1/34		3,233,500
	3,100,000	Pima County, AZ IDA (Metro Police Facility) DRIVERS		15.408			7/1/39		3,507,340
	4,000,000	Tarrant County, TX Cultural Education Facilities Finance Corp. ROLs³		18.596			11/15/29		5,977,440
	38,000,000	TX Municipal Gas Acquisition & Supply Corp. ROLs³		10.166			12/15/26		45,565,800
	4,000,000	University of California (Regents Medical Center) DRIVERS		15.342			5/15/39		5,241,600
	2,625,000	University of California (Regents Medical Center) DRIVERS		14.476			5/15/37		2,975,175
	3,000,000	University of Illinois (Auxiliary Facilities Systems) DRIVERS		17.075			4/1/38		4,238,280
	7,500,000	WA Austin Trust Various States Inverse Certificates		8.198			10/1/33		8,277,300
	11,265,000	WA Health Care Facilities Authority (Catholic Health Initiatives)³		14.647			10/1/36		14,920,943

								$	233,259,037


1.		For a list of abbreviations used in the Inverse Floater table see the Portfolio Abbreviations table on page 63 of the Statement of Investments.

2.		Represents the current interest rate for a variable rate bond known as an "inverse floater."

3.		Security is subject to a shortfall and forbearance agreement.

The Fund enters into shortfall and forbearance agreements with the sponsors of certain inverse floaters held by the Fund. These agreements commit the Fund to reimburse the sponsor of the inverse floater, in certain circumstances, for the amount of the difference between the liquidation value of the underlying security (which is the basis of the inverse floater) and the principal amount due to the holders of the short-term floating rate notes issued by the Trust in conjunction with the inverse floating rate security. Under the standard terms of an inverse floating rate security, absent such a shortfall and forbearance agreement, the Fund would not be required to make such a reimbursement. The Manager monitors the Fund's potential exposure with respect to these agreements on a daily basis and intends to take action to terminate the Fund's investment in such inverse floating rate securities, if it deems it appropriate to do so. As of July 30, 2010, in addition to the exposure detailed in the preceding table, the Fund's maximum exposure under such agreements is estimated at $258,735,000.

Credit Risk. The Fund invests in high-yield, non-investment-grade bonds, which may be subject to a greater degree of credit risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. The Fund may acquire securities in default, and is not obligated to dispose of securities whose issuers subsequently default. Information concerning securities in default as of July 30, 2010 is as follows:



Cost	$	189,187,405
Market Value	$	81,044,535
Market Value as a % of Net Assets		3.07	%

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 Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund's tax return filings generally remain open for the three preceding fiscal reporting period ends.

The tax components of capital shown in the following table 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.

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Net Unrealized

Depreciation Based

on Cost of Securities

Undistributed

Accumulated

and Other Investments

Net Investment

Long-Term

Loss

for Federal Income

Income

Gain

Carryforward^1,2,3,4,5

Tax Purposes

$17,680,988

330,606,137

468,941,093


1.		As of July 30, 2010, the Fund had $321,905,825 of net capital loss carryforwards available to offset future realized capital gains, if any, and thereby reduce future taxable gain distributions. As of July 30, 2010, details of the capital loss carryforwards were as follows:


Expiring

2016	$	38,527,923
2017		105,610,446
2018		177,767,456

Total	$	321,905,825


2.		As of July 30, 2010, the Fund had $8,700,312 of post-October losses available to offset future realized capital gains, if any. Such losses, if unutilized, will expire in 2019.

3.		During the fiscal year ended July 30, 2010, the Fund did not utilize any capital loss carryforward.

4.		During the fiscal year ended July 31, 2009, the Fund did not utilize any capital loss carryforward.

5.		During the fiscal year ended July 30, 2010, $3,258,070 of unused capital loss carryforward expired.

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 July 30, 2010. Net assets of the Fund were unaffected by the reclassifications.


			Reduction
	Reduction to		to Accumulated
Reduction to	Accumulated Net		Net Realized Loss
Paid-in Capital	Investment Income		on Investments

$3,258,070	$	1,035,722	$	4,293,792

The tax character of distributions paid during the years ended July 30, 2010 and July 31, 2009 was as follows:


	Year Ended		Year Ended
	July 30, 2010		July 31, 2009

Distributions paid from:
Exempt-interest dividends	$	172,949,245	$	129,315,183
Ordinary income		475,449		830,340

Total	$	173,424,694	$	130,145,523

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 July 30, 2010 are noted in the following table. 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	$	3,115,754,664¹

Gross unrealized appreciation	$	153,392,605
Gross unrealized depreciation		(622,333,698	)

Net unrealized depreciation	$	(468,941,093	)


1.		The Federal tax cost of securities does not include cost of $453,189,389, which has otherwise been recognized for financial reporting purposes, related to bonds placed into trusts in conjunction with certain investment transactions. See the Inverse Floating Rate Securities note above.

Trustees' Compensation. The Fund has adopted an unfunded retirement plan (the "Plan") for the Fund's independent trustees. Benefits are based on years of service and fees paid to each trustee during their period of service. The Plan was frozen with respect to adding new participants effective December 31, 2006 (the "Freeze Date") and existing Plan Participants as of the Freeze Date will continue to receive accrued benefits under the Plan. Active independent trustees as of the Freeze Date have each elected a distribution method with respect to their benefits under the Plan. During the year ended July 30, 2010, the Fund's projected benefit obligations, payments to retired trustees and accumulated liability were as follows:



Projected Benefit Obligations Increased	$	7,432
Payments Made to Retired Trustees		20,885
Accumulated Liability as of July 30, 2010		170,545

The Board of Trustees has adopted a compensation deferral 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 with the compensation deferral plan.

Dividends and Distributions to Shareholders. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income distributions, if any, are declared daily and paid monthly. Capital gain distributions, if any, are declared and paid annually.

NOTES TO FINANCIAL STATEMENTS Continued

1. Significant Accounting Policies Continued

Investment Income. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily.

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 overdraft at a rate equal to the 1 Month LIBOR Rate plus 2.00%. 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.

Indemnifications. The Fund's organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.

Other. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 increases and decreases in net assets from operations 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:


	Year Ended July 30, 2010						Year Ended July 31, 2009
	Shares			Amount			Shares			Amount

Class A
Sold		134,151,304		$	844,942,272			129,537,682		$	718,953,966
Dividends and/or distributions reinvested		13,373,377			84,819,298			11,654,998			65,533,074
Redeemed		(84,878,059	)		(541,907,623	)		(81,500,065	)		(477,503,982	)

Net increase		62,646,622		$	387,853,947			59,692,615		$	306,983,058


	Year Ended July 30, 2010						Year Ended July 31, 2009
	Shares			Amount			Shares			Amount

Class B
Sold		2,304,630		$	14,479,730			2,197,706		$	12,306,091
Dividends and/or distributions reinvested		215,122			1,358,243			204,777			1,143,184
Redeemed		(1,290,995	)		(8,132,743	)		(1,682,286	)		(9,956,887	)

Net increase		1,228,757		$	7,705,230			720,197		$	3,492,388


Class C
Sold		37,430,947		$	234,602,393			30,732,678		$	170,287,872
Dividends and/or distributions reinvested		2,603,032			16,439,742			1,985,831			11,052,236
Redeemed		(15,183,390	)		(96,244,701	)		(17,172,911	)		(99,051,325	)

Net increase		24,850,589		$	154,797,434			15,545,598		$	82,288,783

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 July 30, 2010, were as follows:


	Purchases		Sales

Investment securities	$	1,062,320,414	$	570,420,306

4. Fees and Other Transactions with Affiliates

Management Fees. Under the investment advisory agreement, the Fund pays the Manager a management fee based on the daily net assets of the Fund at an annual rate as shown in the following table:


Fee Schedule

Up to $200 million	0.60	%
Next $100 million	0.55
Next $200 million	0.50
Next $250 million	0.45
Next $250 million	0.40
Over $1 billion	0.35

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 year ended July 30, 2010, the Fund paid $1,116,778 to OFS for services to 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 (the "Plan") for Class A shares under Rule 12b-1 of the Investment Company Act of 1940. Under the Plan, the Fund reimburses the Distributor for a portion of its costs incurred for services provided to accounts that hold Class A shares. Reimbursement is made periodically at an annual rate

NOTES TO FINANCIAL STATEMENTS Continued

4. Fees and Other Transactions with Affiliates Continued

of up to 0.25% of the daily 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 periodically for providing personal service 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 periods. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations.

