Pre-Effective Amendment to Registration Statement of an Open-End Management Investment Company — Form N-1 Filing Table of Contents
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Pre-Effective No.1 International Large Cap-Core Fund N1A Form/PSP/SAI/PTC
Registration No.333-106014
File No. 811-21370
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. 1
--------------------------------------- [X]
Post-Effective Amendment No. ____ [ ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 [X]
Amendment No. ____ [ ]
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OPPENHEIMER INTERNATIONAL LARGE-CAP CORE TRUST
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(Exact Name of Registrant as Specified in Charter)
6803 South Tucson Way, Centennial, Colorado80112-3924
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(Address of Principal Executive Offices) (Zip Code)
(303) 768-3200
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(Registrant's Telephone Number, including Area Code)
Robert G. Zack, Esq.
OppenheimerFunds, Inc.
498 Seventh Avenue, New York, New York10018
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(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box):
[ ] Immediately upon filing pursuant to paragraph (b)
[ ] On _______________ pursuant to paragraph
[ ] 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.
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The Registrant hereby amends the Registration statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with section 8(a)
of the Securities Act of 1933 or until the Registration Statement shall
become effective on such date as the Commission, acting pursuant to Section
8(a), shall determine.
Oppenheimer
International Large-Cap Core Fund
Prospectus dated August 11, 2003
Oppenheimer International Large-Cap
Core Fund is a mutual fund that seeks
long-term capital appreciation. It
emphasizes investments in common
stocks of large-cap foreign companies.
This Prospectus contains important
information about the Fund's
objective, its investment policies,
strategies and risks. It also contains
important information about how to buy
and sell shares of the Fund and other
As with all mutual funds, the account features. Please read this
Securities and Exchange Commission has Prospectus carefully before you invest
not approved or disapproved the Fund's and keep it for future reference about
securities nor has it determined that your account.
this Prospectus is accurate or
complete. It is a criminal offense to
represent otherwise.
[logo] OppenheimerFunds(R)
The Right Way to Invest
Contents
About the Fund
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The Fund's Investment Objective and Principal Strategies
Main Risks of Investing in the Fund
The Fund's Past Performance
Fees and Expenses of the Fund
About the Fund's Investments and Risks
How the Fund is Managed
About Your Account
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How to Buy Shares
Class A Shares
Class B Shares
Class C Shares
Class N Shares
Class Y Shares
Special Investor Services
AccountLink
PhoneLink
OppenheimerFunds Internet Website
Retirement Plans
How to Sell Shares
By Mail
By Telephone
How to Exchange SharesShareholder Account Rules and PoliciesDividends, Capital Gains and Taxes
ABOUT the fund
The Fund's Investment Objective and Principal Strategies
WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks long-term capital
appreciation.
WHAT DOES THE FUND MAINLY INVEST IN? The Fund currently invests mainly in
common stocks of companies that are domiciled outside the United States or
have their primary operations outside the U.S. As a non-fundamental policy
(which will not be changed without providing at least 60 days notice to Fund
shareholders), the Fund invests at least 80% of its net assets (plus
borrowings for investment purposes) in large-cap companies, as defined below.
A company is considered to be a large-cap company if its market
capitalization is greater than the median market capitalization of the
companies included in the Morgan Stanley Capital International EAFE(R)Index
(Europe, Australasia, Far East) ("MSCI EAFE Index"), an unmanaged index that
is widely recognized as a measure of international stock performance. The
market capitalization of the companies in the Index may change over time as
market conditions and broad market valuations vary. As of the date of this
Prospectus, the median market capitalization of the companies included in the
MSCI EAFE Index is approximately $1.9 billion. The median market
capitalization used to determine large-cap companies will change at such
times as the MSCI EAFE Index is recalculated.
The Fund may invest up to 100% of its assets in foreign securities, and
under normal market conditions it will invest primarily in companies located
in developed markets in countries included in the MSCI EAFE Index. The Fund
will invest at least 80% of its net assets (plus borrowings for investment
purposes) in at least six different countries outside the United States.
HOW DOES THE PORTFOLIO MANAGER DECIDE WHAT SECURITIES TO BUY OR SELL? The Fund's
Investment Manager, OppenheimerFunds, Inc., (the "Manager") has engaged an
affiliate, OFI Institutional Asset Management, Inc., to serve as Sub-Advisor to
the Fund. The Sub-Advisor uses a growth-at-a-responsible-price (GARP) approach
to investing in companies. In employing a GARP approach, the Sub-Advisor selects
future earnings potential that it believes are not adequately reflected in a
company's share price. In selecting securities for the Fund, the Sub-Advisor
evaluates investment opportunities on a company-by-company basis. The portfolio
manager looks primarily for foreign companies using a "bottom up" investment
approach-that is, analyzing individual stocks before considering the impact of
general or industry economic trends. The portfolio manager also uses a
"top-down" approach, reviewing macroeconomic factors in each country and
industry, to analyze the Fund's diversification by country and sector.
The portfolio manager analyzes factors that may vary over time in
seeking broad diversification of the Fund's holdings among industries,
sectors and countries. These factors may include: a company's balance sheet
strength and financial condition, management quality and business strategy.
The portfolio manager's analysis of a market may include a review of
capitalization, liquidity and political stability. The portfolio manager
monitors individual issuers for changes in the factors above that may lead to
a decision to sell a security.
WHO IS THE FUND DESIGNED FOR? The Fund is designed primarily for investors
seeking capital appreciation in their investment over the long term from a
fund that normally has substantial foreign investments. Those investors
should be willing to assume the greater risks of share price fluctuations
that are typical for a fund seeking long-term capital appreciation focusing
on stock investments, and the special risks of investing in foreign
countries. The Fund does not seek current income and the income from its
investments will likely be small, so it is not designed for investors needing
income. Because of its focus on long-term capital appreciation, the Fund may
be appropriate for some portion of a retirement plan investment for investors
with a high risk tolerance. However, the Fund is not a complete investment
program.
Main Risks of Investing in the Fund
All investments carry risks to some degree. The Fund's investments in stocks
are subject to changes in their value from a number of factors, described
below. There is also the risk that poor security selection by the Sub-Advisor
will cause the Fund to underperform other funds having similar objectives.
Changes in the market prices of securities can occur at any time. The share
prices of the Fund will change daily based on changes in market prices of
securities and market conditions, and in response to other economic and
political events.
RISKS OF INVESTING IN STOCKS. Because the Fund invests primarily in common
stocks of foreign companies, the value of the Fund's portfolio will be
affected by changes in the foreign stock markets and the special economic and
other factors that might primarily affect the prices of particular foreign
markets. Market risk will affect the Fund's net asset values per share,
which will fluctuate as the values of the Fund's portfolio securities change.
The prices of individual stocks do not all move in the same direction
uniformly or at the same time, for example, "growth" stocks may perform well
under circumstances in which "value" stocks in general have fallen. Different
stock markets may behave differently from each other.
Additionally, stocks of issuers in a particular industry may be
affected by changes in economic conditions that affect that industry more
than others, or by changes in government regulations, availability of basic
resources or supplies, or other events affecting that industry. To the extent
the Fund emphasizes investments in a particular industry, its share values
may fluctuate in response to events affecting that industry.
Other factors can affect a particular stock's price, such as poor
earnings reports by the issuer, loss of major customers, major litigation
against the issuer, or changes in government regulations affecting the issuer
or its industry.
RISKS OF FOREIGN INVESTING. While foreign securities may offer special
investment opportunities, there are also special risks. The change in value
of a foreign currency against the U.S. dollar will result in a change in the
U.S. dollar value of securities denominated in that foreign currency.
Foreign issuers are not subject to the same accounting and disclosure
requirements to which U.S. companies are subject to.
The value of foreign investments may be affected by exchange control
regulations, expropriation or nationalization of a company's assets, foreign
taxes, delays in settlement of transactions, changes in governmental economic
or monetary policy in the U.S. or abroad, or other political and economic
factors. In addition, foreign securities may not be as liquid as domestic
securities. These risks could cause the prices of foreign stocks to fall and
could therefore depress the Fund's share prices.
HOW RISKY IS THE FUND OVERALL? The risks described above collectively form the
overall risk profile of the Fund, and can affect the value of the Fund's
investments, its investment performance and the prices of its shares. Particular
investments and investment strategies also have risks. These risks mean that you
can lose money by investing in the Fund. When you redeem your shares, they may
be worth more or less than what you paid for them. There is no assurance that
the Fund will achieve its investment objective.
The prices of the Fund's shares can go up and down substantially. The Fund
generally does not use income-oriented investments to help cushion the Fund's
total return from changes in stock prices. In the OppenheimerFunds spectrum,
the Fund is an aggressive investment vehicle, designed for investors willing
to assume greater risks in the hope of achieving long-term capital
appreciation. It is likely to be subject to greater fluctuations in its
share prices than funds that do not invest in foreign securities or funds
that focus on both stocks and bonds.
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An investment in the Fund is not a deposit of any bank and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.
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The Fund's Past Performance
No prior performance information is shown because the Fund has not yet been
in existence for a full calendar year.
Fees and Expenses of the Fund
The following tables are provided to help you understand the fees and
expenses you may pay if you buy and hold shares of the Fund. The Fund pays a
variety of expenses directly for management of its assets, administration,
distribution of its shares and other services. Those expenses are subtracted
from the Fund's assets to calculate the Fund's net asset values per share.
All shareholders therefore pay those expenses indirectly. Shareholders pay
other transaction expenses directly, such as sales charges. "Other Expenses"
and "Total Annual Operating Expenses" are based on the Fund's anticipated
expenses during its first fiscal year.
Shareholder Fees (charges paid directly from your investment):
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Class A Class B Class C Class N Class Y
Shares Shares Shares Shares Shares
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Maximum Sales Charge 5.75% None None None None
(Load) on purchases
(as % of offering
price)
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Maximum Deferred Sales
Charge (Load) (as % of
the lower of the
original offering None1 5%2 1%3 1%4 None
price or redemption
proceeds)
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Redemption Fee (as a 2.00% 2.00% 2.00% 2.00% 2.00%
percentage of total
redemption proceeds)5
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Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)
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Class A Class B Class C Class N Class Y
Shares Shares Shares Shares Shares
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Management Fees 0.85% 0.85% 0.85% 0.85% 0.85%
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Distribution and/or 0.25% 1.00% 1.00% 0.50% None
Service (12b-1) Fees
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Other Expenses6 0.60% 0.60% 0.60% 0.60% 0.60%
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Total Annual Operating 1.70% 2.45% 2.45% 1.95% 1.45%
Expenses
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1. A contingent deferred sales charge may apply to redemptions of
investments of $1 million or more ($500,000 for certain retirement plan
accounts) of Class A shares. See "How to Buy Shares" for details.
2. Applies to redemptions in first year after purchase. The contingent
deferred sales charge declines to 1% in the sixth year and is eliminated
after that.
3. Applies to shares redeemed within 12 months of purchase.
4. Applies to shares redeemed within 18 months of a retirement plan's
first purchase of Class N shares.
5. The redemption fee applies to the proceeds of Fund shares that are
redeemed (either by selling or exchanging to another Oppenheimer fund)
within 30 days of their purchase. See "How to Sell Shares" for more
information on when the redemption fee will apply.
6."Other Expenses" are based on estimated amounts for the current fiscal
year. Expenses may vary in future years. "Other expenses" include, among
others, transfer agent fees, custodial fees, and accounting and legal
expenses that the Fund pays. The Manager has voluntarily agreed to waive
management fees and/or reimburse the Fund for certain expenses so that
"Total Annual Operating Expenses" will not exceed 1.70% for Class A
shares, 2.45% for Class B Shares and Class C shares, 1.95% for Class N
shares and 1.45% for Class Y shares. The voluntary waiver and/or expense
reimbursements described above may be amended or withdrawn at any time
without prior notice to shareholders. The Transfer Agent has voluntarily
undertaken to the Fund to limit the transfer agent fees to 0.35% of
average daily net assets per fiscal year for each class of shares. That
undertaking may be amended or withdrawn at any time without prior notice
to shareholders.
Examples. The following examples are intended to help you compare the cost
of investing in the Fund with the cost of investing in other mutual funds.
The examples assume that you invest $10,000 in a class of shares of the Fund
for the time periods indicated and reinvest your dividends and distributions.
The first example assumes that you redeem all of your shares at the end
of those periods. The second example assumes that you keep your shares. Both
examples also assume that your investment has a 5% return each year and that
the class's operating expenses remain the same. Your actual costs may be
higher or lower because expenses will vary over time. Based on these
assumptions your expenses would be as follows:
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If shares are redeemed: 1 Year 3 Years
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Class A Shares $738 $1,080
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Class B Shares $748 $1,064
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Class C Shares $351 $764
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Class N Shares $301 $612
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Class Y Shares $148 $459
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If shares are not 1 Year 3 Years
redeemed:
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Class A Shares $738 $1,080
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Class B Shares $248 $764
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Class C Shares $248 $764
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Class N Shares $198 $612
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Class Y Shares $148 $459
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In the first example, expenses include the initial sales charge for Class A
and the applicable Class B, Class C and Class N contingent deferred sales
charges. In the second example, the Class A expenses include the sales
charge, but Class B, Class C and Class N expenses do not include contingent
deferred sales charges. There is no sales charge on Class Y shares.
About the Fund's Investments and Risks
THE FUND'S PRINCIPAL INVESTMENT POLICIES. The Fund's holdings will vary over
time based upon the portfolio manager's evaluation of economic and market
trends. The Fund's holdings might not always include all of the different
types of investments described in this Prospectus. The Statement of
Additional Information contains more detailed information about the Fund's
investment policies and risks.
The Sub-Advisor tries to reduce risks by carefully researching
securities before they are purchased. The Fund attempts to reduce its
exposure to market risks by diversifying its investments, that is, by not
holding a large percentage of the stock of any one company and by not
investing too great a percentage of the Fund's assets in any one company.
Also, the Fund does not concentrate 25% or more of its total assets in
investments in any one industry.
Stock Investments. The Fund emphasizes investments in common stocks of
foreign companies. The Fund currently focuses on securities of issuers
that have large capitalizations. Historically, stock prices of
large-cap companies have tended to be less volatile than those of
smaller issuers. The Sub-Advisor may invest in companies that it
believes have growth potential. Growth companies can be new or
established companies that may be developing new products or services
that have relatively favorable prospects, or that are expanding into
new markets or entering a growth cycle.
Growth companies tend to retain a large part of their earnings for
research, development or investment in capital assets. Therefore, they
do not tend to emphasize paying dividends, and may not pay any
dividends for some time. They are selected for the Fund because the
Sub-Advisor believes the price of their stock will increase over the
long term.
Growth stocks may be more volatile than other stock investments. They
may lose favor with investors if the issuer's business plans do not
produce the expected results, or if growth investing falls out of favor
with investors. Growth stocks may be subject to more volatility because
of investor speculation about the issuer's prospects.
Foreign Securities. The foreign securities the Fund can buy include stocks
and other equity securities of companies organized under the laws of a
foreign country or companies that have more than 50% of their
operations or assets abroad, or derive more than 50% of their revenue
or profits from businesses, investments or sales outside the U.S.
Foreign securities include securities traded primarily on foreign
securities exchanges or in foreign over-the-counter markets. The Fund
considers securities of foreign issuers that are represented in the
U.S. securities markets by American Depository Receipts ("ADRs") or
similar depository arrangements to be "foreign securities" for purposes
of its investment allocations.
The Fund can also buy debt securities issued by foreign companies, but
they would primarily be convertible securities. The Sub-Advisor
considers some convertible securities to be "equity equivalents"
because of the conversion feature and in that case, their credit rating
has less impact on the investment decision than in the case of other
debt securities. The Fund can buy debt securities issued by foreign
governments or their agencies, but these are not a main investment
strategy of the Fund.
CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? The Fund's Board of
Trustees can change non-fundamental investment policies without shareholder
approval, although significant changes will be described in amendments to
this Prospectus. Fundamental policies cannot be changed without the approval
of a majority of the Fund's outstanding voting shares. The Fund's investment
objective is a fundamental policy. Other investment restrictions that are
fundamental policies are listed in the Statement of Additional Information.
An investment policy is not fundamental unless this Prospectus or the
Statement of Additional Information says that it is.
OTHER INVESTMENT STRATEGIES. To seek its objective, the Fund can use the
non-principal investment strategies and techniques described below. The
Manager might not always use all of them and is not required to use them to
achieve its objective. These techniques have risks, although some are
designed to help reduce overall investment or market risks.
Investing in Special Situations. At times the Fund might use aggressive
investment techniques. These might include seeking to benefit from what
the portfolio manager perceives to be "special situations," such as
mergers, reorganizations or other unusual events expected to affect a
particular issuer. However, there is a risk in investing in special
situations that the change or event might not occur, which could have a
negative impact on the price of the issuer's securities. The Fund's
investment might not produce the expected gains or could incur a loss
for the portfolio.
Investing in Domestic Securities. The Fund does not expect to invest more
than 10% of its assets under normal market conditions in securities of
U.S. issuers. However, it can hold common and preferred stocks of U.S.
companies as well as their debt securities, and can also invest in U.S.
corporate and government debt securities for defensive and liquidity
purposes.
Illiquid and Restricted Securities. Investments may be illiquid because they
do not have an active trading market. That may make it difficult to
value them or dispose of them promptly at an acceptable price. A
restricted security is one that has a contractual restriction on its
resale or which cannot be sold publicly until it is registered under
applicable securities laws. Restricted securities may have terms that
limit their resale to other investors or may require registration under
applicable securities laws before they may be sold publicly. The Fund
will not invest more than 15% of its net assets in illiquid or
restricted securities. Certain restricted securities that are eligible
for resale to qualified institutional purchasers may not be subject to
that limit. The Manager monitors holdings of illiquid securities on an
ongoing basis to determine whether to sell any holdings to maintain
adequate liquidity.
Derivative Investments. The Fund can use "derivative" investments to seek
increased returns or to try to hedge investment risks, although it does
not currently use them to a significant degree. In general terms, a
derivative investment is an investment contract whose value depends on
(or is derived from) the value of an underlying asset, interest rate or
index. In the broadest sense, exchange-traded options, index options,
futures contracts, forward contracts and other hedging instruments the
Fund might use can be considered "derivative" investments. In addition
to using derivatives for hedging, the Fund might use certain derivative
investments, particularly options on indices (including the MSCI EAFE
Index), because they offer the potential for increased value.
o There are Special Risks in Using Derivative Investments. Markets
underlying securities and indices may move in a direction not
anticipated. Interest rate and stock market changes in the U.S. and
abroad may also influence the performance of derivatives. If the issuer
of the derivative does not pay the amount due, the Fund can lose money
on the investment. Also, the underlying security or investment on which
the derivative is based, and the derivative itself, may not perform the
way the Sub-Advisor expected it to perform. If that happens, the Fund's
share prices could decline.
The Fund has limits on the amount of particular types of derivatives it can
hold. However, using derivatives can cause the Fund to lose money on
its investments and/or increase the volatility of its share prices. As
a result of these risks the Fund could realize less principal or income
from the investment than expected and its share prices could fall or
the Fund's hedge could be unsuccessful. Certain derivative investments
held by the Fund may be illiquid.
Hedging. The Fund can buy and sell options and futures contracts on
broadly-based securities indices, and foreign currencies, put and call
options, forward contracts and options on futures and broadly-based
securities indices. These are all referred to as "hedging
instruments." The Fund has limits on its use of hedging instruments
and is not required to use them in seeking its investment objective.
The Fund could hedge for a number of purposes. It might hedge against
changes in securities prices, or against changing interest rates.
Buying futures and call options would tend to increase the Fund's
exposure to the securities markets. Forward contracts can be used to
try to manage foreign currency risks on the Fund's foreign investments.
There are also special risks in particular hedging strategies. For example,
options trading involves the payment of premiums and can increase
portfolio turnover. If a covered call written by the Fund is exercised
on an investment that has increased in value, the Fund will be required
to sell the investment at the call price and will not be able to
realize any profit if the investment has increased in value above the
call price.
If the Sub-Advisor used a hedging instrument at the wrong time or judged
market conditions incorrectly, the hedge might fail and the strategy
could reduce the Fund's return. The Fund could also experience losses
if the prices of its futures and options positions were not correlated
with its other investments or if it could not close out a position
because of an illiquid market.
Portfolio Turnover. Although the Fund seeks long-term capital appreciation,
it may engage in active and frequent trading while trying to achieve
its objective. Portfolio turnover increases brokerage costs the Fund
pays (and may reduce performance), although the Sub-Advisor does not
expect turnover to be high. Additionally, securities trading can cause
the Fund to realize gains that are distributed to shareholders as
taxable distributions.
Temporary Defensive and Interim Investments. In times of adverse or unstable
market, economic or political conditions, the Fund can invest up to
100% of its assets in defensive securities which may be inconsistent
with the Fund's principal investment strategies. Temporary investments
may be inconsistent with the Fund's principal investment strategies.
Generally they would be cash equivalents (such as commercial paper in
the top two rating categories of national rating organizations), money
market instruments, short-term debt securities, U.S. government
securities, or repurchase agreements. They can also include other
investment-grade debt securities. The Fund might also hold these types
of securities pending the investment of proceeds from the sale of Fund
shares or portfolio securities or to meet anticipated redemptions of
Fund shares. To the extent the Fund invests in these securities, it
might not achieve its investment objective.
Commencement of Operations. At the date of this Prospectus the Fund is a new
fund, therefore the investment of its assets in accordance with its
investment objectives and policies will depend upon the availability of
the securities in which it will invest. The investment of the Fund's
total assets in its principal investments may take up to 30 days after
the Fund commences operations, and in the interim the Fund may invest a
substantial portion of its assets in short-term money market
obligations and other high-quality short-term debt securities.
How the Fund Is ManagedTHE MANAGER. The Manager handles the Fund's day-to-day business. The Manager
carries out its duties, subject to the policies established by the Fund's
Board of Trustees, under an investment advisory agreement that states the
Manager's responsibilities. The agreement sets the fees the Fund pays to the
Manager and describes the expenses that the Fund is responsible to pay to
conduct its business.
The Manager has been an investment advisor since January 1960. The
Manager and its subsidiaries and controlled affiliates managed more than $130
billion in assets as of June 30, 2003, including other Oppenheimer funds with
more than 7 million shareholder accounts. The Manager is located at 498
Seventh Avenue, New York, New York10018.
THE SUB-ADVISOR. The Sub-Advisor is a registered investment adviser and a
direct wholly owned subsidiary of the Manager. The Sub-Advisor supervises
the investment program for the Fund and chooses its investments. The
Sub-Advisor is located at 3401 Enterprise Parkway, Beachwood, Ohio44122.
The Sub-Advisor provides investment supervisory services on a discretionary
basis to individual accounts, investment companies, pension plans, insurance
company separate accounts, public funds and corporations. As of June 30,2003, the Sub-Advisor had approximately $2 billion of assets under management
Portfolio Manager. The portfolio manager of the Fund is Dixon Morgan, Jr.,
Senior Director and Portfolio Manager of the Sub-Advisor. Prior to
joining the Sub-Advisor in April 2000, Mr. Morgan was Managing Director
of International Investments and Portfolio Manager at Gratry and Co.
for eight years.
Advisory Fees. Under the investment advisory agreement, the Fund pays the
Manager an advisory fee at an annual rate that declines on additional
assets as the Fund grows: 0.85% of the first $500 million of average
annual net assets of the Fund, 0.75% of the next $500 million, and
0.70% of average annual net assets in excess of $1 billion.
Sub-Advisory Fees. The Manager, not the Fund, pays the Sub-Advisor an annual
fee under the Sub-Advisory Agreement between the Manager and the
Sub-Advisor. The fee is calculated as a percentage of the fee the Fund
pays the Manager. The Manager shall pay the Sub-Advisor a monthly fee
equal to 30% of the investment advisory fee collected by the Manager
from the Fund during that period.
ABOUT your account
Five classes of shares are described in this Prospectus. Currently, the Fund
only offers Class A shares for sale.
How to Buy Shares
You can buy shares several ways, as described below. The Fund's Distributor,
OppenheimerFunds Distributor, Inc., may appoint servicing agents to accept
purchase (and redemption) orders. The Distributor, in its sole discretion,
may reject any purchase order for the Fund's shares.
Buying Shares Through Your Dealer. You can buy shares through any dealer,
broker or financial institution that has a sales agreement with the
Distributor. Your dealer will place your order with the Distributor on
your behalf.
Buying Shares Through the Distributor. Complete an OppenheimerFunds New
Account Application and return it with a check payable to
"OppenheimerFunds Distributor, Inc." Mail it to P.O. Box 5270, Denver,
Colorado80217. If you don't list a dealer on the application, the
Distributor will act as your agent in buying the shares. However, we
recommend that you discuss your investment with a financial advisor
before you make a purchase to be sure that the Fund is appropriate for
you.
o Paying by Federal Funds Wire. Shares purchased through the Distributor
may be paid for by Federal Funds wire. The minimum investment is
$5,000. Before sending a wire, call the Distributor's Wire Department
at 1.800.225.5677 to notify the Distributor of the wire and to receive
further instructions.
o Buying Shares Through OppenheimerFunds AccountLink. With AccountLink,
you pay for shares by electronic funds transfers from your bank
account. Shares are purchased for your account by a transfer of money
from your bank account through the Automated Clearing House (ACH)
system. You can provide those instructions automatically, under an
Asset Builder Plan, described below, or by telephone instructions using
OppenheimerFunds PhoneLink, also described below. Please refer to
"AccountLink," below for more details.
o Buying Shares Through Asset Builder Plans. You may purchase shares of
the Fund automatically each month from your account at a bank or other
financial institution under an Asset Builder Plan with AccountLink.
Details are in the Asset Builder Application and the Statement of
Additional Information.
WHAT IS THE MINIMUM AMOUNT YOU MUST INVEST? In most cases, you can buy Fund
shares with a minimum initial investment of $25,000 and make additional
investments at any time with $5,000. There are reduced minimums available
under the following special investment plans:
o The minimum investment requirement does not apply to reinvesting
dividends from the Fund or other Oppenheimer funds (a list of them
appears in the Statement of Additional Information, or you can ask your
dealer or call the Transfer Agent), or reinvesting distributions from
unit investment trusts that have made arrangements with the Distributor.
AT WHAT PRICE ARE SHARES SOLD? Shares are sold at their offering price which
is the net asset value per share plus any initial sales charge that applies.
The offering price that applies to a purchase order is based on the next
calculation of the net asset value per share that is made after the
Distributor receives the purchase order at its offices in Colorado, or after
any agent appointed by the Distributor receives the order.
Net Asset Value. The Fund calculates the net asset value of each class of
shares as of the close of The New York Stock Exchange ("the Exchange"),
on each day the Exchange is open for trading (referred to in this
Prospectus as a "regular business day"). The Exchange normally closes
at 4:00 P.M., Eastern time, but may close earlier on some days. All
references to time in this Prospectus mean "Eastern time."
The net asset value per share 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. To determine net asset value, the
Fund's Board of Trustees has established procedures to value the Fund's
securities, in general, based on market value. The Board has adopted
special procedures for valuing illiquid and restricted securities and
obligations for which market values cannot be readily obtained. Because
some foreign securities trade in markets and on exchanges that operate
on weekends and U.S. holidays, the values of some of the Fund's foreign
investments may change on days when investors cannot buy or redeem Fund
shares.
If, after the close of the principal market on which a security held by
the Fund is traded, and before the time the Fund's securities are
priced that day, an event occurs that the Sub-Advisor deems likely to
cause a material change in the value of such security, the Fund's Board
of Trustees has authorized the Manager, subject to the Board's review,
to ascertain a fair value for such security. A security's valuation
may differ depending on the method used for determining value.
The Offering Price. To receive the offering price for a particular day, in
most cases the Distributor or its designated agent must receive your
order by the time the Exchange closes that day. If your order is
received on a day when the Exchange is closed or after it has closed,
the order will receive the next offering price that is determined after
your order is received.
Buying Through a Dealer. If you buy shares through a dealer, your dealer must
receive the order by the close of the Exchange and transmit it to the
Distributor so that it is received before the Distributor's close of
business on a regular business day (normally 5:00 P.M.) to receive that
day's offering price, unless your dealer has made alternative
arrangements with the Distributor. Otherwise, the order will receive
the next offering price that is determined.
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WHAT CLASSES OF SHARES DOES THE FUND OFFER? The Fund offers investors five
different classes of shares but currently only offers Class A shares for
sale. The different classes of shares represent investments in the same
portfolio of securities, but the classes are subject to different expenses
and will likely have different share prices. When you buy shares, be sure to
specify the class of shares. If you do not choose a class, your investment
will be made in Class A shares.
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Class A Shares. If you buy Class A shares, you pay an initial sales charge
(on investments up to $1 million for regular accounts or lesser amounts
for certain retirement plans). The amount of that sales charge will
vary depending on the amount you invest. The sales charge rates are
listed in "How Can You Buy Class A Shares?" below.
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Class B Shares. If you buy Class B shares, you pay no sales charge at the
time of purchase, but you will pay an annual asset-based sales charge.
If you sell your shares within 6 years of buying them, you will
normally pay a contingent deferred sales charge. That contingent
deferred sales charge varies depending on how long you own your shares,
as described in "How Can You Buy Class B Shares?" below.
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Class C Shares. If you buy Class C shares, you pay no sales charge at the
time of purchase, but you will pay an annual asset-based sales charge.
If you sell your shares within 12 months of buying them, you will
normally pay a contingent deferred sales charge of 1.0%, as described
in "How Can You Buy Class C Shares?" below.
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Class N Shares. If you buy Class N shares (available only through certain
retirement plans), you pay no sales charge at the time of purchase, but
you will pay an annual asset-based sales charge. If you sell your
shares within 18 months of the retirement plan's first purchase of
Class N shares, you may pay a contingent deferred sales charge of 1.0%,
as described in "How Can You Buy Class N Shares?" below.
Class Y Shares. Class Y shares are offered only to certain institutional
investors that have special agreements with the Distributor.
WHICH CLASS OF SHARES SHOULD YOU CHOOSE? Once you decide that the Fund is an
appropriate investment for you, the decision as to which class of shares is
best suited to your needs depends on a number of factors that you should
discuss with your financial advisor. Some factors to consider are how much
you plan to invest and how long you plan to hold your investment. If your
goals and objectives change over time and you plan to purchase additional
shares, you should re-evaluate those factors to see if you should consider
another class of shares. The Fund's operating costs that apply to a class of
shares and the effect of the different types of sales charges on your
investment will vary your investment results over time.
The discussion below is not intended to be investment advice or a
recommendation, because each investor's financial considerations are
different. The discussion below assumes that you will purchase only one class
of shares and not a combination of shares of different classes. Of course,
these examples are based on approximations of the effects of current sales
charges and expenses projected over time, and do not detail all of the
considerations in selecting a class of shares. You should analyze your
options carefully with your financial advisor before making that choice.
How Long Do You Expect to Hold Your Investment? While future financial needs
cannot be predicted with certainty, knowing how long you expect to hold
your investment will assist you in selecting the appropriate class of
shares. Because of the effect of class-based expenses, your choice will
also depend on how much you plan to invest. For example, the reduced
sales charges available for larger purchases of Class A shares may,
over time, offset the effect of paying an initial sales charge on your
investment, compared to the effect over time of higher class-based
expenses on shares of Class B, Class C or Class N. For retirement plans
that qualify to purchase Class N shares, Class N shares will generally
be more advantageous than Class B and Class C shares.
o Investing for the Shorter Term. While the Fund is meant to be a
long-term investment, if you have a relatively short-term investment
horizon (that is, you plan to hold your shares for not more than six
years), you should most likely invest in Class A or Class C shares
rather than Class B shares. That is because of the effect of the Class
B contingent deferred sales charge if you redeem within six years, as
well as the effect of the Class B asset-based sales charge on the
investment return for that class in the short-term. Class C shares
might be the appropriate choice (especially for investments of less
than $100,000), because there is no initial sales charge on Class C
shares, and the contingent deferred sales charge does not apply to
amounts you sell after holding them one year.
However, if you plan to invest more than $100,000 for the shorter term,
then as your investment horizon increases toward six years, Class C
shares might not be as advantageous as Class A shares. That is because
the annual asset-based sales charge on Class C shares will have a
greater impact on your account over the longer term than the reduced
front-end sales charge available for larger purchases of Class A
shares.
And for non-retirement plan investors who invest $1 million or more, in
most cases Class A shares will be the most advantageous choice, no
matter how long you intend to hold your shares. For that reason, the
Distributor normally will not accept purchase orders of $500,000 or
more of Class B shares or $1 million or more of Class C shares from a
single investor.
o Investing for the Longer Term. If you are investing less than $100,000
for the longer-term, for example for retirement, and do not expect to
need access to your money for seven years or more, Class B shares may
be appropriate.
Are There Differences in Account Features That Matter to You? Some account
features may not be available to Class B, Class C and Class N
shareholders. Other features may not be advisable (because of the
effect of the contingent deferred sales charge) for Class B, Class C
and Class N shareholders. Therefore, you should carefully review how
you plan to use your investment account before deciding which class of
shares to buy.
Additionally, the dividends payable to Class B, Class C and Class N
shareholders will be reduced by the additional expenses borne by those
classes that are not borne by Class A or Class Y shares, such as the
Class B, Class C and Class N asset-based sales charge described below
and in the Statement of Additional Information. Share certificates are
only available for Class A shares. If you are considering using your
shares as collateral for a loan, that may be a factor to consider.
How Do Share Classes Affect Payments to Your Broker? A financial advisor may
receive different compensation for selling one class of shares than for
selling another class. It is important to remember that Class B, Class
C and Class N contingent deferred sales charges and asset-based sales
charges have the same purpose as the front-end sales charge on sales of
Class A shares: to compensate the Distributor for concessions and
expenses it pays to dealers and financial institutions for selling
shares. The Distributor may pay additional compensation from its own
resources to securities dealers or financial institutions based upon
the value of shares of the Fund owned by the dealer or financial
institution for its own account or for its customers.
SPECIAL SALES CHARGE ARRANGEMENTS AND WAIVERS. Appendix C to the Statement of
Additional Information details the conditions for the waiver of sales charges
that apply in certain cases, and the special sales charge rates that apply to
purchases of shares of the Fund by certain groups, or under specified
retirement plan arrangements or in other special types of transactions. To
receive a waiver or special sales charge rate, you must advise the
Distributor when purchasing shares or the Transfer Agent when redeeming
shares that a special condition applies.
HOW CAN YOU BUY CLASS A SHARES? Class A shares are sold at their offering
price, which is normally net asset value plus an initial sales charge.
However, in some cases, described below, purchases are not subject to an
initial sales charge, and the offering price will be the net asset value. In
other cases, reduced sales charges may be available, as described below or in
the Statement of Additional Information. Out of the amount you invest, the
Fund receives the net asset value to invest for your account.
The sales charge varies depending on the amount of your purchase. A
portion of the sales charge may be retained by the Distributor or allocated
to your dealer as a concession. The Distributor reserves the right to reallow
the entire concession to dealers. The current sales charge rates and
concessions paid to dealers and brokers are as follows:
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Amount of Purchase Front-End Sales Front-End Sales Concession As
Charge As a
Charge As a Percentage of
Percentage of Net Percentage of
Offering Price Amount Invested Offering Price
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Less than $25,000 5.75% 6.10% 4.75%
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$25,000 or more but 5.50% 5.82% 4.75%
less than $50,000
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$50,000 or more but 4.75% 4.99% 4.00%
less than $100,000
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$100,000 or more but 3.75% 3.90% 3.00%
less than $250,000
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$250,000 or more but 2.50% 2.56% 2.00%
less than $500,000
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$500,000 or more but 2.00% 2.04% 1.60%
less than $1 million
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Can You Reduce Class A Sales Charges? You may be eligible to buy Class A
shares at reduced sales charge rates under the Fund's "Right of
Accumulation" or a Letter of Intent, as described in "Reduced SalesCharges" in the Statement of Additional Information.
Class A Contingent Deferred Sales Charge. There is no initial sales charge on
purchases of Class A shares of any one or more of the Oppenheimer funds
aggregating $1 million or more. Retirement plans are not permitted to
make initial purchases of Class A shares subject to a contingent
deferred sales charge. The Distributor pays dealers of record
concessions in an amount equal to 1.0% of purchases of $1 million or
more. The concession will not be paid on purchases of shares by
exchange or that were previously subject to a front-end sales charge
and dealer concession.
If you redeem any of those shares within an 18-month "holding period"
measured from the beginning of the calendar month of their purchase, a
contingent deferred sales charge (called the "Class A contingentdeferred sales charge") may be deducted from the redemption proceeds.
That sales charge will be equal to 1.0% of the lesser of:
o the aggregate net asset value of the redeemed shares at the time of
redemption (excluding shares purchased by reinvestment of dividends or
capital gain distributions) or
o the original net asset value of the redeemed shares.
The Class A contingent deferred sales charge will not exceed the
aggregate amount of the concessions the Distributor paid to your dealer
on all purchases of Class A shares of all Oppenheimer funds you made
that were subject to the Class A contingent deferred sales charge.
Purchases by Certain Retirement Plans. There is no initial sales charge on
purchases of Class A shares of any one or more Oppenheimer funds by
retirement plans that have $10 million or more in plan assets and that
have entered into a special agreement with the Distributor and by
retirement plans which are part of a retirement plan product or
platform offered by certain banks, broker-dealers, financial advisors,
insurance companies or recordkeepers which have entered into a special
agreement with the Distributor. The Distributor currently pays dealers
of record concessions in an amount equal to 0.25% of the purchase price
of Class A shares by those retirement plans from its own resources at
the time of sale, subject to certain exceptions as described in the
Statement of Additional Information. There is no contingent deferred
sales charge upon the redemption of such shares.
HOW CAN YOU BUY CLASS B SHARES? Class B shares are sold at net asset value
per share without an initial sales charge. However, if Class B shares are
redeemed within six years from the beginning of the calendar month of their
purchase, a contingent deferred sales charge will be deducted from the
redemption proceeds. The Class B contingent deferred sales charge is paid to
compensate the Distributor for its expenses of providing distribution-related
services to the Fund in connection with the sale of Class B shares.
The amount of the contingent deferred sales charge will depend on the
number of years since you invested and the dollar amount being redeemed,
according to the following schedule for the Class B contingent deferred sales
charge holding period:
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Years Since Beginning of Month in Contingent Deferred Sales Charge on
Which Purchase Order was Accepted Redemptions in That Year
(As % of Amount Subject to Charge)
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0 - 1 5.0%
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1 - 2 4.0%
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2 - 3 3.0%
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3 - 4 3.0%
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4 - 5 2.0%
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5 - 6 1.0%
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More than 6 None
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In the table, a "year" is a 12-month period. In applying the contingent
deferred sales charge, all purchases are considered to have been made on the
first regular business day of the month in which the purchase was made.
Automatic Conversion of Class B Shares. Class B shares automatically convert
to Class A shares 72 months after you purchase them. This conversion
feature relieves Class B shareholders of the asset-based sales charge
that applies to Class B shares under the Class B Distribution and
Service Plan, described below. The conversion is based on the relative
net asset value of the two classes, and no sales load or other charge
is imposed. When any Class B shares that you hold convert, any other
Class B shares that were acquired by reinvesting dividends and
distributions on the converted shares will also convert to Class A
shares. For further information on the conversion feature and its tax
implications, see "Class B Conversion" in the Statement of Additional
Information.
How Can you Buy Class C Shares? Class C shares are sold at net asset value
per share without an initial sales charge. However, if Class C shares are
redeemed within a holding period of 12 months from the beginning of the
calendar month of their purchase, a contingent deferred sales charge of 1.0%
will be deducted from the redemption proceeds. The Class C contingent
deferred sales charge is paid to compensate the Distributor for its expenses
of providing distribution-related services to the Fund in connection with the
sale of Class C shares.
HOW CAN YOU BUY CLASS N SHARES? Class N shares are offered for sale to
retirement plans (including IRAs and 403(b) plans) that purchase $500,000 or
more of Class N shares of one or more Oppenheimer funds or to group
retirement plans (which do not include IRAs and 403(b) plans) that have
assets of $500,000 or more or 100 or more eligible participants. See
"Availability of Class N shares" in the Statement of Additional Information
for other circumstances where Class N shares are available for purchase.
A contingent deferred sales charge of 1.0% will be imposed upon the
redemption of Class N shares, if:
o The group retirement plan is terminated or Class N shares of all
Oppenheimer funds are terminated as an investment option of the plan
and Class N shares are redeemed within 18 months after the plan's first
purchase of Class N shares of any Oppenheimer fund, or
o With respect to an IRA or 403(b) plan, Class N shares are redeemed
within 18 months of the plan's first purchase of Class N shares of any
Oppenheimer fund.
Retirement plans that offer Class N shares may impose charges on plan
participant accounts. The procedures for buying, selling, exchanging and
transferring the Fund's other classes of shares (other than the time those
orders must be received by the Distributor or Transfer Agent in Colorado) and
the special account features applicable to purchasers of those other classes
of shares described elsewhere in this Prospectus do not apply to Class N
shares offered through a group retirement plan. Instructions for buying,
selling, exchanging or transferring Class N shares offered through a group
retirement plan must be submitted by the plan, not by plan participants for
whose benefit the shares are held.
Who Can Buy Class Y Shares? Class Y shares are sold at net asset value per
share without a sales charge directly to institutional investors that have
special agreements with the Distributor for this purpose. They may include
insurance companies, registered investment companies and employee benefit
plans. Individual investors cannot buy Class Y shares directly.
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 the special account features
available to investors buying those other classes of shares do not apply to
Class Y shares. Instructions for buying, selling, exchanging or transferring
Class Y shares held by institutional investors must be submitted by the
institutional investor, not by its customers for whose benefit the shares are
held.
DISTRIBUTION AND SERVICE (12b-1) PLANS.
Service Plan for Class A Shares. The Fund has adopted a Service Plan for
Class A shares. It reimburses the Distributor for a portion of its
costs incurred for services provided to accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate of up to
0.25% of the average annual net assets of Class A shares of the Fund.
The Distributor currently uses all of those fees to pay dealers,
brokers, banks and other financial institutions quarterly for providing
personal service and maintenance of accounts of their customers that
hold Class A shares.
Distribution and Service Plans for Class B, Class C and Class N Shares. The
Fund has adopted Distribution and Service Plans for Class B, Class C
and Class N shares to pay the Distributor for its services and costs in
distributing Class B, Class C and Class N shares and servicing
accounts. Under the plans, the Fund pays the Distributor an annual
asset-based sales charge of 0.75% on Class B and Class C shares and
0.25% on Class N shares. The Distributor also receives a service fee of
0.25% per year under the Class B, Class C and Class N plans.
The asset-based sales charge and service fees increase Class B and
Class C expenses by 1.0% and increase Class N expenses by 0.50% of the
net assets per year of the respective class. Because these fees are
paid out of the Fund's assets on an on-going basis, over time these
fees will increase the cost of your investment and may cost you more
than other types of sales charges.
The Distributor uses the service fees to compensate dealers for
providing personal services for accounts that hold Class B, Class C or
Class N shares. The Distributor pays the 0.25% service fees to dealers
in advance for the first year after the shares are sold by the dealer.
After the shares have been held for a year, the Distributor pays the
service fees to dealers on a quarterly basis. The Distributor retains
the service fees for accounts for which it renders the required
personal services.
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 retains the Class B asset-based sales charge. See the
Statement of Additional Information for exceptions.
The Distributor currently pays a sales concession of 0.75% of the
purchase price of Class C shares to dealers from its own resources at
the time of sale. Including the advance of the service fee, the total
amount paid by the Distributor to the dealer at the time of sale of
Class C shares is therefore 1.0% of the purchase price. The Distributor
pays the asset-based sales charge as an ongoing concession to the
dealer on Class C shares that have been outstanding for a year or more.
See the Statement of Additional Information for exceptions.
The Distributor currently pays a sales concession of 0.75% of the
purchase price of Class N shares to dealers from its own resources at
the time of sale. Including the advance of the service fee, the total
amount paid by the Distributor to the dealer at the time of sale of
Class N shares is therefore 1.0% of the purchase price. The Distributor
retains the asset-based sales charge on Class N shares. See the
Statement of Additional Information for exceptions.
Special Investor Services
ACCOUNTLINK. You can use our AccountLink feature to link your Fund account
with an account at a U.S. bank or other financial institution. It must be an
Automated Clearing House (ACH) member. AccountLink lets you:
o transmit funds electronically to purchase shares by telephone (through
a service representative or by PhoneLink) or automatically under Asset
Builder Plans, or
o have the Transfer Agent send redemption proceeds or transmit dividends
and distributions directly to your bank account. Please call the
Transfer Agent for more information.
You may purchase shares by telephone only after your account has been
established. To purchase shares in amounts up to $250,000 through a telephone
representative, call the Distributor at 1.800.225.5677. The purchase payment
will be debited from your bank account.
AccountLink privileges should be requested on your Application or your
dealer's settlement instructions if you buy your shares through a dealer.
After your account is established, you can request AccountLink privileges by
sending signature-guaranteed instructions and proper documentation to the
Transfer Agent. AccountLink privileges will apply to each shareholder listed
in the registration on your account as well as to your dealer representative
of record unless and until the Transfer Agent receives written instructions
terminating or changing those privileges. After you establish AccountLink for
your account, any change of bank account information must be made by
signature-guaranteed instructions to the Transfer Agent signed by all
shareholders who own the account.
PHONELINK. PhoneLink is the OppenheimerFunds automated telephone system that
enables shareholders to perform a number of account transactions
automatically using a touch-tone phone. PhoneLink may be used on
already-established Fund accounts after you obtain a Personal Identification
Number (PIN), by calling the PhoneLink number, 1.800.225.5677.
Purchasing Shares. You may purchase shares in amounts up to $100,000 by
phone, by calling 1.800.225.5677. You must have established AccountLink
privileges to link your bank account with the Fund to pay for these
purchases.
Exchanging Shares. With the OppenheimerFunds Exchange Privilege, described
below, you can exchange shares automatically by phone from your Fund
account to another OppenheimerFunds account you have already
established by calling the special PhoneLink number.
Selling Shares. You can redeem shares by telephone automatically by calling
the PhoneLink number and the Fund will send the proceeds directly to
your AccountLink bank account. Please refer to "How to Sell Shares,"
below for details.
CAN YOU SUBMIT TRANSACTION REQUESTS BY FAX? You may send requests for certain
types of account transactions to the Transfer Agent by fax (telecopier).
Please call 1.800.225.5677 for information about which transactions may be
handled this way. Transaction requests submitted by fax are subject to the
same rules and restrictions as written and telephone requests described in
this Prospectus.
OPPENHEIMERFUNDS INTERNET WEBSITE. You can obtain information about the Fund,
as well as your account balance, on the OppenheimerFunds Internet website, at
www.oppenheimerfunds.com. Additionally, shareholders listed in the account
------------------------
registration (and the dealer of record) may request certain account
transactions through a special section of that website. To perform account
transactions or obtain account information online, you must first obtain a
user I.D. and password on that website. If you do not want to have Internet
account transaction capability for your account, please call the Transfer
Agent at 1.800.225.5677. At times, the website may be inaccessible or its
transaction features may be unavailable.
AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. The Fund has several plans that
enable you to sell shares automatically or exchange them to another
OppenheimerFunds account on a regular basis. Please call the Transfer Agent
or consult the Statement of Additional Information for details.
REINVESTMENT PRIVILEGE. If you redeem some or all of your Class A or Class B
shares of the Fund, you have up to six months to reinvest all or part of the
redemption proceeds in Class A shares of the Fund or other Oppenheimer funds
without paying a sales charge. This privilege applies only to Class A shares
that you purchased subject to an initial sales charge and to Class A or Class
B shares on which you paid a contingent deferred sales charge when you
redeemed them. This privilege does not apply to Class C, Class N or Class Y
shares. You must be sure to ask the Distributor for this privilege when you
send your payment.
RETIREMENT PLANS. You may buy shares of the Fund for your retirement plan
account. If you participate in a plan sponsored by your employer, the plan
trustee or administrator must buy the shares for your plan account. The
Distributor also offers a number of different retirement plans that
individuals and employers can use:
Individual Retirement Accounts (IRAs). These include regular IRAs, Roth IRAs,
SIMPLE IRAs and rollover IRAs.
SEP-IRAs. These are Simplified Employee Pension Plan IRAs for small business
owners or self-employed individuals.
403(b)(7) Custodial Plans. These are tax-deferred plans for employees of
eligible tax-exempt organizations, such as schools, hospitals and
charitable organizations.
401(k) Plans. These are special retirement plans for businesses.
Pension and Profit-Sharing Plans. These plans are designed for businesses and
self-employed individuals.
Please call the Distributor for OppenheimerFunds retirement plan
documents, which include applications and important plan information.
How to Sell Shares
You can sell (redeem) some or all of your shares on any regular business day.
Your shares will be sold at the next net asset value calculated after your
order is received in proper form (which means that it must comply with the
procedures described below) and is accepted by the Transfer Agent. The Fund
lets you sell your shares by writing a letter or by telephone. You can also
set up Automatic Withdrawal Plans to redeem shares on a regular basis. If you
have questions about any of these procedures, and especially if you are
redeeming shares in a special situation, such as due to the death of the
owner or from a retirement plan account, please call the Transfer Agent
first, at 1.800.225.5677, for assistance.
The Fund assesses a 2% fee on the proceeds of Fund shares that are
redeemed (either by selling or exchanging to another Oppenheimer fund) within
30 days of their purchase. The redemption fee is paid to the Fund, and is
intended to offset the trading costs, market impact and other costs
associated with short-term money movements in and out of the Fund. The
redemption fee is imposed to the extent that Fund shares redeemed exceed Fund
shares that have been held more than 30 days. For shares of the Fund acquired
by exchange, the holding period prior to the exchange is not considered in
determining whether to apply the redemption fee.
The redemption fee is not imposed on shares:
o held in certain omnibus accounts, including retirement plans qualified
under Sections 401(a) or 401(k) of the Internal Revenue Code, Section
403(b)(7) custodial plan accounts, or plans administered as college
savings programs under Section 529 of the Internal Revenue Code,
o redeemed under automatic withdrawal plans or pursuant to automatic
re-balancing in OppenheimerFunds Portfolio Builder accounts,
o redeemed due to death or disability of the shareholder, or
o redeemed from accounts for which the dealer, broker or financial
institution of record has entered into an agreement with the
Distributor for this purpose.
Certain Requests Require a Signature Guarantee. To protect you and the Fund
from fraud, the following redemption requests must be in writing and
must include a signature guarantee (although there may be other
situations that also require a signature guarantee):
o You wish to redeem more than $100,000 and receive a check
o The redemption check is not payable to all shareholders listed on the
account statement
o The redemption check is not sent to the address of record on your
account statement
o Shares are being transferred to a Fund account with a different owner
or name
o Shares are being redeemed by someone (such as an Executor) other than
the owners.
Where Can You Have Your Signature Guaranteed? The Transfer Agent will accept
a guarantee of your signature by a number of financial institutions,
including:
o a U.S. bank, trust company, credit union or savings association,
o a foreign bank that has a U.S. correspondent bank,
o a U.S. registered dealer or broker in securities, municipal securities
or government securities, or
o a U.S. national securities exchange, a registered securities
association or a clearing agency.
If you are signing on behalf of a corporation, partnership or other
business or as a fiduciary, you must also include your title in the
signature.
Retirement Plan Accounts. There are special procedures to sell shares in an
OppenheimerFunds retirement plan account. Call the Transfer Agent for a
distribution request form. Special income tax withholding requirements
apply to distributions from retirement plans. You must submit a
withholding form with your redemption request to avoid delay in getting
your money and if you do not want tax withheld. If your employer holds
your retirement plan account for you in the name of the plan, you must
ask the plan trustee or administrator to request the sale of the Fund
shares in your plan account.
HOW DO you SELL SHARES BY MAIL? Write a letter of instruction that includes:
o Your name
o The Fund's name
o Your Fund account number (from your account statement)
o The dollar amount or number of shares to be redeemed
o Any special payment instructions
o Any share certificates for the shares you are selling
o The signatures of all registered owners exactly as the account is
registered, and
o Any special documents requested by the Transfer Agent to assure proper
authorization of the person asking to sell the shares.
Use the following address for Send courier or express mail
requests by mail: requests to:
OppenheimerFunds Services OppenheimerFunds Services
P.O. Box 5270 10200 E. Girard Avenue, Building D
Denver, Colorado80217Denver, Colorado80231
HOW DO you SELL SHARES BY TELEPHONE? You and your dealer representative of
record may also sell your shares by telephone. To receive the redemption
price calculated on a particular regular business day, your call must be
received by the Transfer Agent by the close of the Exchange that day, which
is normally 4:00 P.M., but may be earlier on some days. You may not redeem
shares held in an OppenheimerFunds retirement plan account or under a share
certificate by telephone.
o To redeem shares through a service representative or automatically on
PhoneLink, call 1.800.225.5677.
Whichever method you use, you may have a check sent to the address on
the account statement, or, if you have linked your Fund account to your bank
account on AccountLink, you may have the proceeds sent to that bank account.
Are There Limits on Amounts Redeemed by Telephone?
Telephone Redemptions Paid by Check. Up to $100,000 may be redeemed by
telephone in any seven-day period. The check must be payable to all
owners of record of the shares and must be sent to the address on the
account statement. This service is not available within 30 days of
changing the address on an account.
Telephone Redemptions Through AccountLink. There are no dollar limits on
telephone redemption proceeds sent to a bank account designated when
you establish AccountLink. Normally the ACH transfer to your bank is
initiated on the business day after the redemption. You do not receive
dividends on the proceeds of the shares you redeemed while they are
waiting to be transferred.
If you have requested Federal Funds wire privileges for your account,
the wire of the redemption proceeds will normally be transmitted on the
next bank business day after the shares are redeemed. There is a
possibility that the wire may be delayed up to seven days to enable the
Fund to sell securities to pay the redemption proceeds. No dividends
are accrued or paid on the proceeds of shares that have been redeemed
and are awaiting transmittal by wire.
CAN YOU SELL SHARES THROUGH your DEALER? The Distributor has made
arrangements to repurchase Fund shares from dealers and brokers on behalf of
their customers. Brokers or dealers may charge for that service. If your
shares are held in the name of your dealer, you must redeem them through your
dealer.
HOW CONTINGENT DEFERRED SALES CHARGES AFFECT REDEMPTIONS. If you purchase
shares subject to a Class A, Class B, Class C or Class N contingent deferred
sales charge and redeem any of those shares during the applicable holding
period for the class of shares, the contingent deferred sales charge will be
deducted from the redemption proceeds (unless you are eligible for a waiver
of that sales charge based on the categories listed in Appendix C to the
Statement of Additional Information and you advise the Transfer Agent of your
eligibility for the waiver when you place your redemption request.)
A contingent deferred sales charge will be based on the lesser of the
net asset value of the redeemed shares at the time of redemption or the
original net asset value. A contingent deferred sales charge is not imposed
on:
o the amount of your account value represented by an increase in net
asset value over the initial purchase price,
o shares purchased by the reinvestment of dividends or capital gains
distributions, or
o shares redeemed in the special circumstances described in Appendix C to
the Statement of Additional Information.
To determine whether a contingent deferred sales charge applies to a
redemption, the Fund redeems shares in the following order:
1. shares acquired by reinvestment of dividends and capital gains
distributions,
2. shares held for the holding period that applies to the class, and
3. shares held the longest during the holding period.
Contingent deferred sales charges are not charged when you exchange
shares of the Fund for shares of other Oppenheimer funds. However, if you
exchange them within the applicable contingent deferred sales charge holding
period, the holding period will carry over to the fund whose shares you
acquire. Similarly, if you acquire shares of this Fund by exchanging shares
of another Oppenheimer fund that are still subject to a contingent deferred
sales charge holding period, that holding period will carry over to this Fund.
How to Exchange Shares
Shares of the Fund may be exchanged for shares of certain Oppenheimer funds
at net asset value per share at the time of exchange, without sales charge.
Shares of the Fund can be purchased by exchange of shares of other
Oppenheimer funds on the same basis. To exchange shares, you must meet
several conditions:
o Shares of the fund selected for exchange must be available for sale in
your state of residence.
o The prospectuses of both funds must offer the exchange privilege.
o You must hold the shares you buy when you establish your account for at
least seven days before you can exchange them. After the account is
open seven days, you can exchange shares every regular business day.
o You must meet the minimum purchase requirements for the fund whose
shares you purchase by exchange.
o Before exchanging into a fund, you must obtain and read its prospectus.
Shares of a particular class of the Fund may be exchanged only for
shares of the same class in the other Oppenheimer funds. For example, you can
exchange Class A shares of this Fund only for Class A shares of another fund.
In some cases, sales charges may be imposed on exchange transactions. For
tax purposes, exchanges of shares involve a sale of the shares of the fund
you own and a purchase of the shares of the other fund, which may result in a
capital gain or loss. Please refer to "How to Exchange Shares" in the
Statement of Additional Information for more details.
You can find a list of Oppenheimer funds currently available for
exchanges in the Statement of Additional Information or obtain one by calling
a service representative at 1.800.225.5677. That list can change from time to
time.
HOW DO you SUBMIT EXCHANGE REQUESTS? Exchanges may be requested in writing or
by telephone:
Written Exchange Requests. Submit an OppenheimerFunds Exchange Request form,
signed by all owners of the account. Send it to the Transfer Agent at
the address on the back cover. Exchanges of shares held under
certificates cannot be processed unless the Transfer Agent receives the
certificates with the request.
Telephone Exchange Requests. Telephone exchange requests may be made either
by calling a service representative or by using PhoneLink for automated
exchanges by calling 1.800.225.5677. Telephone exchanges may be made
only between accounts that are registered with the same name(s) and
address. Shares held under certificates may not be exchanged by
telephone.
ARE THERE LIMITATIONS ON EXCHANGES? There are certain exchange policies you
should be aware of:
o Shares are redeemed from one fund and purchased from the other fund in
the exchange transaction on the same regular business day on which the
Transfer Agent receives an exchange request that conforms to the
policies described above. It must be received by the close of the
Exchange that day, which is normally 4:00 P.M. but may be earlier on
some days.
o The interests of the Fund's long-term shareholders and its ability to
manage its investments may be adversely affected when its shares are
repeatedly bought and sold in response to short-term market
fluctuations--also known as "market timing." When large dollar amounts
are involved, the Fund may have difficulty implementing long-term
investment strategies, because it cannot predict how much cash it will
have to invest. Market timing also may force the Fund to sell portfolio
securities at disadvantageous times to raise the cash needed to buy a
market timer's Fund shares. These factors may hurt the Fund's
performance and its shareholders. When the Manager believes frequent
trading would have a disruptive effect on the Fund's ability to manage
its investments, the Manager and the Fund may reject purchase orders
and exchanges into the Fund by any person, group or account that the
Manager believes to be a market o timer. All accounts under common
ownership or control within the Oppenheimer funds complex may be
counted together for purposes of determining market timing with respect
to any exchange involving this Fund.
o The Fund may amend, suspend or terminate the exchange privilege at any
time. The Fund is currently not obligated to provide notice before
rejecting an exchange order.
o If the Transfer Agent cannot exchange all the shares you request
because of a restriction cited above, only the shares eligible for
exchange will be exchanged.
o The Fund assesses a 2% fee on the proceeds of Fund shares that are
redeemed (either by selling or exchanging to another Oppenheimer fund)
within 30 days of their purchase. Further details are set forth
following the first paragraph under "How to Sell Shares" on page 22.
Shareholder Account Rules and Policies
More information about the Fund's policies and procedures for buying, selling
and exchanging shares is contained in the Statement of Additional Information.
A $12 annual fee is assessed on any account valued at less than $500. The fee
is automatically deducted from accounts annually on or about the second
to last business day of September. See the Statement of Additional
Information, or visit the OppenheimerFunds website, to learn how you
can avoid this fee and for circumstances when this fee will not be
assessed.
The offering of shares may be suspended during any period in which the
determination of net asset value is suspended, and the offering may be
suspended by the Board of Trustees at any time the Board believes it is
in the Fund's best interest to do so.
Telephone transaction privileges for purchases, redemptions or exchanges may
be modified, suspended or terminated by the Fund at any time. The Fund
will provide you notice whenever it is required to do so by applicable
law. If an account has more than one owner, the Fund and the Transfer
Agent may rely on the instructions of any one owner. Telephone
privileges apply to each owner of the account and the dealer
representative of record for the account unless the Transfer Agent
receives cancellation instructions from an owner of the account.
The Transfer Agent will record any telephone calls to verify data concerning
transactions and has adopted other procedures to confirm that telephone
instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by
confirming such transactions in writing. The Transfer Agent and the
Fund will not be liable for losses or expenses arising out of telephone
instructions reasonably believed to be genuine.
Redemption or transfer requests will not be honored until the Transfer Agent
receives all required documents in proper form. From time to time, the
Transfer Agent in its discretion may waive certain of the requirements
for redemptions stated in this Prospectus.
Dealers that perform account transactions for their clients by participating
in NETWORKING through the National Securities Clearing Corporation are
responsible for obtaining their clients' permission to perform those
transactions, and are responsible to their clients who are shareholders
of the Fund if the dealer performs any transaction erroneously or
improperly.
The redemption price for shares will vary from day to day because the value
of the securities in the Fund's portfolio fluctuates. The redemption
price, which is the net asset value per share, will normally differ for
each class of shares. The redemption value of your shares may be more
or less than their original cost.
Payment for redeemed shares ordinarily is made in cash. It is forwarded by
check, or through AccountLink within seven days after the Transfer
Agent receives redemption instructions in proper form. However, under
unusual circumstances determined by the Securities and Exchange
Commission, payment may be delayed or suspended. For accounts
registered in the name of a broker-dealer, payment will normally be
forwarded within three business days after redemption.
The Transfer Agent may delay processing any type of redemption payment as
described under "How to Sell Shares" for recently purchased shares, but
only until the purchase payment has cleared. That delay may be as much
as 10 days from the date the shares were purchased. That delay may be
avoided if you purchase shares by Federal Funds wire or certified
check, or arrange with your bank to provide telephone or written
assurance to the Transfer Agent that your purchase payment has cleared.
Involuntary redemptions of small accounts may be made by the Fund if the
account value has fallen below $200 for reasons other than the fact
that the market value of shares has dropped. In some cases, involuntary
redemptions may be made to repay the Distributor for losses from the
cancellation of share purchase orders.
Shares may be "redeemed in kind" under unusual circumstances (such as a lack
of liquidity in the Fund's portfolio to meet redemptions). This means
that the redemption proceeds will be paid with liquid securities from
the Fund's portfolio. If redemptions are paid in-kind, shareholders
will incur transaction costs when, and will bear market risk until such
time as, securities received in-kind are converted into cash. However,
the Fund has made an election which requires it to pay a certain
portion of redemption proceeds in cash. See the section entitled
"Payments in-Kind" in the Statement of Additional Information for more
information.
"Backup withholding" of federal income tax may be applied against taxable
dividends, distributions and redemption proceeds (including exchanges)
if you fail to furnish the Fund your correct, certified Social Security
or Employer Identification Number when you sign your application, or if
you under-report your income to the Internal Revenue Service.
To avoid sending duplicate copies of materials to households, the Fund will
mail only one copy of each prospectus, annual and semi-annual report
and annual notice of the Fund's privacy policy to shareholders having
the same last name and address on the Fund's records. The consolidation
of these mailings, called householding, benefits the Fund through
reduced mailing expense.
If you want to receive multiple copies of these materials, you may call
the Transfer Agent at 1.800.225.5677. You may also notify the Transfer
Agent in writing. Individual copies of prospectuses, reports and
privacy notices will be sent to you commencing within 30 days after the
Transfer Agent receives your request to stop householding.
Dividends, Capital Gains and Taxes
Dividends. The Fund intends to declare dividends separately for each class of
shares from net investment income on an annual basis and to pay them to
shareholders in December on a date selected by the Board of Trustees.
Dividends and distributions paid to Class A and Class Y shares will generally
be higher than dividends for Class B, Class C and Class N shares, which
normally have higher expenses than Class A and Class Y shares. The Fund has
no fixed dividend rate and cannot guarantee that it will pay any dividends or
distributions.
Capital Gains. The Fund may realize capital gains on the sale of portfolio
securities. If it does, it may make distributions out of any net short-term
or long-term capital gains in December of each year. The Fund may make
supplemental distributions of dividends and capital gains following the end
of its fiscal year. There can be no assurance that the Fund will pay any
capital gains distributions in a particular year.
WHAT CHOICES DO YOU HAVE FOR RECEIVING DISTRIBUTIONS? When you open your
account, specify on your application how you want to receive your dividends
and distributions. You have four options:
Reinvest All Distributions in the Fund. You can elect to reinvest all
dividends and capital gains distributions in additional shares of the
Fund.
Reinvest Dividends or Capital Gains. You can elect to reinvest some
distributions (dividends, short-term capital gains or long-term capital
gains distributions) in the Fund while receiving the other types of
distributions by check or having them sent to your bank account through
AccountLink.
Receive All Distributions in Cash. You can elect to receive a check for all
dividends and capital gains distributions or have them sent to your
bank through AccountLink.
Reinvest Your Distributions in Another OppenheimerFunds Account. You can
reinvest all distributions in the same class of shares of another
OppenheimerFunds account you have established.
TAXES. If your shares are not held in a tax-deferred retirement account, you
should be aware of the following tax implications of investing in the Fund.
Distributions are subject to federal income tax and may be subject to state
or local taxes. Dividends paid from short-term capital gains and net
investment income are taxable as ordinary income. Long-term capital gains are
taxable as long-term capital gains when distributed to shareholders. It does
not matter how long you have held your shares. Whether you reinvest your
distributions in additional shares or take them in cash, the tax treatment is
the same.
If more than 50% of the Fund's assets are invested in foreign
securities at the end of any fiscal year, the Fund may elect under the
Internal Revenue Code to permit shareholders to take a credit or deduction on
their federal income tax returns for foreign taxes paid by the Fund.
Every year the Fund will send you and the IRS a statement showing the
amount of any taxable distribution you received in the previous year. Any
long-term capital gains will be separately identified in the tax information
the Fund sends you after the end of the calendar year.
Avoid "Buying a Dividend." 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.
Remember, There May be Taxes on Transactions. Because the Fund's share prices
fluctuate, you may have a capital gain or loss when you sell or
exchange your shares. A capital gain or loss is the difference between
the price you paid for the shares and the price you received when you
sold them. Any capital gain is subject to capital gains tax.
Returns of Capital Can Occur. In certain cases, distributions made by the
Fund may be considered a non-taxable return of capital to shareholders.
If that occurs, it will be identified in notices to shareholders.
This information is only a summary of certain federal income tax
information about your investment. You should consult with your tax advisor
about the effect of an investment in the Fund on your particular tax
situation.
INFORMATION AND SERVICES
For More Information on International Large-Cap Core Fund
The following additional information about the Fund is available without
charge upon request:
STATEMENT OF ADDITIONAL INFORMATION. This document includes additional
information about the Fund's investment policies, risks, and operations. It
is incorporated by reference into this Prospectus (which means it is legally
part of this Prospectus).
ANNUAL AND SEMI-ANNUAL REPORTS. Additional information about the Fund's
investments and performance will be available in the Fund's Annual and
Semi-Annual Reports to shareholders. The Annual Report will include a
discussion of market conditions and investment strategies that significantly
affected the Fund's performance during its last fiscal year.
How to Get More Information
You can request the Statement of Additional Information, the Annual and
Semi-Annual Reports, the notice explaining the Fund's privacy policy and
other information about the Fund or your account:
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By Telephone: Call OppenheimerFunds Services toll-free:
1.800.CALL OPP (225.5677)
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By Mail: Write to:
OppenheimerFunds Services
P.O. Box 5270
Denver, Colorado80217-5270
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On the Internet: You can send us a request by e-mail or read or
down-load documents on the OppenheimerFunds
website: 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 1.202.942.8090. Reports and other information
about the Fund are available on the EDGAR database on the SEC's Internet
website at www.sec.gov. Copies may be obtained after payment of a duplicating
-----------
fee by electronic request at the SEC's e-mail address: publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, D.C. 20549-0102.
No one has been authorized to provide any information about the Fund or to
make any representations about the Fund other than what is contained in this
Prospectus. This Prospectus is not an offer to sell shares of the Fund, nor a
solicitation of an offer to buy shares of the Fund, to any person in any
state or other jurisdiction where it is unlawful to make such an offer.
The Fund's shares are distributed by: [logo] OppenheimerFunds
Distributor, Inc.
The Fund's SEC File No. 811-21370
PR0635.001.0803
Printed on recycled paper
Oppenheimer International Large-Cap Core Fund
6803 South Tucson Way, Centennial, Colorado80112-3924
1.800.CALL OPP (225.5677)
Statement of Additional Information dated August 11, 2003
This Statement of Additional Information is not a prospectus. This document
contains additional information about the Fund and supplements information in
the Prospectus dated August 11, 2003. 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, Colorado80217, by calling
the Transfer Agent at the toll-free number shown above, or by downloading it
from the OppenheimerFunds Internet website at www.oppenheimerfunds.com.
Contents Page
About the Fund
Additional Information about the Fund's Investment Policies and Risks...
The Fund's Investment Policies.......................................
Other Investment Techniques and Strategies...........................
Other Investment Restrictions........................................
How the Fund is Managed.................................................
Organization and History.............................................
Board of Trustees and Oversight Committees...........................
Trustees and Officers of the Fund....................................
The Manager..........................................................
Brokerage Policies of the Fund..........................................
Distribution and Service Plans..........................................
Performance of the Fund.................................................
About Your AccountHow To Buy Shares.......................................................
How To Sell Shares......................................................
How To Exchange Shares..................................................
Dividends, Capital Gains and Taxes......................................
Additional Information About the Fund...................................
Financial Information About the Fund
Independent Auditors' Report............................................
Financial Statements ...................................................
Appendix A: Ratings Definitions.........................................A-1
Appendix B: Industry Classifications....................................B-1
Appendix C: OppenheimerFunds Special Sales Charge Arrangements and Waivers:C-1
ABOUT The FUnd
Additional Information About the Fund's Investment Policies and Risks
The investment objective, the principal investment policies and the main
risks of the Fund are described in the Prospectus. The Prospectus also
describes certain non-principal investment strategies and risks. This
Statement of Additional Information contains supplemental information about
those policies and risks and the types of securities that the Fund's
investment Manager, OppenheimerFunds, Inc. (the "Manager"), and the Fund's
Sub-Advisor OFI Institutional Asset Management, Inc. (the "Sub-Advisor") can
select for the Fund. Additional information is also provided about other
strategies that the Fund may use to try to achieve its objective.
The Fund's Investment Policies. The composition of the Fund's holdings and
the techniques and strategies that the Fund's Sub-Advisor, may use in
selecting portfolio securities will vary over time. The Fund is not required
to use the investment techniques and strategies described below at all times
in seeking its goal. It may use some of the special investment techniques and
strategies at some times or not at all.
|X| Investments in Stocks and Other Equity Securities. The Fund
focuses its investments in common stocks of foreign companies using either a
growth or value strategy, but it can invest in other equity securities.
Equity securities include common stocks, preferred stocks, rights and
warrants, and securities convertible into common stock.
Current income is not a criterion used to select portfolio securities.
However, certain debt securities can be selected for the Fund's portfolio for
defensive purposes. The Fund can also buy debt securities that the
Sub-Advisor believes might offer some opportunities for capital appreciation
when stocks are disfavored, including convertible securities as discussed
below.
|X| Convertible Securities. Convertible securities are debt
securities that are convertible into an issuer's common stock. Convertible
securities rank senior to common stock in a corporation's capital structure
and therefore are subject to less risk than common stock in case of the
issuer's bankruptcy or liquidation.
The value of a convertible security is a function of its "investment
value" and its "conversion value." If the investment value exceeds the
conversion value, the security will behave more like a debt security, and the
security's price will likely increase when interest rates fall and decrease
when interest rates rise. If the conversion value exceeds the investment
value, the security will behave more like an equity security: it will likely
sell at a premium over its conversion value, and its price will tend to
fluctuate directly with the price of the underlying security. Convertible
securities are subject to credit risks and interest rate risk as discussed
below under "Investing in Debt Securities."
While many convertible securities are a form of debt security, in some
cases their conversion feature (allowing conversion into equity securities)
causes the Sub-Advisor to regard them more as "equity equivalents." In those
cases, the credit rating assigned to the security has less impact on the
Sub-Advisor's investment decision than in the case of non-convertible fixed
income securities. To determine whether convertible securities should be
regarded as "equity equivalents," the Sub-Advisor examines the following
factors:
(1) whether, at the option of the investor, the convertible security can be
exchanged for a fixed number of shares of common stock of the
issuer,
(2) whether the issuer of the convertible securities has restated its
earnings per share of common stock on a fully diluted basis
(considering the effect of conversion of the convertible
securities), and
(3) the extent to which the convertible security may be a defensive "equity
substitute," providing the ability to participate in any
appreciation in the price of the issuer's common stock.
|X| Rights and Warrants. The Fund can invest up to 5% of its total
assets in warrants or rights. That 5% limit does not apply to warrants and
rights the Fund has acquired as part of units of securities or that are
attached to other securities that the Fund buys.
Warrants basically are options to purchase equity securities at
specific prices valid for a specific period of time. Their prices do not
necessarily move parallel to the prices of the underlying securities. Rights
are similar to warrants, but normally have a short duration and are
distributed directly by the issuer to its shareholders. Rights and warrants
have no voting rights, receive no dividends and have no rights with respect
to the assets of the issuer.
|X| Preferred Stocks. Preferred stocks are equity securities
but have certain attributes of debt securities. Preferred stock, unlike
common stock, has a stated dividend rate payable from the corporation's
earnings. Preferred stock dividends may be cumulative or non-cumulative,
participating, or auction rate. "Cumulative" dividend provisions require all
or a portion of prior unpaid dividends to be paid before the issuer can pay
dividends on common shares.
If interest rates rise, the fixed dividend on preferred stocks may be
less attractive, causing the price of preferred stocks to decline. Preferred
stocks may have mandatory sinking fund provisions, as well as provisions for
their call or redemption prior to maturity which can have a negative effect
on their prices when interest rates prior to maturity rates decline.
Preferred stock may be "participating" stock, which means that it may be
entitled to a dividend exceeding the stated dividend in certain cases.
Preferred stocks are equity securities because they do not constitute a
liability of the issuer and therefore do not offer the same degree of
protection of capital as debt securities and may not offer the same degree of
assurance of continued income as debt securities. The rights of preferred
stock on distribution of a corporation's assets in the event of its
liquidation are generally subordinate to the rights associated with a
corporation's debt securities. Preferred stock generally has a preference
over common stock on the distribution of a corporation's assets in the event
of its liquidation.
|X| Foreign Securities. "Foreign securities" include equity and debt
securities of companies organized under the laws of countries other than the
United States and of governments other than the U.S. government. "Foreignsecurities" also include securities of companies (including those that are
located in the U.S. or organized under U.S. law) that derive a significant
portion of their revenue or profits from foreign businesses, investments or
sales, or that have a significant portion of their assets abroad. Those
securities may be traded on foreign securities exchanges or in the foreign
over-the-counter markets.
Securities of foreign issuers that are represented by American
Depository Receipts or that are listed on a U.S. securities exchange or
traded in the U.S. over-the-counter markets, and foreign currencies, are
considered "foreign securities" for the purpose of the Fund's investment
allocations. They are subject to some of the special considerations and
risks, discussed below, that apply to foreign securities traded and held
abroad.