Distribution and Service Plans for Class B and Class C Shares. The Fund has adopted Distribution and Service Plans (the "Plans") for Class B and Class C shares under Rule 12b-1 of the Investment Company Act of 1940 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% on Class B and Class C shares daily net assets. The Distributor also receives a service fee of 0.25% per year under each plan. If either the Class B or Class C plan is terminated by the Fund or by the shareholders of a class, the Board of Trustees and its independent trustees must determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the service fee and/or asset-based sales charge in respect to shares sold prior to the effective date of such termination. Fees incurred by the Fund under the Plans are detailed in the Statement of Operations. The Distributor determines its uncompensated expenses under the Plans at calendar quarter ends. The Distributor's aggregate uncompensated expenses under the Plans at June 30, 2010 were as follows:



Class B	$	2,236,764
Class C		7,422,065

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 following table for the period indicated.

Class A

Class B

Class C

Class A

Contingent

Front-End

Deferred

Sales Charges

Retained by

Year Ended

Distributor

July 30, 2010

974,914

264,767

79,079

145,567

Waivers and Reimbursements of Expenses. The Manager has voluntarily agreed to reimburse the Fund for a portion of the legal costs and fees incurred in connection with the pending litigation matters discussed in the "Pending Litigation" note which appears later in this report. During the year ended July 30, 2010, the Manager reimbursed the Fund $41,990 for legal costs and fees.

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.

Some of these undertakings may be modified or terminated at any time; some may not be modified or terminated until after one year from the date of the current prospectus, as indicated therein.

5. Restricted Securities

As of July 30, 2010, investments in securities included issues that are restricted. A restricted security may have a contractual restriction on its resale and is valued under methods approved by the Board of Trustees as reflecting fair value. Securities that are restricted are marked with an applicable footnote on the Statement of Investments. Restricted securities are reported on a schedule following the Statement of Investments.

6. Borrowings

The Fund can borrow money from banks in amounts up to one third of its total assets (including the amount borrowed) less all liabilities and indebtedness other than borrowings. The Fund can use those borrowings for investment-related purposes such as purchasing portfolio securities. The Fund can also borrow for other purposes, such as to raise money to unwind or "collapse" trusts that issued "inverse floaters" to the Fund, or to contribute to such trusts to enable them to meet tenders of their short-term securities by the holders of those securities. The Fund also may borrow to meet redemption obligations or for temporary and emergency purposes. The purchase of securities with borrowed funds creates leverage in the Fund. The use of leverage will subject the Fund to greater costs than funds that do not borrow for leverage, and may also make the Fund's share price more sensitive to interest changes. The interest on borrowed money is an expense that might reduce the Fund's yield. Expenses incurred by the Fund with respect to interest on borrowings and commitment fees are disclosed separately or as other expenses on the Statement of Operations.

The Fund entered into a Revolving Credit and Security Agreement (the "Agreement") with conduit lenders and a bank which enables it to participate with certain other Oppenheimer funds in a committed, secured borrowing facility that permits borrowings of up to $2.25 billion, collectively. To secure the loan, the Fund pledges investment securities in accordance with the terms of the Agreement. Securities held in collateralized accounts to cover these borrowings are noted in the Statement of Investments. Interest is charged to the Fund, based on its borrowings, at current commercial paper issuance rates (0.432% as of July 30, 2010). The Fund pays additional fees annually to its lender on its outstanding borrowings to manage and administer the facility. The Fund is also allocated its pro-rata share of an annual structuring fee and ongoing commitment fees both of which are based on the total facility size. Total fees and interest that are included in expenses on the Fund's Statement of Operations related to its participation in the borrowing facility during the year ended July 30, 2010 equal 0.23% of the Fund's average net assets on an annualized basis. The Fund has the right to prepay such loans and terminate its participation in the conduit loan facility at any time upon prior notice.

NOTES TO FINANCIAL STATEMENTS Continued

6. Borrowings Continued

As of July 30, 2010, the Fund had borrowings outstanding at an interest rate of 0.432%. Details of the borrowings for the year ended July 30, 2010 are as follows:



Average Daily Loan Balance	$	71,502,466
Average Daily Interest Rate		0.295	%
Fees Paid	$	4,088,235
Interest Paid	$	297,956

7. Pending Litigation

Since 2009, a number of lawsuits have been filed in federal courts against the Manager, the Distributor, and certain mutual funds advised by the Manager and distributed by the Distributor-including the Fund. The lawsuits naming the Fund as a defendant also name as defendants certain officers, trustees and former trustees of the Fund. The plaintiffs seek class action status on behalf of purchasers of shares of the Fund during a particular time period. The lawsuits raise claims under federal securities laws alleging that, among other things, the disclosure documents of the Fund contained misrepresentations and omissions, that the Fund's investment policies were not followed, and that the Fund and the other defendants violated federal securities laws and regulations and certain state laws. The plaintiffs seek unspecified damages, equitable relief and an award of attorneys' fees and litigation expenses. Litigation involving certain other Oppenheimer funds is similar in nature.

The Distributor and another subsidiary of the Manager have been named as defendants in a putative class action filed in federal court in 2010. The plaintiff, a participant in the State of Texas' college savings plan, asserts claims on behalf of all persons who invested in qualified 529 plans managed by these subsidiaries of the Manager and which held investments in a certain mutual fund managed by the Manager and distributed by the Distributor. Plaintiff alleges causes of action for "improper investments," "breach of fiduciary duty," and "punitive damages" arising from that fund's investments in 2008 and 2009.

They seek unspecified damages, equitable relief and an award of attorneys' fees and litigation expenses. None of the suits have named the Distributor, any of the Oppenheimer mutual funds or any of their independent Trustees or Directors as defendants. None of the Oppenheimer funds invested in any funds or accounts managed by Madoff.

Oppenheimer AMT-Free Municipals

</R> <R>

Website
www.oppenheimerfunds.com

</R>

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
Citibank, N.A.
111 Wall Street
New York, New York 10005

Independent Registered Public Accounting Firm
KPMG LLP
707 Seventeenth Street
Denver, Colorado 80202

Legal Counsel
Kramer Levin Naftalis & Frankel LLP
1177 Avenue of the Americas
New York, New York 10036

<R>

PX0310.001.1110

</R>

OPPENHEIMER AMT-FREE MUNICIPALS

FORM N-1A

PART C

OTHER INFORMATION

Item 28. Exhibits

(a) Amended and Restated Declaration of Trust dated October 20, 2003: Previously filed with Registrant's Post-Effective Amendment No. 48, (9/28/04), and incorporated herein by reference.

(b) Amended and Restated By-Laws dated as of June 16, 2005: Previously filed with Registrant’s Post-Effective Amendment No. 51, (9/27/06), and incorporated herein by reference.

(c) (i) Specimen Class A Share Certificate: Previously filed with Registrant's Post-Effective Amendment No. 44, (11/26/01), and incorporated herein by reference.

(ii) Specimen Class B Share Certificate: Previously filed with Registrant's Post-Effective Amendment No. 44, (11/26/01), and incorporated herein by reference.

(iii) Specimen Class C Share Certificate: Previously filed with Registrant's Post-Effective Amendment No. 44, (11/26/01), and incorporated herein by reference.

(d) Amended and Restated Investment Advisory Agreement dated January 1, 2005: Previously filed with Registrant’s Post-Effective Amendment No. 49, (9/28/05), and incorporated herein by reference.

(e) (i) General Distributor's Agreement dated December 10, 1992: Previously filed with Registrant's Post-Effective Amendment No. 30, 3/16/93, refiled with Registrant's Post-Effective Amendment No. 33, (4/28/95), pursuant to Item 102 of Regulation S-T, and incorporated herein by reference.

(ii) Form of Dealer Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference.

(iii) Form of Broker Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference.

(iv) Form of Agency Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), 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. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference.

(f) (i) Amended and Restated Retirement Plan for Non-Interested Trustees or Directors dated 1/01/05: Previously filed with Post-Effective Amendment No. 4 to the Registration Statement of Oppenheimer Portfolio Series (Reg. No. 333-121449), (5/29/09), and incorporated herein by reference.

(ii) Amended & Restated Compensation Deferral Plan for Eligible Trustees, effective 1/1/08: Previously filed with Post-Effective Amendment No. 4 to the Registration Statement of Oppenheimer Portfolio Series (Reg. No. 333-121449), (5/29/09), and incorporated herein by reference.

(g) (i) Global Custodial Services Agreement dated May 3, 2001 as amended from time to time: Previously filed with Post-Effective Amendment No. 33 to the Registration Statement of Centennial Money Market Trust (Reg. No. 2-65245), (10/25/01), and incorporated herein by reference.

(ii) Amended and Restated Foreign Custody Manager Agreement dated May 31, 2001, as amended July 15, 2003: Previously filed with the Pre-Effective Amendment No. 1 to the Registration Statement of Oppenheimer International Large-Cap Core Trust (Reg. No. 333-106014), (8/5/03), and incorporated herein by reference.

(h) Not applicable.

(i) Opinion and Consent of Counsel dated May 1, 1987: Previously filed with Registrant's Post-Effective Amendment No. 22, 5/1/87, refiled with Registrant's Post-Effective Amendment No. 33, (4/28/95), pursuant to Item 102 of Regulation S-T, and incorporated herein by reference.

(j) Independent Registered Public Accounting Firm’s Consent: Filed herewith.

(k) Not applicable.

(l) Investment Letter from OppenheimerFunds, Inc. to Registrant dated October 1, 1976: Previously filed with Registrant’s Post-Effective Amendment No. 40, (9/24/98), and incorporated herein by reference.

(m) (i) Amended and Restated Service Plan and Agreement for Class A shares dated October 26, 2005: Previously filed with Registrant’s Post-Effective Amendment No. 51, (9/27/06), and incorporated herein by reference.

(ii) Amended and Restated Distribution and Service Plan and Agreement for Class B shares dated October 26, 2005: Previously filed with Registrant’s Post-Effective Amendment No. 51, (9/27/06), and incorporated herein by reference.

(iii) Amended and Restated Distribution and Service Plan and Agreement for Class C shares dated October 26, 2005: Previously filed with Registrant’s Post-Effective Amendment No. 51, (9/27/06), and incorporated herein by reference.

(n) Oppenheimer Funds Multiple Class Plan under Rule 18f-3 updated through 9/17/09: Previously filed with the Post-Effective Amendment No. 16 to the Registration Statement of Oppenheimer Main Street Small Cap Fund (Reg. No. 333-78269), (10/2/09), and incorporated herein by reference.

(o) Power of Attorney dated March 3, 2010 for all Trustees/Directors and Officers: Previously filed with the Post-Effective Amendment No. 21 to the Registration Statement of Oppenheimer International Growth Fund (Reg. No. 333-00201), (3/24/10), and incorporated herein by reference.

(p) Amended and Restated Code of Ethics of the Oppenheimer Funds dated November 2007 under Rule 17j-1 of the Investment Company Act of 1940: Previously filed with Post-Effective Amendment No. 65 to the Registration Statement of Oppenheimer Quest For Value Funds, (Reg No. 33-15489), (2/24/10), and incorporated herein by reference.

Item 29. - Persons Controlled by or Under Common Control with the Fund

None.