The amount of the Fund's assets invested in securities of issuers in a
particular country will vary over time, based upon the Sub-Advisor's
evaluation of the investment merits of particular issuers as well as the
market and economic conditions in a particular country or region. Factors
that might be considered could include, for example, a country's balance of
payments, inflation rate, economic self-sufficiency, and social and political
factors.
Because the Fund may purchase securities denominated in foreign
currencies, a change in the value of such foreign currency against the U.S.
dollar will result in a change in the amount of income the Fund has available
for distribution. Because a portion of the Fund's investment income may be
received in foreign currencies, the Fund will be required to compute its
income in U.S. dollars for distribution to shareholders, and therefore the
Fund will absorb the cost of currency fluctuations. After the Fund has
distributed income, subsequent foreign currency losses may result in the
Fund's having distributed more income in a particular fiscal period that was
available from investment income, which could result in a return of capital
to shareholders.
Investing in foreign securities offers potential benefits not available
from investing solely in securities of domestic issuers. They include the
opportunity to invest in foreign issuers that appear to offer growth
potential, or in foreign countries with economic policies or business cycles
different from those of the U.S., or to reduce fluctuations in portfolio
value by taking advantage of foreign stock markets that do not move in a
manner parallel to U.S. markets.
o Risks of Foreign Investing. Investments in foreign securities may
offer special opportunities for investing but also present special additional
risks and considerations not typically associated with investments in
domestic securities. Some of these additional risks are:
o reduction of income by foreign taxes;
o fluctuation in value of foreign investments due to changes in currency
rates or currency control regulations (for example,
currency blockage);
o transaction charges for currency exchange;
o lack of public information about foreign issuers;
o lack of uniform accounting, auditing and financial reporting standards
in foreign countries comparable to those applicable to
domestic issuers;
o less volume on foreign exchanges than on U.S. exchanges;
o greater volatility and less liquidity on foreign markets than in the
U.S.;
o less governmental regulation of foreign issuers, stock exchanges and
brokers than in the U.S.;
o foreign exchange contracts;
o greater difficulties in commencing lawsuits;
o higher brokerage commission rates than in the U.S.;
o increased risks of delays in settlement of portfolio transactions or
loss of certificates for portfolio securities;
o foreign withholding taxes on interest and dividends;
o possibilities in some countries of expropriation, nationalization,
confiscatory taxation, political, financial or social
instability or adverse diplomatic developments; and
o unfavorable differences between the U.S. economy and foreign economies.
In the past, U.S. government policies have discouraged certain
investments abroad by U.S. investors, through taxation or other restrictions,
and it is possible that such restrictions could be re-imposed.
Special Risks of Emerging Markets. The Fund primarily invests in
developed markets, but may invest in emerging markets. Emerging and
developing markets abroad may also offer special opportunities for investing
but have greater risks than more developed foreign markets, such as those in
Europe, Canada, Australia, New Zealand and Japan. There may be even less
liquidity in their securities markets, and settlements of purchases and sales
of securities may be subject to additional delays. They are subject to
greater risks of limitations on the repatriation of income and profits
because of currency restrictions imposed by local governments. Those
countries may also be subject to the risk of greater political and economic
instability, which can greatly affect the volatility of prices of securities
in those countries.
o Passive Foreign Investment Companies. The Fund may purchase the
securities of certain foreign investment corporations called passive foreign
investment companies ("PFICs"). Such entities have been the only or primary
way to invest in certain countries because some foreign countries limit, or
prohibit, all direct foreign investment in the securities of companies
domiciled therein. However, the governments of some countries have authorized
the organization of investment funds to permit indirect foreign investment in
such securities. For tax purposes, these funds also may be PFICs.
The Fund is subject to certain percentage limitations under the
Investment Company Act of 1940 (the "Investment Company Act") relating to the
purchase of securities of investment companies, and, consequently, the Fund
may have to subject any of its investment in other investment companies,
including PFICs, to the limitation that no more than 10% of the value of the
Fund's total assets may be invested in such securities. In addition to
bearing their proportionate share of a fund's expenses (management fees and
operating expenses), shareholders will also indirectly bear similar expenses
of such entities. Like other foreign securities, interests in PFICs also
involve the risk of foreign securities, as described above.
|X| Portfolio Turnover. "Portfolio turnover" describes the rate at which
the Fund traded its portfolio securities during its last fiscal year. For
example, if a fund sold all of its securities during the year, its portfolio
turnover rate would have been 100%. The Fund's portfolio turnover
rate will fluctuate from year to year, depending on market conditions. The
Fund does not expect to have a portfolio turnover rate of more than 100%
annually. Increased portfolio turnover creates higher brokerage and
transaction costs for the Fund, which may reduce its overall performance.
Additionally, the realization of capital gains from selling portfolio
securities may result in distributions of taxable long-term capital gains to
shareholders, since the Fund will normally distribute all of its capital
gains realized each year, to avoid excise taxes under the Internal Revenue
Code.
Other Investment Techniques and Strategies. In seeking its objective, the
Fund may from time to time use the types of investment strategies and
investments described below. It is not required to use all of these
strategies at all times and at times may not use them.
|X| Investing in Small, Unseasoned Companies. The Fund invests primarily
in large-cap companies. The Manager and Sub-Advisor do not expect to normally
to invest in small-capitalization or mid-capitalization companies in any
significant amounts. However, the Fund can invest in securities of small,
unseasoned companies. These are companies that have been in operation for
less than three years, including the operations of any predecessors.
Securities of these companies may be subject to volatility in their prices.
They might have a limited trading market, which could adversely affect the
Fund's ability to dispose of them and can reduce the price the Fund might be
able to obtain for them. Other investors that own a security issued by a
small, unseasoned issuer for which there is limited liquidity might trade the
security when the Fund is attempting to dispose of its holdings of that
security. In that case the Fund might receive a lower price for its holdings
than might otherwise be obtained.
|X| Investing in Debt Securities. While the Fund does not invest for the
purpose of seeking current income, at times the Fund can invest in debt
securities, including the convertible debt securities described above under
the description of equity investments. Debt securities also can be selected
for investment by the Fund for defensive purposes, as described below. For
example, when the stock market is volatile, or when the portfolio manager
believes that growth opportunities in stocks are not attractive, certain debt
securities might provide not only offer defensive opportunities but also some
opportunities for capital appreciation.
The Fund's debt investments can include corporate bonds and notes of
foreign or U.S. companies, as well as U.S. and foreign government securities.
It is not expected that this will be a significant portfolio strategy of the
Fund under normal market circumstances, and the Fund normally does not intend
to invest more than 5% of its total assets in debt securities. Foreign debt
securities are subject to the risks of foreign investing described above. In
general, domestic and foreign fixed- income securities are also subject to
two additional types of risk: credit risk and interest rate risk.
o Credit Risk. Credit risk relates to the ability of the issuer to meet
interest or principal payments or both as they become due. For lower-grade
debt securities here is a greater risk that the issuer may default on its
obligation to pay interest or to repay principal than in the case of
investment grade securities. The issuer's low creditworthiness may increase
the potential for its insolvency. An overall decline in values in the high
yield bond market is also more likely during a period of a general economic
downturn. An economic downturn or an increase in interest rates could
severely disrupt the market for high yield bonds, adversely affecting the
values of outstanding bonds as well as the ability of issuers to pay interest
or repay principal. In the case of foreign high yield bonds, these risks are
in addition to the special risks of foreign investing discussed in the
Prospectus and in this Statement of Additional Information.
However, the Fund's limitations on buying these investments may reduce
the risks to the Fund, as will the Fund's policy of diversifying its
investments. Additionally, to the extent they can be converted into stock,
convertible securities may be less subject to some of these risks than
non-convertible high yield bonds, since stock may be more liquid and less
affected by some of these risk factors.
o Interest Rate Risk. Interest rate risk refers to the fluctuations in
value of fixed-income securities resulting from the inverse relationship
between price and yield. For example, an increase in general interest rates
will tend to reduce the market value of already-issued fixed-income
investments, and a decline in general interest rates will tend to increase
their value. In addition, debt securities with longer maturities, which tend
to have higher yields, are subject to potentially greater fluctuations in
value from changes in interest rates than obligations with shorter
maturities.
Fluctuations in the market value of fixed-income securities after the
Fund buys them will not affect the interest income payable on those
securities (unless the security pays interest at a variable rate pegged to
interest rate changes). However, those price fluctuations will be reflected
in the valuations of the securities, and therefore the Fund's net asset
values will be affected by those fluctuations.
o Special Risks of Lower-Grade Securities. While the Fund can invest in
higher-yielding lower-grade debt securities (that is, securities below
investment grade), its debt investments will generally be investment grade.
Those are securities rated in the four highest rating categories of Moody's
Investors Service ("Moody's"), Standard & Poor's Ratings Services, a division
of The McGraw-Hill Companies, Inc. ("Standard and Poor's") and Fitch, Inc.
("Fitch"), or having equivalent ratings from other nationally recognized
rating agencies or, in the case of unrated securities, comparable ratings
assigned to a security by the Sub-Advisor.
"Lower-grade" debt securities are those rated below "investment grade,"
which means they have a rating lower than "Baa" by Moody's or lower than
"BBB" by Standard & Poor's or Fitch or similar ratings by other nationally
recognized rating organizations.
The Fund can invest in securities rated as low as "C" or "D" or which
are in default when the Fund buys them. Securities rated "Baa" by Moody's or
"BBB" by Standard & Poor's are considered investment grade but may be subject
to greater market fluctuations and risks of loss of income and principal than
higher-grade securities. They may be considered to have speculative elements.
Definitions of the debt security ratings categories of Moody's, Standard &
Poor's and Fitch are included in Appendix A to this Statement of Additional
Information.
The Fund can also buy unrated securities to which the Sub-Advisor
assigns a rating based upon its evaluation of the yield and risks of
comparable rated securities. The Fund is not obligated to dispose of a
security if the rating is reduced after the Fund buys the security, but the
Sub-Advisor will monitor those securities to determine whether they should be
retained in the Fund's portfolio.
|X| Investing in Cyclical Opportunities. The Fund might also seek to take
advantage of changes in the business cycle by investing in companies that are
sensitive to those changes if the Sub-Advisor believes they have growth
potential. For example, when the economy is expanding,
companies in the consumer durables and technology sectors might benefit and
present long-term growth opportunities. The Fund focuses on seeking growth
over the long term but might seek to take tactical advantage of short-term
market movements or events affecting particular issuers or industries. There
is the risk that those securities can lose value when the issuer or industry
is out of favor in the business cycle.
|X| Repurchase Agreements. The Fund can acquire securities subject to
repurchase agreements. It might do so for liquidity purposes to meet
anticipated redemptions of Fund shares, or pending the investment of the
proceeds from sales of Fund shares, or pending the settlement of portfolio
securities transactions, or for defensive purposes.
In a repurchase transaction, the Fund buys a security from, and
simultaneously resells it to, an approved vendor for delivery on an
agreed-upon future date. The resale price exceeds the purchase price by an
amount that reflects an agreed-upon interest rate effective for the period
during which the repurchase agreement is in effect. Approved vendors include
U.S. commercial banks, U.S. branches of foreign banks, or broker-dealers that
have been designated as primary dealers in government securities. They must
meet credit requirements set by the Sub-Advisor from time to time.
The majority of these transactions run from day to day, and delivery
pursuant to the resale typically occurs within one to five days of the
purchase. Repurchase agreements having a maturity beyond seven days are
subject to the Fund's policy limits on holding illiquid investments,
described below. The Fund cannot enter into a repurchase agreement that
causes more than 10% of its net assets to be subject to repurchase agreements
having a maturity beyond seven days. There is no limit on the amount of the
Fund's net assets that may be subject to repurchase agreements having
maturities of seven days or less.
Repurchase agreements, considered "loans" under the Investment Company
Act, are collateralized by the underlying security. The Fund's repurchase
agreements require that at all times while the repurchase agreement is in
effect, the value of the collateral must equal or exceed the repurchase price
to fully collateralize the repayment obligation. However, if the vendor fails
to pay the resale price on the delivery date, the Fund may incur costs in
disposing of the collateral and may experience losses if there is any delay
in its ability to do so. The Sub-Advisor will monitor the vendor's
creditworthiness to confirm that the vendor is financially sound and will
continuously monitor the collateral's value.
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission ("SEC"), the Fund, along with other affiliated entities managed by
the Manager, may transfer uninvested cash balances into one or more joint
repurchase accounts. These balances are invested in one or more repurchase
agreements, secured by U.S. government securities. Securities that are
pledged as collateral for repurchase agreements are held by a custodian bank
until the agreements mature. Each joint repurchase arrangement requires that
the market value of the collateral be sufficient to cover payments of
interest and principal; however, in the event of default by the other party
to the agreement, retention or sale of the collateral may be subject to legal
proceedings.
|X| Illiquid and Restricted Securities. Under the policies and
procedures established by the Fund's Board of Trustees, the Manager
determines the liquidity of certain of the Fund's investments. To enable the
Fund to sell its holdings of a restricted security not registered under the
applicable securities laws, the Fund may have to cause those securities to be
registered. The expenses of registering restricted securities may be
negotiated by the Fund with the issuer at the time the Fund buys the
securities. When the Fund must arrange registration because the Fund wishes
to sell the security, a considerable period may elapse between the time the
decision is made to sell the security and the time the security is registered
so that the Fund could sell it. The Fund would bear the risks of any downward
price fluctuation during that period.
The Fund can also acquire restricted securities through private
placements. Those securities have contractual restrictions on their public
resale. Those restrictions might limit the Fund's ability to dispose of the
securities and might lower the amount the Fund could realize upon the sale.
The Fund has limitations that apply to purchases of restricted
securities, as stated in the Prospectus. Those percentage restrictions do not
limit purchases of restricted securities that are eligible for sale to
qualified institutional purchasers under Rule 144A of the Securities Act of
1933, if those securities have been determined to be liquid by the Manager
under Board-approved guidelines. Those guidelines take into account the
trading activity for such securities and the availability of reliable pricing
information, among other factors. If there is a lack of trading interest in
a particular Rule 144A security, the Fund's holdings of that security may be
considered to be illiquid.
Illiquid securities include repurchase agreements maturing in more than
seven days and participation interests that do not have puts exercisable
within seven days.
| Borrowing. The Fund has the ability to borrow from banks on an
unsecured basis to invest the borrowed funds in portfolio securities. This
speculative technique is known as "leverage." 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.
Notwithstanding interfund borrowing described below, currently, under
the Investment Company Act, a mutual fund may borrow only from banks and the
maximum amount it may borrow is up to one-third of its total assets
(including the amount borrowed) less all liabilities and indebtedness other
than borrowing, except that a fund may borrow up to 5% of its total assets
for temporary purposes from any person. Under the Investment Company Act,
there is a rebuttable presumption that a loan is temporary if it is repaid
within 60 days and not extended or renewed. As a matter of fundamental
policy, the Fund is authorized to borrow up to 33 1/3% of its total assets.
During periods of substantial borrowings, the value of the Fund's assets
would be reduced due to the added expense of interest on borrowed monies.
The Fund is authorized to borrow, and to pledge assets to secure such
borrowings, up to the maximum extent permissible under the Investment Company
Act (i.e., presently 50% of net assets). Any such borrowing will be made
only pursuant to the requirements of the Investment Company Act and will be
made only to the extent that the value of each Fund's assets less its
liabilities, other than borrowings, is equal to at least 300% of all
borrowings including the proposed borrowing.
If the value of a Fund's assets, so computed, should fail to meet the
300% asset coverage requirement, the Fund is required, within three days
thereafter (not including Sundays and holidays) to reduce its bank debt to
the extent necessary to meet such requirement and may have to sell a portion
of its investments at a time when independent investment judgment would not
dictate such sale. Interest on money borrowed is an expense the Fund would
not otherwise incur, so that it may have little or no net investment income
during periods of substantial borrowings. If it does borrow, its expenses
will be greater, other things being equal, than comparable funds that do not
borrow. Since substantially all of a Fund's assets fluctuate in value, but
borrowing obligations are fixed when the Fund has outstanding borrowings, the
net asset value per share of a Fund correspondingly will tend to increase and
decrease more when the Fund's assets increase or decrease in value than would
otherwise be the case.
|X| Interfund Borrowing and Lending Arrangements. Consistent with its
investment policies and pursuant to an exemptive order issued by the SEC, the
Fund may engage in borrowing and lending activities with other funds in the
OppenheimerFunds complex. Borrowing money from affiliated funds may afford
the Fund the flexibility to use the most cost-effective alternative to
satisfy its borrowing requirements. Lending money to an affiliated fund may
allow the Fund to obtain a higher rate of return than it could from interest
rates on alternative short-term investments. Implementation of interfund
lending is being accomplished consistent with applicable regulatory
requirements, including the provisions of the SEC order.
o Interfund Borrowing. The Fund will not borrow from affiliated funds
unless the terms of the borrowing arrangement are at least as favorable as
the terms the Fund could otherwise negotiate with a third party. To assure
that the Fund will not be disadvantaged by borrowing from an affiliated fund,
certain safeguards are being implemented. Examples of these safeguards
include the following:
o the Fund will not borrow money from affiliated funds unless the
interest rate is more favorable than available bank loan
rates;
o the Fund's borrowing from affiliated funds must be consistent with its
investment objective and investment policies;
o the loan rates will be the average of the overnight repurchase
agreement rate available through the OppenheimerFunds joint
repurchase agreement account and a pre-established formula
based on quotations from independent banks to approximate the
lowest interest rate at which bank loans would be available to
the Fund;
o if the Fund has outstanding borrowings from all sources greater than
10% of its total assets, then the Fund must secure each
additional outstanding interfund loan by segregating liquid
assets of the Fund as collateral;
o the Fund cannot borrow from an affiliated fund in excess of 125% of its
total redemptions for the preceding seven days;
o each interfund loan may be repaid on any day by the Fund; and
o the Trustees will be provided with a report of all interfund loans and
the Trustees will monitor all such borrowings to ensure that
the Fund's participation is appropriate.
There is a risk that a borrowing fund could have a loan called on one
days' notice. In that circumstance, the Fund might have to borrow from a
bank at a higher interest cost if money to lend were not available from
another Oppenheimer fund.
o Interfund Lending. To assure that the Fund will not be disadvantaged by
making loans to affiliated funds, certain safeguards are being implemented.
Examples of these safeguards include the following:
o the Fund will not lend money to affiliated funds unless the interest
rate on such loan is determined to be reasonable under the
circumstances;
o the Fund may not make interfund loans in excess of 15% of its net
assets;
o an interfund loan to any one affiliated fund shall not exceed 5% of the
Fund's net assets;
o an interfund loan may not be outstanding for more than seven days;
o each interfund loan may be called on one business day's notice; and
o the Manager will provide the Trustees reports on all interfund loans
demonstrating that the Fund's participation is appropriate and
that the loan is consistent with its investment objectives and
policies.
When the Fund lends assets to another affiliated fund, the Fund is
subject to the risk that the borrowing fund might fail to repay the loan.
|X| Loans of Portfolio Securities. To raise cash for liquidity purposes,
the Fund can lend its portfolio securities to brokers, dealers and other
types of financial institutions approved by the Fund's Board of Trustees.
Consistent with applicable regulatory requirements, the Fund may lend its
portfolio securities in amounts up to 33 1/3% of total assets, however the
Board of Trustees has limited these loans to not more than 25% of the value
of the Fund's total assets.
There are some risks in connection with securities lending. The Fund
might experience a delay in receiving additional collateral to secure a loan,
or a delay in recovery of the loaned securities if the borrower defaults. The
Fund must receive collateral for a loan. Under current applicable regulatory
requirements (which are subject to change), on each business day the loan
collateral must be at least equal to the value of the loaned securities. It
must consist of cash, bank letters of credit, securities of the U.S.
government or its agencies or instrumentalities, or other cash equivalents in
which the Fund is permitted to invest. To be acceptable as collateral,
letters of credit must obligate a bank to pay amounts demanded by the Fund if
the demand meets the terms of the letter. The terms of the letter of credit
and the issuing bank both must be satisfactory to the Fund.
When it lends securities, the Fund receives amounts equal to the
dividends or interest on loaned securities. It also receives one or more of
(a) negotiated loan fees, (b) interest on securities used as collateral, and
(c) interest on any short-term debt securities purchased with such loan
collateral. Each type of interest may be shared with the borrower. The Fund
may also pay reasonable finders', custodian and administrative fees in
connection with these loans. The terms of the Fund's loans must meet
applicable tests under the Internal Revenue Code and must permit the Fund to
reacquire loaned securities on five days' notice or in time to vote on any
important matter.
|X| Derivatives. The Fund can invest in a variety of derivative investments
to seek income for liquidity needs or for speculative or hedging purposes.
Some derivative investments the Fund can use are the hedging instruments
described below in this Statement of Additional Information.
Some of the derivative investments the Fund can use include "debt
exchangeable for common stock" of an issuer or "equity-linked debt
securities" of an issuer. At maturity, the debt security is exchanged for
common stock of the issuer or it is payable in an amount based on the price
of the issuer's common stock at the time of maturity. Both alternatives
present a risk that the amount payable at maturity will be less than the
principal amount of the debt because the price of the issuer's common stock
might not be as high as the Sub-Advisor expected.
|X| Hedging. Although the Fund does not anticipate the extensive use of
hedging instruments, the Fund can use them. It is not required to do so in
seeking its objective. To attempt to protect against declines in the market
value of the Fund's portfolio, to permit the Fund to retain unrealized gains
in the value of portfolio securities which have appreciated, or to facilitate
selling securities for investment reasons, the Fund could:
o sell futures contracts,
o buy puts on futures or on securities, or
o write covered calls on securities or futures. Covered calls can also
be used to seek income, but the Sub-Advisor does not expect to
engage extensively in that practice.
The Fund might use hedging to establish a position in the securities
market as a temporary substitute for purchasing particular securities. In
that case, the Fund would normally seek to purchase the securities and then
terminate that hedging position. The Fund might also use this type of hedge
to attempt to protect against the possibility that its portfolio securities
would not be fully included in a rise in value of the market. To do so the
Fund could:
o buy futures, or
o buy calls on such futures or on securities.
The Fund's strategy of hedging with futures and options on futures will
be incidental to the Fund's activities in the underlying cash market. The
particular hedging instruments the Fund can use are described below. The
Fund may employ new hedging instruments and strategies when they are
developed, if those investment methods are consistent with the Fund's
investment objective and are permissible under applicable regulations
governing the Fund.
o Futures. The Fund can buy and sell futures contracts that relate to (1)
broad-based stock indices (these are referred to as "stock index futures"),
(2) an individual stock ("single stock futures"), (3) bond indices (these are
referred to as "bond index futures"), (4) debt securities (these are referred
to as "interest rate futures"), and (5) foreign currencies (these are
referred to as "forward contracts").
A broad-based stock index is used as the basis for trading stock index
futures. An index may in some cases be based on stocks of issuers in a
particular industry or group of industries. A stock index assigns relative
values to the common stocks included in the index and its value fluctuates in
response to the changes in value of the underlying stocks. A stock index
cannot be purchased or sold directly. Bond index futures are similar
contracts based on the future value of the basket of securities that comprise
the index. These contracts obligate the seller to deliver, and the purchaser
to take, cash to settle the futures transaction. There is no delivery made of
the underlying securities to settle the futures obligation. Either party may
also settle the transaction by entering into an offsetting contract.
No money is paid or received by the Fund on the purchase or sale of a
future. Upon entering into a futures transaction, the Fund will be required
to deposit an initial margin payment with the futures commission merchant
(the "futures broker"). Initial margin payments will be deposited with the
Fund's custodian bank in an account registered in the futures broker's name.
However, the futures broker can gain access to that account only under
specified conditions. As the future is marked to market (that is, its value
on the Fund's books is changed) to reflect changes in its market value,
subsequent margin payments, called variation margin, will be paid to or by
the futures broker daily.
At any time prior to expiration of the future, the Fund may elect to
close out its position by taking an opposite position, at which time a final
determination of variation margin is made and any additional cash must be
paid by or released to the Fund. Any loss or gain on the future is then
realized by the Fund for tax purposes. All futures transactions, except
forward contracts, are effected through a clearinghouse associated with the
exchange on which the contracts are traded.
An interest rate future obligates the seller to deliver (and the
purchaser to take) cash or a specified type of debt security to settle the
futures transactions. Either party could also enter into an offsetting
contract to close out the position.
Similarly, a single stock future obligates the seller to deliver (and
the purchaser to take) cash or a specified equity security to settle the
futures transaction. Either party could also enter into an offsetting
contract to close out the position. Single stock futures trade on a very
limited number of exchanges, with contracts typically not fungible among the
exchanges.
o Put and Call Options. The Fund can buy and sell certain kinds of put
options ("puts") and call options ("calls"). The Fund can buy and sell
exchange-traded and over-the
counter put and call options, including index options, securities options,
currency options, and options on the other types of futures described above.
o Writing Covered Call Options. The Fund can write (that is, sell) calls.
If the Fund sells a call option, it must be covered. That means the Fund
must own the security subject to the call while the call is outstanding, or,
for certain types of calls, the call may be covered by identifying liquid
assets on the Fund's books to enable the Fund to satisfy its obligations if
the call is exercised. Up to 25% of the Fund's total assets may be subject
to calls the Fund writes.
When the Fund writes a call on a security, it receives cash (a
premium). The Fund agrees to sell the underlying security to a purchaser of a
corresponding call on the same security during the call period at a fixed
exercise price regardless of market price changes during the call period. The
call period is usually not more than nine months. The exercise price may
differ from the market price of the underlying security. The Fund has the
risk of loss that the price of the underlying security may decline during the
call period. That risk may be offset to some extent by the premium the Fund
receives. If the value of the investment does not rise above the call price,
it is likely that the call will lapse without being exercised. In that case
the Fund would keep the cash premium and the investment.
When the Fund writes a call on an index, it receives cash (a premium).
If the buyer of the call exercises it, the Fund will pay an amount of cash
equal to the difference between the closing price of the call and the
exercise price, multiplied by 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, or a securities depository acting for the
custodian, will act as the Fund's escrow agent, through the facilities of the
Options Clearing Corporation ("OCC"), as to the investments on which the Fund
has written calls traded on exchanges or as to other acceptable escrow
securities. In that way, no margin will be required for such transactions.
OCC will release the securities on the expiration of the option or when the
Fund enters into a closing transaction.
If the Fund writes an over-the-counter ("OTC") option, it will enter
into an arrangement with a primary U.S. government securities dealer which
will establish a formula price at which the Fund will have the absolute right
to repurchase that OTC option. The formula price will generally be based on
a multiple of the premium received for the option, plus the amount by which
the option is exercisable below the market price of the underlying security
(that is, the option is "in the money"). If the Fund writes an OTC option, it
will treat as illiquid (for purposes of its restriction on holding illiquid
securities) the mark-to-market value of any OTC option it holds, unless the
option is subject to a buy-back agreement by the executing broker.
To terminate its obligation on a call it has written, the Fund may
purchase a corresponding call in a "closing purchase transaction." The Fund
will then realize a profit or loss, depending upon whether the net of the
amount of the option transaction costs and the premium received on the call
the Fund wrote is more or less than the price of the call the Fund purchases
to close out the transaction. The Fund may realize a profit if the call
expires unexercised, because the Fund will retain the underlying security and
the premium it received when it wrote the call. Any such profits are
considered short-term capital gains for federal
income tax purposes, as are the premiums on lapsed calls. When distributed by
the Fund they are taxable as ordinary income. If the Fund cannot effect a
closing purchase transaction due to the lack of a market, it will have to
hold the callable securities until the call expires or is exercised.
The Fund may also write calls on a futures contract without owning the
futures contract or securities deliverable under the contract. To do so, at
the time the call is written, the Fund must cover the call by identifying on
its books an equivalent dollar amount of liquid assets. The Fund will
identify additional liquid assets on the Fund's books if the value of the
identified assets drops below 100% of the current value of the future.
Because of this segregation requirement, in no circumstances would the Fund's
receipt of an exercise notice as to that future require the Fund to deliver a
futures contract. It would simply put the Fund in a short futures position,
which is permitted by the Fund's hedging policies.
o Writing Put Options. The Fund can sell put options. A put option on
securities gives the purchaser the right to sell, and the writer the
obligation to buy, the underlying investment at the exercise price during the
option period. The Fund will not write puts if, as a result, more than 50%
of the Fund's net assets would be required to be identified on the Fund's
books to cover such put options.
If the Fund writes a put, the put must be covered by liquid assets
identified on the Fund's books. The premium the Fund receives from writing a
put represents a profit, as long as the price of the underlying investment
remains equal to or above the exercise price of the put. However, the Fund
also assumes the obligation during the option period to buy the underlying
investment from the buyer of the put at the exercise price, even if the value
of the investment falls below the exercise price. If a put the Fund has
written expires unexercised, the Fund realizes a gain in the amount of the
premium less the transaction costs incurred. If the put is exercised, the
Fund must fulfill its obligation to purchase the underlying investment at the
exercise price. That price will usually exceed the market value of the
investment at that time. In that case, the Fund may incur a loss if it sells
the underlying investment. That loss will be equal to the sum of the sale
price of the underlying investment and the premium received minus the sum of
the exercise price and any transaction costs the Fund incurred.
When writing a put option on a security, to secure its obligation to
pay for the underlying security the Fund will identify on its books liquid
assets with a value equal to or greater than the exercise price of the
underlying securities. The Fund therefore forgoes the opportunity of
investing the identified assets or writing calls against those assets.
As long as the Fund's obligation as the put writer continues, it may be
assigned an exercise notice by the broker-dealer through which the put was
sold. That notice will require the Fund to take delivery of the underlying
security and pay the exercise price. The Fund has no control over when it
may be required to purchase the underlying security, since it may be assigned
an exercise notice at any time prior to the termination of its obligation as
the writer of the put. That obligation terminates upon expiration of the
put. It may also terminate if, before it receives an exercise notice, the
Fund effects a closing purchase transaction by purchasing a put of the same
series as it sold. Once the Fund has been assigned an exercise notice, it
cannot effect a closing purchase transaction.
The Fund may decide to effect a closing purchase transaction to realize
a profit on an outstanding put option it has written or to prevent the
underlying security from being put. Effecting a closing purchase transaction
will also permit the Fund to write another put option on
the security, or to sell the security and use the proceeds from the sale for
other investments. The Fund will realize a profit or loss from a closing
purchase transaction depending on whether the cost of the transaction is less
or more than the premium received from writing the put option. Any profits
from writing puts are considered short-term capital gains for federal tax
purposes, and when distributed by the Fund, are taxable as ordinary income.
o Purchasing Calls and Puts. The Fund can purchase calls to protect
against the possibility that the Fund's portfolio will not participate in an
anticipated rise in the securities market. When the Fund buys a call (other
than in a closing purchase transaction), it pays a premium. The Fund then has
the right to buy the underlying investment from a seller of a corresponding
call on the same investment during the call period at a fixed exercise
price. The Fund benefits only if it sells the call at a profit or if, during
the call period, the market price of the underlying investment is above the
sum of the call price plus the transaction costs and the premium paid for the
call and the Fund exercises the call. If the Fund does not exercise the call
or sell it (whether or not at a profit), the call will become worthless at
its expiration date. In that case the Fund will have paid the premium but
lost the right to purchase the underlying investment.
The Fund can buy puts whether or not it holds the underlying investment
in its portfolio. When the Fund purchases a put, it pays a premium and,
except as to puts on indices, has the right to sell the underlying investment
to a seller of a put on a corresponding investment during the put period at a
fixed exercise price. Buying a put on securities or futures the Fund owns
enables the Fund to attempt to protect itself during the put period against a
decline in the value of the underlying investment below the exercise price by
selling the underlying investment at the exercise price to a seller of a
corresponding put. If the market price of the underlying investment is equal
to or above the exercise price and, as a result, the put is not exercised or
resold, the put will become worthless at its expiration date. In that case
the Fund will have paid the premium but lost the right to sell the underlying
investment. However, the Fund may sell the put prior to its expiration. That
sale may or may not be at a profit.
Buying a put on an investment the Fund does not own (such as an index
or future) permits the Fund either to resell the put or to buy the underlying
investment and sell it at the exercise price. The resale price will vary
inversely to the price of the underlying investment. If the market price of
the underlying investment is above the exercise price and, as a result, the
put is not exercised, the put will become worthless on its expiration date.
When the Fund purchases a call or put on an index or future, it pays a
premium, but settlement is in cash rather than by delivery of the underlying
investment to the Fund. Gain or loss depends on changes in the index in
question (and thus on price movements in the securities market generally)
rather than on price movements in individual securities or futures contracts.
The Fund may buy a call or put only if, after the purchase, the value
of all call and put options held by the Fund will not exceed 5% of the Fund's
total assets.
o Buying and Selling Call and Put Options on Foreign Currencies. The Fund
can buy and sell calls and puts on foreign currencies. They include puts and
calls that trade on a securities or commodities exchange or in the
over-the-counter markets or are quoted by major recognized dealers in such
options. The Fund could use these calls and puts to try to
protect against declines in the dollar value of foreign securities and
increases in the dollar cost of foreign securities the Fund wants to acquire
If the Sub-Advisor anticipates a rise in the dollar value of a foreign
currency in which securities to be acquired are denominated, the increased
cost of those securities may be partially offset by purchasing calls or
writing puts on that foreign currency. If the Sub-Advisor anticipates a
decline in the dollar value of a foreign currency, the decline in the dollar
value of portfolio securities denominated in that currency might be partially
offset by writing calls or purchasing puts on that foreign currency. However,
the currency rates could fluctuate in a direction adverse to the Fund's
position. The Fund will then have incurred option premium payments and
transaction costs without a corresponding benefit.
A call the Fund writes on a foreign currency is "covered" if the Fund
owns the underlying foreign currency covered by the call or has an absolute
and immediate right to acquire that foreign currency without additional cash
consideration (or it can do so for additional cash consideration identified
on its books) upon conversion or exchange of other foreign currency held in
its portfolio.
The Fund could write a call on a foreign currency to provide a hedge
against a decline in the U.S. dollar value of a security which the Fund owns
or has the right to acquire and which is denominated in the currency
underlying the option. That decline might be one that occurs due to an
expected adverse change in the exchange rate. This is known as a
"cross-hedging" strategy. In those circumstances, the Fund covers the option
by identifying on its books liquid assets in an amount equal to the exercise
price of the option.
o Risks of Hedging with Options and Futures. The use of hedging
instruments requires special skills and knowledge of investment techniques
that are different than what is required for normal portfolio management. If
the Sub-Advisor uses a hedging instrument at the wrong time or judges market
conditions incorrectly, hedging strategies may reduce the Fund's return. The
Fund could also experience losses if the prices of its futures and options
positions were not correlated with its other investments.
The Fund's option activities could affect its portfolio turnover rate
and brokerage commissions. The exercise of calls written by the Fund might
cause the Fund to sell related portfolio securities, thus increasing its
turnover rate. The exercise by the Fund of puts on securities will cause the
sale of underlying investments, increasing portfolio turnover. Although the
decision whether to exercise a put it holds is within the Fund's control,
holding a put might cause the Fund to sell the related investments for
reasons that would not exist in the absence of the put.
The Fund could pay a brokerage commission each time it buys a call or
put, sells a call or put, or buys or sells an underlying investment in
connection with the exercise of a call or put. Those commissions could be
higher on a relative basis than the commissions for direct purchases or sales
of the underlying investments. Premiums paid for options are small in
relation to the market value of the underlying investments. Consequently, put
and call options offer large amounts of leverage. The leverage offered by
trading in options could result in the Fund's net asset value being more
sensitive to changes in the value of the underlying investment.
If a covered call written by the Fund is exercised on an investment
that has increased in value, the Fund will be required to sell the investment
at the call price. It will not be able to realize any profit if the
investment has increased in value above the call price.
An option position may be closed out only on a market that provides
secondary trading for options of the same series, and there is no assurance
that a liquid secondary market will exist for any particular option. The
Fund might experience losses if it could not close out a position because of
an illiquid market for the future or option.
There is a risk in using short hedging by selling futures or purchasing
puts on broadly-based indices or futures to attempt to protect against
declines in the value of the Fund's portfolio securities. The risk is that
the prices of the futures or the applicable index will correlate imperfectly
with the behavior of the cash prices of the Fund's securities. For example,
it is possible that while the Fund has used hedging instruments in a short
hedge, the market might advance and the value of the securities held in the
Fund's holdings might decline. If that occurred, the Fund would lose money on
the hedging instruments and also experience a decline in the value of its
portfolio securities. However, while this could occur for a very brief period
or to a very small degree, over time the value of a diversified portfolio of
securities will tend to move in the same direction as the indices upon which
the hedging instruments are based.
The risk of imperfect correlation increases as the composition of the
Fund's holdings diverges from the securities included in the applicable
index. To compensate for the imperfect correlation of movements in the price
of the portfolio securities being hedged and movements in the price of the
hedging instruments, the Fund might use hedging instruments in a greater
dollar amount than the dollar amount of portfolio securities being hedged. It
might do so if the historical volatility of the prices of the portfolio
securities being hedged is more than the historical volatility of the
applicable index.
The ordinary spreads between prices in the cash and futures markets are
subject to distortions, due to differences in the nature of those markets.
First, all participants in the futures market are subject to margin deposit
and maintenance requirements. Rather than meeting additional margin deposit
requirements, investors may close futures contracts through offsetting
transactions which could distort the normal relationship between the cash and
futures markets. Second, the liquidity of the futures market depends on
participants entering into offsetting transactions rather than making or
taking delivery. To the extent participants decide to make or take delivery,
liquidity in the futures market could be reduced, thus producing distortion.
Third, from the point of view of speculators, the deposit requirements in the
futures market are less onerous than margin requirements in the securities
markets. Therefore, increased participation by speculators in the futures
market may cause temporary price distortions.