Item 30. - Indemnification

Reference is made to the provisions of Article Seventh of Registrant's Amended and Restated Declaration of Trust filed as Exhibit 28(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 31. - 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 31(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	Treasurer of Centennial Asset Management Corporation; Vice President and Assistant Treasurer of OppenheimerFunds Distributor, Inc.
Patrick Adams Vice President	None
Robert Agan, Senior Vice President	Senior Vice President of Shareholder Financial Services, Inc. and Shareholders Services, Inc.; Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and OFI Private Investments Inc.
Obianyo Akunwafor, Assistant Vice President	None.
Carl Algermissen, Vice President & Associate Counsel	Assistant Secretary of Centennial Asset Management Corporation.
Ramesh Allu, Vice President	Formerly VP of Business Solutions at Equant Solutions (July 2008 – July 2010).
Michael Amato, Vice President	None
Nicole Andersen, Assistant Vice President	None
Konstantin Andreev, Assistant Vice President	Formerly a Portfolio Director at Chatham Financial (April 2006 – November 2009).
Raymond Anello, Vice President	Formerly Portfolio Manager of Dividend Strategy/Sector Analyst for Energy/Utilities at RS Investments (June 2007– April 2009).
Janette Aprilante, Vice President & Secretary	Secretary (since December 2001) of: Centennial Asset Management Corporation, OppenheimerFunds Distributor, Inc., HarbourView Asset Management Corporation (since June 2003), 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, Vice President	None
Paul Aynsley, Vice President	None
James F. Bailey, Senior Vice President	Senior Vice President of Shareholder Services, Inc. (since March 2006).
Robert Baker, Vice President	None
John Michael Banta, Assistant Vice President	None
Michael Barnes, Assistant Vice President	None
Adam Bass, Assistant Vice President	None
Kevin Baum, Senior Vice President	None
Jeff Baumgartner, Vice President	Vice President of HarbourView Asset Management Corporation.
Kathleen Beichert, Senior Vice President	Vice President of OppenheimerFunds Distributor, Inc.
Emanuele Bergagnini, Vice President	Assistant Vice President of OFI Institutional Asset Management, Inc.
Robert Bertucci, Assistant Vice President: Rochester Division	None
Rajeev Bhaman, Senior Vice President	Vice President of OFI Institutional Asset Management, Inc.
Adam Bierstedt, Assistant Vice President	Formerly a manager in the Business Controller Group at OppenheimerFunds, Inc. (February 2006 – January 2010).
Craig Billings, Vice President	None
Mark Binning, Assistant Vice President	None
Donal Bishnoi, Assistant Vice President	None
Beth Bleimehl, Assistant Vice President	None
Lisa I. Bloomberg, Senior Vice President & Deputy General Counsel	Assistant Secretary of Oppenheimer Real Asset Management, Inc.
Veronika Boesch, Vice President	None
Chad Boll, Vice President	None
Michelle Borre Massick, Vice President	None
Lori E. Bostrom, Senior Vice President & Deputy General Counsel	Assistant Secretary of OppenheimerFunds Legacy Program.
John Boydell, Vice President	None
Richard Britton, Vice President	None
Jack Brown, Vice President	None
Roger Buckley, Assistant Vice President	None
Joy Budzinski, Vice President	None
Carla Buffulin, Assistant Vice President	None
Stephanie Bullington, Vice President	None
Julie Burke, Vice President	None
Mark Burns, Vice President	None
JoAnne Butler, Assistant Vice President	None
Christine Calandrella, Assistant Vice President	None
Michael Camarella, Assistant Vice President	None
Debra Casey, Vice President	None
Ronald Chibnik, Vice President	None
Patrick Sheng Chu, Assistant Vice President	None
Brett Clark, Vice President	None
Jennifer Clark, Assistant Vice President	Assistant Vice President at Shareholder Financial Services, Inc., Shareholder Services, Inc., and OFI Private Investments Inc.
H.C. Digby Clements, Senior Vice President: Rochester Division	None
Thomas Closs, Assistant Vice President	None
David Cole, Assistant Vice President	None
Tamara Colorado, Vice President	None
Eric Compton, Vice President	None
Scott Cottier, Vice President: Rochester Division	None
William Couch, Assistant Vice President	None
Geoffrey Craddock Senior Vice President	Formerly Senior Vice President and Head of Market Risk Management for CIBC.
Terry Crady, Assistant Vice President	Formerly IT Development Manager at OppenheimerFunds, Inc.
Roger W. Crandall, Director	President, Director and Chief Executive Officer of Massachusetts Mutual Life Insurance Company.
Lisa Crotty, Assistant Vice President	None
Jerry Cubbin, Vice President	Formerly a Consultant at National Australia Bank, (May 2009 – October 2009), and a Consultant at Magnitude Capital, (November 2008 – May 2009).
George Curry, Vice President	Vice President of OppenheimerFunds Distributor, Inc.
Kevin Dachille, Vice President	None
Rushan Dagli, Vice President	Vice President of OFI Private Investments Inc., Shareholder Financial Services, Inc. and Shareholder Services, Inc.
John Damian, Senior Vice President	None
Robert Dawson, Assistant Vice President	None
John Delano, Vice President	None
Kendra Delisa, Assistant Vice President	None
Alessio de Longis, Vice President	Formerly Sr. Research Analyst (February 2008 – April 2009).
Brendan Deasy, Vice President	None
Damaris De Los Santos, Assistant Vice President	None
Richard Demarco, Assistant Vice President	None
Mark Demitry, Vice President	None
Robin Dey, Vice President	None
Craig P. Dinsell, Executive Vice President	None
Randall C. Dishmon, Vice President	None
Rebecca K. Dolan, Vice President	None
Steven D. Dombrower, Vice President	Senior Vice President of OFI Private Investments Inc.; Vice President of OppenheimerFunds Distributor, Inc.
Andrew Donohue, Assistant Vice President	Formerly Manager at OppenheimerFunds, Inc. (2007 – June 2009).
Alicia Dopico, Vice President	None
Andrew Doyle, Senior Vice President	Formerly First Vice President, head of Global Wealth Management Rewards and Information Services at Bank of America (March 2006 – March 2009).
Thomas Doyle, Assistant Vice President	None
Robert Dunphy, Assistant Vice President	Formerly Intermediate Analyst at OppenheimerFunds, Inc (August 2004 – May 2009).
Brian Dvorak, Vice President	None
Taylor Edwards, Vice President & Associate Counsel	None
Peter Elder, Vice President	None
Peter Ellman, Assistant Vice President	None
Christopher Emanuel, Vice President	None
Daniel R. Engstrom, Vice President	None
James Robert Erven, Assistant Vice President	None
Dana Espinel, Assistant Vice President	Senior Meetings Events Manager at Wolters Kluwer (May 2007 – October 2010)
George R. Evans, Senior Vice President & Director of Equities	None
Kathy Faber, Assistant Vice President	None
David Falicia, Assistant Vice President	Assistant Secretary (as of July 2004) of HarbourView Asset Management Corporation.
Matthew Farkas, Vice President and Associate Counsel	None
Kristie Feinberg, Vice President and Assistant Treasurer	Assistant Treasurer of Oppenheimer Acquisition Corp., Centennial Asset Management Corp., OFI Institutional Asset Management Inc. and OFI Institutional Asset Management; Treasurer of OppenheimerFunds Legacy Program, Oppenheimer Real Asset Management, Inc.
Emmanuel Ferreira, Vice President	None
Steven Fling, Assistant Vice President	None
Colleen M. Franca, Vice President	None
Debbie Francis, Assistant Vice President	Previously employed at OppenheimerFunds, Inc (August 2007 – August 2009).
Dominic Freud, Vice President	None
Marcus Franz, Vice President	None
Arthur Gabinet, Executive Vice President and General Counsel – Asset Management	Formerly a principal in the Legal Department at Vanguard.
Hazem Gamal, Vice President	None
Charles Gapay, Assistant Vice President	None
Anthony W. Gennaro, Jr., Vice President	Formerly a sector manager for media, internet and telecom and a co-portfolio manager for mid-cap portfolios with the RS Core Equity Team of RS Investment Management Co. LLC (October 2006 – April 2009.)
Timothy Gerlach, Assistant Vice President	None
Alan C. Gilston, Vice President	None
Edward Gizzi, Vice President and Assistant Counsel	Associate at Willkie Farr & Gallagher, LLP (February 2006 – October 2010).
William F. Glavin, Jr., Chairman, Chief Executive Officer, President and Director	Formerly Executive Vice President and co-Chief Operating Officer of MassMutual Financial Group; President and Management Director of Oppenheimer Acquisition Corp.
Jill E. Glazerman, Senior Vice President	None
Kevin Glenn, Assistant Vice President	None
Manind Govil, Senior Vice President	Formerly portfolio manager with RS Investment Management Co. LLC (October 2006 – May 2009).
Raquel Granahan, Senior Vice President	Senior Vice President of OFI Private Investments Inc.; Vice President of OppenheimerFunds Distributor, Inc., and OppenheimerFunds Legacy Program.
Robert B. Grill, Senior Vice President	None
Samuel Groban, Assistant Vice President	None
Selin Gulcelik, Vice President	None
Marilyn Hall, Vice President	None
Cheryl Hampton, Vice President	Formerly Vice President and Director of Mutual Fund and Hedge Fund Operations at Calamos Advisors LLC (March 2007 – September 2009).
Kelly Haney, Assistant Vice President	None
Jason Harubin, Assistant Vice President	None
Steve Hauenstein, Assistant Vice President	None
Molly Hausmann, Assistant Vice President	None
Thomas B. Hayes, Vice President	None
Heidi Heikenfeld, Assistant Vice President	None
Lori Heinel Senior Vice President	Formerly a managing director and head of investment solutions at Citi Private Bank
Philipp Hensler, Executive Vice President	Formerly CEO, Chairman and Managing Director at DWS Investment Distributors, Inc.; Director, CEO and Chairman of OppenheimerFunds Distributor, Inc. (since March 2010).
Kenneth Herold, Assistant Vice President	None
Benjamin Hetrick, Assistant Vice President	None
Joseph Higgins, Vice President	Vice President of OFI Institutional Asset Management, Inc.
Dorothy F. Hirshman, Vice President	None
Daniel Hoelscher, Assistant Vice President	None
Craig Holloway, Assistant Vice President	None
Lucienne Howell, Vice President	None
Brian Hourihan, Vice President & Deputy General Counsel	Assistant Secretary of OFI Trust Company, Oppenheimer Real Asset Management, Inc., HarbourView Asset Management Corporation, OFI Institutional Asset Management, Inc. (since April 2006) and Trinity Investment Management Corporation.
Edward Hrybenko, Senior Vice President	Vice President of OppenheimerFunds Distributor, Inc.
Jason Hubersberger, Vice President	None
Douglas Huffman, Assistant Vice President	None
Margaret Hui, Vice President	None
Dana Hunter, Assistant Vice President	None
John Huttlin, Vice President	Senior Vice President (Director of the International Division) (since January 2004) of OFI Institutional Asset Management, Inc.; Director (since June 2003) of OppenheimerFunds International Distributor Limited.
James G. Hyland, Assistant Vice President	None
Kelly Bridget Ireland, Vice President	None
Kathleen T. Ives, Senior Vice President, Deputy General Counsel & Assistant Secretary	Vice President and Assistant Secretary of OppenheimerFunds Distributor, Inc. and Shareholder Services, Inc.; Assistant Secretary of Centennial Asset Management Corporation, OppenheimerFunds Legacy Program and Shareholder Financial Services, Inc.
Frank V. Jennings, Senior Vice President	None
Lisa Kadehjian, Assistant Vice President	None
Rezo Kanovich, Vice President	None
Amee Kantesaria, Vice President and Assistant Counsel	None
Cem Karacadag, Vice President	None
Thomas W. Keffer, Senior Vice President	Senior Vice President of OppenheimerFunds Distributor, Inc.
Sean Keller, Vice President	None
James Kennedy, Senior Vice President	None
John Kiernan, Vice President & Associate Counsel	None
Robert Kinsey, Vice President	None
Audrey Kiszla, Vice President	None
Daniel Kohn, Vice President	None
Samuel Koren, Vice President and Deputy General Counsel	Formerly Managing Director of the Litigation and Regulatory Group at Bear, Stearns; Attorney at Cleary Gottlieb Steen & Hamilton.
Martin S. Korn, Senior Vice President	None
Michael Kotlarz, Vice President	None
Brian Kramer, Vice President	None
Magnus Krantz, Vice President	Formerly an Analyst at RS Investments (December 2005 – May 2009).
Alexander Kurinets, Assistant Vice President	None
Gloria LaFond, Assistant Vice President	None
Lisa Lamentino, Vice President	None
Eric Larson, Vice President	Formerly Senior Equity Trader at RS Investments (October 2006 – May 2009).
Gayle Leavitt, Assistant Vice President	None
John Lech, Assistant Vice President	None
Johnny C. Lee, Vice President & Assistant Counsel	Formerly Vice President at Morgan Stanley Investment Management, Inc. (August 2006 – February 2009).
Victor Lee, Vice President	None
Young-Sup Lee, Vice President	None.
Randy Legg, Vice President & Associate Counsel	None
Michael Leskinen, Vice President	Formerly Senior Sector Analyst (December 2007 – February 2009).
Michael S. Levine, Vice President	None
Brian Levitt, Vice President	None
Justin Leverenz, Senior Vice President	None
William M. Levey, Assistant Vice President & Assistant Counsel	Formerly an attorney at Seward & Kissel LLP (September 2005 – April 2009).
Gang Li, Vice President	None
Shanquan Li, Vice President	None
Julie A. Libby, Senior Vice President	Senior Vice President and Chief Operating Officer of OFI Private Investments Inc.
Mitchell J. Lindauer, Vice President & Assistant General Counsel	None
William Linden, Vice President	None
Justin Livengood, Vice President	None
Christina Loftus, Vice President	None
David P. Lolli, Assistant Vice President	None
Daniel G. Loughran, Senior Vice President: Rochester Division	None
Patricia Lovett, Senior Vice President	Vice President of Shareholder Financial Services, Inc. and Senior Vice President of Shareholder Services, Inc.
Misha Lozovik, Vice President	None
Dongyan Ma, Assistant Vice President	None
Jerry Mandzij, Vice President	None
Dana Mangnuson, Assistant Vice President	Formerly a Marketing Manager at OppenheimerFunds, Inc.
Daniel Martin, Assistant Vice President	None
Kenneth Martin, Vice President	Formerly a Compliance Officer at Merrill Lynch & Co. (May 2007 – August 2009).
Melissa Mazer, Vice President	None
Neil McCarthy, Vice President	None
Elizabeth McCormack, Vice President	Vice President and Assistant Secretary of HarbourView Asset Management Corporation.
Joseph McDonnell, Vice President	None
Annika McGovern, Assistant Vice President	None
Joseph McGovern, Vice President	None
William McNamara, Vice President	None
Michael Medev, Assistant Vice President	None
Krishna Memani, Senior Vice President and Director of Fixed Income	Formerly Managing Director and Head of the U.S. and European Credit Analyst Team at Deutsche Bank Securities (June 2006 through January 2009).
Jay Mewhirter, Vice President	None
Andrew J. Mika, Senior Vice President	None
Jan Miller, Assistant Vice President	None
Scott Miller, Vice President	None
Rejeev Mohammed, Assistant Vice President	None
David Moore, Vice President	None
Sarah Morrison, Assistant Vice President	None
Jill Mulcahy, Vice President: Rochester Division	None
Suzanne Murphy, Vice President	Vice President of OFI Private Investments Inc.
Thomas J. Murray, Vice President	None
Pankaj Naik, Vice President	None
Christina Nasta, Senior Vice President	Vice President of OppenheimerFunds Distributor, Inc.
Amie Nelson, Vice President	None
Derek Newman, Vice President and Assistant Counsel	Formerly an associate at Dechert LLP
Paul Newman, Assistant Vice President	None
William Norman, Assistant Vice President	None
James B. O’Connell, Assistant Vice President	None
Matthew O’Donnell, Vice President	None
Lisa Ogren, Assistant Vice President	Formerly Manager at OppenheimerFunds, Inc.
Tony Oh, Vice President	None
Kristina Olson, Senior Vice President	None
Kristin Pak, Vice President	None
Lerae A. Palumbo, Assistant Vice President	None
Kim Pascalau, Assistant Vice President	None
Robert H. Pemble, Vice President	None
Lori L. Penna, Vice President	None
Brian Petersen, Vice President	Assistant Treasurer of OppenheimerFunds Legacy Program.
Marmeline Petion-Midy, Assistant Vice President	None
David Pfeffer, Director and Senior Vice President	Management Director and Treasurer of Oppenheimer Acquisition Corp.; Senior Vice President of HarbourView Asset Management Corporation since February 2004; Director of OppenheimerFunds Distributor, Inc. as of December 2009.
James F. Phillips, Senior Vice President	None
Gary Pilc, Vice President	None
Christine Polak, Vice President	None
Sergei Polevikov, Assistant Vice President	None
Jeffrey Portnoy, Assistant Vice President	None
Stacy Pottinger, Vice President	None
Christopher Proctor, Vice President	None
Ellen Puckett, Assistant Vice President	None
Jodi Pullman, Assistant Vice President	None
Paul Quarles, Assistant Vice President	None
Michael E. Quinn, Vice President	None
Julie S. Radtke, Vice President	None
Benjamin Ram, Vice President	Sector manager at RS Investment Management Co. LLC (October 2006 – May 2009) and Portfolio Manager Mid Cap Strategies.
Norma J. Rapini, Assistant Vice President: Rochester Division	None
Amber Reilly, Assistant Vice President	Manager (October 2008 – May 2009) and Specialist (March 2008 – October 2008) at Newsday Media Group.
Barbara Reinhard, Senior Vice President	Formerly deputy Chief Investment Strategist at Morgan Stanley Smith Barney.
Jill Reiter, Assistant Vice President	None
Maria Ribeiro De Castro, Vice President	None
Grace Roberts, Vice President	None
Benjamin Rockmuller, Vice President	None
Antoinette Rodriguez, Vice President	None
Lucille Rodriguez, Assistant Vice President	None
Michael Rollings, Director	Executive Vice President and Chief Financial Officer of Massachusetts Mutual Life Insurance Company
Stacey Roode, Senior Vice President	None
Erica Rualo, Vice President	None
Adrienne Ruffle, Vice President & Associate Counsel	Assistant Secretary of OppenheimerFunds Legacy Program.
Gerald Rutledge, Vice President	None
Sean Ryan, Assistant Vice President and Assistant Counsel	Formerly an associate at Sidley Austin, LLP.
Rohit Sah, Vice President	None
Gary Salerno, Assistant Vice President	None
Valerie Sanders, Vice President	None
Carlos Santiago Assistant Vice President	None
Kurt Savallo, Assistant Vice President	Formerly Senior Business Analyst at OppenheimerFunds, Inc.
Mary Beth Schellhorn, Assistant Vice President	None
Ellen P. Schoenfeld, Vice President	None
Patrick Schneider, Assistant Vice President	None
Scott A. Schwegel, Assistant Vice President	None
Allan P. Sedmak, Assistant Vice President	None
Matthew Severski, Assistant Vice President	Formerly Lead IS Engineer at OppenheimerFunds, Inc. (August 2006 – May 2009).
Jennifer L. Sexton, Vice President	Senior Vice President of OFI Private Investments Inc.
Asutosh Shah, Vice President	None
Kamal Shah, Vice President	None
Tammy Sheffer, Vice President	None
Richard Shepley, Vice President	Managing Director at Deutsche Asset Management (January 1998 – March 2010).
William Sheppard, Vice President	None
Mary Dugan Sheridan, Vice President	None
Nicholas Sherwood, Assistant Vice President	None
Joel Simon, Vice President	Formerly Assistant Vice President at OppenheimerFunds, Inc. (1999 – 2009).
David C. Sitgreaves, Assistant Vice President	None
Jan Smith, Assistant Vice President	Formerly Manager at OppenheimerFunds Inc. (May 2005 – June 2009).
Louis Sortino, Vice President: Rochester Division	None
Keith J. Spencer, Senior Vice President	None
Brett Stein, Vice President	None
Richard A. Stein, Vice President: Rochester Division	None
Arthur P. Steinmetz, Executive Vice President & Chief Investment Officer	Director and Senior Vice President of HarbourView Asset Management Corporation; Vice President of OFI Institutional Asset Management, Inc.
Jennifer Stevens, Vice President	None
Benjamin Stewart, Assistant Vice President	None
Wayne Strauss, Vice President	None
Peter Strzalkowski, Vice President	Vice President of HarbourView Asset Management, Inc.
Agata Strzelichowski, Assistant Vice President	None
Amy Sullivan, Assistant Vice President	None
Michael Sussman, Vice President	Vice President of OppenheimerFunds Distributor, Inc.
Kanishka Surana, Vice President	Partner and Director of Analytics at Ogilvy and Mather (May 2009 – July 2010); Manager at Gerson and Lehrman Group (October 2007 – May 2009).
Kelly Thomas, Assistant Vice President	None
Matthew Torpey, Assistant Vice President	None
Melinda Trujillo, Vice President	None
Leonid Tsvayg, Assistant Vice President	None
Keith Tucker, Vice President	None
Angela Uttaro, Vice President: Rochester Division	None
Julie Van Cleave, Vice President	Formerly managing director at Deutsche Asset Management (December 2002 through February 2009).
Mark S. Vandehey, Senior Vice President & Chief Compliance Officer	Vice President and Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Centennial Asset Management Corporation and Shareholder Services, Inc.; Chief Compliance Officer of HarbourView Asset Management Corporation, Oppenheimer 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, Vice President	None
Nancy Vann, Vice President & Associate Counsel	None
Raman Vardharaj, Vice President	Formerly a sector manager and a senior quantitative analyst at RS Investment Management Co. LLC (October 2006 – May 2009).
Rene Vecka, Assistant Vice President: Rochester Division	None
Elaine Villas Assistant Vice President	None
Ryan Virag, Assistant Vice President	None
Jake Vogelaar, Assistant Vice President	None
Phillip F. Vottiero, Senior Vice President	None
Mark Wachter, Vice President	None
Darren Walsh, Executive Vice President	President and Director of Shareholder Financial Services, Inc. and Shareholder Services, Inc.
Eliot Walsh, Assistant Vice President	None
Richard Walsh, Vice President	Vice President of OFI Private Investments.
Samuel Wang, Vice President	Director (January 2010 – October 2010) and Vice President (November 2005 – December 2009) of Global Communications and Public Affairs at Citigroup, Inc.
Elizabeth Ward, Director	Senior Vice President and Chief Enterprise Risk Officer of Massachusetts Mutual Life Insurance Company.
Thomas Waters, Vice President	Vice President of OFI Institutional Asset Management, Inc.
Margaret Weaver, Vice President	None
Jerry A. Webman, Senior Vice President	Senior Vice President of HarbourView Asset Management Corporation.
Christopher D. Weiler, Vice President: Rochester Division	None
Adam Weiner, Vice President	None
Christine Wells, Vice President	None
Joseph J. Welsh, Senior Vice President	Vice President of HarbourView Asset Management Corporation.
Adam Wilde, Assistant Vice President	None
Troy Willis, Vice President, Rochester Division	None
Mitchell Williams, Vice President	None
Martha Willis, Executive Vice President	Formerly Executive Vice President of Investment Product Management at Fidelity Investments; Director of OFI Private Investments Inc., Centennial Asset Management Corporation and OppenheimerFunds Legacy Program.
Brian W. Wixted, Senior Vice President	Treasurer of HarbourView Asset Management Corporation; OppenheimerFunds International Ltd., 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	Senior Vice President of HarbourView Asset Management Corporation; Vice President of OFI Institutional Asset Management, Inc. and Centennial Asset Management Corporation; serves on the Board of the Colorado Ballet.
Oliver Wolff, Assistant Vice President	None
Caleb C. Wong, Vice President	None
Sookhee Yee, Assistant Vice President	Vice President at Merrill Lynch Bank and Trust, FSB (February 2002 – May 2009).
Edward C. Yoensky, Assistant Vice President	None
Geoff Youell, Assistant Vice President	None
Robert G. Zack, Executive Vice President & General Counsel - Corporate	General Counsel of Centennial Asset Management Corporation; General Counsel of 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.; Executive Vice President, General Counsel and Director of OFI Trust Company; Director and Assistant Secretary of OppenheimerFunds International Limited; Vice President, Secretary and General Counsel of Oppenheimer Acquisition Corp.; Director and Assistant Secretary of OppenheimerFunds International Distributor Limited ; Vice President of OppenheimerFunds Legacy Program; Vice President and Director of Oppenheimer Partnership Holdings Inc.; Director of OFI Institutional Asset Management, Ltd.
Anna Zatulovskaya, Assistant Vice President	None
Sara Zervos, Vice President	None
Ronald Zibelli, Jr. Vice President	None
Matthew Ziehl, Vice President	Formerly a portfolio manager with RS Investment Management Co. LLC (from October 2006 – May 2009)