The Fund can use hedging instruments to establish a position in the
securities markets as a temporary substitute for the purchase of individual
securities (long hedging) by buying futures and/or calls on such futures,
broadly-based indices or on securities. It is possible that when the Fund
does so the market might decline. If the Fund then concludes not to invest
in securities because of concerns that the market might decline further or
for other reasons, the Fund will realize a loss on the hedging instruments
that is not offset by a reduction in the price of the securities purchased.
o Forward Contracts. Forward contracts are foreign currency exchange
contracts. They are used to buy or sell foreign currency for future delivery
at a fixed price. The Fund uses them to "lock in" the U.S. dollar price of a
security denominated in a foreign currency that the Fund has bought or sold,
or to protect against possible losses from changes in the relative values of
the U.S. dollar and a foreign currency. The Fund limits its exposure in
foreign currency exchange contracts in a particular foreign currency to the
amount of its assets denominated in that currency or a closely-correlated
currency. The Fund may also use "cross-hedging" where the Fund hedges against
changes in currencies other than the currency in which a security it holds is
denominated.
Under a forward contract, one party agrees to purchase, and another
party agrees to sell, a specific currency at a future date. That date may be
any fixed number of days from the date of the contract agreed upon by the
parties. The transaction price is set at the time the contract is entered
into. These contracts are traded in the inter-bank market conducted directly
among currency traders (usually large commercial banks) and their customers.
The Fund may use forward contracts to protect against uncertainty in
the level of future exchange rates. The use of forward contracts does not
eliminate the risk of fluctuations in the prices of the underlying securities
the Fund owns or intends to acquire, but it does fix a rate of exchange in
advance. Although forward contracts may reduce the risk of loss from a
decline in the value of the hedged currency, at the same time they limit any
potential gain if the value of the hedged currency increases.
When the Fund enters into a contract for the purchase or sale of a
security denominated in a foreign currency, or when it anticipates receiving
dividend payments in a foreign currency, the Fund might desire to "lock-in"
the U.S. dollar price of the security or the U.S. dollar equivalent of the
dividend payments. To do so, the Fund could enter into a forward contract
for the purchase or sale of the amount of foreign currency involved in the
underlying transaction, in a fixed amount of U.S. dollars per unit of the
foreign currency. This is called a "transaction hedge." The transaction hedge
will protect the Fund against a loss from an adverse change in the currency
exchange rates during the period between the date on which the security is
purchased or sold or on which the payment is declared, and the date on which
the payments are made or received.
The Fund could also use forward contracts to lock in the U.S. dollar
value of portfolio positions. This is called a "position hedge." When the
Fund believes that foreign currency might suffer a substantial decline
against the U.S. dollar, it could enter into a forward contract to sell an
amount of that foreign currency approximating the value of some or all of the
Fund's portfolio securities denominated in that foreign currency. When the
Fund believes that the U.S. dollar might suffer a substantial decline against
a foreign currency, it could enter into a forward contract to buy that
foreign currency for a fixed dollar amount. Alternatively, the Fund could
enter into a forward contract to sell a different foreign currency for a
fixed U.S. dollar amount if the Fund believes that the U.S. dollar value of
the foreign currency to be sold pursuant to its forward contract will fall
whenever there is a decline in the U.S. dollar value of the currency in which
portfolio securities of the Fund are denominated. That is referred to as a
"cross hedge."
The Fund will cover its short positions in these cases by identifying
on its books assets having a value equal to the aggregate amount of the
Fund's commitment under forward contracts. The Fund will not enter into
forward contracts or maintain a net exposure to such
contracts if the consummation of the contracts would obligate the Fund to
deliver an amount of foreign currency in excess of the value of the Fund's
portfolio securities or other assets denominated in that currency or another
currency that is the subject of the hedge.
However, to avoid excess transactions and transaction costs, the Fund
may maintain a net exposure to forward contracts in excess of the value of
the Fund's portfolio securities or other assets denominated in foreign
currencies if the excess amount is "covered" by liquid securities denominated
in any currency. The cover must be at least equal at all times to the amount
of that excess. As one alternative, the Fund may purchase a call option
permitting the Fund to purchase the amount of foreign currency being hedged
by a forward sale contract at a price no higher than the forward contract
price. As another alternative, the Fund may purchase a put option permitting
the Fund to sell the amount of foreign currency subject to a forward purchase
contract at a price as high or higher than the forward contact price.
The precise matching of the amounts under forward contracts and the
value of the securities involved generally will not be possible because the
future value of securities denominated in foreign currencies will change as a
consequence of market movements between the date the forward contract is
entered into and the date it is sold. In some cases the Sub-Advisor might
decide to sell the security and deliver foreign currency to settle the
original purchase obligation. If the market value of the security is less
than the amount of foreign currency the Fund is obligated to deliver, the
Fund might have to purchase additional foreign currency on the "spot" (that
is, cash) market to settle the security trade. If the market value of the
security instead exceeds the amount of foreign currency the Fund is obligated
to deliver to settle the trade, the Fund might have to sell on the spot
market some of the foreign currency received upon the sale of the security.
There will be additional transaction costs on the spot market in those cases.
The projection of short-term currency market movements is extremely
difficult, and the successful execution of a short-term hedging strategy is
highly uncertain. Forward contracts involve the risk that anticipated
currency movements will not be accurately predicted, causing the Fund to
sustain losses on these contracts and to pay additional transactions costs.
The use of forward contracts in this manner might reduce the Fund's
performance if there are unanticipated changes in currency prices to a
greater degree than if the Fund had not entered into such contracts.
At or before the maturity of a forward contract requiring the Fund to
sell a currency, the Fund might sell a portfolio security and use the sale
proceeds to make delivery of the currency. In the alternative the Fund might
retain the security and offset its contractual obligation to deliver the
currency by purchasing a second contract. Under that contract the Fund will
obtain, on the same maturity date, the same amount of the currency that it is
obligated to deliver. Similarly, the Fund might close out a forward contract
requiring it to purchase a specified currency by entering into a second
contract entitling it to sell the same amount of the same currency on the
maturity date of the first contract. The Fund would realize a gain or loss
as a result of entering into such an offsetting forward contract under either
circumstance. The gain or loss will depend on the extent to which the
exchange rate or rates between the currencies involved moved between the
execution dates of the first contract and offsetting contract.
The costs to the Fund of engaging in forward contracts vary with
factors such as the currencies involved, the length of the contract period
and the market conditions then prevailing. Because forward contracts are
usually entered into on a principal basis, no brokerage fees or
commissions are involved. Because these contracts are not traded on an
exchange, the Fund must evaluate the credit and performance risk of the
counterparty under each forward contract.
Although the Fund values its assets daily in terms of U.S. dollars, it
does not intend to convert its holdings of foreign currencies into U.S.
dollars on a daily basis. The Fund may convert foreign currency from time to
time, and will incur costs in doing so. Foreign exchange dealers do not
charge a fee for conversion, but they do seek to realize a profit based on
the difference between the prices at which they buy and sell various
currencies. Thus, a dealer might offer to sell a foreign currency to the
Fund at one rate, while offering a lesser rate of exchange if the Fund
desires to resell that currency to the dealer.
o Total Return Swap Transactions. The Fund may enter into total return
swaps. The Fund will only enter into total return swaps if consistent with
its fundamental investment objectives or policies and not invest in swaps
with respect to more than 30% of the Fund's total assets. A swap contract is
essentially like a portfolio of forward contracts, under which one party
agrees to exchange an asset (for example, bushels of wheat) for another asset
(cash) at specified dates in the future. A one-period swap contract operates
in a manner similar to a forward or futures contract because there is an
agreement to swap a commodity for cash at only one forward date. The Fund may
engage in swap transactions that have more than one period and therefore more
than one exchange of assets.
The Fund may invest in total return swaps to gain exposure to the
overall commodity markets. In a total return commodity swap the Fund will
receive the price appreciation of a commodity index, a portion of the index,
or a single commodity in exchange for paying an agreed-upon fee. If the
commodity swap is for one period, the Fund will pay a fixed fee, established
at the outset of the swap. However, if the term of the commodity swap is
more than one period, with interim swap payments, the Fund will pay an
adjustable or floating fee. With a "floating" rate, the fee is pegged to a
base rate such as the London Interbank Offered Rate ("LIBOR"), and is
adjusted each period. Therefore, if interest rates increase over the term of
the swap contract, the Fund may be required to pay a higher fee at each swap
reset date.
o Regulatory Aspects of Hedging Instruments. When using futures and
options on futures, the Fund is required to operate within certain guidelines
and restrictions with respect to the use of futures as established by the
Commodities Futures Trading Commission (the "CFTC"). In particular, the Fund
is exempted from registration with the CFTC as a "commodity pool operator" if
the Fund complies with the requirements of Rule 4.5 adopted by the CFTC. The
Rule does not limit the percentage of the Fund's assets that may be used for
futures margin and related options premiums for a bona fide hedging
position. However, under the Rule, the Fund must limit its aggregate initial
futures margin and related options premiums to not more than 5% of the Fund's
net assets for hedging strategies that are not considered bona fide hedging
strategies under the Rule. Under the Rule, the Fund must also use short
futures and options on futures solely for bona fide hedging purposes within
the meaning and intent of the applicable provisions of the Commodity Exchange
Act.
Transactions in options by the Fund are subject to limitations
established by the option exchanges. The exchanges limit the maximum number
of options that may be written or held by a single investor or group of
investors acting in concert. Those limits apply regardless of whether the
options were written or purchased on the same or different exchanges or are
held in one or more accounts or through one or more different exchanges or
through one or more brokers. Thus, the number of options that the Fund may
write or hold may be affected by options written
or held by other entities, including other investment companies having the
same advisor as the Fund (or an advisor that is an affiliate of the Fund's
advisor). The exchanges also impose position limits on futures
transactions. An exchange may order the liquidation of positions found to be
in violation of those limits and may impose certain other sanctions.
Under interpretations of staff members of the SEC regarding applicable
provisions of the Investment Company Act, when the Fund purchases a future,
it must maintain cash or readily marketable short-term debt instruments in an
amount equal to the market value of the securities underlying the future,
less the margin deposit applicable to it.
o Tax Aspects of Certain Hedging Instruments. Certain foreign currency
exchange contracts in which the Fund may invest are treated as "Section 1256
contracts" under the Internal Revenue Code. In general, gains or losses
relating to Section 1256 contracts are characterized as 60% long-term and 40%
short-term capital gains or losses under the Code. However, foreign currency
gains or losses arising from Section 1256 contracts that are forward
contracts generally are treated as ordinary income or loss. In addition,
Section 1256 contracts held by the Fund at the end of each taxable year are
"marked-to-market," and unrealized gains or losses are treated as though they
were realized. These contracts also may be marked-to-market for purposes of
determining the excise tax applicable to investment company distributions and
for other purposes under rules prescribed pursuant to the Internal Revenue
Code. An election can be made by the Fund to exempt those transactions from
this marked-to-market treatment.
Certain forward contracts the Fund enters into may result in
"straddles" for federal income tax purposes. The straddle rules may affect
the character and timing of gains (or losses) recognized by the Fund on
straddle positions. Generally, a loss sustained on the disposition of a
position making up a straddle is allowed only to the extent that the loss
exceeds any unrecognized gain in the offsetting positions making up the
straddle. Disallowed loss is generally allowed at the point where there is
no unrecognized gain in the offsetting positions making up the straddle, or
the offsetting position is disposed of.
Under the Internal Revenue Code, the following gains or losses are
treated as ordinary income or loss:
(1) gains or losses attributable to fluctuations in exchange rates that
occur between the time the Fund accrues interest or other
receivables or accrues expenses or other liabilities denominated
in a foreign currency and the time the Fund actually collects such
receivables or pays such liabilities, and
(2) gains or losses attributable to fluctuations in the value of a foreign
currency between the date of acquisition of a debt security
denominated in a foreign currency or foreign currency forward
contracts and the date of disposition.
Currency gains and losses are offset against market gains and losses on
each trade before determining a net "Section 988" gain or loss under the
Internal Revenue Code for that trade, which may increase or decrease the
amount of the Fund's investment income available for distribution to its
shareholders.
|X| Temporary Defensive Investments. When market conditions are unstable,
or the Sub-Advisor believes it is otherwise appropriate to reduce holdings in
stocks, the Fund can invest in a variety of debt securities for defensive
purposes. The Fund can also purchase these securities for liquidity purposes
to meet cash needs due to the redemption of Fund shares, or to hold while
waiting to reinvest cash received from the sale of other portfolio
securities. The Fund can buy:
o high-quality (rated in the top two rating categories of
nationally-recognized rating organizations or deemed by the
Sub-Advisor to be of comparable quality), short-term money market
instruments, including those issued by the U. S. Treasury or
other government agencies,
o commercial paper (short-term, unsecured, promissory notes of domestic
or foreign companies) rated in the top two rating categories of a
nationally-recognized rating organization,
o debt obligations of corporate issuers, rated investment grade (rated at
least Baa by Moody's or at least BBB by Standard & Poor's, or a
comparable rating by another rating organization), or unrated
securities judged by the Sub-Advisor to be of a quality
comparable to rated securities in those categories,
o certificates of deposit and bankers' acceptances of domestic and
foreign banks and savings and loan associations, and
o repurchase agreements.
Short-term debt securities would normally be selected for defensive or
cash management purposes because they can normally be disposed of quickly,
are not generally subject to significant fluctuations in principal value and
their value will be less subject to interest rate risk than longer-term debt
securities.
|X| Investment in Other Investment Companies. The Fund can also invest in
the securities of other investment companies, which can include open-end
funds, closed-end funds and unit investment trusts, subject to the limits set
forth in the Investment Company Act that apply to those types of
investments. For example, the Fund can invest in Exchange-Traded Funds,
which are typically open-end funds or unit investment trusts, listed on a
stock exchange. The Fund might do so as a way of gaining exposure to the
segments of the equity or fixed-income markets represented by the
Exchange-Traded Funds' portfolio, at times when the Fund may not be able to
buy those portfolio securities directly.
Investing in another investment company may involve the payment of
substantial premiums above the value of such investment company's portfolio
securities and is subject to limitations under the Investment Company Act.
The Fund does not intend to invest in other investment companies unless the
Manager believes that the potential benefits of the investment justify the
payment of any premiums or sales charges. As a shareholder of an investment
company, the Fund would be subject to its ratable share of that investment
company's expenses, including its advisory and administration expenses.
Other Investment Restrictions
|X| What Are "Fundamental Policies?" Fundamental policies are those
policies that the Fund has adopted to govern its investments that can be
changed only by the vote of a "majority" of the Fund's outstanding voting
securities. Under the Investment Company Act, a "majority" vote is defined as
the vote of the holders of the lesser of:
o 67% or more of the shares present or represented by proxy at a
shareholder meeting, if the holders of more than 50% of the
outstanding shares are present or represented by proxy, or
o more than 50% of the outstanding shares.
The Fund's investment objective is a fundamental policy. Other policies
described in the Prospectus or this Statement of Additional Information are
"fundamental" only if they are identified as such. The Fund's Board of
Trustees can change non-fundamental policies without shareholder approval.
However, significant changes to investment policies will be described in
supplements or updates to the Prospectus or this Statement of Additional
Information, as appropriate. The Fund's principal investment policies are
described in the Prospectus.
|X| Does the Fund Have Additional Fundamental Policies? The
following investment restrictions are fundamental policies of the Fund.
o The Fund cannot buy securities or other instruments issued or
guaranteed by any one issuer if more than 5% of its total assets
would be invested in securities or other instruments of that issuer
or if it would then own more than 10% of that issuer's voting
securities. This limitation applies to 75% of the Fund's total
assets. The limit does not apply to securities issued or
guaranteed by the U.S. government or any of its agencies or
instrumentalities or securities of other investment companies.
o The Fund cannot make loans, except to the extent permitted under the
Investment Company Act, the rules or regulations thereunder or any
exemption therefrom that is applicable to the Fund, as such
statute, rules or regulations may be amended or interpreted from
time to time.
o The Fund may not borrow money, except to the extent permitted under the
Investment Company Act, the rules or regulations thereunder or any
exemption therefrom that is applicable to the Fund, as such
statute, rules or regulations may be amended or interpreted from
time to time.
o The Fund cannot invest 25% or more of its total assets in any one
industry. That limit does not apply to securities issued or
guaranteed by the U.S. government or its agencies and
instrumentalities.
o The Fund cannot buy or sell real estate. However, the Fund can
purchase and sell securities issued or secured by companies that
invest in or deal in real estate or interests in real estate.
o The Fund cannot buy or sell commodities or commodity contracts.
However, the Fund can buy and sell derivative instruments and other
hedging instruments, such as futures contracts, options, swaps, and
forward contracts.
o The Fund cannot underwrite securities of other companies. A permitted
exception is in case it is deemed to be an underwriter under the
Securities Act of 1933 when reselling any securities held in its
own portfolio.
o The Fund cannot issue "senior securities," but this does not prohibit
certain investment activities for which assets of the Fund are
designated as segregated, or margin, collateral or escrow
arrangements are established, to cover the related obligations.
Examples of those activities include borrowing money, reverse
repurchase agreements, delayed-delivery and when-issued
arrangements for portfolio securities transactions, and contracts
to buy or sell derivatives, hedging instruments, options or
futures.
Unless the Prospectus or this Statement of Additional Information
states that a percentage restriction applies on an ongoing basis, it applies
only at the time the Fund makes an investment, with the exception of the
borrowing policy and illiquid securities policy. The Fund need not sell
securities to meet the percentage limits if the value of the investment
increases in proportion to the size of the Fund.
For purposes of the Fund's policy not to concentrate its investments,
the Fund has adopted the industry classifications set forth in Appendix B to
this Statement of Additional Information. The industry classifications set
forth therein are not a fundamental policy.
How the Fund is ManagedOrganization and History. The Fund is an open-end, diversified, management
investment company with an unlimited number of authorized shares of
beneficial interest. The Fund was organized as a Massachusetts business trust
on May 22, 2003.
Classes of Shares. The Trustees are authorized, without shareholder
approval, to create new series and classes of shares. The Trustees may
reclassify unissued shares of the Fund into additional series of classes of
shares. The Trustees also may divide or combine the shares of a class into a
greater or lesser number of shares without changing the proportionate
beneficial interest of a shareholder in the Fund. Shares do not have
cumulative voting rights or preemptive or subscription rights. Shares may be
voted in person or by proxy at shareholder meetings. The Fund currently has
five classes of shares: Class A, Class B, Class C, Class N and Class Y. All
classes invest in the same investment portfolio. Only retirement plans may
purchase Class N shares. Only certain institutional investors may elect to
purchase Class Y shares. Each class of shares:
o has its own dividends and distributions,
o pays certain expenses which may be different for the different classes,
o may have a different net asset value,
o may have separate voting rights on matters in which interests of one
class are
different from interests of another class, and
o votes as a class on matters that affect that class alone.
Shares are freely transferable, and each share of each class has one
vote at shareholder meetings, with fractional shares voting proportionally on
matters submitted to the vote of shareholders. Each share of the Fund
represents an interest in the Fund proportionately equal to the interest of
each other share of the same class.
Meetings of Shareholders. As a Massachusetts business trust, the Fund is not
required to hold, and does not plan to hold, regular annual meetings of
shareholders. The Fund will hold meetings when required to do so by the
Investment Company Act or other applicable law. It will also do so when a
shareholder meeting is called by the Trustees or upon proper request of the
shareholders.
Shareholders have the right, upon the declaration in writing or vote of
two-thirds of the outstanding shares of the Fund, to remove a Trustee. The
Trustees will call a meeting of shareholders to vote on the removal of a
Trustee upon the written request of the record holders of 10% of its
outstanding shares. If the Trustees receive a request from at least 10
shareholders stating that they wish to communicate with other shareholders to
request a meeting to remove a Trustee, the Trustees will then either make the
Fund's shareholder list available to the applicants or mail their
communication to all other shareholders at the applicants' expense. The
shareholders making the request must have been shareholders for at least six
months and must hold shares of the Fund valued at $25,000 or more or
constituting at least 1% of the Fund's outstanding shares, whichever is less.
The Trustees may also take other action as permitted by the Investment
Company Act.
Shareholder and Trustee Liability. The Fund's Declaration of Trust contains
an express disclaimer of shareholder or Trustee liability for the Fund's
obligations. It also provides for indemnification and reimbursement of
expenses out of the Fund's property for any shareholder held personally
liable for its obligations. The Declaration of Trust also states that upon
request, the Fund shall assume the defense of any claim made against a
shareholder for any act or obligation of the Fund and shall satisfy any
judgment on that claim. Massachusetts law permits a shareholder of a
business trust (such as the Fund) to be held personally liable as a "partner"
under certain circumstances. However, the risk that a Fund shareholder will
incur financial loss from being held liable as a "partner" of the Fund is
limited to the relatively remote circumstances in which the Fund would be
unable to meet its obligations.
The Fund's contractual arrangements state that any person doing
business with the Fund (and each shareholder of the Fund) agrees under its
Declaration of Trust to look solely to the assets of the Fund for
satisfaction of any claim or demand that may arise out of any dealings with
the Fund. Additionally, the Trustees shall have no personal liability to any
such person, to the extent permitted by law.
Board of Trustees and Oversight Committees. The Fund is governed by a Board
of Trustees, which is responsible for protecting the interests of
shareholders under Massachusetts law. The Trustees meet periodically
throughout the year to oversee the Fund's activities, review its performance,
and review the actions of the Manager. Although the Fund will not normally
hold annual meetings of its shareholders, it may hold shareholder meetings
from time to time on important matters, and shareholders have the right to
call a meeting to remove a Trustee or to take other action described in the
Fund's Declaration of Trust.
The Trustees have appointed an Audit Committee, comprised of Messrs.,
Abdow, Wikler (Chairman) and Wold, all of whom are independent Trustees. The
Fund is a new fund and as such has not completed its first fiscal year.
However, the Audit Committee plans to meet at least once during each fiscal
year. The Board of Trustees does not have a standing nominating or
compensation committee.
The Audit Committee furnishes the Board with recommendations regarding
the selection of the independent auditor. Other functions of the Audit
Committee include: (i) reviewing the scope and results of audits and the
audit fees charged; (ii) reviewing reports from the Fund's independent
auditor regarding the adequacy of the Fund's internal accounting procedures
and controls; and (iii) establishing a separate line of communication between
the Fund's independent auditors and its Trustees, among other duties as set
forth in the Committee's charter.
Based on the Audit Committee's recommendation, the Board of Trustees of
the Fund, including a majority of the Independent Trustees, on May 21, 2003,
selected Ernst & Young LLP ("Ernst & Young") as auditors of the Fund. Ernst &
Young also serve as independent auditors for certain other funds for which
the Manager acts as investment advisor.
It is anticipated the Ernst & Young will perform audit services for the
Fund including the audit of the Fund's financial statements, review of the
Fund's annual report and registration statement amendment, consultation on
financial accounting and reporting matters, and meetings with the Board of
Trustees.
Trustees and Officers of the Fund. The Fund's Trustees and Officers and
their positions held with the Fund and length of service in such position(s)
and their principal occupations and business affiliations during the past
five years are listed in the chart below. Except for Mr. Murphy and Mr.
Walcott each of the trustees is an "Independent Trustee," as defined in the
Investment Company Act. Mr. Murphy is an "Interested Trustee," because he is
affiliated with the Manager by virtue of his positions as an officer and
director of the Manager, and as a shareholder of its parent company. Mr.
Walcott is also an "Interested Trustee" by virtue of his former position as
an officer of the Manager's parent company. All information in the following
tables is as of December 31, 2002. All of the Trustees are Trustees or
Managers of the following Oppenheimer funds (referred to as "Board IV Funds"):
OFI Tremont Core Diversified Hedge Fund
OFI Tremont Market Neutral Hedge Fund
Oppenheimer Tremont Market Neutral Fund LLC
Oppenheimer Tremont Opportunity Fund LLC
Oppenheimer Real Estate Fund
Oppenheimer Multi Cap Value Fund
Oppenheimer Total Return Bond Fund
Oppenheimer International Large-Cap Core Fund
Oppenheimer International Value Fund
Messrs. Murphy, Masterson, Molleur, Wixted, Vottiero, Zack, Morgan and
Mses. Bechtolt, Feld, Ives and Lee are officers of the Fund and, with the
exception of Ms. Lee and Mr. Morgan, hold the same offices with the other
Oppenheimer funds. Ms. Lee is an officer of certain other Oppenheimer
funds. As of the date of this Statement of Additional Information, the
Trustees and the officers of the Fund as a group owned of record or
beneficially less than 1% of each class of the outstanding shares of the
Fund. The foregoing statement does not reflect ownership of shares of the
Fund held of record by an employee benefit plan for employees of the Manager,
other than the shares beneficially owned under the plan by the officers of
the Fund listed above. In addition, each Independent Trustee, and his family
members, do not own securities of either the Manager or Distributor of the
Board IV Funds, or any person directly or indirectly controlling, controlled
by or under common control with the Manager or Distributor. The chart below
does not disclose information about each Trustee's ownership of Fund shares
or ownership of shares of OFI Tremont Core Diversified Hedge Fund, OFI
Tremont Market Neutral Hedge Fund, Oppenheimer Total Return Bond Fund,
Oppenheimer International Large-Cap Core Fund or Oppenheimer International
Value Fund because these funds had not yet commenced operations as of
December 31, 2002.
The address of each Independent Trustee in the chart below is: 6803 S.
Tucson Way, Centennial, CO80112-3924. Each Trustee serves for an indefinite
term, until his resignation, retirement, death or removal.
-------------------------------------------------------------------------------------
Independent Trustees
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Aggregate
Dollar
Range Of
Shares
Dollar Beneficially
Range Owned in
Name, Principal Occupation(s) During Past 5 of Any of the
Position(s) Held Years; Shares Oppenheimer
with Fund, Other Trusteeships/Directorships Held by BeneficiaFunds
Length of Service, Trustee; Owned Overseen
Age Number of Portfolios in Fund Complex in the by Trustee
Currently Overseen by Trustee Fund
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
As of December 31,2002
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Ronald J. Abdow, President, Abdow Corporation (operator of $0 Over
Trustee since 2003, restaurants): Trustee, Abdow G&R Trust $100,000
Age: 70 and Abdow Co. (owners and operators of
restaurant properties); Partner, Abdow
Partnership, Abdow Auburn Associates and
Abdow Hazard Associates (owners and
operators of restaurant properties);
Chairman, Western Mass Development Corp;
Chairman, American International College;
Trustee (since 1993) of MML Series
Investment Fund and Trustee (since 1994)
of MassMutual Institutional Funds
(open-end investment companies). Oversees
9 portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Joseph M. Wikler, Self-employed as an investment $0 $10,001-$50,000
Trustee since 2003, consultant; a director of Lakes
Age: 61 Environmental Association (since 1996),
and Medintec (since 1992) and Cathco
(since 1995) (medical device companies);
and a member of the investment committee
of the Associated Jewish Charities of
Baltimore (since 1994); formerly a
director of Fortis/Hartford mutual funds
(1994 - December 2001). Oversees 9
portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Peter I. Wold, President of Wold Properties, Inc. (an $0 Over
Trustee since 2003, oil and gas exploration and production $100,000
Age: 54 company); Vice President, Secretary and
Treasurer of Wold Trona Company, Inc.
(soda ash processing and production);
Vice President of Wold Talc Company, Inc.
(talc mining); Managing Member,
Hole-in-the-Wall Ranch (cattle ranching);
formerly Director and Chairman of the
Board, Denver Branch of the Federal
Reserve Bank of Kansas City (1993-1999)
and Director of PacifiCorp. (1995 -
1999), an electric utility. Oversees 9
portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
The address of the Interested Trustee in the chart below is as
follows: 6803 S. Tucson Way, Centennial, CO80112-3924. The Trustee serves
for an indefinite term, until his resignation, retirement, death or removal.
-------------------------------------------------------------------------------------
Interested Trustee
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Aggregate
Dollar
Range
Of Shares
Dollar Beneficially
Range Owned in
Name, Principal Occupation(s) During Past 5 of Any of the
Position(s) Held Years; Shares Oppenheimer
with Fund, Other Trusteeships/Directorships Held by BeneficiaFunds
Length of Service; Trustee; Owned Overseen
Age Number of Portfolios in Fund Complex in the by Trustee
Currently Overseen by Trustee Fund
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
As of December 31,2002
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Eustis Walcott, Principal with Ardsley Associates (since $0 $10,001-50,000
Trustee since 2003 August 2000) (consulting firm); formerly
Age: 64 Senior Vice President, MassMutual
Financial Group (May 1990 - July 2000).
Trustee (since 2000) of Cornerstone Real
Estate Advisors, MML Investors Services
(since 2000), OFI Trust Company (since
2001) and the American International
College (since 1995). Trustee and Vice
President (since 1996) of the MassMutual
Foundation. Oversees 9 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
The address of Mr. Murphy, an interested trustee and officer of the
Fund as indicated in the chart below, is 498 Seventh Avenue, New York, NY10018. Mr. Murphy serves for an indefinite term, until his resignation,
retirement, death or removal.
-------------------------------------------------------------------------------------
Interested Trustee and Officer
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Aggregate
Dollar
Range
Of Shares
Dollar Beneficially
Range Owned in
Name, Principal Occupation(s) During Past 5 of Any of the
Position(s) Held Years; Shares Oppenheimer
with Fund, Other Trusteeships/Directorships Held by BeneficiaFunds
Length of Service; Trustee; Owned Overseen
Age Number of Portfolios in Fund Complex in the by Trustee
Currently Overseen by Trustee Fund
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
As of December 31,2002
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
John V. Murphy, Chairman, Chief Executive Officer and $0 Over
President, Trustee director (since June 2001) and President $100,000
and Chairman of the (since September 2000) of the Manager;
Board, President and a director or trustee of
Trustee since 2003 other Oppenheimer funds; President and a
Age: 53 director (since July 2001) of Oppenheimer
Acquisition Corp. and of Oppenheimer
Partnership Holdings, Inc.; a director
(since November 2001) of OppenheimerFunds
Distributor, Inc.; Chairman and a
director (since July 2001) of Shareholder
Services, Inc. and of Shareholder
Financial Services, Inc.; President and a
director (since July 2001) of
OppenheimerFunds Legacy Program (a
charitable trust program established by
the Manager); a director of the following
investment advisory subsidiaries of
OppenheimerFunds, Inc.: OFI Institutional
Asset Management, Inc. and Centennial
Asset Management Corporation (since
November 2001), HarbourView Asset
Management Corporation and OFI Private
Investments, Inc. (since July 2001);
President (since November 1, 2001) and a
director (since July 2001) of Oppenheimer
Real Asset Management, Inc.; a director
(since November 2001) of Trinity
Investment Management Corp. and Tremont
Advisers, Inc. (investment advisory
affiliates of the Manager); Executive
Vice President (since February 1997) of
Massachusetts Mutual Life Insurance
Company (the Manager's parent company); a
director (since June 1995) of DLB
Acquisition Corporation (a holding
company that owns the shaes of David L.
Babson & Company); formerly, Chief
Operating Officer (September 2000-June
2001) of the Manager; President and
trustee (November 1999-November 2001) of
MML Series Investment Fund and MassMutual
Institutional Funds (open-end investment
companies); a director (September
1999-August 2000) of C.M. Life Insurance
Company; President, Chief Executive
Officer and director (September
1999-August 2000) of MML Bay State Life
Insurance Company; a director (June
1989-June 1998) of Emerald Isle Bancorp
and Hibernia Savings Bank (a wholly-owned
subsidiary of Emerald Isle Bancorp).
Oversees 71 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
The address of the Officers in the chart below is 498 Seventh Avenue,
New York, NY10018 except for Mr. Wixted and Mses. Bechtolt and Ives whose
address is 6803 S. Tucson Way, Centennial, CO80112-3924. Each Officer serves
for an annual term or until his or her earlier resignation, death or removal.
-------------------------------------------------------------------------------------
Officers of the Fund
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Name,
Position(s) Held with Fund,
Length of Service,
Age Principal Occupation(s) During Past 5 Years
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Dixon Morgan, Jr., Vice Senior Director and Portfolio Manager of HarbourView
President and Portfolio Asset Management Corporation and OFI Institutional
Manager since 2003 Asset Management, Inc., both affiliates of the
Age: 57 Manager since April 2000. Prior to joining the
Sub-Advisor in April 2000, Mr. Morgan was a Managing
Director of Gratry & Company from July 1990 until
April 2000.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Brian W. Wixted, Senior Vice President and Treasurer (since March
Treasurer, Principal 1999) of the Manager; Treasurer (since March 1999)
Financial and Accounting of HarbourView Asset Management Corporation,
Officer since 2003 Shareholder Services, Inc., Oppenheimer Real Asset
Age: 42 Management Corporation, Shareholder Financial
Services, Inc., Oppenheimer Partnership Holdings,
Inc., OFI Private Investments, Inc. (since March
2000), OppenheimerFunds International Ltd. and
Oppenheimer Millennium Funds plc (since May 2000)
and OFI Institutional Asset Management, Inc. (since
November 2000); Treasurer and Chief Financial
Officer (since May 2000) of Oppenheimer Trust
Company (a trust company subsidiary of the Manager);
Assistant Treasurer (since March 1999) of
Oppenheimer Acquisition Corp. and OppenheimerFunds
Legacy Program (since April 2000); formerly
Principal and Chief Operating Officer (March
1995-March 1999) of Bankers Trust Company-Mutual
Fund Services Division. An officer of 87 portfolios
in the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Philip Vottiero, Vice President/Fund Accounting of the Manager (since
Assistant Treasurer since 2003 March 2002; formerly Vice President/Corporate
Age: 39 Accounting of the Manager (July 1999-March 2002)
prior to which he was Chief Financial Officer at
Sovlink Corporation (April 1996-June 1999). An
officer of 87 portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Connie Bechtolt, Assistant Vice President of the Manager (since
Assistant Treasurer since 2003 September 1998); formerly Manager/Fund Accounting
Age: 39 (September 1994-September 1998) of the Manager. An
officer of 87 portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Robert G. Zack, Senior Vice President (since May 1985) and General
Secretary since 2003 Counsel (since February 2002) of the Manager;
Age: 54 General Counsel and a director (since November 2001)
of OppenheimerFunds Distributor, Inc.; Senior Vice
President and General Counsel (since November 2001)
of HarbourView Asset Management Corporation; Vice
President and a director (since November 2000) of
Oppenheimer Partnership Holdings, Inc.; Senior Vice
President, General Counsel and a director (since
November 2001) of Shareholder Services, Inc.,
Shareholder Financial Services, Inc., OFI Private
Investments, Inc., Oppenheimer Trust Company and OFI
Institutional Asset Management, Inc.; General
Counsel (since November 2001) of Centennial Asset
Management Corporation; a director (since November
2001) of Oppenheimer Real Asset Management, Inc.;
Assistant Secretary and a director (since November
2001) of OppenheimerFunds International Ltd.; Vice
President (since November 2001) of OppenheimerFunds
Legacy Program; Secretary (since November 2001) of
Oppenheimer Acquisition Corp.; formerly Acting
General Counsel (November 2001-February 2002) and
Associate General Counsel (May 1981-October 2001) of
the Manager; Assistant Secretary of Shareholder
Services, Inc. (May 1985-November 2001), Shareholder
Financial Services, Inc. (November 1989-November
2001); OppenheimerFunds International Ltd. And
Oppenheimer Millennium Funds plc (October
1997-November 2001). An officer of 87 portfolios in
the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Philip T. Masterson, Vice President and Assistant Counsel of the Manager
Assistant Secretary since 2003 (since July 1998); formerly, an associate with
Age: 38 Davis, Graham, & Stubbs LLP (January 1997-June
1998). An officer of 87 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Denis R. Molleur, Vice President and Senior Counsel of the Manager
Assistant Secretary since 2003 (since July 1999); formerly a Vice President and
Age: 45 Associate Counsel of the Manager (September
1995-July 1999). An officer of 85 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Dina C. Lee, Assistant Vice President and Assistant Counsel of
Assistant Secretary since 2003 the Manager (since December 2000); formerly an
Age: 32 attorney and Assistant Secretary of Van Eck Global
(until December 2000). An officer of 5 portfolios in
the OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Katherine P. Feld, Vice President and Senior Counsel (since July 1999)
Assistant Secretary since 2003 of the Manager; Vice President (since June 1990) of
Age: 44 OppenheimerFunds Distributor, Inc.; Director, Vice
President and Assistant Secretary (since June 1999)
of Centennial Asset Management Corporation; Vice
President (since 1997) of Oppenheimer Real Asset
Management, Inc.; formerly Vice President and
Associate Counsel of the Manager (June 1990-July
1999). An officer of 87 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Kathleen T. Ives, Vice President and Assistant Counsel (since June
Assistant Secretary since 2003 1998) of the Manager; Vice President (since 1999) of
Age: 36 OppenheimerFunds Distributor, Inc.; Vice President
and Assistant Secretary (since 1999) of Shareholder
Services, Inc.; Assistant Secretary (since December
2001) of OppenheimerFunds Legacy Program and
Shareholder Financial Services, Inc.; formerly
Assistant Vice President and Assistant Counsel of
the Manager (August 1997-June 1998); Assistant
Counsel of the Manager (August 1994-August 1997). An
officer of 87 portfolios in the OppenheimerFunds
complex.
--------------------------------------------------------------------------------
|X| Remuneration of Trustees. The officers of the Fund and one Trustee
(Mr. Murphy) are affiliated with the Manager and receive no salary or fee
from the Fund. The Trustees of the Fund will receive the estimated
compensation shown below from the Fund with respect to the Fund's fiscal year
ending April 30, 2004. The compensation from all of the Board IV Oppenheimer
funds represents compensation received as a trustee, manager or member of a
committee of the Board during the calendar year ended December 31, 2002. The
Trustees do not receive any retirement benefits from the Board IV Oppenheimer
funds. The chart below does not disclose compensation from the Fund, OFI
--------------------------------------------------------------------------------
Estimated Aggregate Total Compensation from all
----------------------------------Compensa
I:\LEGAL\N1A\Intl Large Cap Fund
Core Trust\2003\SAI 2003 ---------
Pre-Effective #1 .doc Fiscal Y
Oppenheimer Total Return 4/3
Bond Fund or Oppenheimer
International Value Fund
because these funds had not yet tion-from-----Board-IV-Funds-for-which
commenced operations as of for the Individual Served as
December 31, 2002. ----------- Trustee/Manager
ear Ending For the Calendar Year Ended
Trustee Name and Other Fund 0/041 12/31/02
Position(s) (as applicable) (4 Funds)
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Ronald J. Abdow $1,258 $18,000
Audit Committee Member
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Eustis Walcott $1,162 $18,000
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Joseph M. Wikler $1,258 $18,000
Audit Committee Chairman
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
Peter I. Wold $1,258 $18,000
Audit Committee Member
------------------------------------------------------------------------------------
1. Estimated aggregate compensation from the Fund includes fees and deferred
compensation, if any.
|X| Major Shareholders. As of the date of this Statement of Additional
Information, OppenheimerFunds, Inc. is the only shareholder of record.