The Oppenheimer Funds include the following:

Limited Term New York Municipal Fund (a series of Rochester Portfolio Series)

OFI Tremont Core Strategies Hedge Fund

Oppenheimer Absolute Return Fund

Oppenheimer AMT-Free Municipals

Oppenheimer AMT-Free New York Municipals

Oppenheimer Balanced Fund

Oppenheimer Baring SMA International Fund

Oppenheimer California Municipal Fund

Oppenheimer Capital Appreciation Fund

Oppenheimer Capital Income Fund

Oppenheimer Cash Reserves

Oppenheimer Champion Income Fund

Oppenheimer Commodity Strategy Total Return Fund

Oppenheimer Core Bond Fund (a series of Oppenheimer Integrity Funds)

Oppenheimer Corporate Bond Fund

Oppenheimer Currency Opportunities Fund

Oppenheimer Developing Markets Fund

Oppenheimer Discovery Fund

Oppenheimer Emerging Markets Debt Fund

Oppenheimer Equity Fund, Inc.

Oppenheimer Equity Income Fund, Inc.

Oppenheimer Global Fund

Oppenheimer Global Opportunities Fund

Oppenheimer Global Strategic Income Fund

Oppenheimer Global Value Fund

Oppenheimer Gold & Special Minerals Fund

Oppenheimer International Bond Fund

Oppenheimer Institutional Money Market Fund

Oppenheimer International Diversified Fund

Oppenheimer International Growth Fund

Oppenheimer International Small Company Fund

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 Select Fund

Oppenheimer Main Street Small- & Mid-Cap Fund

Oppenheimer Master Event-Linked Bond Fund, LLC

Oppenheimer Master Loan Fund, LLC

Oppenheimer Master Inflation Protected Securities Fund, LLC

Oppenheimer Master International Value Fund, LLC

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

Equity Investor Fund
Conservative Investor Fund

Moderate Investor Fund

Oppenheimer Portfolio Series Fixed Income Active Allocation Fund
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 For Value Funds (3 series)

Oppenheimer Global Allocation Fund

Oppenheimer Quest Opportunity Value Fund

Oppenheimer Small- & Mid-Cap Value Fund

Oppenheimer Quest International Value Fund

Oppenheimer Real Estate Fund

Oppenheimer Rising Dividends Fund

Oppenheimer Rochester Arizona Municipal Fund

Oppenheimer Rochester Double Tax-Free Municipals

Oppenheimer Rochester General Municipal Fund

Oppenheimer Rochester Maryland Municipal Fund

Oppenheimer Rochester Massachusetts Municipal Fund

Oppenheimer Rochester Michigan Municipal Fund

Oppenheimer Rochester Minnesota Municipal Fund

Oppenheimer Rochester North Carolina Municipal Fund

Oppenheimer Rochester Ohio Municipal Fund

Oppenheimer Rochester Virginia Municipal Fund

Oppenheimer Select Value Fund

Oppenheimer Senior Floating Rate Fund

Oppenheimer Series Fund, Inc. (1 series):

Oppenheimer Value Fund

Oppenheimer Transition 2010 Fund

Oppenheimer Transition 2015 Fund

Oppenheimer Transition 2020 Fund

Oppenheimer Transition 2025 Fund

Oppenheimer Transition 2030 Fund

Oppenheimer Transition 2040 Fund

Oppenheimer Transition 2050 Fund

Oppenheimer U.S. Government Trust

Oppenheimer Variable Account Funds (11 series):

Oppenheimer Balanced Fund/VA

Oppenheimer Capital Appreciation Fund/VA

Oppenheimer Core Bond Fund/VA

Oppenheimer Global Securities Fund/VA

Oppenheimer Global Strategic Income Fund/VA

Oppenheimer High Income Fund/VA

Oppenheimer Main Street Fund/VA

Oppenheimer Main Street Small Cap Fund/VA

Oppenheimer Money Fund/VA

Oppenheimer Small- & Mid-Cap Growth Fund/VA

Oppenheimer Value Fund/VA

Panorama Series Fund, Inc. (3 series):

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., Centennial Asset Management Corporation, 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 Acquisition Corp., OFI Private Investments Inc., OFI Institutional Asset Management, Inc. Oppenheimer Real Asset Management, Inc. and OFI Trust Company is Two World Financial Center, 225 Liberty Street, 11^th Floor, New York, New York 10281-1008.

The address of OppenheimerFunds International Ltd. is 70 Sir John Rogerson’s Quay, Dublin 2, Ireland.

The address of OFI Institutional Asset Management, Ltd., is One Silk Road, London, England EC27 8HQ.

The address of Trinity Investment Management Corporation is 301 North Spring Street, Bellefonte, Pennsylvania 16823.

The address of OppenheimerFunds International Distributor Limited is 13^th Floor, Printing House, 6 Duddell Street, Central, Hong Kong.

Item 32. 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 31(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 Business Address	Position & Office with Underwriter	Position and Office with Registrant
Timothy Abbhul⁽¹⁾	Vice President and Treasurer	None
Robert Agan⁽¹⁾	Vice President	None
Anthony Allocco⁽²⁾	Assistant Vice President	None
Janette Aprilante⁽²⁾	Secretary	None
James Austin⁽¹⁾	Vice President	None
James Barker 1723 W. Nelson Street Chicago, IL 60657	Vice President	None
Kathleen Beichert⁽¹⁾	Senior Vice President	None
Rocco Benedetto⁽²⁾	Vice President	None
Christopher Bergeron	Vice President	None
Rick Bettridge 11504 Flowering Plum Lane Highland, UT 84003	Vice President	None
Adam Bilmes⁽²⁾	Assistant Vice President	None
William Borders⁽²⁾	Assistant Vice President	None
David A. Borrelli 105 Black Calla Ct. San Ramon, CA 94583	Vice President	None
Jeffrey R. Botwinick 4431 Twin Pines Drive Manlius, NY 13104	Vice President	None
Sarah Bourgraf⁽¹⁾	Vice President	None
Bryan Bracchi 1124 Hampton Dr. Allen, TX 75013	Vice President	None
Joshua Broad⁽²⁾	Vice President	None
Ken Broadsky⁽²⁾	Vice President	None
Kevin E. Brosmith 5 Deer Path South Natlick, MA 01760	Senior Vice President	None
Jeffrey W. Bryan 1048 Malaga Avenue Coral Gables, FL 33134	Vice President	None
Ross Burkstaller 211 Tulane Drive SE Albuquerque, NM 87106	Vice President	None
Michael Butler⁽²⁾	Assistant Vice President	None
Tracy Cairoli⁽²⁾	Vice President	None
Robert Caruso 15 Deforest Road Wilton, CT 06897	Vice President	None
Donelle Chisolm⁽²⁾	Assistant Vice President	None
Andrew Chronofsky	Vice President	None
Angelanto Ciaglia⁽²⁾	Vice President	None
Nicholas Cirbo⁽¹⁾	Vice President	None
Kevin Clark⁽²⁾	Assistant Vice President	None
Melissa Clayton⁽²⁾	Assistant Vice President	None
Craig Colby⁽²⁾	Vice President	None
Rodney Constable⁽¹⁾	Vice President	None
Neev Crane 1530 Beacon Street, Apt. #1403 Brookline, MA 02446	Vice President	None
Michael Daley 40W387 Oliver Wendell Holmes St St. Charles, IL 60175	Vice President	None
John Davis⁽²⁾	Vice President	None
Stephen J. Demetrovits⁽²⁾	Vice President	None
Brian Dietrich⁽¹⁾	Assistant Vice President	None
Steven Dombrower 13 Greenbrush Court Greenlawn, NY 11740	Vice President	None
Robert Dunphy⁽²⁾	Vice President	None
Beth Arthur Du Toit⁽¹⁾	Vice President	None
Paul Eck 3055 Forest Ridge Court Fairlawn, OH 44333	Vice President	None
Kent M. Elwell 35 Crown Terrace Yardley, PA 19067	Vice President	None
Dana Espinel⁽²⁾	Assistant Vice President	None
Gregg A. Everett 4328 Auston Way Palm Harbor, FL 34685-4017	Vice President	None
George R. Fahey 9511 Silent Hills Lane Lone Tree, CO 80124	Senior Vice President	None
Eric C. Fallon 10 Worth Circle Newton, MA 02458	Vice President	None
Matthew Farrier⁽¹⁾	Vice President	None
Kristie Feinberg⁽²⁾	Assistant Treasurer	None
Joseph Fernandez 1717 Richbourg Park Drive Brentwood, TN 37027	Vice President	None
Mark J. Ferro 104 Beach 221^st Street Breezy Point, NY 11697	Senior Vice President	None
Eric P. Fishel 725 Boston Post Rd., #12 Sudbury, MA 01776	Vice President	None
David Flaherty⁽²⁾	Assistant Vice President	None
Patrick W. Flynn 14083 East Fair Avenue Englewood, CO 80111	Senior Vice President	None
John (“J”) Fortuna⁽²⁾	Vice President	None
Jayme D. Fowler 3818 Cedar Springs Road, #101-349 Dallas, TX 75219	Vice President	None
Diane Frankenfield⁽²⁾	Senior Vice President	None
Jerry Fraustro⁽²⁾	Vice President	None
William Friebel 2919 St. Albans Forest Circle Glencoe, MO 63038	Vice President	None
Alyson Frost⁽²⁾	Assistant Vice President	None
Greg Fulginite 515 N. Bemiston Ave. St. Louis, MO 63130	Vice President	None
William Gahagan⁽²⁾	Vice President	None
Charlotte Gardner⁽¹⁾	Vice President	None
David Goldberg⁽²⁾	Assistant Vice President	None
Michael Gottesman 255 Westchester Way Birmingham, MI 48009	Vice President	None
Raquel Granahan⁽²⁾	Senior Vice President	None
Robert Grill⁽²⁾	Senior Vice President	None
Eric Grossjung 4002 N. 194^th Street Elkhorn, NE 68022	Vice President	None
Michael D. Guman 3913 Pleasant Avenue Allentown, PA 18103	Vice President	None
James E. Gunter 603 Withers Circle Wilmington, DE 19810	Vice President	None
Kevin J. Healy⁽²⁾	Vice President	None
Kenneth Henry⁽²⁾	Vice President	None
Philipp Hensler⁽²⁾	Chairman, Chief Executive Officer & Director	None
Wendy G. Hetson⁽²⁾	Vice President	None
Jennifer Hoelscher⁽¹⁾	Assistant Vice President	None
Edward Hrybenko⁽²⁾	Senior Vice President	None
Amy Huber⁽¹⁾	Assistant Vice President	None
Brian F. Husch 37 Hollow Road Stonybrook, NY 11790	Vice President	None
Patrick Hyland⁽²⁾	Assistant Vice President	None
Keith Hylind⁽²⁾	Vice President	None
Kathleen T. Ives⁽¹⁾	Vice President & Assistant Secretary	Assistant Secretary
Shonda Rae Jaquez⁽²⁾	Vice President	None
Brian Johnson⁽¹⁾	Vice President	None
Eric K. Johnson 8588 Colonial Drive Lone Tree, CO 80124	Senior Vice President	None
Elyse Jurman 5486 NW 42 Ave Boca Raton, FL 33496	Vice President	None
Thomas Keffer⁽²⁾	Senior Vice President	None
Brian Kiley⁽²⁾	Vice President	None
Richard Klein 4820 Fremont Avenue South Minneapolis, MN 55419	Senior Vice President	None
Brent A. Krantz 61500 Tam McArthur Loop Bend, OR 97702	Senior Vice President	None
Eric Kristenson⁽²⁾	Vice President	None
Lamar Kunes⁽²⁾	Vice President	None
David T. Kuzia 10258 S. Dowling Way Highlands Ranch, CO 80126	Vice President	None
John Laudadio⁽²⁾	Vice President	None
Jesse Levitt⁽²⁾	Vice President	None
Julie Libby⁽²⁾	Senior Vice President	None
Eric J. Liberman 27 Tappan Ave., Unit West Sleepy Hollow, NY 10591	Vice President	None
Malissa Lischin⁽²⁾	Assistant Vice President	None
Christina Loftus⁽²⁾	Senior Vice President	None
Thomas Loncar 1401 North Taft Street, Apt. 726 Arlington, VA 22201	Vice President	None
Peter Maddox⁽²⁾	Vice President	None
Michael Malik 546 Idylberry Road San Rafael, CA 94903	Vice President	None
Joseph Marich⁽²⁾	Vice President	None
Steven C. Manns 1627 N. Hermitage Avenue Chicago, IL 60622	Vice President	None
Todd A. Marion 24 Midland Avenue Cold Spring Harbor, NY 11724	Vice President	None
LuAnn Mascia⁽²⁾	Vice President	None
Anthony Mazzariello⁽²⁾	Vice President	None
Michael McDonald 11749 S Cormorant Circle Parker, CO 80134	Vice President	None
John C. McDonough 533 Valley Road New Canaan, CT 06840	President and Director	None
Kent C. McGowan 9510 190^th Place SW Edmonds, WA 98020	Vice President	None
Brian F. Medina 3009 Irving Street Denver, CO 80211	Vice President	None
William Meerman 4939 Stonehaven Drive Columbus, OH 43220	Vice President	None
Clint Modler⁽¹⁾	Vice President	None
Joseph Moran⁽²⁾	Senior Vice President	None
Robert Moser 9650 East Aspen Hill Circle Lone Tree, CO 80124	Vice President	None
David W. Mountford 7820 Banyan Terrace Tamarac, FL 33321	Vice President	None
James Mugno⁽²⁾	Vice President	None
Matthew Mulcahy⁽²⁾	Vice President	None
Wendy Jean Murray 32 Carolin Road Upper Montclair, NJ 07043	Vice President	None
Kimberly Mustin⁽²⁾	Senior Vice President	None
John S. Napier 17 Hillcrest Ave. Darien, CT 06820	Senior Vice President	None
Christina Nasta⁽²⁾	Senior Vice President	None
Kevin P. Neznek⁽²⁾	Senior Vice President	None
Christopher Nicholson⁽²⁾	Vice President	None
Chad Noel	Vice President	None
Timothy O’Connell⁽²⁾	Vice President	None
Janet Oleary⁽²⁾	Vice President	None
Alan Panzer6755 Ridge Mill Lane Atlanta, GA 30328	Vice President	None
Anthony Parisi	Vice President	None
Maria Paster⁽²⁾	Assistant Vice President	None
Donald Pawluk⁽²⁾	Vice President	None
Brian C. Perkes 6 Lawton Ct. Frisco, TX 75034	Vice President	None
Wayne Perry 3900 Fairfax Drive Apt 813 Arlington, VA 22203	Vice President	None
Charles K. Pettit⁽²⁾	Vice President	None
David Pfeffer⁽²⁾	Director	None
Andrew Phillips⁽¹⁾	Assistant Vice President	None
Aaron Pisani⁽¹⁾	Vice President	None
Rachel Powers⁽¹⁾	Vice President	None
Nicole Pretzel⁽²⁾	Vice President	None
David Preuss⁽²⁾	Assistant Vice President	None
Minnie Ra 100 Dolores Street, #203 Carmel, CA 93923	Vice President	None
Dustin Raring 27 Blakemore Drive Ladera Ranch, CA 92797	Vice President	None
Michael A. Raso 3 Vine Place Larchmont, NY 10538	Vice President	None
Richard E. Rath 46 Mt. Vernon Ave. Alexandria, VA 22301	Vice President	None
Ramsey Rayan⁽²⁾	Vice President	None
William J. Raynor⁽⁴⁾	Vice President	None
Ian M. Roche 7070 Bramshill Circle Bainbridge, OH 44023	Vice President	None
Michael Rock 9016 Stourbridge Drive Huntersville, NC 28078	Vice President	None
Stacy Roode⁽¹⁾	Vice President	None
Thomas Sabow 6617 Southcrest Drive Edina, MN 55435	Vice President	None
Mark Santero⁽²⁾	Senior Vice President	None
John Saunders 2251 Chantilly Ave. Winter Park, FL 32789	Vice President	None
Thomas Schmitt 40 Rockcrest Rd Manhasset, NY 11030	Vice President	None
William Schories 3 Hill Street Hazlet, NJ 07730	Vice President	None
Jennifer Sexton⁽²⁾	Vice President	None
Eric Sharp 862 McNeill Circle Woodland, CA 95695	Vice President	None
Kenneth Shell⁽¹⁾	Vice President	None
Debbie A. Simon 55 E. Erie St., #4404 Chicago, IL 60611	Vice President	None
Bryant Smith	Vice President	None
Christopher M. Spencer 2353 W 118^th Terrace Leawood, KS 66211	Vice President	None
John A. Spensley 375 Mallard Court Carmel, IN 46032	Vice President	None
Michael Staples 4255 Jefferson St Apt 328 Kansas City, MO 64111	Vice President	None
Alfred St. John⁽²⁾	Vice President	None
Bryan Stein 8 Longwood Rd. Voorhees, NJ 08043	Vice President	None
Brian C. Summe 2479 Legends Way Crestview Hills, KY 41017	Vice President	None
Kanishka Surana⁽²⁾	Vice President	None
Kenneth Sussi⁽²⁾	Vice President	None
Michael Sussman⁽²⁾	Vice President	None
George T. Sweeney 5 Smokehouse Lane Hummelstown, PA 17036	Senior Vice President	None
Leon Tallon⁽²⁾	Vice President	None
Brian Taylor	Vice President	None
James Taylor⁽²⁾	Assistant Vice President	None
Paul Temple⁽²⁾	Vice President	None
Troy Testa	Vice President	None
David G. Thomas 16628 Elk Run Court Leesburg, VA 20176	Vice President	None
Wesley Vance⁽²⁾	Vice President	None
Mark S. Vandehey⁽¹⁾	Vice President and Chief Compliance Officer	Vice President and Chief Compliance Officer
Vincent Vermette⁽²⁾	Vice President	None
Molly Vogt	Vice President	None
Teresa Ward⁽¹⁾	Vice President	None
Janeanne Weickum⁽¹⁾	Vice President	None
Michael J. Weigner 4905 W. San Nicholas Street Tampa, FL 33629	Vice President	None
Donn Weise 3249 Earlmar Drive Los Angeles, CA 90064	Vice President	None
Chris G. Werner 98 Crown Point Place Castle Rock, CO 80108	Vice President	None
Ryan Wilde⁽¹⁾	Vice President	None
Julie Wimer⁽²⁾	Assistant Vice President	None
Peter Winters 911 N. Organce Ave, Apt. 514 Orlando, FL 32801	Vice President	None
Patrick Wisneski⁽¹⁾	Vice President	None
Meredith Wolff⁽²⁾	Vice President	None
Cary Patrick Wozniak 18808 Bravata Court San Diego, CA 92128	Vice President	None
John Charles Young 3914 Southwestern Houston, TX 77005	Vice President	None
Robert G. Zack⁽²⁾	General Counsel	Secretary
Steven Zito⁽¹⁾	Vice President	None