The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a
holding company controlled by Massachusetts Mutual Life Insurance Company, a
global, diversified insurance and financial services organization. The
Manager is organized under the laws of the State of Colorado.
|X|Code of Ethics. The Fund, the Manager, Sub-Advisor and the Distributor
have a Code of Ethics. It is designed to detect and prevent improper
personal trading by certain employees, including portfolio managers, that
would compete with or take advantage of the Fund's portfolio transactions.
Covered persons include persons with knowledge of the investments and
investment intentions of the Fund and other funds advised by the Manager.
The Code of Ethics does permit personnel subject to the Code to invest in
securities, including securities that may be purchased or held by the Fund,
subject to a number of restrictions and controls. Compliance with the Code of
Ethics is carefully monitored and enforced by the Manager.
The Code of Ethics is an exhibit to the Fund's registration statement
filed with the SEC and can be reviewed and copied at the SEC's Public
Reference Room in Washington, D.C. You can obtain information about the hours
of operation of the Public Reference Room by calling the SEC at
1.202.942.8090. The Code of Ethics can also be viewed as part of the Fund's
registration statement on the SEC's EDGAR database at the SEC's Internet
website at www.sec.gov. Copies may be obtained, after paying a duplicating
fee, by electronic request at the following E-mail address:
publicinfo@sec.gov., or by writing to the SEC's Public Reference Section,
-------------------
Washington, D.C. 20549-0102.
|X| Portfolio Proxy Voting. The Fund has adopted Portfolio Proxy Voting
Policies and Procedures under which the Fund votes proxies relating to
securities ("portfolio proxies") held by the Fund. The Fund's primary
consideration in voting portfolio proxies is the financial interests of the
Fund and its shareholders. The Fund has retained an unaffiliated third-party
as its agent to vote portfolio proxies in accordance with the Fund's
Portfolio Proxy Voting Guidelines and to maintain records of such portfolio
proxy voting. The Proxy Voting Guidelines include provisions to address
conflicts of interest that may arise between the Fund and OFI where an OFI
directly-controlled affiliated manages or administers the assets of a pension
plan of the company soliciting the proxy. The Fund's Portfolio Proxy Voting
Guidelines and Procedures on routine and non-routine proxy proposals are
summarized below.
o The Fund votes with the recommendation of the issuer's management on
routine matters, including election of directors nominated by
management and ratification of auditors, unless circumstances indicate
otherwise.
o In general, the Fund opposes anti-takeover proposals and supports
elimination of anti-takeover proposals, absent unusual circumstances.
o The Fund supports shareholder proposals to reduce a super-majority vote
requirement, and opposes management proposals to add a super-majority
vote requirement.
o The Fund opposes proposals to classify the board of directors.
o The Fund support proposals to eliminate cumulative voting.
o The Fund opposes re-pricing of stock options.
o The Fund generally considers executive compensation questions such as
stock option plans and bonus plans to be ordinary business activity.
The Fund analyzes stock option plans, paying particular attention to
their dilutive effect. While the Fund generally supports management
proposals, the Fund opposes plans it considers to be excessive.
The Fund will be required to file new Form N-PX, with its complete
proxy voting record for the 12 months ended June 30th, no later than August
31st of each year. The first such filing is due no later than August 31,2004, for the twelve months ended June 30, 2004. Once filed, the Fund's
Form N-PX filing will be available (i) without charge, upon request, by
calling the Fund toll-free at 1.800.225.5677 and (ii) on the SEC's website
at www.sec.gov.
-----------
|X| The Investment Advisory Agreement. The Board of Trustees concluded
that it was in the best interest of shareholders to approve the adoption of
the Investment Advisory Agreement, based on the factors discussed below.
The Manager provides investment advisory and management services to the Fund
under an investment advisory agreement between the Manager and the Fund. The
portfolio manager of the Fund is employed by the Sub-Advisor and is the
person who is principally responsible for the day-to-day management of the
Fund's portfolio.
The investment advisory agreement requires the Manager, at its expense,
to provide the Fund with adequate office space, facilities and equipment. It
also requires the Manager to provide and supervise the activities of all
administrative and clerical personnel required to provide effective
administration for the Fund. Those responsibilities include the compilation
and maintenance of records with respect to its operations, the preparation
and filing of specified reports, and composition of proxy materials and
registration statements for continuous public sale of shares of the Fund.
The Fund pays expenses not expressly assumed by the Manager under the
advisory agreement. The advisory agreement lists examples of expenses paid by
the Fund. The major categories relate to interest, taxes, brokerage
commissions, fees to certain Trustees, legal and audit expenses, custodian
and transfer agent expenses, share issuance costs, certain printing and
registration costs and non-recurring expenses, including litigation costs.
The management fees paid by the Fund to the Manager are calculated at the
rates described in the Prospectus, which are applied to the assets of the
Fund as a whole. The fees are allocated to each class of shares based upon
the relative proportion of the Fund's net assets represented by that class.
The Fund is a new fund and has not yet completed its first fiscal year,
therefore the total amount that the Fund paid to the Manager under the
investment advisory contract during the Fund's last three fiscal years is not
yet available.
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 resulting from a
good faith error or omission on its part with respect to any of its duties
under the agreement.
The agreement permits the Manager to act as investment advisor for any
other person, firm or corporation and to use the name "Oppenheimer" in
connection with other investment companies for which it may act as investment
advisor or general distributor. If the Manager shall no longer act as
investment advisor to the Fund, the Manager may withdraw the right of the
Fund to use the name "Oppenheimer" as part of its name.
|X| Approval of Investment Advisory Agreement and Sub-Advisory
Agreement. The Board of Trustees, including a majority of the Independent
Trustees, is required to approve the Investment Advisory Agreement and the
Sub-Advisory Agreement. The Investment Company Act requires that the Board
request and evaluate and the Manager and Sub-Advisor provide such information
as may be reasonably necessary to evaluate the terms of the investment
advisory agreements. The Board also receives information about the 12b-1
distribution fees the Fund pays.
The Board reviewed the foregoing information in arriving at its
decision to approve the investment advisory agreements. Among other factors,
the Board considered:
o The nature, cost, and quality of the services provided to the Fund and
its shareholders;
o The investment performance of the Manager and the Sub-Advisor in
comparison to regular market indices;
o Economies of scale that may be available to the Fund from the Manager;
o Fees paid by other mutual funds for similar services;
o Fees paid to the Manager and Sub-Advisor by other similar funds
o The value and quality of any other benefits or services received by the
Fund from its relationship with the Manager and the Sub-Advisor; and
o The direct and indirect benefits the Manager and Sub-Advisor receive
from their relationship with the Fund. These included services
provided by the Distributor and the Transfer Agent, and brokerage
and soft dollar arrangements permissible under Section 28(e) of the
Securities Exchange Act.
The Board considered that the Manager and the Sub-Advisor must be able
to pay and retain high quality personnel at competitive rates to provide
services to the Fund. The Board also considered that maintaining the
financial viability of the Manager and the Sub-Advisor is important so that
they will be able to continue to provide quality services to the Fund and its
shareholders in adverse times.
These matters were also considered by the Independent Trustees, who met
separately from the full Board, with experienced Counsel to the Fund, Mayer,
Brown, Rowe & Maw who assisted the Board in its deliberations. The Fund's
Counsel is independent of the Manager and Sub-Advisor within the meaning and
intent of the SEC Rules regarding the independence of counsel.
After careful deliberation, the Board of concluded that it was in the
best interest of shareholders to approve the investment advisory agreements.
In arriving at a decision to approve the investment advisory agreements, the
Board did not single out any one factor or group of factors as being more
important than other factors, but considered all factors together. The Board
judged the terms and conditions of the investment advisory agreements,
including the investment advisory fees, in light of all of the surrounding
circumstances.
The Sub-Advisor. The Sub-Advisor is a registered investment adviser and a
direct wholly owned subsidiary of the Manager. The Sub-Advisor provides
investment supervisory services on a discretionary basis to individual
accounts, investment companies, pension plans, insurance company separate
accounts, public funds and corporations. As of June 30, 2003, the
Sub-Advisor had approximately $2 billion of assets under management.
|X| The Sub-Advisory Agreement. Under the Sub-Advisory Agreement
between the Manager and the Sub-Advisor, the Sub-Advisor shall regularly
provide investment advice with respect to the Fund and invest and reinvest
cash, securities and the property comprising the assets of the Fund. The
Sub-Advisor also agrees to provide assistance in the distribution and
marketing of the Fund.
Under the Sub-Advisory Agreement, the Manager shall pay the
Sub-Advisor, as compensation for services rendered hereunder, from its own
assets, a fee, payable monthly, equal to 30% of the investment advisory fee
collected by the Manager from the Fund during the period.
The Sub-Advisory Agreement states that in the absence of willful
misfeasance, bad faith, negligence or reckless disregard of its duties or
obligations, the Sub-Advisor shall not be liable to the Manager for any act
or omission in the course of or connected with rendering services under the
Sub-Advisory Agreement or for any losses that may be sustained in the
purchase, holding or sale of any security.
Brokerage Policies of the Fund
Brokerage Provisions of the Investment Advisory Agreement and the
Sub-Advisory Agreement. One of the duties of the Sub-Advisor under the
Sub-Advisory Agreement is to arrange the portfolio transactions for the Fund.
The Fund's Investment Advisory Agreement with the Manager and the
Sub-Advisory Agreement contain provisions relating to the employment of
broker-dealers to effect the Fund's portfolio transactions. The Manager and
the Sub-Advisor are authorized to employ broker-dealers, including
"affiliated" brokers, as that term is defined in the Investment Company Act.
They may employ broker-dealers that they think, in its best judgment based on
all relevant factors, will implement the policy of the Fund to obtain, at
reasonable expense, the "best execution" of the Fund's portfolio
transactions. "Best execution" means prompt and reliable execution at the
most favorable price obtainable. The Manager and Sub-Advisor need not seek
competitive commission bidding. However, it is expected to be aware of the
current rates of eligible brokers and to minimize the commissions paid to the
extent consistent with the interests and policies of the Fund as established
by its Board of Trustees.
The Manager and the Sub-Advisor may select brokers (other than
affiliates) that provide brokerage and/or research services for the Fund
and/or the other accounts over which the Manager, the Sub-Advisor or their
respective affiliates have investment discretion. The commissions paid to
such brokers may be higher than another qualified broker would charge, if the
Manager or Sub-Advisor, as applicable, makes a good faith determination that
the commission is fair and reasonable in relation to the services provided.
Subject to those considerations, as a factor in selecting brokers for the
Fund's portfolio transactions, the Manager and the Sub-Advisor may also
consider sales of shares of the Fund and other investment companies for which
the Manager or an affiliate serves as investment advisor.
The Sub-Advisory Agreement permits the Sub-Advisor to enter into
"soft-dollar" arrangements through the agency of third parties to obtain
services for the Fund. Pursuant to these arrangements, the Sub-Advisor will
undertake to place brokerage business with broker-dealers who pay third
parties that provide services. Any such "soft-dollar" arrangements will be
made in accordance with policies adopted by the Board of the Fund and in
compliance with applicable law.
Brokerage Practices. Brokerage for the Fund is allocated subject to the
provisions of the Investment Advisory Agreement and the Sub-Advisory
Agreement and the procedures and rules described above. Generally, the
Sub-Advisor's portfolio traders allocate brokerage based upon recommendations
from the Fund's portfolio manager. In certain instances, a portfolio manager
may directly place trades and allocate brokerage. In either case, the
Sub-Advisor's executive officers supervise the allocation of brokerage.
Transactions in securities other than those for which an exchange is
the primary market are generally done with principals or market makers. In
transactions on foreign exchanges, the Fund may be required to pay fixed
brokerage commissions and therefore would not have the benefit of negotiated
commissions available in U.S. markets. Brokerage commissions are paid
primarily for transactions in listed securities or for certain fixed-income
agency transactions in the secondary market. Otherwise brokerage commissions
are paid only if it appears likely that a better price or execution can be
obtained by doing so.
The Sub-Advisor serves as investment manager to a number of clients.
It is the practice of the Sub-Advisor to allocate purchase or sale
transactions among the Fund and other clients whose assets it manages in a
manner it deems equitable. In making those allocations, the Sub-Advisor
considers several main factors, including the respective investment
objectives, the relative size of portfolio holdings of the same or comparable
securities, the availability of cash for investment and the size of
investment commitments.
When orders to purchase or sell the same security on identical terms
are placed by more than one of the funds and/or other advisory accounts
managed by the Sub-Advisor, the transactions are generally executed as
received, although a fund or advisory account that does not direct trades to
a specific broker (these are called "free trades") usually will have its
order executed first. Orders placed by accounts that direct trades to a
specific broker will generally be executed after the free trades. All orders
placed on behalf of the Fund are considered free trades. However, having an
order placed first in the market does not necessarily guarantee the most
favorable price. Purchases are combined where possible for the purpose of
negotiating brokerage commissions. In some cases that practice might have a
detrimental effect on the price or volume of the security in a particular
transaction for the Fund.
Other funds advised by the Manager have investment policies similar to
those of the Fund. Those other funds may purchase or sell the same securities
as the Fund at the same time as the Fund, which could affect the supply and
price of the securities. If two or more funds advised by the Manager purchase
the same security on the same day from the same dealer, the transactions
under those combined orders are averaged as to price and allocated in
accordance with the purchase or sale orders actually placed for each account.
Most purchases of debt obligations are principal transactions at net
prices. Instead of using a broker for those transactions, the Fund normally
deals directly with the selling or purchasing principal or market maker
unless the Sub-Advisor determines that a better price or execution can be
obtained by using the services of a broker. Purchases of portfolio securities
from underwriters include a commission or concession paid by the issuer to
the underwriter. Purchases from dealers include a spread between the bid and
asked prices. The Fund seeks to obtain prompt execution of these orders at
the most favorable net price.
The Investment Advisory Agreement and the Sub-Advisory Agreement permit
the Manager and the Sub-Advisor to allocate brokerage for research services.
The investment research services provided by a particular broker may be
useful only to one or more of the advisory accounts of the Sub-Advisor and
its affiliates. The investment research received for the commissions of those
other accounts may be useful both to the Fund and one or more of the
Sub-Advisor's other accounts. Investment research may be supplied to the
Sub-Advisor by a third party at the instance of a broker through which trades
are placed.
Investment research services include information and analysis on
particular companies and industries as well as market or economic trends and
portfolio strategy, market quotations for portfolio evaluations, information
systems, computer hardware and similar products and services. If a research
service also assists the Sub-Advisor in a non-research capacity (such as
bookkeeping or other administrative functions), then only the percentage or
component that provides assistance to the Sub-Advisor in the investment
decision-making process may be paid in commission dollars.
The Board of Trustees permits the Manager to use stated commissions on
secondary fixed-income agency trades to obtain research if the broker
represents to the Manager that: (i) the trade is not from or for the broker's
own inventory, (ii) the trade was executed by the broker on an agency basis
at the stated commission, and (iii) the trade is not a riskless principal
transaction. The Board of Trustees permits the Manager to use commissions on
fixed-price offerings to obtain research, in the same manner as is permitted
for agency transactions.
The research services provided by brokers broaden the scope and
supplements the research activities of the Sub-Advisor. That research
provides additional views and comparisons for consideration, and helps the
Sub-Advisor 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 Sub-Advisor provides information to the Board about the commissions paid
to brokers furnishing such services, together with the Sub-Advisor's
representation that the amount of such commissions was reasonably related to
the value or benefit of such services.
Distribution and Service PlansThe Distributor. Under its General Distributor's Agreement with the Fund, the
Distributor acts as the Fund's principal underwriter in the continuous public
offering of the Fund's classes of shares. The Distributor bears the expenses
normally attributable to sales, including advertising and the cost of
printing and mailing prospectuses, other than those furnished to existing
shareholders. The Distributor is not obligated to sell a specific number of
shares.
Distribution and Service Plans. The Fund has adopted a Service Plan for Class
A shares and Distribution and Service Plans for Class B, Class C and Class N
shares under Rule 12b-1 of the Investment Company Act. Under those plans the
Fund pays the Distributor for all or a portion of its costs incurred in
connection with the distribution and/or servicing of the shares of the
particular class.
Each plan has been approved by a vote of the Board of Trustees,
including a majority of the Independent Trustees1, cast in person at a
meeting called for the purpose of voting on that plan.
Under the plans, the Manager and the Distributor may make payments to
affiliates and in their sole discretion, from time to time, may use their own
resources (at no direct cost to the Fund) to make payments to brokers,
dealers or other financial institutions for distribution and administrative
services they perform. The Manager may use its profits from the advisory fee
it receives from the Fund. In their sole discretion, the Distributor and the
Manager may increase or decrease the amount of payments they make from their
own resources to plan recipients.
Unless a plan is terminated as described below, the plan continues in
effect from year to year but only if the Fund's Board of Trustees and its
Independent Trustees specifically vote annually to approve its continuance.
Approval must be by a vote cast in person at a meeting called for the purpose
of voting on continuing the plan. A plan may be terminated at any time by the
vote of a majority of the Independent Trustees or by the vote of the holders
of a "majority" (as defined in the Investment Company Act) of the outstanding
shares of that class.
The Board of Trustees and the Independent Trustees must approve all
material amendments to a plan. An amendment to increase materially the amount
of payments to be made under a plan must be approved by shareholders of the
class affected by the amendment. Because Class B shares of the Fund
automatically convert into Class A shares 72 months after purchase, the Fund
must obtain the approval of both Class A and Class B shareholders for a
proposed material amendment to the Class A Plan that would materially
increase payments under the Plan. That approval must be by a "majority" (as
defined in the Investment Company Act) of the shares of each class, voting
separately by class.
While the plans are in effect, the Treasurer of the Fund shall provide
separate written reports on the plans to the Board of Trustees at least
quarterly for its review. The reports shall detail the amount of all payments
made under a plan and the purpose for which the payments were made. Those
reports are subject to the review and approval of the Independent Trustees.
Each plan states that while it is in effect, the selection and
nomination of those Trustees of the Fund who are not "interested persons" of
the Fund is committed to the discretion of the Independent Trustees. This
does not prevent the involvement of others in the selection and nomination
process as long as the final decision as to selection or nomination is
approved by a majority of the Independent Trustees.
Under the plan for a class, no payment will be made to any recipient in
any quarter in which the aggregate net asset value of all Fund shares of that
class held by the recipient for itself and its customers does not exceed a
minimum amount, if any, that may be set from time to time by a majority of
the Independent Trustees. The Board of Trustees has set no minimum amount of
assets to qualify for payments under the plans.
|X| Class A Service Plan Fees. Under the Class A service plan, the
Distributor currently uses the fees it receives from the Fund to pay brokers,
dealers and other financial institutions (they are referred to as
"recipients") for personal services and account maintenance services they
provide for their customers who hold Class A shares. The services include,
among others, answering customer inquiries about the Fund, assisting in
establishing and maintaining accounts in the Fund, making the Fund's
investment plans available and providing other services at the request of the
Fund or the Distributor. While the plan permits the Board to authorize
payments to the Distributor to reimburse itself for services under the plan,
the Board has not yet done so, except in the case of the special arrangement
described below. The Distributor makes payments to plan recipients quarterly
at an annual rate not to exceed 0.25% of the average annual net assets
consisting of Class A shares held in the accounts of the recipients or their
customers.
During the first year the shares are sold, the Distributor retains the
service fee to reimburse itself for the costs of distributing the shares. Any
unreimbursed expenses the Distributor incurs with respect to Class A shares
in any fiscal year cannot be recovered in subsequent years. The Distributor
may not use payments received under the Class A Plan to pay any of its
interest expenses, carrying charges, or other financial costs, or allocation
of overhead.
Class B, Class C and Class N Service and Distribution Plan Fees. Under the
Class B, Class C and Class N plans, service fees and distribution fees, are
computed on the average of the net asset value of shares in the respective
class, determined as of the close of each regular business day during the
period. Each plan provides for the Distributor to be compensated at a flat
rate, whether the Distributor's distribution expenses are more or less than
the amounts paid by the Fund under the plan during the period for which the
fee is paid. The types of services that recipients provide for the service
fee are similar to the services provided under the Class A service plan
described above.
The Class B, Class C and Class N plans permit the Distributor to retain
both the asset-based sales charges and the service fees or to pay recipients
the service fee on a quarterly basis, without payment in advance. However,
the Distributor currently intends to pay the service fee to recipients in
advance for the first year after the shares are purchased. After the first
year shares are outstanding, the Distributor makes service fee payments
quarterly on those shares. The advance payment is based on the net asset
value of shares sold. Shares purchased by exchange do not qualify for the
advance service fee payment. If Class B, Class C or Class N shares are
redeemed during the first year after their purchase, the recipient of the
service fees on those shares will be obligated to repay the Distributor a pro
rata portion of the advance payment of the service fee made on those shares.
The asset-based sales charge and service fees increase Class B and
Class C expenses by 1.00% and increase Class N expenses by 0.50% of the net
assets per year of the respective class.
The Distributor retains the asset-based sales charge on Class B and
Class N shares. The Distributor retains the asset-based sales charge on Class
C shares during the first year the shares are outstanding. It pays the
asset-based sales charge as an ongoing commission to the recipient on Class C
shares outstanding for a year or more. If a dealer has a special agreement
with the Distributor, the Distributor will pay the Class B, Class C, or Class
N service fee and the asset-based sales charge on Class C shares to the
dealer quarterly in lieu of paying the sales commissions and service fee in
advance at the time of purchase.
The asset-based sales charges on Class B, Class C and Class N shares
allow investors to buy shares without a front-end sales charge while allowing
the Distributor to compensate dealers that sell those shares. The Fund pays
the asset-based sales charges to the Distributor for its services rendered in
distributing Class B, Class C and Class N shares. The payments are made to
the Distributor in recognition that the Distributor:
o pays sales concessions to authorized brokers and dealers at the time of
sale and pays service fees as described above,
o may finance payment of sales concessions and/or the advance of the
service fee payment to recipients under the plans, or may provide
such financing from its own resources or from the resources of an
affiliate,
o employs personnel to support distribution of Class B, Class C and Class
N shares,
o bears the costs of sales literature, advertising and prospectuses
(other than those furnished to current shareholders) and state "blue
sky" registration fees and certain other distribution expenses,
o may not be able to adequately compensate dealers that sell Class B,
Class C and Class N shares without receiving payment under the plans
and therefore may not be able to offer such Classes for sale absent
the plans,
o receives payments under the plans consistent with the service fees and
asset-based sales charges paid by other non-proprietary funds that
charge 12b-1 fees,
o may use the payments under the plan to include the Fund in various
third-party distribution programs that may increase sales of Fund
shares,
o may experience increased difficulty selling the Fund's shares if
payments under the plan are discontinued because most competitor
funds have plans that pay dealers for rendering distribution
services as much or more than the amounts currently being paid by
the Fund, and
o may not be able to continue providing, at the same or at a lesser cost,
the same quality distribution sales efforts and services, or to
obtain such services from brokers and dealers, if the plan payments
were to be discontinued.
When Class B, Class C or Class N shares are sold without the designation of a
broker-dealer, the Distributor is automatically designated as the
broker-dealer of record. In those cases, the Distributor retains the service
fee and asset-based sales charge paid on Class B, Class C and Class N shares.
The Distributor's actual expenses in selling Class B, Class C and Class
N shares may be more than the payments it receives from the contingent
deferred sales charges collected on redeemed shares and from the Fund under
the plans. If either the Class B, Class C or Class N plan is terminated by
the Fund, the Board of Trustees may allow the Fund to continue payments of
the asset-based sales charge to the Distributor for distributing shares
before the plan was terminated.
All payments under the Class B, Class C and Class N plans are subject
to the limitations imposed by the Conduct Rules of the National Association
of Securities Dealers, Inc. on payments of asset-based sales charges and
service fees.
Performance of the Fund
Explanation of Performance Terminology. The Fund uses a variety of terms to
illustrate its investment performance. These terms include "average annual
total return,""cumulative total return,""average annual total return at net
asset value" and "total return at net asset value." An explanation of how
total returns are calculated is set forth below.
The Fund's illustrations of its performance data in advertisements must
comply with rules of the SEC. Those rules describe the types of performance
data that may be used and how it is to be calculated. In general, any
advertisement by the Fund of its performance data must include the average
annual total returns for the advertised class of shares of the Fund. Those
returns must be shown for the 1-, 5- and 10-year periods (or the life of the
class, if less) ending as of the most recently ended calendar quarter prior
to the publication of the advertisement (or its submission for publication).
Use of standardized performance calculations enables an investor to
compare the Fund's performance to the performance of other funds for the same
periods. However, a number of factors should be considered before using the
Fund's performance information as a basis for comparison with other
investments:
o Total returns measure the performance of a hypothetical account in the
Fund over various periods and do not show the performance of each
shareholder's account. Your account's performance will vary from the model
performance data if your dividends are received in cash, or you buy or sell
shares during the period, or you bought your shares at a different time and
price than the shares used in the model.
o The Fund's performance returns may not reflect the effect of taxes on
dividends and capital gains distributions.
o An investment in the Fund is not insured by the FDIC or any other
government agency.
o The principal value of the Fund's shares, and total returns are not
guaranteed and normally will fluctuate on a daily basis.
o When an investor's shares are redeemed, they may be worth more or less
than their original cost.
o Total returns for any given past period represent historical
performance information and are not, and should not be considered, a
prediction of future returns.
The performance of each class of shares is shown separately, because
the performance of each class of shares will usually be different. That is
because of the different kinds of expenses each class bears. The total
returns of each class of shares of the Fund are affected by market
conditions, the quality of the Fund's investments, the maturity of those
investments, the types of investments the Fund holds, and its operating
expenses that are allocated to the particular class.
The maximum offering price for Class A shares includes the current maximum
initial sales charge. The maximum offering price for Class B, Class C and
Class N shares is the net asset value per share, without considering the
effect of contingent deferred sales charges. There is no sales charge on
Class Y shares. The Class A dividend yield may also be quoted without
deducting the maximum initial sales charge.
|X| Total Return Information. There are different types of "total
returns" to measure the Fund's performance. Total return is the change in
value of a hypothetical investment in the Fund over a given period, assuming
that all dividends and capital gains distributions are reinvested in
additional shares and that the investment is redeemed at the end of the
period. Because of differences in expenses for each class of shares, the
total returns for each class are separately measured. The cumulative total
return measures the change in value over the entire period (for example, 10
years). An average annual total return shows the average rate of return for
each year in a period that would produce the cumulative total return over the
entire period. However, average annual total returns do not show actual
year-by-year performance. The Fund uses standardized calculations for its
total returns as prescribed by the SEC. The methodology is discussed below.
In calculating total returns for Class A shares, the current maximum
sales charge of 5.75% (as a percentage of the offering price) is deducted
from the initial investment ("P") (unless the return is shown without sales
charge, as described below). For Class B shares, payment of the applicable
contingent deferred sales charge is applied, depending on the period for
which the return is shown: 5.0% in the first year, 4.0% in the second year,
3.0% in the third and fourth
years, 2.0% in the fifth year, 1.0% in the sixth year and none thereafter.
For Class C shares, the 1.0% contingent deferred sales charge is deducted for
returns for the one-year period. For Class N shares, the 1% contingent
deferred sales charge is deducted for returns for the one-year period. There
is no sales charge for Class Y shares.
o Average Annual Total Return. The "average annual total return" of each
class is an average annual compounded rate of return for each year in a
specified number of years. It is the rate of return based on the change in
value of a hypothetical initial investment of $1,000 ("P" in the formula
below) held for a number of years ("n" in the formula) to achieve an Ending
Redeemable Value ("ERV" in the formula) of that investment, according to the
following formula:
ERV l/n - 1 Average Annual Total
---
Return
P
o Average Annual Total Return (After Taxes on Distributions). The
"average annual total return (after taxes on distributions)" of Class A
shares is an average annual compounded rate of return for each year in a
specified number of years, adjusted to show the effect of federal taxes
(calculated using the highest individual marginal federal income tax rates in
effect on any reinvestment date) on any distributions made by the Fund during
the specified period. It is the rate of return based on the change in value
of a hypothetical initial investment of $1,000 ("P" in the formula below)
held for a number of years ("n" in the formula) to achieve an ending value
("ATVD" in the formula) of that investment, after taking into account the
effect of taxes on Fund distributions, but not on the redemption of Fund
shares, according to the following formula:
- 1 = Average Annual Total Return (After Taxes on
ATVD l/n Distributions)
---
P
o Average Annual Total Return (After Taxes on Distributions and
Redemptions). The "average annual total return (after taxes on distributions
and redemptions)" of Class A shares is an average annual compounded rate of
return for each year in a specified number of years, adjusted to show the
effect of federal taxes (calculated using the highest individual marginal
federal income tax rates in effect on any reinvestment date) on any
distributions made by the Fund during the specified period and the effect of
capital gains taxes or capital loss tax benefits (each calculated using the
highest federal individual capital gains tax rate in effect on the redemption
date) resulting from the redemption of the shares at the end of the period.
It is the rate of return based on the change in value of a hypothetical
initial investment of $1,000 ("P" in the formula below) held for a number of
years ("n" in the formula) to achieve an ending value ("ATVDR" in the
formula) of that investment, after taking into account the effect of taxes on
fund distributions and on the redemption of Fund shares, according to the
following formula:
ATVDR - 1 = Average Annual Total Return (After Taxes on Distributions
---
l/n and Redemptions)
P
o Cumulative Total Return. The "cumulative total return" calculation
measures the change in value of a hypothetical investment of $1,000 over an
entire period of years. Its calculation uses some of the same factors as
average annual total return, but it does not average the rate of return on an
annual basis. Cumulative total return is determined as follows:
ERV - P = Total Return
-----------
P
o Total Returns at Net Asset Value. From time to time the Fund may also
quote a cumulative or an average annual total return "at net asset value"
(without deducting sales charges) for Class A, Class B, Class C or Class N
shares. There is no sales charge on Class Y shares. Each is based on the
difference in net asset value per share at the beginning and the end of the
period for a hypothetical investment in that class of shares (without
considering front-end or contingent deferred sales charges) and takes into
consideration the reinvestment of dividends and capital gains distributions.
Other Performance Comparisons. The Fund compares its performance annually to
that of an appropriate broadly-based market index in its Annual Report to
shareholders. You can obtain that information by contacting the Transfer
Agent at the addresses or telephone numbers shown on the cover of this
Statement of Additional Information. The Fund may also compare its
performance to that of other investments, including other mutual funds, or
use rankings of its performance by independent ranking entities. Examples of
these performance comparisons are set forth below.
|X| Lipper Rankings. From time to time the Fund may publish the
ranking of the performance of its classes of shares by Lipper, Inc.
("Lipper"). Lipper is a widely-recognized independent mutual fund monitoring
service. Lipper monitors the performance of regulated investment companies,
including the Fund, and ranks their performance for various periods in
categories based on investment styles. The Lipper performance rankings are
based on total returns that include the reinvestment of capital gain
distributions and income dividends but do not take sales charges or taxes
into consideration. Lipper also publishes "peer-group" indices of the
performance of all mutual funds in a category that it monitors and averages
of the performance of the funds in particular categories.
|X| Morningstar Ratings. From time to time the Fund may publish the star
rating of the performance of its classes of shares by Morningstar, Inc., an
independent mutual fund monitoring service. Morningstar rates mutual funds
in their specialized market sector. The Fund is rated among the foreign
stock funds category.
Morningstar proprietary star ratings reflect historical risk-adjusted
total investment return. For each fund with at least a three-year history,
Morningstar calculates a Morningstar Rating(TM)based on a Morningstar
Risk-Adjusted Return measure that accounts for variation in a fund's monthly
performance (including the effects of sales charges, loads, and redemption
fees), placing more emphasis on downward variations and rewarding consistent
performance. The top 10% of funds in each category receive 5 stars, the
next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5%
receive 2 stars, and the bottom 10% receive 1 star. (Each share class is
counted as a fraction of one fund within this scale and rated separately,
which may cause slight variations in the distribution percentages.) The
Overall Morningstar Rating for a fund is derived from a weighted average of
the performance figures associated with its three-, five-and ten-year (if
applicable) Morningstar Rating metrics.
|X| Performance Rankings and Comparisons by Other Entities and
Publications. From time to time the Fund may include in its advertisements
and sales literature performance information about the Fund cited in
newspapers and other periodicals such as The New York Times, The Wall Street
Journal, Barron's, or similar publications. That information may include
performance quotations from other sources, including Lipper and Morningstar.
The performance of the Fund's classes of shares may be compared in
publications to the performance
of various market indices or other investments, and averages, performance
rankings or other benchmarks prepared by recognized mutual fund statistical
services.
Investors may also wish to compare the returns on the Fund's share
classes to the return on fixed-income investments available from banks and
thrift institutions. Those include certificates of deposit, ordinary
interest-paying checking and savings accounts, and other forms of fixed or
variable time deposits, and various other instruments such as Treasury bills.
However, the Fund's returns and share price are not guaranteed or insured by
the FDIC or any other agency and will fluctuate daily, while bank depository
obligations may be insured by the FDIC and may provide fixed rates of return.
Repayment of principal and payment of interest on Treasury securities is
backed by the full faith and credit of the U.S. government.
From time to time, the Fund may publish rankings or ratings of the
Manager or Transfer Agent, and of the investor services provided by them to
shareholders of the Oppenheimer funds, other than performance rankings of the
Oppenheimer funds themselves. Those ratings or rankings of shareholder and
investor services by third parties may include comparisons of their
services to those provided by other mutual fund families selected by the
rating or ranking services. They may be based upon the opinions of the rating
or ranking service itself, using its research or judgment, or based upon
surveys of investors, brokers, shareholders or others.
From time to time the Fund may include in its advertisements and sales
literature the total return performance of a hypothetical investment account
that includes shares of the Fund and other Oppenheimer funds. The combined
account may be part of an illustration of an asset allocation model or
similar presentation. The account performance may combine total return
performance of the Fund and the total return performance of other Oppenheimer
funds included in the account. Additionally, from time to time, the Fund's
advertisements and sales literature may include, for illustrative or
comparative purposes, statistical data or other information about general or
specific market and economic conditions. That may include, for example,
o information about the performance of certain securities or commodities
markets or segments of those markets,
o information about the performance of the economies of particular
countries or regions,
o the earnings of companies included in segments of particular
industries, sectors, securities markets, countries or regions,
o the availability of different types of securities or offerings of
securities,
o information relating to the gross national or gross domestic product of
the United States or other countries or regions,
o comparisons of various market sectors or indices to demonstrate
performance, risk, or other characteristics of the Fund.
ABOUT your account
How to Buy Shares
Additional information is presented below about the methods that can be used
to buy shares of the Fund. Appendix C contains more information about the
special sales charge arrangements offered by the Fund, and the circumstances
in which sales charges may be reduced or waived for certain classes of
investors.
AccountLink. When shares are purchased through AccountLink, each purchase
must be at least $50 and shareholders must invest at least $500 before an
---
Asset Builder Plan (described below) can be established on a new account.
Shares will be purchased on the regular business day the Distributor is
instructed to initiate the Automated Clearing House ("ACH") transfer to buy
the shares. Dividends will begin to accrue on shares purchased with the
proceeds of ACH transfers on the business day the Fund receives Federal Funds
for the purchase through the ACH system before the close of The New York
Stock Exchange ("the Exchange"). The Exchange normally closes at 4:00 P.M.,
but may close earlier on certain days. If Federal Funds are received on a
business day after the close of the Exchange, the shares will be purchased
and dividends will begin to accrue on the next regular business day. The
proceeds of ACH transfers are normally received by the Fund three days after
the transfers are initiated. If the proceeds of the ACH transfer are not
received on a timely basis, the Distributor reserves the right to cancel the
purchase order. The Distributor and the Fund are not responsible for any
delays in purchasing shares resulting from delays in ACH transmissions.
Reduced Sales Charges. As discussed in the Prospectus, a reduced sales
charge rate may be obtained for Class A shares under Right of Accumulation
and Letters of Intent because of the economies of sales efforts and reduction
in expenses realized by the Distributor, dealers and brokers making such
sales. No sales charge is imposed in certain other circumstances described
in Appendix C to this Statement of Additional Information because the
Distributor or dealer or broker incurs little or no selling expenses.
|X| Right of Accumulation. To qualify for the lower sales charge
rates that apply to larger purchases of Class A shares, you and your spouse
can add together:
o Class A and Class B shares you purchase for your individual accounts
(including IRAs and 403(b) plans), or for your joint accounts, or
for trust or custodial accounts on behalf of your children who
are minors, and
o Current purchases of Class A and Class B shares of the Fund and other
Oppenheimer funds to reduce the sales charge rate that applies to
current purchases of Class A shares, and
o Class A and Class B shares of Oppenheimer funds you previously
purchased subject to an initial or contingent deferred sales
charge to reduce the sales charge rate for current purchases of
Class A shares, provided that you still hold your investment in
one of the Oppenheimer funds.
A fiduciary can count all shares purchased for a trust, estate or other
fiduciary account (including one or more employee benefit plans of the same
employer) that has multiple accounts. The Distributor will add the value, at
current offering price, of the shares you previously purchased and currently
own to the value of current purchases to determine the sales charge rate that
applies. The reduced sales charge will apply only to current purchases. You
must request it when you buy shares.
The Oppenheimer Funds. The Oppenheimer funds are those mutual funds for
which the Distributor acts as the distributor and currently include the
following:
Oppenheimer AMT-Free New York Municipals Oppenheimer Multi Cap Value Fund
Oppenheimer Bond Fund Oppenheimer Multiple Strategies Fund
Oppenheimer California Municipal Fund Oppenheimer Municipal Bond Fund
Oppenheimer Capital Appreciation Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Preservation Fund Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Capital Income Fund Oppenheimer Quest Balanced Value Fund
Oppenheimer Quest Capital Value Fund,
Oppenheimer Champion Income Fund Inc.
Oppenheimer Quest Global Value Fund,
Oppenheimer Convertible Securities Fund Inc.
Oppenheimer Developing Markets Fund Oppenheimer Quest Opportunity Value Fund
Oppenheimer Disciplined Allocation Fund Oppenheimer Quest Value Fund, Inc.
Oppenheimer Discovery Fund Oppenheimer Real Asset Fund
Oppenheimer Emerging Growth Fund Oppenheimer Real Estate Fund
Oppenheimer Rochester National
Oppenheimer Emerging Technologies Fund Municipals
Oppenheimer Enterprise Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Europe Fund Oppenheimer Small Cap Value Fund
Oppenheimer Global Fund Oppenheimer Strategic Income Fund
Oppenheimer Global Growth & Income Fund Oppenheimer Total Return Bond Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Total Return Fund, Inc.
Oppenheimer Growth Fund Oppenheimer Trinity Core Fund
Oppenheimer Trinity Large Cap Growth
Oppenheimer High Yield Fund Fund
Oppenheimer International Bond Fund Oppenheimer Trinity Value Fund
Oppenheimer International Growth Fund Oppenheimer U.S. Government Trust
Oppenheimer International Large-Cap Core
Fund Oppenheimer Value Fund
Oppenheimer International Small Company
Fund Limited-Term New York Municipal Fund
Oppenheimer International Value Fund Rochester Fund Municipals
Oppenheimer Limited-Term Government Fund OSM1- Gartmore Millennium Growth Fund II
Oppenheimer Limited Term Municipal Fund OSM1 - Jennison Growth Fund
OSM1 - Mercury Advisors S&P 500 Index
Oppenheimer Main Street Fund Fund
OSM1 - Mercury Advisors Focus Growth
Oppenheimer Main Street Opportunity Fund Fund
Oppenheimer Main Street Small Cap Fund OSM1 - QM Active Balanced Fund
Oppenheimer MidCap Fund OSM1 - Salomon Brothers All Cap Fund
And the following money market funds:
Oppenheimer Cash Reserves Centennial Government Trust
Oppenheimer Money Market Fund, Inc. Centennial Money Market Trust
Centennial America Fund, L. P. Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust Centennial Tax Exempt Trust
1 - "OSM" stands for Oppenheimer Select Managers
There is an initial sales charge on the purchase of Class A shares of
each of the Oppenheimer funds described above except the money market funds
and Oppenheimer Senior Floating Rate Fund. Under certain circumstances
described in this Statement of Additional Information, redemption proceeds of
certain money market fund shares may be subject to a contingent deferred
sales charge.
Letters of Intent. Under a Letter of Intent, if you purchase Class A shares
or Class A and Class B shares of the Fund and other Oppenheimer funds during
a 13-month period, you can reduce the sales charge rate that applies to your
purchases of Class A shares. The total amount of your intended purchases of
both Class A and Class B shares will determine the reduced sales charge rate
for the Class A shares purchased during that period. You can include
purchases made up to 90 days before the date of the Letter. Letters of
Intent do not consider Class C or Class N or Class Y shares you purchase or
may have purchased.
A Letter of Intent is an investor's statement in writing to the
Distributor of the intention to purchase Class A shares or Class A and Class
B shares of the Fund (and other Oppenheimer funds) during a 13-month period
(the "Letter of Intent period"). At the investor's request, this may include
purchases made up to 90 days prior to the date of the Letter. The Letter
states the investor's intention to make the aggregate amount of purchases of
shares which, when added to the investor's holdings of shares of those funds,
will equal or exceed the amount specified in the Letter. Purchases made by
reinvestment of dividends or distributions of capital gains and purchases
made at net asset value without sales charge do not count toward satisfying
the amount of the Letter.
A Letter enables an investor to count the Class A and Class B shares
purchased under the Letter to obtain the reduced sales charge rate on
purchases of Class A shares of the Fund (and other Oppenheimer funds) that
applies under the Right of Accumulation to current purchases of Class A
shares. Each purchase of Class A shares under the Letter will be made at the
offering price (including the sales charge) that applies to a single lump-sum
purchase of shares in the amount intended to be purchased under the Letter.
In submitting a Letter, the investor makes no commitment to purchase
shares. However, if the investor's purchases of shares within the Letter of
Intent period, when added to the value (at offering price) of the investor's
holdings of shares on the last day of that period, do not equal or exceed the
intended purchase amount, the investor agrees to pay the additional amount of
sales charge applicable to such purchases. That amount is described in "Terms
of Escrow," below (those terms may be amended by the Distributor from time to
time). The investor agrees that shares equal in value to 5% of the intended
purchase amount will be held in escrow by the Transfer Agent subject to the
Terms of Escrow. Also, the investor agrees to be bound by the terms of the
Prospectus, this Statement of Additional Information and the application used
for a Letter of Intent. If those terms are amended, as they may be from time
to time by the Fund, the investor agrees to be bound by the amended terms and
that those amendments will apply automatically to existing Letters of Intent.
If the total eligible purchases made during the Letter of Intent period
do not equal or exceed the intended purchase amount, the concessions
previously paid to the dealer of record for the account and the amount of
sales charge retained by the Distributor will be adjusted to the rates
applicable to actual total purchases. If total eligible purchases during the
Letter of Intent period exceed the intended purchase amount and exceed the
amount needed to qualify for the next sales charge rate reduction set forth
in the Prospectus, the sales charges paid will be adjusted to the lower rate.
That adjustment will be made only if and when the dealer returns to the
Distributor the excess of the amount of concessions allowed or paid to the
dealer over the amount of concessions that apply to the actual amount of
purchases. The excess concessions returned to the Distributor will be used
to purchase additional shares for the investor's account at the net asset
value per share in effect on the date of such purchase, promptly after the
Distributor's receipt thereof.
The Transfer Agent will not hold shares in escrow for purchases of
shares of the Fund and other Oppenheimer funds by OppenheimerFunds prototype
401(k) plans under a Letter of Intent. If the intended purchase amount under
a Letter of Intent entered into by an OppenheimerFunds prototype 401(k) plan
is not purchased by the plan by the end of the Letter of Intent period, there
will be no adjustment of concessions paid to the broker-dealer or financial
institution of record for accounts held in the name of that plan.
In determining the total amount of purchases made under a Letter,
shares redeemed by the investor prior to the termination of the Letter of
Intent period will be deducted. It is the responsibility of the dealer of
record and/or the investor to advise the Distributor about the Letter in
placing any purchase orders for the investor during the Letter of Intent
period. All of such purchases must be made through the Distributor.
|X| Terms of Escrow That Apply to Letters of Intent.
1. Out of the initial purchase (or subsequent purchases if necessary)
made pursuant to a Letter, shares of the Fund equal in value up to 5% of the
intended purchase amount specified in the Letter shall be held in escrow by
the Transfer Agent. For example, if the intended purchase amount is $50,000,
the escrow shall be shares valued in the amount of $2,500 (computed at the
offering price adjusted for a $50,000 purchase). Any dividends and capital
gains distributions on the escrowed shares will be credited to the investor's
account.
2. If the total minimum investment specified under the Letter is
completed within the 13-month Letter of Intent period, the escrowed shares
will be promptly released to the investor.
3. If, at the end of the 13-month Letter of Intent period the total
purchases pursuant to the Letter are less than the intended purchase amount
specified in the Letter, the investor must remit to the Distributor an amount
equal to the difference between the dollar amount of sales charges actually
paid and the amount of sales charges which would have been paid if the total
amount purchased had been made at a single time. That sales charge
adjustment will apply to any shares redeemed prior to the completion of the
Letter. If the difference in sales charges is not paid within twenty days
after a request from the Distributor or the dealer, the Distributor will,
within sixty days of the expiration of the Letter, redeem the number of
escrowed shares necessary to realize such difference in sales charges. Full
and fractional shares remaining after such redemption will be released from
escrow. If a request is received to redeem escrowed shares prior to the
payment of such additional sales charge, the sales charge will be withheld
from the redemption proceeds.
4. By signing the Letter, the investor irrevocably constitutes and
appoints the Transfer Agent as attorney-in-fact to surrender for redemption
any or all escrowed shares.
5. The shares eligible for purchase under the Letter (or the holding of
which may be counted toward completion of a Letter) include:
(a) Class A shares sold with a front-end sales charge or subject to a Class
A contingent deferred sales charge,
(b) Class B shares of other Oppenheimer funds acquired subject to a
contingent deferred sales charge, and
(c) Class A or Class B shares acquired by exchange of either (1) Class A
shares of one of the other Oppenheimer funds that were acquired
subject to a Class A initial or contingent deferred sales charge
or (2) Class B shares of one of the other Oppenheimer funds that
were acquired subject to a contingent deferred sales charge.
6. Shares held in escrow hereunder will automatically be exchanged for
shares of another fund to which an exchange is requested, as described in the
section of the Prospectus entitled "How to Exchange Shares" and the escrow
will be transferred to that other fund.
Asset Builder Plans. As explained in the Prospectus, you must initially
establish your account with $500. Subsequently, you can establish an Asset
Builder Plan to automatically purchase additional shares directly from a bank
account for as little as $50. Shares purchased by Asset Builder Plan payments
from bank accounts are subject to the redemption restrictions for recent
purchases described in the Prospectus. Asset Builder Plans are available
only if your bank is an ACH member. Asset Builder Plans may not be used to
buy shares for OppenheimerFunds employer-sponsored qualified retirement
accounts. Asset Builder Plans also enable shareholders of Oppenheimer Cash
Reserves to use their fund account to make monthly automatic purchases of
shares of up to four other Oppenheimer funds.
If you make payments from your bank account to purchase shares of the
Fund, your bank account will be debited automatically. Normally the debit
will be made two business days prior to the investment dates you selected on
your application. Neither the Distributor, the Transfer Agent nor the Fund
shall be responsible for any delays in purchasing shares that result from
delays in ACH transmissions.
Before you establish Asset Builder payments, you should obtain a
prospectus of the selected fund(s) from your financial advisor (or the
Distributor) and request an application from the Distributor. Complete the
application and return it. You may change the amount of your Asset Builder
payment or you can terminate these automatic investments at any time by
writing to the Transfer Agent. The Transfer Agent requires a reasonable
period (approximately 10 days) after receipt of your instructions to
implement them. The Fund reserves the right to amend, suspend or discontinue
offering Asset Builder plans at any time without prior notice.
Retirement Plans. Certain types of retirement plans are entitled to purchase
shares of the Fund without sales charge or at reduced sales charge rates, as
described in Appendix C to this Statement of Additional Information. Certain
special sales charge arrangements described in that Appendix apply to
retirement plans whose records are maintained on a daily valuation basis by
Merrill Lynch Pierce Fenner & Smith, Inc. ("Merrill Lynch") or an independent
record keeper that has a contract or special arrangement with Merrill Lynch.
If on the date the plan sponsor signed the Merrill Lynch record keeping
service agreement the plan has less than $3 million in assets (other than
assets invested in money market funds) invested in applicable investments,
then the retirement plan may purchase only Class B shares of the Oppenheimer
funds. Any retirement plans in that category that currently invest in Class B
shares of the Fund will have their Class B shares converted to Class A shares
of the Fund when the plan's applicable investments reach $5 million.
OppenheimerFunds has entered into arrangements with certain record keepers
whereby the Transfer Agent compensates the record keeper for its record
keeping and account servicing functions that it performs on behalf of the
participant level accounts of a retirement plan. While such compensation may
act to reduce the record keeping fees charged by the retirement plan's record
keeper, that compensation arrangement may be terminated at any time,
potentially affecting the record keeping fees charged by the retirement
plan's record keeper.
Cancellation of Purchase Orders. Cancellation of purchase orders for the
Fund's shares (for example, when a purchase check is returned to the Fund
unpaid) causes a loss to be incurred when the net asset values of the Fund's
shares on the cancellation date is less than on the purchase date. That loss
is equal to the amount of the decline in the net asset value per share
multiplied by the number of shares in the purchase order. The investor is
responsible for that loss. If the investor fails to compensate the Fund for
the loss, the Distributor will do so. The Fund may reimburse the Distributor
for that amount by redeeming shares from any account registered in that
investor's name, or the Fund or the Distributor may seek other redress.
Classes of Shares. Each class of shares of the Fund represents an interest in
the same portfolio of investments of the Fund. However, each class has
different shareholder privileges and features. The net income attributable
to Class B, Class C or Class N shares and the dividends payable on Class B,
Class C or Class N shares will be reduced by incremental expenses borne
solely by that class. Those expenses include the asset-based sales charges to
which Class B, Class C and Class N shares are subject.
The availability of different classes of shares permits an investor to
choose the method of purchasing shares that is more appropriate for the
investor. That may depend on the amount of the purchase, the length of time
the investor expects to hold shares, and other relevant circumstances. Class
A shares normally are sold subject to an initial sales charge. While Class B,
Class C and Class N shares have no initial sales charge, the purpose of the
deferred sales charge and asset-based sales charge on Class B, Class C and
Class N shares is the same as that of the initial sales charge on Class A
shares - to compensate the Distributor and brokers, dealers and financial
institutions that sell shares of the Fund. A salesperson who is entitled to
receive compensation from his or her firm for selling Fund shares may receive
different levels of compensation for selling one class of shares rather than
another.
The Distributor will not accept any order in the amount of $500,000 or
more for Class B shares or $1 million or more for Class C shares on behalf of
a single investor (not including dealer "street name" or omnibus accounts).
That is because generally it will be more advantageous for that investor to
purchase Class A shares of the Fund.
|X| Class A Shares Subject to a Contingent Deferred Sales Charge. For
purchases of Class A shares at net asset value whether or not subject to a
contingent deferred sales charge as described in the Prospectus, no sales
concessions will be paid to the broker-dealer of record, as described in the
Prospectus, on sales of Class A shares purchased with the redemption proceeds
of shares of another mutual fund offered as an investment option in a
retirement plan in which Oppenheimer funds are also offered as investment
options under a special arrangement with the Distributor, if the purchase
occurs more than 30 days after the Oppenheimer funds are added as an
investment option under that plan. Additionally, that concession will not be
paid on purchases of Class A shares by a retirement plan made with the
redemption proceeds of Class N shares of one or more Oppenheimer funds held
by the plan for more than 18 months.
|X| Class B Conversion. Under current interpretations of applicable
federal income tax law by the Internal Revenue Service, the conversion of
Class B shares to Class A shares 72 months after purchase is not treated as a
taxable event for the shareholder. If those laws or the IRS interpretation of
those laws should change, the automatic conversion feature may be suspended.
In that event, no further conversions of Class B shares would occur while
that suspension remained in effect. Although Class B shares could then be
exchanged for Class A shares on the basis of relative net asset value of the
two classes, without the imposition of a sales charge or fee, such exchange
could constitute a taxable event for the shareholder, and absent such
exchange, Class B shares might continue to be subject to the asset-based
sales charge for longer than six years.
|X| Availability of Class N Shares. In addition to the description
of the types of retirement plans which may purchase Class N shares contained
in the prospectus, Class N shares also are offered to the following:
o to all rollover IRAs (including SEP IRAs and SIMPLE IRAs),
o to all rollover contributions made to Individual 401(k) plans,
Profit-Sharing Plans and Money Purchase Pension Plans,
o to all direct rollovers from OppenheimerFunds-sponsored Pinnacle and
Ascender retirement plans,
o to all trustee-to-trustee IRA transfers,
o to all 90-24 type 403(b) transfers,
o to Group Retirement Plans (as defined in Appendix C to this Statement
of Additional Information) which have entered into a special
agreement with the Distributor for that purpose,
o to Retirement Plans qualified under Sections 401(a) or 401(k) of the
Internal Revenue Code, the recordkeeper or the plan sponsor for
which has entered into a special agreement with the Distributor,
o to Retirement Plans of a plan sponsor where the aggregate assets of all
such plans invested in the Oppenheimer funds is $500,000 or more,
o to OppenheimerFunds-sponsored Ascender 401(k) plans that pay for the
purchase with the redemption proceeds of Class A shares of one or
more Oppenheimer funds, and
o to certain customers of broker-dealers and financial advisors that are
identified in a special agreement between the broker-dealer or
financial advisor and the Distributor for that purpose.
The sales concession and the advance of the service fee, as described
in the Prospectus, will not be paid to dealers of record on sales of Class N
shares on:
o purchases of Class N shares in amounts of $500,000 or more by a
retirement plan that pays for the purchase with the redemption
proceeds of Class A shares of one or more Oppenheimer funds
(other than rollovers from an OppenheimerFunds-sponsored Pinnacle
or Ascender 401(k) plan to any IRA invested in the Oppenheimer
funds),
o purchases of Class N shares in amounts of $500,000 or more by a
retirement plan that pays for the purchase with the redemption
proceeds of Class C shares of one or more Oppenheimer funds held
by the plan for more than one year (other than rollovers from an
OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan to
any IRA invested in the Oppenheimer funds), and
o on purchases of Class N shares by an OppenheimerFunds-sponsored
Pinnacle or Ascender 401(k) plan made with the redemption
proceeds of Class A shares of one or more Oppenheimer funds.
No sales concessions will be paid to the broker-dealer of record, as
described in the Prospectus, on sales of Class N shares purchased with the
redemption proceeds of shares of another mutual fund offered as an investment
option in a retirement plan in which Oppenheimer funds are also offered as
investment options under a special arrangement with the Distributor, if the
purchase occurs more than 30 days after the Oppenheimer funds are added as an
investment option under that plan.
|X| Allocation of Expenses. The Fund pays expenses related to its
daily operations, such as custodian fees, Trustees' fees, transfer agency
fees, legal fees and auditing costs. Those expenses are paid out of the
Fund's assets and are not paid directly by shareholders. However, those
expenses reduce the net asset values of shares, and therefore are indirectly
borne by shareholders through their investment.
The methodology for calculating the net asset value, dividends and
distributions of the Fund's share classes recognizes two types of expenses.
General expenses that do not pertain specifically to any one class are
allocated pro rata to the shares of all classes. The allocation is based on
the percentage of the Fund's total assets that is represented by the assets
of each class, and then equally to each outstanding share within a given
class. Such general expenses include management fees, legal, bookkeeping and
audit fees, printing and mailing costs of shareholder reports, Prospectuses,
Statements of Additional Information and other materials for current
shareholders, fees to unaffiliated Trustees, custodian expenses, share
issuance costs, organization and start-up costs, interest, taxes and
brokerage commissions, and non-recurring expenses, such as litigation costs.
Other expenses that are directly attributable to a particular class are
allocated equally to each outstanding share within that class. Examples of
such expenses include distribution and service plan (12b-1) fees, transfer
and shareholder servicing agent fees and expenses, and shareholder meeting
expenses (to the extent that such expenses pertain only to a specific class).
Account Fees. As stated in the Prospectus, a $12 annual fee is assessed on
any account valued at less than $500. This fee will not be assessed on the
following accounts:
o Accounts that have balances below $500 due to the automatic conversion
of shares from Class B to Class A shares;
o Accounts with an active Asset Builder Plan, payroll deduction plan or a
military allotment plan;
o OppenheimerFunds-sponsored group retirement accounts that are making
continuing purchases;
o Certain accounts held by broker-dealers through the National Securities
Clearing Corporation; and
o Accounts that fall below the $500 threshold due solely to market
fluctuations within the 12-month period preceding the date the fee is
deducted.
The fee is automatically deducted from qualifying accounts annually on
or about the second to last business day of September. This annual fee is
waived for any shareholders who elect to access their account documents
through electronic document delivery rather than in paper copy and who elect
to utilize the Internet or PhoneLink as their primary source for their
general servicing needs. To sign up to access account documents
electronically via eDocs Direct, please visit the Service Center on our
website at www.oppenheimerfunds.com or call 1.888.470.0862 for instructions.
------------------------
Determination of Net Asset Values Per Share. The net asset values per share
of each class of shares of the Fund are determined as of the close of
business of the Exchange on each day that the Exchange is open. The
calculation is done by dividing the value of the Fund's net assets
attributable to a class by the number of shares of that class that are
outstanding. The Exchange normally closes at 4:00 P.M., Eastern time, but
may close earlier on some other days (for example, in case of weather
emergencies or on days falling before a U.S. holiday). All references to
time in this Statement of Additional Information mean "Eastern time." The
Exchange's most recent annual announcement (which is subject to change)
states that it will close on New Year's Day, Martin Luther King, Jr. Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. It may also close on other days.
Dealers other than Exchange members may conduct trading in certain
securities on days on which the Exchange is closed (including weekends and
holidays) or after 4:00 P.M. on a regular business day. Because the Fund's
net asset values will not be calculated on those days, the Fund's net asset
values per share may be significantly affected on such days when shareholders
may not purchase or redeem shares. Additionally, trading on European and
Asian stock exchanges and over-the-counter markets normally is completed
before the close of the Exchange.
Changes in the values of securities traded on foreign exchanges or
markets as a result of events that occur after the prices of those securities
are determined, but before the close of the Exchange, will not be reflected
in the Fund's calculation of its net asset values that day unless the Manager
determines that the event is likely to effect a material change in the value
of the security. The Manager, or an internal valuation committee established
by the Manager, as applicable, may establish a valuation, under procedures
established by the Board and subject to the approval, ratification and
confirmation by the Board at its next ensuing meeting.
|X| Securities Valuation. The Fund's Board of Trustees has
established procedures for the valuation of the Fund's securities. In general
those procedures are as follows:
o Equity securities traded on a U.S. securities exchange or on Nasdaq(R)
are valued as follows:
(1) if last sale information is regularly reported, they are valued at the
last reported sale price on the principal exchange on which
they are traded or on Nasdaq, as applicable, on that day, or
(2) if last sale information is not available on a valuation date, they are
valued at the last reported sale price preceding the valuation
date if it is within the spread of the closing "bid" and
"asked" prices on the valuation date or, if not, at the
closing "bid" price on the valuation date.
o Equity securities traded on a foreign securities exchange generally are
valued in one of the following ways:
(1) at the last sale price available to the pricing service approved by the
Board of Trustees, or
(2) at the last sale price obtained by the Manager from the report of the
principal exchange on which the security is traded at its last
trading session on or immediately before the valuation date, or
(3) at the mean between the "bid" and "asked" prices obtained from the
principal exchange on which the security is traded or, on the
basis of reasonable inquiry, from two market makers in the
security.
o Long-term debt securities having a remaining maturity in excess of 60
days are valued based on the mean between the "bid" and "asked" prices
determined by a portfolio pricing service approved by the Fund's Board of
Trustees or obtained by the Manager from two active market makers in the
security on the basis of reasonable inquiry.
o The following securities are valued at the mean between the "bid" and
"asked" prices determined by a pricing service approved by the Fund's Board
of Trustees or obtained by the Manager from two active market makers in the
security on the basis of reasonable inquiry:
(1) debt instruments that have a maturity of more than 397 days when
issued,
(2) debt instruments that had a maturity of 397 days or less when issued
and have a remaining maturity of more than 60 days, and
(3) non-money market debt instruments that had a maturity of 397 days or
less when issued and which have a remaining maturity of 60 days or
less.
o The following securities are valued at cost, adjusted for amortization
of premiums and accretion of discounts:
(1) money market debt securities held by a non-money market fund that had a
maturity of less than 397 days when issued that have a
remaining maturity of 60 days or less, and
(2) debt instruments held by a money market fund that have a remaining
maturity of 397 days or less.
o Securities (including restricted securities) not having
readily-available market quotations are valued at fair value determined under
the Board's procedures. If the Manager is unable to locate two market makers
willing to give quotes, a security may be priced at the mean between the
"bid" and "asked" prices provided by a single active market maker (which in
certain cases may be the "bid" price if no "asked" price is available).
In the case of U.S. government securities, mortgage-backed securities,
corporate bonds and foreign government securities, when last sale information
is not generally available, the Manager may use pricing services approved by
the Board of Trustees. The pricing service may use "matrix" comparisons to
the prices for comparable instruments on the basis of quality, yield and
maturity. Other special factors may be involved (such as the tax-exempt
status of the interest paid by municipal securities). The Manager will
monitor the accuracy of the pricing services. That monitoring may include
comparing prices used for portfolio valuation to actual sales prices of
selected securities.
The closing prices in the London foreign exchange market on a
particular business day that are provided to the Manager by a bank, dealer or
pricing service that the Manager has determined to be reliable are used to
value foreign currency, including forward contracts, and to convert to U.S.
dollars securities that are denominated in foreign currency.
Puts, calls, and futures are valued at the last sale price on the
principal exchange on which they are traded or on Nasdaq, as applicable, as
determined by a pricing service approved by the Board of Trustees or by the
Manager. If there were no sales that day, they shall be valued at the last
sale price on the preceding trading day if it is within the spread of the
closing "bid" and "asked" prices on the principal exchange or on Nasdaq on
the valuation date. If not, the value shall be the closing bid price on the
principal exchange or on Nasdaq on the valuation date. If the put, call or
future is not traded on an exchange or on Nasdaq, it shall be valued by the
mean between "bid" and "asked" prices obtained by the Manager from two active
market makers. In certain cases that may be at the "bid" price if no "asked"
price is available.
When the Fund writes an option, an amount equal to the premium received
is included in the Fund's Statement of Assets and Liabilities as an asset. An
equivalent credit is included in the liability section. The credit is
adjusted ("marked-to-market") to reflect the current market value of the
option. In determining the Fund's gain on investments, if a call or put
written by the Fund is exercised, the proceeds are increased by the premium
received. If a call or put written by the Fund expires, the Fund has a gain
in the amount of the premium. If the Fund enters into a closing purchase
transaction, it will have a gain or loss, depending on whether the premium
received was more or less than the cost of the closing transaction. If the
Fund exercises a put it holds, the amount the Fund receives on its sale of
the underlying investment is reduced by the amount of premium paid by the
Fund.
How to Sell Shares
The information below supplements the terms and conditions for redeeming
shares set forth in the Prospectus.
Reinvestment Privilege. Within six months of a redemption, a shareholder may
reinvest all or part of the redemption proceeds of:
o Class A shares purchased subject to an initial sales charge or Class A
shares on which a contingent deferred sales charge was paid, or
o Class B shares that were subject to the Class B contingent deferred
sales charge when redeemed.
The reinvestment may be made without sales charge only in Class A
shares of the Fund or any of the other Oppenheimer funds into which shares of
the Fund are exchangeable as described in "How to Exchange Shares" below.
Reinvestment will be at the net asset value next computed after the Transfer
Agent receives the reinvestment order. The shareholder must ask the Transfer
Agent for that privilege at the time of reinvestment. This privilege does not
apply to Class C, Class N or Class Y shares. The Fund may amend, suspend or
cease offering this reinvestment privilege at any time as to shares redeemed
after the date of such amendment, suspension or cessation.
Any capital gain that was realized when the shares were redeemed is
taxable, and reinvestment will not alter any capital gains tax payable on
that gain. If there has been a capital loss on the redemption, some or all
of the loss may not be tax deductible, depending on the timing and amount of
the reinvestment. Under the Internal Revenue Code, if the redemption
proceeds of Fund shares on which a sales charge was paid are reinvested in
shares of the Fund or another of the Oppenheimer funds within 90 days of
payment of the sales charge, the shareholder's basis in the shares of the
Fund that were redeemed may not include the amount of the sales charge paid.
That would reduce the loss or increase the gain recognized from the
redemption. However, in that case the sales charge would be added to the
basis of the shares acquired by the reinvestment of the redemption proceeds.
Payments "In Kind". The Prospectus states that payment for shares tendered
for redemption is ordinarily made in cash. However, under certain
circumstances, the Board of Trustees of the Fund may determine that it would
be detrimental to the best interests of the remaining shareholders of the
Fund to make payment of a redemption order wholly or partly in cash. In that
case, the Fund may pay the redemption proceeds in whole or in part by a
distribution "in kind" of liquid securities from the portfolio of the Fund,
in lieu of cash.
The Fund has elected to be governed by Rule 18f-1 under the Investment
Company Act. Under that rule, the Fund is obligated to redeem shares solely
in cash up to the lesser of $250,000 or 1% of the net assets of the Fund
during any 90-day period for any one shareholder. If shares are redeemed in
kind, the redeeming shareholder might incur brokerage or other costs in
selling the securities for cash. The Fund will value securities used to pay
redemptions in kind using the same method the Fund uses to value its
portfolio securities described above under "Determination of Net Asset ValuesPer Share." That valuation will be made as of the time the redemption price
is determined.
Involuntary Redemptions. The Fund's Board of Trustees has the right to cause
the involuntary redemption of the shares held in any account if the aggregate
net asset value of those shares is less than $200 or such lesser amount as
the Board may fix. The Board will not cause the involuntary redemption of
shares in an account if the aggregate net asset value of such shares has
fallen below the stated minimum solely as a result of market fluctuations.
If the Board exercises this right, it may also fix the requirements for any
notice to be given to the shareholders in question (not less than 30 days).
The Board may alternatively set requirements for the shareholder to increase
the investment, or set other terms and conditions so that the shares would
not be involuntarily redeemed.
Transfers of Shares. A transfer of shares to a different registration is not
an event that triggers the payment of sales charges. Therefore, shares are
not subject to the payment of a contingent deferred sales charge of any class
at the time of transfer to the name of another person or entity. It does not
matter whether the transfer occurs by absolute assignment, gift or bequest,
as long as it does not involve, directly or indirectly, a public sale of the
shares. When shares subject to a contingent deferred sales charge are
transferred, the transferred shares will remain subject to the contingent
deferred sales charge. It will be calculated as if the transferee shareholder
had acquired the transferred shares in the same manner and at the same time
as the transferring shareholder.
If less than all shares held in an account are transferred, and some
but not all shares in the account would be subject to a contingent deferred
sales charge if redeemed at the time of transfer, the priorities described in
the Prospectus under "How to Buy Shares" for the imposition of the Class B,
Class C and Class N contingent deferred sales charge will be followed in
determining the order in which shares are transferred.
Distributions From Retirement Plans. Requests for distributions from
OppenheimerFunds-sponsored IRAs, SEP-IRAs, SIMPLE IRAs, 403(b)(7) custodial
plans, 401(k) plans or pension or profit-sharing plans should be addressed to
"Trustee, OppenheimerFunds Retirement Plans," c/o the Transfer Agent at its
address listed in "How To Sell Shares" in the Prospectus or on the back cover
of this Statement of Additional Information. The request must:
(1) state the reason for the distribution;
(2) state the owner's awareness of tax penalties if the distribution is
premature; and
(3) conform to the requirements of the plan and the Fund's other redemption
requirements.
Participants (other than self-employed plan sponsors) in
OppenheimerFunds-sponsored pension or profit-sharing plans with shares of the
Fund held in the name of the plan or its fiduciary may not directly request
redemption of their accounts. The plan administrator or fiduciary must sign
the request.
Distributions from pension and profit sharing plans are subject to
special requirements under the Internal Revenue Code and certain documents
(available from the Transfer Agent) must be completed and submitted to the
Transfer Agent before the distribution may be made. Distributions from
retirement plans are subject to withholding requirements under the Internal
Revenue Code, and IRS Form W-4P (available from the Transfer Agent) must be
submitted to the Transfer Agent with the distribution request, or the
distribution may be delayed. Unless the shareholder has provided the
Transfer Agent with a certified tax identification number, the Internal
Revenue Code requires that tax be withheld from any distribution even if the
shareholder elects not to have tax withheld. The Fund, the Manager, the
Distributor, and the Transfer Agent assume no responsibility to determine
whether a distribution satisfies the conditions of applicable tax laws and
will not be responsible for any tax penalties assessed in connection with a
distribution.
Special Arrangements for Repurchase of Shares from Dealers and Brokers. The
Distributor is the Fund's agent to repurchase its shares from authorized
dealers or brokers on behalf of their customers. Shareholders should contact
their broker or dealer to arrange this type of redemption. The repurchase
price per share will be the net asset value next computed after the
Distributor receives an order placed by the dealer or broker. However, if the
Distributor receives a repurchase order from a dealer or broker after the
close of the Exchange on a regular business day, it will be processed at that
day's net asset value if the order was received by the dealer or broker from
its customers prior to the time the Exchange closes. Normally, the Exchange
closes at 4:00 P.M., but may do so earlier on some days. Additionally, the
order must have been transmitted to and received by the Distributor prior to
its close of business that day (normally 5:00 P.M.).
Ordinarily, for accounts redeemed by a broker-dealer under this
procedure, payment will be made within three business days after the shares
have been redeemed upon the Distributor's receipt of the required redemption
documents in proper form. The signature(s) of the registered owners on the
redemption documents must be guaranteed as described in the Prospectus.
Automatic Withdrawal and Exchange Plans. Investors owning shares of the Fund
valued at $5,000 or more can authorize the Transfer Agent to redeem shares
(having a value of at least $50) automatically on a monthly, quarterly,
semi-annual or annual basis under an Automatic Withdrawal Plan. Shares will
be redeemed three business days prior to the date requested by the
shareholder for receipt of the payment. Automatic withdrawals of up to
$1,500 per month may be requested by telephone if payments are to be made by
check payable to all shareholders of record. Payments must also be sent to
the address of record for the account and the address must not have been
changed within the prior 30 days. Required minimum distributions from
OppenheimerFunds-sponsored retirement plans may not be arranged on this
basis.
Payments are normally made by check, but shareholders having
AccountLink privileges (see "How To Buy Shares") may arrange to have
Automatic Withdrawal Plan payments transferred to the bank account designated
on the account application or by signature-guaranteed instructions sent to
the Transfer Agent. Shares are normally redeemed pursuant to an Automatic
Withdrawal Plan three business days before the payment transmittal date you
select in the account application. If a contingent deferred sales charge
applies to the redemption, the amount of the check or payment will be reduced
accordingly.
The Fund cannot guarantee receipt of a payment on the date requested.
The Fund reserves the right to amend, suspend or discontinue offering these
plans at any time without prior notice. Because of the sales charge assessed
on Class A share purchases, shareholders should not make regular additional
Class A share purchases while participating in an Automatic Withdrawal Plan.
Class B, Class C and Class N shareholders should not establish automatic
withdrawal plans, because of the potential imposition of the contingent
deferred sales charge on such withdrawals (except where the Class B, Class C
or Class N contingent deferred sales charge is waived as described in
Appendix C to this Statement of Additional Information).
By requesting an Automatic Withdrawal or Exchange Plan, the shareholder
agrees to the terms and conditions that apply to such plans, as stated
below. These provisions may be amended from time to time by the Fund and/or
the Distributor. When adopted, any amendments will automatically apply to
existing Plans.
|X| Automatic Exchange Plans. Shareholders can authorize the
Transfer Agent to exchange a pre-determined amount of shares of the Fund for
shares (of the same class) of other Oppenheimer funds automatically on a
monthly, quarterly, semi-annual or annual basis under an Automatic Exchange
Plan. The minimum amount that may be exchanged to each other fund account is
$50. Instructions should be provided on the OppenheimerFunds Application or
signature-guaranteed instructions. Exchanges made under these plans are
subject to the restrictions that apply to exchanges as set forth in "How toExchange Shares" in the Prospectus and below in this Statement of Additional
Information.
|X| Automatic Withdrawal Plans. Fund shares will be redeemed as necessary
to meet withdrawal payments. Shares acquired without a sales charge will be
redeemed first. Shares acquired with reinvested dividends and capital gains
distributions will be redeemed next, followed by shares acquired with a sales
charge, to the extent necessary to make withdrawal payments. Depending upon
the amount withdrawn, the investor's principal may be depleted. Payments
made under these plans should not be considered as a yield or income on your
investment.
The Transfer Agent will administer the investor's Automatic Withdrawal
Plan as agent for the shareholder(s) (the "Planholder") who executed the Plan
authorization and application submitted to the Transfer Agent. Neither the
Fund nor the Transfer Agent shall incur any liability to the Planholder for
any action taken or not taken by the Transfer Agent in good faith to
administer the Plan. Share certificates will not be issued for shares of the
Fund purchased for and held under the Plan, but the Transfer Agent will
credit all such shares to the account of the Planholder on the records of the
Fund. Any share certificates held by a Planholder may be surrendered
unendorsed to the Transfer Agent with the Plan application so that the shares
represented by the certificate may be held under the Plan.
For accounts subject to Automatic Withdrawal Plans, distributions of
capital gains must be reinvested in shares of the Fund, which will be done at
net asset value without a sales charge. Dividends on shares held in the
account may be paid in cash or reinvested.
Shares will be redeemed to make withdrawal payments at the net asset
value per share determined on the redemption date. Checks or AccountLink
payments representing the proceeds of Plan withdrawals will normally be
transmitted three business days prior to the date selected for receipt of the
payment, according to the choice specified in writing by the Planholder.
Receipt of payment on the date selected cannot be guaranteed.
The amount and the interval of disbursement payments and the address to
which checks are to be mailed or AccountLink payments are to be sent may be
changed at any time by the Planholder by writing to the Transfer Agent. The
Planholder should allow at least two weeks' time after mailing such
notification for the requested change to be put in effect. The Planholder
may, at any time, instruct the Transfer Agent by written notice to redeem
all, or any part of, the shares held under the Plan. That notice must be in
proper form in accordance with the requirements of the then-current
Prospectus of the Fund. In that case, the Transfer Agent will redeem the
number of shares requested at the net asset value per share in effect and
will mail a check for the proceeds to the Planholder.