⁽¹⁾6803 South Tucson Way, Centennial, CO 80112-3924

⁽²⁾Two World Financial Center, 225 Liberty Street, 11^th Floor, New York, NY 10281-1008

⁽³⁾350 Linden Oaks, Rochester, NY 14623

⁽⁴⁾Independence Wharf, 470 Atlantic Avenue, 11^th Floor, Boston, MA 02210

(c)

Not applicable.

Item 33. 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 34. Management Services

Not applicable.

Item 35. Undertakings

Not applicable.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York and State of New York on the 23rd day of November, 2010.

OPPENHEIMER AMT-FREE MUNICIPALS

By: William F. Glavin, Jr.*

William F. Glavin, Jr.*, President and

Principal Executive Officer

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

Brian F. Wruble* Chairman of the November 23, 2010
Brian F. Wruble Board of Trustees

William F. Glavin, Jr.* President, Principal November 23, 2010
William F. Glavin, Jr. Executive Officer

Brian W. Wixted* Treasurer, Principal November 23, 2010
Brian W. Wixted Financial & Accounting Officer

David K. Downes* Trustee November 23, 2010

David K. Downes

Matthew P. Fink* Trustee November 23, 2010

Matthew P.Fink

Phillip A. Griffiths* Trustee November 23, 2010
Phillip A. Griffiths

Mary F. Miller* Trustee November 23, 2010
Mary F. Miller

Joel W. Motley* Trustee November 23, 2010
Joel W. Motley

Mary Ann Tynan, * Trustee November 23, 2010

Mary Ann Tynan

Joseph M. Wikler* Trustee November 23, 2010

Joseph M. Wikler

Peter I. Wold* Trustee November 23, 2010

Peter I. Wold

*By: /s/ Mitchell J. Lindauer

Mitchell J. Lindauer, Attorney-in-Fact

Oppenheimer AMT-Free Municipals

Post-Effective Amendment No. 58

Registration Statement No. 2-57116

EXHIBIT INDEX

Exhibit No. Description

28(j) Independent Registered Public Accounting Firm’s Consent