The Planholder may terminate a Plan at any time by writing to the
Transfer Agent. The Fund may also give directions to the Transfer Agent to
terminate a Plan. The Transfer Agent will also terminate a Plan upon its
receipt of evidence satisfactory to it that the Planholder has died or is
legally incapacitated. Upon termination of a Plan by the Transfer Agent or
the Fund, shares that have not been redeemed will be held in uncertificated
form in the name of the Planholder. The account will continue as a
dividend-reinvestment, uncertificated account unless and until proper
instructions are received from the Planholder, his or her executor or
guardian, or another authorized person.
To use shares held under the Plan as collateral for a debt, the
Planholder may request issuance of a portion of the shares in certificated
form. Upon written request from the Planholder, the Transfer Agent will
determine the number of shares for which a certificate may be issued without
causing the withdrawal checks to stop. However, should such uncertificated
shares become exhausted, Plan withdrawals will terminate.
If the Transfer Agent ceases to act as transfer agent for the Fund, the
Planholder will be deemed to have appointed any successor transfer agent to
act as agent in administering the Plan.
How to Exchange Shares
As stated in the Prospectus, shares of a particular class of Oppenheimer
funds having more than one class of shares may be exchanged only for shares
of the same class of other Oppenheimer funds. Shares of Oppenheimer funds
that have a single class without a class designation are deemed "Class A"
shares for this purpose. You can obtain a current list showing which funds
offer which classes of shares by calling the Distributor.
o All of the Oppenheimer funds currently offer Class A, B, C, N and Y
shares with the following exceptions:
The following funds only offer Class A shares:
Centennial America Fund, L.P. Centennial New York Tax Exempt
Trust
Centennial California Tax Exempt Centennial Tax Exempt Trust
Trust
Centennial Government Trust Oppenheimer Money Market Fund, Inc.
Centennial Money Market Trust Oppenheimer Real Estate Fund
The following funds do not offer Class N shares:
Oppenheimer AMT-Free New York Oppenheimer Pennsylvania Municipal
Municipals Fund
Oppenheimer California Municipal Fund Oppenheimer Rochester National
Municipals
Oppenheimer Limited Term Municipal Oppenheimer Senior Floating Rate
Fund Fund
Oppenheimer Municipal Bond Fund Limited Term New York Municipal Fund
Oppenheimer New Jersey Municipal Fund Rochester Fund Municipals
The following funds do not offer Class Y shares:
Oppenheimer AMT-Free New York Oppenheimer Limited Term Municipal
Municipals Fund
Oppenheimer California Municipal Fund Oppenheimer Multiple Strategies Fund
Oppenheimer Capital Income Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Cash Reserves Oppenheimer Pennsylvania Municipal
Fund
Oppenheimer Champion Income Fund Oppenheimer Quest Capital Value
Fund, Inc.
Oppenheimer Convertible Securities Fund Oppenheimer Quest Global Value Fund,
Inc.
Oppenheimer Disciplined Allocation Fund Oppenheimer Rochester National
Municipals
Oppenheimer Developing Markets Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Gold & Special Minerals Oppenheimer Small Cap Value Fund
Fund
Oppenheimer International Bond Fund Oppenheimer Total Return Bond Fund
Oppenheimer International Growth Fund Limited Term New York Municipal Fund
Oppenheimer International Small
Company Fund
o Class Y shares of Oppenheimer Real Asset Fund may not be exchanged for
shares of any other fund.
o Class B, Class C and Class N shares of Oppenheimer Cash Reserves are
generally available only by exchange from the same class of shares of
other Oppenheimer funds or through OppenheimerFunds-sponsored 401(k)
plans.
o Class M shares of Oppenheimer Convertible Securities Fund may be
exchanged only for Class A shares of other Oppenheimer funds. They may
not be acquired by exchange of shares of any class of any other
Oppenheimer funds except Class A shares of Oppenheimer Money Market
Fund or Oppenheimer Cash Reserves acquired by exchange of Class M
shares.
o Class X shares of Limited Term New York Municipal Fund may be exchanged
only for Class B shares of other Oppenheimer funds and no exchanges may
be made to Class X shares.
o Shares of Oppenheimer Capital Preservation Fund may not be exchanged
for shares of Oppenheimer Money Market Fund, Inc., Oppenheimer Cash
Reserves or Oppenheimer Limited-Term Government Fund. Only
participants in certain retirement plans may purchase shares of
Oppenheimer Capital Preservation Fund, and only those participants may
exchange shares of other Oppenheimer funds for shares of Oppenheimer
Capital Preservation Fund.
o Class A shares of Oppenheimer Senior Floating Rate Fund are not
available by exchange of shares of Oppenheimer Money Market Fund or
Class A shares of Oppenheimer Cash Reserves.
o Shares of Oppenheimer Select Managers Mercury Advisors S&P Index Fund
and Oppenheimer Select Managers QM Active Balanced Fund are only
available to retirement plans and are available only by exchange from
the same class of shares of other Oppenheimer funds held by retirement
plans.
o Class A shares of Oppenheimer funds may be exchanged at net asset value
for shares of any money market fund offered by the Distributor. Shares
of any money market fund purchased without a sales charge may be
exchanged for shares of Oppenheimer funds offered with a sales charge
upon payment of the sales charge. They may also be used to purchase
shares of Oppenheimer funds subject to an early withdrawal charge or
contingent deferred sales charge.
o Shares of Oppenheimer Money Market Fund, Inc. purchased with the
redemption proceeds of shares of other mutual funds (other than funds
managed by the Manager or its subsidiaries) redeemed within the 30 days
prior to that purchase may subsequently be exchanged for shares of
other Oppenheimer funds without being subject to an initial sales
charge or contingent deferred sales charge. To qualify for that
privilege, the investor or the investor's dealer must notify the
Distributor of eligibility for this privilege at the time the shares of
Oppenheimer Money Market Fund, Inc. are purchased. If requested, they
must supply proof of entitlement to this privilege.
o Shares of the Fund acquired by reinvestment of dividends or
distributions from any of the other Oppenheimer funds or from any unit
investment trust for which reinvestment arrangements have been made
with the Distributor may be exchanged at net asset value for shares of
any of the Oppenheimer funds.
The Fund may amend, suspend or terminate the exchange privilege at any
time. Although the Fund may impose these changes at any time, it will provide
you with notice of those changes whenever it is required to do so by
applicable law. It may be required to provide 60 days' notice prior to
materially amending or terminating the exchange privilege. That 60 day notice
is not required in extraordinary circumstances.
|X| How Exchanges Affect Contingent Deferred Sales Charges. No
contingent deferred sales charge is imposed on exchanges of shares of any
class purchased subject to a contingent deferred sales charge, with the
following exceptions:
o When Class A shares of any Oppenheimer fund (other than Rochester
National Municipals and Rochester Fund Municipals) acquired by exchange of
Class A shares of any Oppenheimer fund purchased subject to a Class A
contingent deferred sales charge are redeemed within 18 months measured
from the beginning of the calendar month of the initial purchase of the
exchanged Class A shares, the Class A contingent deferred sales charge is
imposed on the redeemed shares.
o When Class A shares of Rochester National Municipals and Rochester Fund
Municipals acquired by exchange of Class A shares of any Oppenheimer fund
purchased subject to a Class A contingent deferred sales charge are
redeemed within 24 months of the beginning of the calendar month of the
initial purchase of the exchanged Class A shares, the Class A contingent
deferred sales charge is imposed on the redeemed shares.
o If any Class A shares of another Oppenheimer fund that are exchanged
for Class A shares of Oppenheimer Senior Floating Rate Fund are subject to
the Class A contingent deferred sales charge of the other Oppenheimer fund
at the time of exchange, the holding period for that Class A contingent
deferred sales charge will carry over to the Class A shares of Oppenheimer
Senior Floating Rate Fund acquired in the exchange. The Class A shares of
Oppenheimer Senior Floating Rate Fund acquired in that exchange will be
subject to the Class A Early Withdrawal Charge of Oppenheimer Senior
Floating Rate Fund if they are repurchased before the expiration of the
holding period.
o When Class A shares of Oppenheimer Cash Reserves and Oppenheimer Money
Market Fund, Inc. acquired by exchange of Class A shares of any
Oppenheimer fund purchased subject to a Class A contingent deferred sales
charge are redeemed within the Class A holding period of the fund from
which the shares were exchanged, the Class A contingent deferred sales
charge of the fund from which the shares were exchanged is imposed on the
redeemed shares.
o With respect to Class B shares, the Class B contingent deferred sales
charge is imposed on Class B shares acquired by exchange if they are
redeemed within six years of the initial purchase of the exchanged Class B
shares.
o With respect to Class C shares, the Class C contingent deferred sales
charge is imposed on Class C shares acquired by exchange if they are
redeemed within 12 months of the initial purchase of the exchanged Class C
shares.
o With respect to Class N shares, a 1% contingent deferred sales charge
will be imposed if the retirement plan (not including IRAs and 403(b)
plans) is terminated or Class N shares of all Oppenheimer funds are
terminated as an investment option of the plan and Class N shares are
redeemed within 18 months after the plan's first purchase of Class N
shares of any Oppenheimer fund or with respect to an individual retirement
plan or 403(b) plan, Class N shares are redeemed within 18 months of the
plan's first purchase of Class N shares of any Oppenheimer fund.
o When Class B, Class C or Class N shares are redeemed to effect an
exchange, the priorities described in "How To Buy Shares" in the
Prospectus for the imposition of the Class B, Class C or Class N
contingent deferred sales charge will be followed in determining the order
in which the shares are exchanged. Before exchanging shares, shareholders
should take into account how the exchange may affect any contingent
deferred sales charge that might be imposed in the subsequent redemption
of remaining shares.
Shareholders owning shares of more than one class must specify which
class of shares they wish to exchange.
|X| Limits on Multiple Exchange Orders. The Fund reserves the right
to reject telephone or written exchange requests submitted in bulk by anyone
on behalf of more than one account. The Fund may accept requests for
exchanges of up to 50 accounts per day from representatives of authorized
dealers that qualify for this privilege.
|X| Telephone Exchange Requests. When exchanging shares by telephone,
a shareholder must have an existing account in the fund to which the exchange
is to be made. Otherwise, the investors must obtain a prospectus of that fund
before the exchange request may be submitted. If all telephone lines are busy
(which might occur, for example, during periods of substantial market
fluctuations), shareholders might not be able to request exchanges by
telephone and would have to submit written exchange requests.
|X| Processing Exchange Requests. Shares to be exchanged are redeemed on
the regular business day the Transfer Agent receives an exchange request in
proper form (the "Redemption Date"). Normally, shares of the fund to be
acquired are purchased on the Redemption Date, but such purchases may be
delayed by either fund up to five business days if it determines that it
would be disadvantaged by an immediate transfer of the redemption proceeds.
The Fund reserves the right, in its discretion, to refuse any exchange
request that may disadvantage it. For example, if the receipt of multiple
exchange requests from a dealer might require the disposition of portfolio
securities at a time or at a price that might be disadvantageous to the Fund,
the Fund may refuse the request.
When you exchange some or all of your shares from one fund to another,
any special account feature such as an Asset Builder Plan or Automatic
Withdrawal Plan, will be switched to the new fund account unless you tell the
Transfer Agent not to do so. However, special redemption and exchange
features such as Automatic Exchange Plans and Automatic Withdrawal Plans
cannot be switched to an account in Oppenheimer Senior Floating Rate Fund.
In connection with any exchange request, the number of shares exchanged
may be less than the number requested if the exchange or the number requested
would include shares subject to a restriction cited in the Prospectus or this
Statement of Additional Information, or would include shares covered by a
share certificate that is not tendered with the request. In those cases,
only the shares available for exchange without restriction will be exchanged.
The different Oppenheimer funds available for exchange have different
investment objectives, policies and risks. A shareholder should assure that
the fund selected is appropriate for his or her investment and should be
aware of the tax consequences of an exchange. For federal income tax
purposes, an exchange transaction is treated as a redemption of shares of one
fund and a purchase of shares of another. "Reinvestment Privilege," above,
discusses some of the tax consequences of reinvestment of redemption proceeds
in such cases. The Fund, the Distributor, and the Transfer Agent are unable
to provide investment, tax or legal advice to a shareholder in connection
with an exchange request or any other investment transaction.
Dividends, Capital Gains and Taxes
Dividends and Distributions. The Fund has no fixed dividend rate and there
can be no assurance as to the payment of any dividends or the realization of
any capital gains. The dividends and distributions paid by a class of shares
will vary from time to time depending on market conditions, the composition
of the Fund's portfolio, and expenses borne by the Fund or borne separately
by a class. Dividends are calculated in the same manner, at the same time,
and on the same day for each class of shares. However, dividends on Class B,
Class C and Class N shares are expected to be lower than dividends on Class A
and Class Y shares. That is because of the effect of the asset-based sales
charge on Class B, Class C and Class N shares. Those dividends will also
differ in amount as a consequence of any difference in the net asset values
of the different classes of shares.
Dividends, distributions and proceeds of the redemption of Fund shares
represented by
checks returned to the Transfer Agent by the Postal Service as undeliverable
will be invested in shares of Oppenheimer Money Market Fund, Inc.
Reinvestment will be made as promptly as possible after the return of such
checks to the Transfer Agent, to enable the investor to earn a return on
otherwise idle funds. Unclaimed accounts may be subject to state escheatment
laws, and the Fund and the Transfer Agent will not be liable to shareholders
or their representatives for compliance with those laws in good faith.
Tax Status of the Fund's Dividends, Distributions and Redemptions of Shares.
The federal tax treatment of the Fund's dividends and capital gains
distributions is briefly highlighted in the Prospectus. The following is only
a summary of certain additional tax considerations generally affecting the
Fund and its shareholders.
The tax discussion in the Prospectus and this Statement of Additional
Information is based on tax law in effect on the date of the Prospectus and
this Statement of Additional Information. Those laws and regulations may be
changed by legislative, judicial, or administrative action, sometimes with
retroactive effect. State and local tax treatment of ordinary income
dividends and capital gain dividends from regulated investment companies may
differ from the treatment under the Internal Revenue Code described below.
Potential purchasers of shares of the Fund are urged to consult their tax
advisers with specific reference to their own tax circumstances as well as
the consequences of federal, state and local tax rules affecting an
investment in the Fund.
|X| Qualification as a Regulated Investment Company. The Fund has elected
to be taxed as a regulated investment company under Subchapter M of the
Internal Revenue Code of 1986, as amended. As a regulated investment
company, the Fund is not subject to federal income tax on the portion of its
net investment income (that is, taxable interest, dividends, and other
taxable ordinary income, net of expenses) and capital gain net income (that
is, the excess of net long-term capital gains over net short-term capital
losses) that it distributes to shareholders. That qualification enables the
Fund to "pass through" its income and realized capital gains to shareholders
without having to pay tax on them. This avoids a "double tax" on that income
and capital gains, since shareholders normally will be taxed on the dividends
and capital gains they receive from the Fund (unless their Fund shares are
held in a retirement account or the shareholder is otherwise exempt from
tax).
The Internal Revenue Code contains a number of complex tests relating
to qualification that the Fund might not meet in a particular year. If it did
not qualify as a regulated investment company, the Fund would be treated for
tax purposes as an ordinary corporation and would receive no tax deduction
for payments made to shareholders.
To qualify as a regulated investment company, the Fund must distribute
at least 90% of its investment company taxable income (in brief, net
investment income and the excess of net short-term capital gain over net
long-term capital loss) for the taxable year. The Fund must also satisfy
certain other requirements of the Internal Revenue Code, some of which are
described below. Distributions by the Fund made during the taxable year or,
under specified circumstances, within 12 months after the close of the
taxable year, will be considered distributions of income and gains for the
taxable year and will therefore count toward satisfaction of the
above-mentioned requirement.
To qualify as a regulated investment company, the Fund must derive at
least 90% of its gross income from dividends, interest, certain payments with
respect to securities loans, gains from the sale or other disposition of
stock or securities or foreign currencies (to the extent such currency gains
are directly related to the regulated investment company's principal business
of investing in stock or securities) and certain other income.
In addition to satisfying the requirements described above, the Fund
must satisfy an asset diversification test in order to qualify as a regulated
investment company. Under that test, at the close of each quarter of the
Fund's taxable year, at least 50% of the value of the Fund's assets must
consist of cash and cash items (including receivables), U.S. government
securities, securities of other regulated investment companies, and
securities of other issuers. As to each of those issuers, the Fund must not
have invested more than 5% of the value of the Fund's total assets in
securities of each such issuer and the Fund must not hold more than 10% of
the outstanding voting securities of each such issuer. No more than 25% of
the value of its total assets may be invested in the securities of any one
issuer (other than U.S. government securities and securities of other
regulated investment companies), or in two or more issuers which the Fund
controls and which are engaged in the same or similar trades or businesses.
For purposes of this test, obligations issued or guaranteed by certain
agencies or instrumentalities of the U.S. government are treated as U.S.
government securities.
|X| Excise Tax on Regulated Investment Companies. Under the Internal
Revenue Code, by December 31 each year, the Fund must distribute 98% of its
taxable investment income earned from January 1 through December 31 of that
year and 98% of its capital gains realized in the period from November 1 of
the prior year through October 31 of the current year. If it does not, the
Fund must pay an excise tax on the amounts not distributed. It is presently
anticipated that the Fund will meet those requirements. To meet this
requirement, in certain circumstances the Fund might be required to liquidate
portfolio investments to make sufficient distributions to avoid excise tax
liability. However, the Board of Trustees and the Manager might determine in
a particular year that it would be in the best interests of shareholders for
the Fund not to make such distributions at the required levels and to pay the
excise tax on the undistributed amounts. That would reduce the amount of
income or capital gains available for distribution to shareholders.
|X| Taxation of Fund Distributions. The Fund anticipates distributing
substantially all of its investment company taxable income for each taxable
year. Those distributions will be taxable to shareholders as ordinary income
and treated as dividends for federal income tax purposes.
Special provisions of the Internal Revenue Code govern the eligibility
of the Fund's dividends for the dividends-received deduction for corporate
shareholders. Long-term capital gains distributions are not eligible for the
deduction. The amount of dividends paid by the Fund that may qualify for the
deduction is limited to the aggregate amount of qualifying dividends that the
Fund derives from portfolio investments that the Fund has held for a minimum
period, usually 46 days. A corporate shareholder will not be eligible for the
deduction on dividends paid on Fund shares held for 45 days or less. To the
extent the Fund's dividends are derived from gross income from option
premiums, interest income or short-term gains from the sale of securities or
dividends from foreign corporations, those dividends will not qualify for the
deduction.
The Fund may either retain or distribute to shareholders its net
capital gain for each taxable year. The Fund currently intends to distribute
any such amounts. If net long term capital gains are distributed and
designated as a capital gain distribution, it will be taxable to shareholders
as a long-term capital gain and will be properly identified in reports sent
to shareholders in January of each year. Such treatment will apply no matter
how long the shareholder has held his or her shares or whether that gain was
recognized by the Fund before the shareholder acquired his or her shares.
If the Fund elects to retain its net capital gain, the Fund will be
subject to tax on it at the 35% corporate tax rate. If the Fund elects to
retain its net capital gain, the Fund will provide to shareholders of record
on the last day of its taxable year information regarding their pro rata
share of the gain and tax paid. As a result, each shareholder will be
required to report his or her pro rata share of such gain on their tax return
as long-term capital gain, will receive a refundable tax credit for his/her
pro rata share of tax paid by the Fund on the gain, and will increase the tax
basis for his/her shares by an amount equal to the deemed distribution less
the tax credit.
Investment income that may be received by the Fund from sources within
foreign countries may be subject to foreign taxes withheld at the source.
The United States has entered into tax treaties with many foreign countries
which entitle the Fund to a reduced rate of, or exemption from, taxes on such
income.
Distributions by the Fund that do not constitute ordinary income
dividends or capital gain distributions will be treated as a return of
capital to the extent of the shareholder's tax basis in their shares. Any
excess will be treated as gain from the sale of those shares, as discussed
below. Shareholders will be advised annually as to the U.S. federal income
tax consequences of distributions made (or deemed made) during the year. If
prior distributions made by the Fund must be re-characterized as a
non-taxable return of capital at the end of the fiscal year as a result of
the effect of the Fund's investment policies, they will be identified as such
in notices sent to shareholders.
Distributions by the Fund will be treated in the manner described above
regardless of whether the distributions are paid in cash or reinvested in
additional shares of the Fund (or of another fund). Shareholders receiving a
distribution in the form of additional shares will be treated as receiving a
distribution in an amount equal to the fair market value of the shares
received, determined as of the reinvestment date.
The Fund will be required in certain cases to withhold approximately
28% currently of ordinary income dividends, capital gains distributions and
the proceeds of the redemption of shares, paid to any shareholder (1) who has
failed to provide a correct taxpayer identification number or to properly
-------
certify that number when required, (2) who is subject to backup withholding
for failure to report the receipt of interest or dividend income properly, or
(3) who has failed to certify to the Fund that the shareholder is not subject
to backup withholding or is an "exempt recipient" (such as a corporation).
All income and any tax withheld by the Fund is remitted by the Fund to the
U.S. Treasury and is identified in reports mailed to shareholders in January
of each year.
|X| Tax Effects of Redemptions of Shares. If a shareholder redeems all or a
portion of his/her shares, the shareholder will recognize a gain or loss on
the redeemed shares in an amount equal to the difference between the proceeds
of the redeemed shares and the shareholder's adjusted tax basis in the
shares. All or a portion of any loss recognized in that manner may be
disallowed if the shareholder purchases other shares of the Fund within 30
days before or after the redemption.
In general, any gain or loss arising from the redemption of shares of
the Fund will be considered capital gain or loss, if the shares were held as
a capital asset. It will be long-term capital gain or loss if the shares were
held for more than one year. However, any capital loss arising from the
redemption of shares held for six months or less will be treated as a
long-term capital loss to the extent of the amount of capital gain dividends
received on those shares. Special holding period rules under the Internal
Revenue Code apply in this case to determine the holding period of shares and
there are limits on the deductibility of capital losses in any year.
|X| Foreign Shareholders. Under U.S. tax law, taxation of a shareholder
who is a foreign person (to include, but not limited to, a nonresident alien
individual, a foreign trust, a foreign estate, a foreign corporation, or a
foreign partnership) primarily depends on whether the foreign person's income
from the Fund is effectively connected with the conduct of a U.S. trade or
business. Typically, ordinary income dividends paid from a mutual fund are
not considered "effectively connected" income.
Ordinary income dividends that are paid by the Fund (and are deemed not
"effectively connected income") to foreign persons will be subject to a U.S.
tax withheld by the Fund at a rate of approximately 28% currently, provided
the Fund obtains a properly completed and signed Certificate of Foreign
Status. The tax rate may be reduced if the foreign person's country of
residence has a tax treaty with the U.S. allowing for a reduced tax rate on
ordinary income dividends paid by the Fund. All income and any tax withheld
by the Fund is remitted by the Fund to the U.S. Treasury and is identified in
reports mailed to shareholders in March of each year.
If the ordinary income dividends from the Fund are effectively
---
connected with the conduct of a U.S. trade or business, then the foreign
person may claim an exemption from the U.S. tax described above provided the
Fund obtains a properly completed and signed Certificate of Foreign Status.
If the foreign person fails to provide a certification of his/her
foreign status, the Fund will be required to withhold U.S. tax at a rate of
approximately 28% currently on ordinary income dividends, capital gains
distributions and the proceeds of the redemption of shares, paid to any
foreign person. All income and any tax withheld (in this situation) by the
Fund is remitted by the Fund to the U.S. Treasury and is identified in
reports mailed to shareholders in January of each year.
The tax consequences to foreign persons entitled to claim the benefits
of an applicable tax treaty may be different from those described herein.
Foreign shareholders are urged to consult their own tax advisors or the U.S.
Internal Revenue Service with respect to the particular tax consequences to
them of an investment in the Fund, including the applicability of the U.S.
withholding taxes described above.
Dividend Reinvestment in Another Fund. Shareholders of the Fund may elect to
reinvest all dividends and/or capital gains distributions in shares of the
same class of any of the other Oppenheimer funds listed above. Reinvestment
will be made without sales charge at the net asset value per share in effect
at the close of business on the payable date of the dividend or distribution.
To elect this option, the shareholder must notify the Transfer Agent in
writing and must have an existing account in the fund selected for
reinvestment. Otherwise the shareholder first must obtain a prospectus for
that fund and an application from the Distributor to establish an account.
Dividends and/or distributions from shares of certain other Oppenheimer funds
(other than Oppenheimer Cash Reserves) may be invested in shares of this Fund
on the same basis.
Additional Information About the FundThe Distributor. The Fund's shares are sold through dealers, brokers and
other financial institutions that have a sales agreement with
OppenheimerFunds Distributor, Inc., a subsidiary of the Manager that acts as
the Fund's Distributor. The Distributor also distributes shares of the other
Oppenheimer funds and is sub-distributor for funds managed by a subsidiary of
the Manager.
The Transfer Agent. OppenheimerFunds Services, the Fund's Transfer Agent, is
a division of the Manager. It is responsible for maintaining the Fund's
shareholder registry and shareholder accounting records, and for paying
dividends and distributions to shareholders. It also handles shareholder
servicing and administrative functions. It serves as the Transfer Agent for
an annual per account fee. It also acts as shareholder servicing agent for
the other Oppenheimer funds. Shareholders should direct inquiries about their
accounts to the Transfer Agent at the address and toll-free numbers shown on
the back cover.
The Custodian. Citibank, N.A. is the custodian of the Fund's assets. The
custodian's responsibilities include safeguarding and controlling the Fund's
portfolio securities and handling the delivery of such securities to and from
the Fund. It is the practice of the Fund to deal with the custodian in a
manner uninfluenced by any banking relationship the custodian may have with
the Manager and its affiliates. The Fund's cash balances with the custodian
in excess of $100,000 are not protected by federal deposit insurance. Those
uninsured balances at times may be substantial.
Independent Auditors. Ernst & Young LLP are the independent auditors of the
Fund. They audit the Fund's financial statements and perform other related
audit services. They also act as auditors for certain other funds advised by
the Manager and its affiliates.
Report of Independent Auditors
To the Shareholder and
Board of Trustees of
Oppenheimer International Large-Cap Core Trust
We have audited the accompanying statement of assets and liabilities of
Oppenheimer International Large-Cap Core Fund (the sole fund constituting the
Oppenheimer International Large-Cap Core Trust) (the "Fund") as of July 16,2003. This statement of assets and liabilities is the responsibility of the
Fund's management. Our responsibility is to express an opinion on this
statement of assets and liabilities based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the statement
of assets and liabilities is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the statement of assets and liabilities. An audit also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall statement of assets and
liabilities presentation. We believe that our audit provides a reasonable
basis for our opinion.
In our opinion, the statement of assets and liabilities referred to above
presents fairly, in all material respects, the financial position of
Oppenheimer International Large-Cap Core Fund of the Oppenheimer
International Large-Cap Core Trust at July 16, 2003, in conformity with
accounting principles generally accepted in the United States.
ERNST & YOUNG LLP
New York, New York
July 16, 2003
Oppenheimer International Large-Cap Core Fund
Statement of Assets and Liabilities
July 16, 2003
ASSETS:
Cash $100,000
LIABILITIES: --
---------
Net Assets $100,000
========
NET ASSETS - Applicable to 10,000 Class A shares
of beneficial interest issued and outstanding, $.001 par
value,
unlimited shares authorized
$100,000
========
NET ASSET VALUE PER SHARE (net assets divided by
10,000 Class A shares of beneficial interest) $10.00
MAXIMUM OFFERING PRICE PER SHARE (net asset
value plus sales charge of 5.75% of offering price)
$10.61
Notes to Statement of Assets and Liabilities:
Note 1.
Organization
Oppenheimer International Large-Cap Core Fund, a series of Oppenheimer
International Large-Cap Core Trust (the "Fund") was organized as a business
trust under the laws of the Commonwealth of Massachusetts on May 22, 2003 as
a diversified, open-end management investment company registered under the
Investment Company Act of 1940, as amended. The Fund has had no operations
through July 16, 2003 other than those related to organizational matters and
the sale and issuance of 10,000 Class A shares to OppenheimerFunds, Inc.
("OFI" or the "Manager"). The Fund intends to offer Class B, C, N and Y
shares.
On May 21, 2003, the Fund's Board of Trustees (the "Board") approved an
investment Advisory Agreement with OFI and a Distributor's Agreement with
OppenheimerFunds Distributor, Inc. ("OFDI"), a wholly-owned subsidiary of
OFI. OFI Institutional Asset Management, Inc. (the "Sub-Advisor"), a direct
wholly-owned subsidiary of OFI, is primarily responsible for the day-to-day
management of the Fund's portfolio.
The Fund's investment objective is long-term capital appreciation through
investment in common stocks of large-cap foreign companies.
Note 2. Significant Accounting Policies
OFI has assumed all organization and initial offering costs which are
estimated at $27,000.
The Fund's financial statements are prepared in conformity with accounting
principles generally accepted in the United States which may require the use
of management estimates and assumptions. Actual results could differ from
those estimates.
The Fund intends to comply in its initial fiscal year and thereafter with
provisions of the Internal Revenue Code applicable to regulated investment
companies and as such, will not be subject to federal income taxes on
otherwise taxable income (including net realized capital gains) distributed
to shareholders. The Fund intends to qualify as RIC under sub-chapter M of
the Internal Revenue Service Code.
Note 3. Fees and Other Transactions with Affiliated Parties
The Fund will pay the Manager an advisory fee (the "Management Fee") at the
annual rate of 0.85% of the Fund's first $500 million of average annual net
assets, 0.75% of the next $500 million of average annual net assets, and
0.70% of average annual net assets in excess of $1 billion. Such fee will be
accrued daily and paid monthly.
Under the Sub-Advisory Agreement between the Manager and the Sub-Advisor, the
Manager, not the Fund, will pay the Sub-Advisor an annual fee equal to 30% of
the Management Fee collected by the Manager.
OppenheimerFunds Services ("OFS"), a division of the Manager, acts as the
transfer and shareholder servicing agent for the Fund. The Fund will pay OFS
an agreed upon per account fee.
OFDI acts as the Fund's principal underwriter in the continuous public
offering of shares of the Fund.
Appendix A
RATINGS DEFINITIONS
-------------------
Below are summaries of the rating definitions used by the
nationally-recognized rating agencies listed below. Those ratings represent
the opinion of the agency as to the credit quality of issues that they rate.
The summaries below are based upon publicly-available information provided by
the rating organizations.
Moody's Investors Service, Inc. ("Moody's")
LONG-TERM (TAXABLE) BOND RATINGS
Aaa: Bonds rated "Aaa" are judged to be the best quality. They carry the
smallest degree of investment risk. Interest payments are protected by a
large or by an exceptionally stable margin and principal is secure. While
the various protective elements are likely to change, the changes that can be
expected are most unlikely to impair the fundamentally strong position of
such issues.
Aa: Bonds rated "Aa" are judged to be of high quality by all standards.
Together with the "Aaa" group, they comprise what are generally known as
high-grade bonds. They are rated lower than the best bonds because margins
of protection may not be as large as with "Aaa" securities or fluctuation of
protective elements may be of greater amplitude or there may be other
elements present which make the long-term risk appear somewhat larger than
that of "Aaa" securities.
A: Bonds rated "A" possess many favorable investment attributes and are to be
considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present
which suggest a susceptibility to impairment some time in the future.
Baa: Bonds rated "Baa" are considered medium-grade obligations; that is, they
are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any
great length of time. Such bonds lack outstanding investment characteristics
and have speculative characteristics as well.
Ba: Bonds rated "Ba" are judged to have speculative elements. Their future
cannot be considered well-assured. Often the protection of interest and
principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B: Bonds rated "B" generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.
Caa: Bonds rated "Caa" are of poor standing. Such issues may be in default or
there may be present elements of danger with respect to principal or
interest.
Ca: Bonds rated "Ca" represent obligations which are speculative in a high
degree. Such issues are often in default or have other marked shortcomings.
C: Bonds rated "C" are the lowest class of rated bonds and can be regarded
as having extremely poor prospects of ever attaining any real investment
standing.
Moody's applies numerical modifiers 1, 2, and 3 in each generic rating
classification from "Aa" through
"Caa." The modifier "1" indicates that the obligation ranks in the higher end
of its generic rating category; the modifier "2" indicates a mid-range
ranking; and the modifier "3" indicates a ranking in the lower end of that
generic rating category. Advanced refunded issues that are secured by certain
assets are identified with a # symbol.
PRIME RATING SYSTEM (SHORT-TERM RATINGS - TAXABLE DEBT)
These ratings apply to the ability of issuers to honor senior debt
obligations having an original maturity not exceeding one year:
Prime-1: Issuer has a superior ability for repayment of senior short-term
debt obligations.
Prime-2: Issuer has a strong ability for repayment of senior short-term debt
obligations. Earnings trends and coverage ratios, while sound, may be more
subject to variation. Capitalization characteristics, while appropriate, may
be more affected by external conditions. Ample alternate liquidity is
maintained.
Prime-3: Issuer has an acceptable ability for repayment of senior short-term
obligations. The effect of industry characteristics and market compositions
may be more pronounced. Variability in earnings and profitability may result
in changes in the level of debt protection measurements and may require
relatively high financial leverage. Adequate alternate liquidity is
maintained.
Not Prime: Issuer does not fall within any Prime rating category.
Standard & Poor's Ratings Services ("Standard & Poor's"), a division of The
McGraw-Hill Companies, Inc.
LONG-TERM ISSUE CREDIT RATINGS
AAA: Bonds rated "AAA" have the highest rating assigned by Standard & Poor's.
The obligor's capacity to meet its financial commitment on the obligation is
extremely strong.
AA: Bonds rated "AA" differ from the highest rated bonds only in small
degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.
A: Bonds rated "A" are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its
financial commitment on the obligation is still strong.
BBB: Bonds rated "BBB" exhibit adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead
to a weakened capacity of the obligor to meet its financial commitment on the
obligation.
BB, B, CCC, CC, and C:
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.
BB: Bonds rated "BB" are less vulnerable to nonpayment than other speculative
issues. However, they face major ongoing uncertainties or exposure to adverse
business, financial, or economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the obligation.
B: Bonds rated "B" are more vulnerable to nonpayment than bonds 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: Bonds rated "CCC" are currently vulnerable to nonpayment, and are
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation. In the event of
adverse business, financial, or economic conditions, the obligor is not
likely to have the capacity to meet its financial commitment on the
obligation.
CC: Bonds rated "CC" are currently highly vulnerable to nonpayment.
C: Subordinated debt or preferred stock obligations rated "C" are currently
highly vulnerable to nonpayment. The "C" rating may be used to cover a
situation where a bankruptcy petition has been filed or similar action taken,
but payments on this obligation are being continued. A "C" also will be
assigned to a preferred stock issue in arrears on dividends or sinking fund
payments, but that is currently paying.
D: Bonds rated "D" are in payment default. The "D" rating category is used
when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless Standard & Poor's believes
that such payments will be made during such grace period. The "D" rating also
will be used upon the filing of a bankruptcy petition or the taking of a
similar action if payments on an obligation are jeopardized.
The ratings from "AA" to "CCC" may be modified by the addition of a plus (+)
or minus (-) sign to show relative standing within the major rating
categories. The "r" symbol is attached to the ratings of instruments with
significant noncredit risks.
SHORT-TERM ISSUE CREDIT RATINGS
A-1: A short-term bond 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 bond 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 bond 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 bond 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 bond 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 bond 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.
Fitch, Inc.
INTERNATIONAL LONG-TERM CREDIT RATINGS
Investment Grade:AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of
credit risk. They are assigned only in the case of exceptionally strong
capacity for timely payment of financial commitments. This capacity is highly
unlikely to be adversely affected by foreseeable events.
AA: Very High Credit Quality. "AA" ratings denote a very low expectation of
credit risk. They indicate a very strong capacity for timely payment of
financial commitments. This capacity is not significantly vulnerable to
foreseeable events.
A: High Credit Quality. "A" ratings denote a low expectation of credit risk.
The capacity for timely payment of financial commitments is considered
strong. This capacity may, nevertheless, be more vulnerable to changes in
circumstances or in economic conditions than is the case for higher ratings.
BBB: Good Credit Quality. "BBB" ratings indicate that there is currently a
low expectation of credit risk. The capacity for timely payment of financial
commitments is considered adequate, but adverse changes in circumstances and
in economic conditions are more likely to impair this capacity. This is the
lowest investment-grade category.
Speculative Grade:
BB: Speculative. "BB" ratings indicate that there is a possibility of credit
risk developing, particularly as the result of adverse economic change over
time. However, business or financial alternatives may be available to allow
financial commitments to be met. Securities rated in this category are not
investment grade.
B: Highly Speculative. "B" ratings indicate that significant credit risk is
present, but a limited margin of safety remains. Financial commitments are
currently being met. However, capacity for continued payment is contingent
upon a sustained, favorable business and economic environment.
CCC, CC C: High Default Risk. Default is a real possibility. Capacity for
meeting financial commitments is solely reliant upon sustained, favorable
business or economic developments. A "CC" rating indicates that default of
some kind appears probable. "C" ratings signal imminent default.
DDD, DD, and D: Default. The ratings of obligations in this category are
based on their prospects for achieving partial or full recovery in a
reorganization or liquidation of the obligor. While expected recovery values
are highly speculative and cannot be estimated with any precision, the
following serve as general guidelines. "DDD" obligations have the highest
potential for recovery, around 90%-100% of outstanding amounts and accrued
interest. "DD" indicates potential recoveries in the range of 50%-90%, and
"D" the lowest recovery potential, i.e., below 50%.
Entities rated in this category have defaulted on some or all of their
obligations. Entities rated "DDD" have the highest prospect for resumption of
performance or continued operation with or without a formal reorganization
process. Entities rated "DD" and "D" are generally undergoing a formal
reorganization or liquidation process; those rated "DD" are likely to satisfy
a higher portion of their outstanding obligations, while entities rated "D"
have a poor prospect for repaying all obligations.
Plus (+) and minus (-) signs may be appended to a rating symbol to denote
relative status within the major rating categories. Plus and minus signs are
not added to the "AAA" category or to categories below "CCC," nor to
short-term ratings other than "F1" (see below).
INTERNATIONAL SHORT-TERM CREDIT RATINGS
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.
--------
1. In accordance with Rule 12b-1 of the Investment Company Act, the term
"Independent Trustees" in this Statement of Additional Information refers to
those Trustees who are not "interested persons" of the Fund (or its parent
corporation) and who do not have any direct or indirect financial interest in
the operation of the distribution plan or any agreement under the plan.
2 Certain waivers also apply to Class M shares of Oppenheimer Convertible
Securities Fund.
3 In the case of Oppenheimer Senior Floating Rate Fund, a
continuously-offered closed-end fund, references to contingent deferred sales
charges mean the Fund's Early Withdrawal Charges and references to
"redemptions" mean "repurchases" of shares.
4 An "employee benefit plan" means any plan or arrangement, whether or not it
is "qualified" under the Internal Revenue Code, under which Class N shares of
an Oppenheimer fund or funds are purchased by a fiduciary or other
administrator for the account of participants who are employees of a single
employer or of affiliated employers. These may include, for example, medical
savings accounts, payroll deduction plans or similar plans. The fund accounts
must be registered in the name of the fiduciary or administrator purchasing
the shares for the benefit of participants in the plan.
5 The term "Group Retirement Plan" means any qualified or non-qualified
retirement plan for employees of a corporation or sole proprietorship,
members and employees of a partnership or association or other organized
group of persons (the members of which may include other groups), if the
group has made special arrangements with the Distributor and all members of
the group participating in (or who are eligible to participate in) the plan
purchase shares of an Oppenheimer fund or funds through a single investment
dealer, broker or other financial institution designated by the group. Such
plans include 457 plans, SEP-IRAs, SARSEPs, SIMPLE plans and 403(b) plans
other than plans for public school employees. The term "Group Retirement
Plan" also includes qualified retirement plans and non-qualified deferred
compensation plans and IRAs that purchase shares of an Oppenheimer fund or
funds through a single investment dealer, broker or other financial
institution that has made special arrangements with the Distributor.
6 However, that concession will not be paid on purchases of shares in amounts
of $1 million or more (including any right of accumulation) by a Retirement
Plan that pays for the purchase with the redemption proceeds of Class C
shares of one or more Oppenheimer funds held by the Plan for more than one
year.
7 This provision does not apply to IRAs.
8 This provision does not apply to 403(b)(7) custodial plans if the
participant is less than age 55, nor to IRAs.
9 The distribution must be requested prior to Plan termination or the
elimination of the Oppenheimer funds as an investment option under the Plan.
10 This provision does not apply to IRAs.
11 This provision does not apply to loans from 403(b)(7) custodial plans and
loans from the OppenheimerFunds-sponsored Single K retirement plan.
12 This provision does not apply to 403(b)(7) custodial plans if the
participant is less than age 55, nor to IRAs.
Appendix B
Industry Classifications
------------------------
Aerospace & Defense Household Durables
Air Freight & Couriers Household Products
Airlines Industrial Conglomerates
Auto Components Insurance
Automobiles Internet & Catalog Retail
Banks Internet Software & Services
Beverages Information Technology Consulting &
Services
Biotechnology Leisure Equipment & Products
Building Products Machinery
Chemicals Marine
Commercial Services & Supplies Media
Communications Equipment Metals & Mining
Computers & Peripherals Multiline Retail
Construction & Engineering Multi-Utilities
Construction Materials Office Electronics
Containers & Packaging Oil & Gas
Distributors Paper & Forest Products
Diversified Financials Personal Products
Diversified Telecommunication Pharmaceuticals
Services
Electric Utilities Real Estate
Electrical Equipment Road & Rail
Electronic Equipment & Instruments Semiconductor Equipment & Products
Energy Equipment & Services Software
Food & Drug Retailing Specialty Retail
Food Products Textiles & Apparel
Gas Utilities Tobacco
Health Care Equipment & Supplies Trading Companies & Distributors
Health Care Providers & Services Transportation Infrastructure
Hotels Restaurants & Leisure Water Utilities
Wireless Telecommunication Services
Appendix C
OppenheimerFunds Special Sales Charge Arrangements and Waivers
--------------------------------------------------------------
In certain cases, the initial sales charge that applies to purchases of Class
A shares2 of the Oppenheimer funds or the contingent deferred sales charge
that may apply to Class A, Class B or Class C shares may be waived.3 That is
because of the economies of sales efforts realized by OppenheimerFunds
Distributor, Inc., (referred to in this document as the "Distributor"), or by
dealers or other financial institutions that offer those shares to certain
classes of investors.
Not all waivers apply to all funds. For example, waivers relating to
Retirement Plans do not apply to Oppenheimer municipal funds, because shares
of those funds are not available for purchase by or on behalf of retirement
plans. Other waivers apply only to shareholders of certain funds.
For the purposes of some of the waivers described below and in the Prospectus
and Statement of Additional Information of the applicable Oppenheimer funds,
the term "Retirement Plan" refers to the following types of plans:
1) plans qualified under Sections 401(a) or 401(k) of the Internal
Revenue Code,
2) non-qualified deferred compensation plans,
3) employee benefit plans4
4) Group Retirement Plans5
5) 403(b)(7) custodial plan accounts
6) Individual Retirement Accounts ("IRAs"), including traditional
IRAs, Roth IRAs, SEP-IRAs, SARSEPs or SIMPLE plans
The interpretation of these provisions as to the applicability of a special
arrangement or waiver in a particular case is in the sole discretion of the
Distributor or the transfer agent (referred to in this document as the
"Transfer Agent") of the particular Oppenheimer fund. These waivers and
special arrangements may be amended or terminated at any time by a particular
fund, the Distributor, and/or OppenheimerFunds, Inc. (referred to in this
document as the "Manager").
Waivers that apply at the time shares are redeemed must be requested by the
shareholder and/or dealer in the redemption request.
I.
Applicability of Class A Contingent Deferred Sales Charges in Certain Cases
------------------------------------------------------------------------------
Purchases of Class A Shares of Oppenheimer Funds That Are Not Subject to
Initial Sales Charge but May Be Subject to the Class A Contingent Deferred
Sales Charge (unless a waiver applies).
There is no initial sales charge on purchases of Class A shares of any
of the Oppenheimer funds in the cases listed below. However, these purchases
may be subject to the Class A contingent deferred sales charge if redeemed
within 18 months (24 months in the case of Oppenheimer Rochester National
Municipals and Rochester Fund Municipals) of the beginning of the calendar
month of their purchase, as described in the Prospectus (unless a waiver
described elsewhere in this Appendix applies to the redemption).
Additionally, on shares purchased under these waivers that are subject to the
Class A contingent deferred sales charge, the Distributor will pay the
applicable concession described in the Prospectus under "Class A ContingentDeferred Sales Charge."6 This waiver provision applies to:
|_| Purchases of Class A shares aggregating $1 million or more.
|_| Purchases of Class A shares by a Retirement Plan that was permitted to
purchase such shares at net asset value but subject to a contingent
deferred sales charge prior to March 1, 2001. That included plans
(other than IRA or 403(b)(7) Custodial Plans) that: 1) bought shares
costing $500,000 or more, 2) had at the time of purchase 100 or more
eligible employees or total plan assets of $500,000 or more, or 3)
certified to the Distributor that it projects to have annual plan
purchases of $200,000 or more.
|_| Purchases by an OppenheimerFunds-sponsored Rollover IRA, if the
purchases are made:
1) through a broker, dealer, bank or registered investment adviser
that has made special arrangements with the Distributor for those
purchases, or
2) by a direct rollover of a distribution from a qualified
Retirement Plan if the administrator of that Plan has made
special arrangements with the Distributor for those purchases.
|_| Purchases of Class A shares by Retirement Plans that have any of the
following record-keeping arrangements:
1) The record keeping is performed by Merrill Lynch Pierce Fenner &
Smith, Inc. ("Merrill Lynch") on a daily valuation basis for the
Retirement Plan. On the date the plan sponsor signs the
record-keeping service agreement with Merrill Lynch, the Plan
must have $3 million or more of its assets invested in (a) mutual
funds, other than those advised or managed by Merrill Lynch
Investment Management, L.P. ("MLIM"), that are made available
under a Service Agreement between Merrill Lynch and the mutual
fund's principal underwriter or distributor, and (b) funds
advised or managed by MLIM (the funds described in (a) and (b)
are referred to as "Applicable Investments").
2) The record keeping for the Retirement Plan is performed on a
daily valuation basis by a record keeper whose services are
provided under a contract or arrangement between the Retirement
Plan and Merrill Lynch. On the date the plan sponsor signs the
record keeping service agreement with Merrill Lynch, the Plan
must have $3 million or more of its assets (excluding assets
invested in money market funds) invested in Applicable
Investments.
3) The record keeping for a Retirement Plan is handled under a
service agreement with Merrill Lynch and on the date the plan
sponsor signs that agreement, the Plan has 500 or more eligible
employees (as determined by the Merrill Lynch plan conversion
manager).
II.
Waivers of Class A Sales Charges of Oppenheimer Funds
------------------------------------------------------------------------------
A. Waivers of Initial and Contingent Deferred Sales Charges for Certain
Purchasers.
Class A shares purchased by the following investors are not subject to any
Class A sales charges (and no concessions are paid by the Distributor on such
purchases):
|_| The Manager or its affiliates.
|_| Present or former officers, directors, trustees and employees (and
their "immediate families") of the Fund, the Manager and its
affiliates, and retirement plans established by them for their
employees. The term "immediate family" refers to one's spouse,
children, grandchildren, grandparents, parents, parents-in-law,
brothers and sisters, sons- and daughters-in-law, a sibling's
spouse, a spouse's siblings, aunts, uncles, nieces and nephews;
relatives by virtue of a remarriage (step-children, step-parents,
etc.) are included.
|_| Registered management investment companies, or separate accounts of
insurance companies having an agreement with the Manager or the
Distributor for that purpose.
|_| Dealers or brokers that have a sales agreement with the Distributor, if
they purchase shares for their own accounts or for retirement plans
for their employees.
|_| Employees and registered representatives (and their spouses) of dealers
or brokers described above or financial institutions that have
entered into sales arrangements with such dealers or brokers (and
which are identified as such to the Distributor) or with the
Distributor. The purchaser must certify to the Distributor at the
time of purchase that the purchase is for the purchaser's own
account (or for the benefit of such employee's spouse or minor
children).
|_| Dealers, brokers, banks or registered investment advisors that have
entered into an agreement with the Distributor providing
specifically for the use of shares of the Fund in particular
investment products made available to their clients. Those clients
may be charged a transaction fee by their dealer, broker, bank or
advisor for the purchase or sale of Fund shares.
|_| Investment advisors and financial planners who have entered into an
agreement for this purpose with the Distributor and who charge an
advisory, consulting or other fee for their services and buy shares
for their own accounts or the accounts of their clients.
|_| "Rabbi trusts" that buy shares for their own accounts, if the purchases
are made through a broker or agent or other financial intermediary
that has made special arrangements with the Distributor for those
purchases.
|_| Clients of investment advisors or financial planners (that have entered
into an agreement for this purpose with the Distributor) who buy
shares for their own accounts may also purchase shares without sales
charge but only if their accounts are linked to a master account of
their investment advisor or financial planner on the books and
records of the broker, agent or financial intermediary with which
the Distributor has made such special arrangements . Each of these
investors may be charged a fee by the broker, agent or financial
intermediary for purchasing shares.
|_| Directors, trustees, officers or full-time employees of OpCap Advisors
or its affiliates, their relatives or any trust, pension, profit
sharing or other benefit plan which beneficially owns shares for
those persons.
|_| Accounts for which Oppenheimer Capital (or its successor) is the
investment advisor (the Distributor must be advised of this
arrangement) and persons who are directors or trustees of the
company or trust which is the beneficial owner of such accounts.
|_| A unit investment trust that has entered into an appropriate agreement
with the Distributor.
|_| Dealers, brokers, banks, or registered investment advisers that have
entered into an agreement with the Distributor to sell shares to
defined contribution employee retirement plans for which the dealer,
broker or investment adviser provides administration services.
|-|
Retirement Plans and deferred compensation plans and trusts used to
fund those plans (including, for example, plans qualified or created
under sections 401(a), 401(k), 403(b) or 457 of the Internal Revenue
Code), in each case if those purchases are made through a broker,
agent or other financial intermediary that has made special
arrangements with the Distributor for those purchases.
|_| A TRAC-2000 401(k) plan (sponsored by the former Quest for Value
Advisors) whose Class B or Class C shares of a Former Quest for
Value Fund were exchanged for Class A shares of that Fund due to the
termination of the Class B and Class C TRAC-2000 program on November24, 1995.
|_| A qualified Retirement Plan that had agreed with the former Quest for
Value Advisors to purchase shares of any of the Former Quest for
Value Funds at net asset value, with such shares to be held through
DCXchange, a sub-transfer agency mutual fund clearinghouse, if that
arrangement was consummated and share purchases commenced by
December 31, 1996.
B. Waivers of Initial and Contingent Deferred Sales Charges in Certain
Transactions.
Class A shares issued or purchased in the following transactions are not
subject to sales charges (and no concessions are paid by the Distributor on
such purchases):
|_| Shares issued in plans of reorganization, such as mergers, asset
acquisitions and exchange offers, to which the Fund is a party.
|_| Shares purchased by the reinvestment of dividends or other
distributions reinvested from the Fund or other Oppenheimer funds
(other than Oppenheimer Cash Reserves) or unit investment trusts for
which reinvestment arrangements have been made with the Distributor.
|_| Shares purchased through a broker-dealer that has entered into a
special agreement with the Distributor to allow the broker's
customers to purchase and pay for shares of Oppenheimer funds using
the proceeds of shares redeemed in the prior 30 days from a mutual
fund (other than a fund managed by the Manager or any of its
subsidiaries) on which an initial sales charge or contingent
deferred sales charge was paid. This waiver also applies to shares
purchased by exchange of shares of Oppenheimer Money Market Fund,
Inc. that were purchased and paid for in this manner. This waiver
must be requested when the purchase order is placed for shares of
the Fund, and the Distributor may require evidence of qualification
for this waiver.
|_| Shares purchased with the proceeds of maturing principal units of any
Qualified Unit Investment Liquid Trust Series.
|_| Shares purchased by the reinvestment of loan repayments by a
participant in a Retirement Plan for which the Manager or an
affiliate acts as sponsor.
C. Waivers of the Class A Contingent Deferred Sales Charge for Certain
Redemptions.
The Class A contingent deferred sales charge is also waived if shares that
would otherwise be subject to the contingent deferred sales charge are
redeemed in the following cases:
|_| To make Automatic Withdrawal Plan payments that are limited annually to
no more than 12% of the account value adjusted annually.
|_| Involuntary redemptions of shares by operation of law or involuntary
redemptions of small accounts (please refer to "Shareholder AccountRules and Policies," in the applicable fund Prospectus).
|_| For distributions from Retirement Plans, deferred compensation plans or
other employee benefit plans for any of the following purposes:
1) Following the death or disability (as defined in the Internal
Revenue Code) of the participant or beneficiary. The death or
disability must occur after the participant's account was
established.
2) To return excess contributions.
3) To return contributions made due to a mistake of fact.
4) Hardship withdrawals, as defined in the plan.7
5) Under a Qualified Domestic Relations Order, as defined in the
Internal Revenue Code, or, in the case of an IRA, a divorce or
separation agreement described in Section 71(b) of the Internal
Revenue Code.
6) To meet the minimum distribution requirements of the Internal
Revenue Code.
7) To make "substantially equal periodic payments" as described in
Section 72(t) of the Internal Revenue Code.
8) For loans to participants or beneficiaries.
9) Separation from service.8
10) Participant-directed redemptions to purchase shares of a
mutual fund (other than a fund managed by the Manager or a
subsidiary of the Manager) if the plan has made special
arrangements with the Distributor.
11) Plan termination or "in-service distributions," if the
redemption proceeds are rolled over directly to an
OppenheimerFunds-sponsored IRA.
|_| For distributions from 401(k) plans sponsored by broker-dealers that
have entered into a special agreement with the Distributor allowing
this waiver.
|_| For distributions from retirement plans that have $10 million or more
in plan assets and that have entered into a special agreement with
the Distributor.
|_| For distributions from retirement plans which are part of a retirement
plan product or platform offered by certain banks, broker-dealers,
financial advisors, insurance companies or record keepers which have
entered into a special agreement with the Distributor.
III. Waivers of Class B, Class C and Class N Sales Charges of Oppenheimer
Funds
--------------------------------------------------------------------------------
The Class B, Class C and Class N contingent deferred sales charges will not
be applied to shares purchased in certain types of transactions or redeemed
in certain circumstances described below.
A. Waivers for Redemptions in Certain Cases.
The Class B, Class C and Class N contingent deferred sales charges will be
waived for redemptions of shares in the following cases:
|_| Shares redeemed involuntarily, as described in "Shareholder AccountRules and Policies," in the applicable Prospectus.
|_| Redemptions from accounts other than Retirement Plans following the
death or disability of the last surviving shareholder. The death or
disability must have occurred after the account was established, and
for disability you must provide evidence of a determination of
disability by the Social Security Administration.
|_| The contingent deferred sales charges are generally not waived
following the death or disability of a grantor or trustee for a
trust account. The contingent deferred sales charges will only be
waived in the limited case of the death of the trustee of a grantor
trust or revocable living trust for which the trustee is also the
sole beneficiary. The death or disability must have occurred after
the account was established, and for disability you must provide
evidence of a determination of disability by the Social Security
Administration.
|_| Distributions from accounts for which the broker-dealer of record has
entered into a special agreement with the Distributor allowing this
waiver.
|_| Redemptions of Class B shares held by Retirement Plans whose records
are maintained on a daily valuation basis by Merrill Lynch or an
independent record keeper under a contract with Merrill Lynch.
|_| Redemptions of Class C shares of Oppenheimer U.S. Government Trust from
accounts of clients of financial institutions that have entered into
a special arrangement with the Distributor for this purpose.
|_| Redemptions requested in writing by a Retirement Plan sponsor of Class
C shares of an Oppenheimer fund in amounts of $500,000 or more and
made more than 12 months after the Retirement Plan's first purchase
of Class C shares, if the redemption proceeds are invested in Class
N shares of one or more Oppenheimer funds.
|_| Distributions9 from Retirement Plans or other employee benefit plans
for any of the following purposes:
1) Following the death or disability (as defined in the Internal
Revenue Code) of the participant or beneficiary. The death or
disability must occur after the participant's account was
established in an Oppenheimer fund.
2) To return excess contributions made to a participant's account.
3) To return contributions made due to a mistake of fact.
4) To make hardship withdrawals, as defined in the plan.10
5) To make distributions required under a Qualified Domestic
Relations Order or, in the case of an IRA, a divorce or
separation agreement described in Section 71(b) of the Internal
Revenue Code.
6) To meet the minimum distribution requirements of the Internal
Revenue Code.
7) To make "substantially equal periodic payments" as described in
Section 72(t) of the Internal Revenue Code.
8) For loans to participants or beneficiaries.11
9) On account of the participant's separation from service.12
10) Participant-directed redemptions to purchase shares of a
mutual fund (other than a fund managed by the Manager or a
subsidiary of the Manager) offered as an investment option in a
Retirement Plan if the plan has made special arrangements with
the Distributor.
11) Distributions made on account of a plan termination or
"in-service" distributions, if the redemption proceeds are rolled
over directly to an OppenheimerFunds-sponsored IRA.
12) For distributions from a participant's account under an
Automatic Withdrawal Plan after the participant reaches age 59 1/2,
as long as the aggregate value of the distributions does not
exceed 10% of the account's value, adjusted annually.
13) Redemptions of Class B shares under an Automatic Withdrawal
Plan for an account other than a Retirement Plan, if the
aggregate value of the redeemed shares does not exceed 10% of the
account's value, adjusted annually.
14) For distributions from 401(k) plans sponsored by
broker-dealers that have entered into a special arrangement with
the Distributor allowing this waiver.
|_| Redemptions of Class B shares or Class C shares under an Automatic
Withdrawal Plan from an account other than a Retirement Plan if the
aggregate value of the redeemed shares does not exceed 10% of the
account's value annually.
B. Waivers for Shares Sold or Issued in Certain Transactions.
The contingent deferred sales charge is also waived on Class B and Class C
shares sold or issued in the following cases:
|_| Shares sold to the Manager or its affiliates.
|_| Shares sold to registered management investment companies or separate
accounts of insurance companies having an agreement with the Manager
or the Distributor for that purpose.
|_| Shares issued in plans of reorganization to which the Fund is a party.
|_| Shares sold to present or former officers, directors, trustees or
employees (and their "immediate families" as defined above in
Section I.A.) of the Fund, the Manager and its affiliates and
retirement plans established by them for their employees.
IV. Special Sales Charge Arrangements for Shareholders of Certain
Oppenheimer Funds Who Were Shareholders of Former Quest for Value Funds
------------------------------------------------------------------------------
The initial and contingent deferred sales charge rates and waivers for Class
A, Class B and Class C shares described in the Prospectus or Statement of
Additional Information of the Oppenheimer funds are modified as described
below for certain persons who were shareholders of the former Quest for Value
Funds. To be eligible, those persons must have been shareholders on November24, 1995, when OppenheimerFunds, Inc. became the investment advisor to those
former Quest for Value Funds. Those funds include:
Oppenheimer Quest Value Fund, Inc. Oppenheimer Small Cap Value
Fund
Oppenheimer Quest Balanced Value Fund Oppenheimer Quest Global
Value Fund, Inc.
Oppenheimer Quest Opportunity Value Fund
These arrangements also apply to shareholders of the following funds
when they merged (were reorganized) into various Oppenheimer funds on
November 24, 1995:
Quest for Value U.S. Government Income Fund Quest for Value New York
Tax-Exempt Fund
Quest for Value Investment Quality Income Fund Quest for Value
National Tax-Exempt Fund
Quest for Value Global Income Fund Quest for Value California
Tax-Exempt Fund
All of the funds listed above are referred to in this Appendix as the
"Former Quest for Value Funds." The waivers of initial and contingent
deferred sales charges described in this Appendix apply to shares of an
Oppenheimer fund that are either:
|_| acquired by such shareholder pursuant to an exchange of shares of an
Oppenheimer fund that was one of the Former Quest for Value Funds,
or
|_| purchased by such shareholder by exchange of shares of another
Oppenheimer fund that were acquired pursuant to the merger of any of
the Former Quest for Value Funds into that other Oppenheimer fund on
November 24, 1995.
A. Reductions or Waivers of Class A Sales Charges.
|X| Reduced Class A Initial Sales Charge Rates for Certain Former Quest for
Value Funds Shareholders.
Purchases by Groups and Associations. The following table sets forth the
initial sales charge rates for Class A shares purchased by members of
"Associations" formed for any purpose other than the purchase of securities.
The rates in the table apply if that Association purchased shares of any of
the Former Quest for Value Funds or received a proposal to purchase such
shares from OCC Distributors prior to November 24, 1995.
--------------------------------------------------------------------------------
Initial Sales Initial Sales Charge Concession as
Number of Eligible Charge as a % of as a % of Net Amount % of Offering
Employees or Members Offering Price Invested Price
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
9 or Fewer 2.50% 2.56% 2.00%
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
At least 10 but not 2.00% 2.04% 1.60%
more than 49
--------------------------------------------------------------------------------
------------------------------------------------------------------------------
For purchases by Associations having 50 or more eligible employees or
members, there is no initial sales charge on purchases of Class A shares, but
those shares are subject to the Class A contingent deferred sales charge
described in the applicable fund's Prospectus.
Purchases made under this arrangement qualify for the lower of either
the sales charge rate in the table based on the number of members of an
Association, or the sales charge rate that applies under the Right of
Accumulation described in the applicable fund's Prospectus and Statement of
Additional Information. Individuals who qualify under this arrangement for
reduced sales charge rates as members of Associations also may purchase
shares for their individual or custodial accounts at these reduced sales
charge rates, upon request to the Distributor.
|X| Waiver of Class A Sales Charges for Certain Shareholders. Class A
shares purchased by the following investors are not subject to any Class A
initial or contingent deferred sales charges:
o Shareholders who were shareholders of the AMA Family of Funds on
February 28, 1991 and who acquired shares of any of the Former
Quest for Value Funds by merger of a portfolio of the AMA Family
of Funds.
o Shareholders who acquired shares of any Former Quest for Value Fund by
merger of any of the portfolios of the Unified Funds.
|X| Waiver of Class A Contingent Deferred Sales Charge in Certain
Transactions. The Class A contingent deferred sales charge will not apply to
redemptions of Class A shares purchased by the following investors who were
shareholders of any Former Quest for Value Fund:
Investors who purchased Class A shares from a dealer that is or was not
permitted to receive a sales load or redemption fee imposed on a shareholder
with whom that dealer has a fiduciary relationship, under the Employee
Retirement Income Security Act of 1974 and regulations adopted under that law.
B. Class A, Class B and Class C Contingent Deferred Sales Charge Waivers.
|X| Waivers for Redemptions of Shares Purchased Prior to March 6, 1995. In
the following cases, the contingent deferred sales charge will be waived for
redemptions of Class A, Class B or Class C shares of an Oppenheimer fund. The
shares must have been acquired by the merger of a Former Quest for Value Fund
into the fund or by exchange from an Oppenheimer fund that was a Former Quest
for Value Fund or into which such fund merged. Those shares must have been
purchased prior to March 6, 1995 in connection with:
o withdrawals under an automatic withdrawal plan holding only either
Class B or Class C shares if the annual withdrawal does not
exceed 10% of the initial value of the account value, adjusted
annually, and
o liquidation of a shareholder's account if the aggregate net asset value
of shares held in the account is less than the required minimum
value of such accounts.
|X| Waivers for Redemptions of Shares Purchased on or After March 6, 1995
but Prior to November 24, 1995. In the following cases, the contingent
deferred sales charge will be waived for redemptions of Class A, Class B or
Class C shares of an Oppenheimer fund. The shares must have been acquired by
the merger of a Former Quest for Value Fund into the fund or by exchange from
an Oppenheimer fund that was a Former Quest For Value Fund or into which such
Former Quest for Value Fund merged. Those shares must have been purchased on
or after March 6, 1995, but prior to November 24, 1995:
o redemptions following the death or disability of the shareholder(s) (as
evidenced by a determination of total disability by the U.S.
Social Security Administration);
o withdrawals under an automatic withdrawal plan (but only for Class B or
Class C shares) where the annual withdrawals do not exceed 10% of
the initial value of the account value; adjusted annually, and
o liquidation of a shareholder's account if the aggregate net asset value
of shares held in the account is less than the required minimum
account value.
A shareholder's account will be credited with the amount of any
contingent deferred sales charge paid on the redemption of any Class A, Class
B or Class C shares of the Oppenheimer fund described in this section if the
proceeds are invested in the same Class of shares in that fund or another
Oppenheimer fund within 90 days after redemption.
V. Special Sales Charge Arrangements for Shareholders of Certain
Oppenheimer Funds Who Were Shareholders of Connecticut Mutual
Investment Accounts, Inc.
---------------------------------------------------------------------------
The initial and contingent deferred sale charge rates and waivers for Class A
and Class B shares described in the respective Prospectus (or this Appendix)
of the following Oppenheimer funds (each is referred to as a "Fund" in this
section):
Oppenheimer U. S. Government Trust,
Oppenheimer Bond Fund,
Oppenheimer Value Fund and
Oppenheimer Disciplined Allocation Fund
are modified as described below for those Fund shareholders who were
shareholders of the following funds (referred to as the "Former Connecticut
Mutual Funds") on March 1, 1996, when OppenheimerFunds, Inc. became the
investment adviser to the Former Connecticut Mutual Funds:
Connecticut Mutual Liquid Account Connecticut Mutual Total Return
Account
Connecticut Mutual Government Securities Account CMIA LifeSpan Capital
Appreciation Account
Connecticut Mutual Income Account CMIA LifeSpan Balanced Account
Connecticut Mutual Growth Account CMIA Diversified Income Account
A. Prior Class A CDSC and Class A Sales Charge Waivers.
|X| Class A Contingent Deferred Sales Charge. Certain shareholders of a
Fund and the other Former Connecticut Mutual Funds are entitled to continue
to make additional purchases of Class A shares at net asset value without a
Class A initial sales charge, but subject to the Class A contingent deferred
sales charge that was in effect prior to March 18, 1996 (the "prior Class A
CDSC"). Under the prior Class A CDSC, if any of those shares are redeemed
within one year of purchase, they will be assessed a 1% contingent deferred
sales charge on an amount equal to the current market value or the original
purchase price of the shares sold, whichever is smaller (in such redemptions,
any shares not subject to the prior Class A CDSC will be redeemed first).
Those shareholders who are eligible for the prior Class A CDSC are:
1) persons whose purchases of Class A shares of a Fund and other
Former Connecticut Mutual Funds were $500,000 prior to March 18,1996, as a result of direct purchases or purchases pursuant to
the Fund's policies on Combined Purchases or Rights of
Accumulation, who still hold those shares in that Fund or other
Former Connecticut Mutual Funds, and
2) persons whose intended purchases under a Statement of Intention
entered into prior to March 18, 1996, with the former general
distributor of the Former Connecticut Mutual Funds to purchase
shares valued at $500,000 or more over a 13-month period entitled
those persons to purchase shares at net asset value without being
subject to the Class A initial sales charge
Any of the Class A shares of a Fund and the other Former Connecticut
Mutual Funds that were purchased at net asset value prior to March 18, 1996,
remain subject to the prior Class A CDSC, or if any additional shares are
purchased by those shareholders at net asset value pursuant to this
arrangement they will be subject to the prior Class A CDSC.
|X| Class A Sales Charge Waivers. Additional Class A shares of a Fund may
be purchased without a sales charge, by a person who was in one (or more) of
the categories below and acquired Class A shares prior to March 18, 1996, and
still holds Class A shares:
1) any purchaser, provided the total initial amount invested in the
Fund or any one or more of the Former Connecticut Mutual Funds
totaled $500,000 or more, including investments made pursuant to
the Combined Purchases, Statement of Intention and Rights of
Accumulation features available at the time of the initial
purchase and such investment is still held in one or more of the
Former Connecticut Mutual Funds or a Fund into which such Fund
merged;
2) any participant in a qualified plan, provided that the total
initial amount invested by the plan in the Fund or any one or
more of the Former Connecticut Mutual Funds totaled $500,000 or
more;
3) Directors of the Fund or any one or more of the Former
Connecticut Mutual Funds and members of their immediate families;
4) employee benefit plans sponsored by Connecticut Mutual Financial
Services, L.L.C. ("CMFS"), the prior distributor of the Former
Connecticut Mutual Funds, and its affiliated companies;
5) one or more members of a group of at least 1,000 persons (and
persons who are retirees from such group) engaged in a common
business, profession, civic or charitable endeavor or other
activity, and the spouses and minor dependent children of such
persons, pursuant to a marketing program between CMFS and such
group; and
6) an institution acting as a fiduciary on behalf of an individual
or individuals, if such institution was directly compensated by
the individual(s) for recommending the purchase of the shares of
the Fund or any one or more of the Former Connecticut Mutual
Funds, provided the institution had an agreement with CMFS.
Purchases of Class A shares made pursuant to (1) and (2) above may be
subject to the Class A CDSC of the Former Connecticut Mutual Funds described
above.
Additionally, Class A shares of a Fund may be purchased without a sales
charge by any holder of a variable annuity contract issued in New York State
by Connecticut Mutual Life Insurance Company through the Panorama Separate
Account which is beyond the applicable surrender charge period and which was
used to fund a qualified plan, if that holder exchanges the variable annuity
contract proceeds to buy Class A shares of the Fund.
B. Class A and Class B Contingent Deferred Sales Charge Waivers.
In addition to the waivers set forth in the Prospectus and in this Appendix,
above, the contingent deferred sales charge will be waived for redemptions of
Class A and Class B shares of a Fund and exchanges of Class A or Class B
shares of a Fund into Class A or Class B shares of a Former Connecticut
Mutual Fund provided that the Class A or Class B shares of the Fund to be
redeemed or exchanged were (i) acquired prior to March 18, 1996 or (ii) were
acquired by exchange from an Oppenheimer fund that was a Former Connecticut
Mutual Fund. Additionally, the shares of such Former Connecticut Mutual Fund
must have been purchased prior to March 18, 1996:
1) by the estate of a deceased shareholder;
2) upon the disability of a shareholder, as defined in Section 72(m)(7) of
the Internal Revenue Code;
3) for retirement distributions (or loans) to participants or
beneficiaries from retirement plans qualified under Sections 401(a) or
403(b)(7)of the Code, or from IRAs, deferred compensation plans created
under Section 457 of the Code, or other employee benefit plans;
4) as tax-free returns of excess contributions to such retirement or
employee benefit plans;
5) in whole or in part, in connection with shares sold to any state,
county, or city, or any instrumentality, department, authority, or
agency thereof, that is prohibited by applicable investment laws from
paying a sales charge or concession in connection with the purchase of
shares of any registered investment management company;
6) in connection with the redemption of shares of the Fund due to a
combination with another investment company by virtue of a merger,
acquisition or similar reorganization transaction;
7) in connection with the Fund's right to involuntarily redeem or
liquidate the Fund;
8) in connection with automatic redemptions of Class A shares and Class B
shares in certain retirement plan accounts pursuant to an Automatic
Withdrawal Plan but limited to no more than 12% of the original value
annually; or
9) as involuntary redemptions of shares by operation of law, or under
procedures set forth in the Fund's Articles of Incorporation, or as
adopted by the Board of Directors of the Fund.
VI. Special Reduced Sales Charge for Former Shareholders of Advance
America Funds, Inc.
------------------------------------------------------------------------------
Shareholders of Oppenheimer Municipal Bond Fund, Oppenheimer U.S. Government
Trust, Oppenheimer Strategic Income Fund and Oppenheimer Capital Income Fund
who acquired (and still hold) shares of those funds as a result of the
reorganization of series of Advance America Funds, Inc. into those
Oppenheimer funds on October 18, 1991, and who held shares of Advance America
Funds, Inc. on March 30, 1990, may purchase Class A shares of those four
Oppenheimer funds at a maximum sales charge rate of 4.50%.
VII. Sales Charge Waivers on Purchases of Class M Shares of Oppenheimer
Convertible Securities Fund
------------------------------------------------------------------------------
Oppenheimer Convertible Securities Fund (referred to as the "Fund" in this
section) may sell Class M shares at net asset value without any initial sales
charge to the classes of investors listed below who, prior to March 11, 1996,
owned shares of the Fund's then-existing Class A and were permitted to
purchase those shares at net asset value without sales charge:
|_| the Manager and its affiliates,
|_| present or former officers, directors, trustees and employees (and
their "immediate families" as defined in the Fund's Statement of
Additional Information) of the Fund, the Manager and its affiliates,
and retirement plans established by them or the prior investment
advisor of the Fund for their employees,
|_| registered management investment companies or separate accounts of
insurance companies that had an agreement with the Fund's prior
investment advisor or distributor for that purpose,
|_| dealers or brokers that have a sales agreement with the Distributor, if
they purchase shares for their own accounts or for retirement plans
for their employees,
|_| employees and registered representatives (and their spouses) of dealers
or brokers described in the preceding section or financial
institutions that have entered into sales arrangements with those
dealers or brokers (and whose identity is made known to the
Distributor) or with the Distributor, but only if the purchaser
certifies to the Distributor at the time of purchase that the
purchaser meets these qualifications,
|_| dealers, brokers, or registered investment advisors that had entered
into an agreement with the Distributor or the prior distributor of
the Fund specifically providing for the use of Class M shares of the
Fund in specific investment products made available to their
clients, and
|_| dealers, brokers or registered investment advisors that had entered
into an agreement with the Distributor or prior distributor of the
Fund's shares to sell shares to defined contribution employee
retirement plans for which the dealer, broker, or investment advisor
provides administrative services.
OPPENHEIMER INTERNATIONAL LARGE-CAP CORE TRUST
FORM N-1A
PART C
OTHER INFORMATION
Item 23. - Exhibits
-------------------
(a) Declaration of Trust dated May 16, 2003: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(b) By-Laws: Previously filed with Registrant's Initial Registration
Statement (Reg. No. 333-106014), 6/11/03 and incorporated herein by reference
(c) (i) Specimen Class A Share Certificate: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(ii) Specimen Class B Share Certificate: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(iii) Specimen Class C Share Certificate: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(iv) Specimen Class N Share Certificate: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(v) Specimen Class Y Share Certificate: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(d) (i) Investment Advisory Agreement dated May 28, 2003: Previously filed
with Registrant's Initial Registration Statement (Reg. No. 333-106014),
6/11/03 and incorporated herein by reference.
(ii) Sub-Advisory Agreement dated May 28, 2003: Previously filed with
Registrant's Initial Registration Statement (Reg. No. 333-106014), 6/11/03
and incorporated herein by reference.
(e) (i) General Distributor's Agreement dated May 28, 2003: Previously
filed with Registrant's Initial Registration Statement (Reg. No. 333-106014),
6/11/03 and incorporated herein by reference.
(ii) Form of Dealer Agreement of OppenheimerFunds Distributor, Inc.:
Previously filed with Post-Effective Amendment No. 45 to the Registration
Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076), 10/26/01, and
incorporated herein by reference.
(iii) Form of Broker Agreement of OppenheimerFunds Distributor, Inc.:
Previously filed with Post-Effective Amendment No. 45 to the Registration
Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076), 10/26/01, and
incorporated herein by reference.
(iv) Form of Agency Agreement of OppenheimerFunds Distributor, Inc.:
Previously filed with Post-Effective Amendment No. 45 to the Registration
Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076), 10/26/01, and
incorporated herein by reference.
(v) Form of Trust Company Fund/SERV Purchase Agreement of
OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective
Amendment No. 45 to the Registration Statement of Oppenheimer High Yield Fund
(Reg. No. 2-62076), 10/26/01, and incorporated herein by reference.
(vi) Form of Trust Company Agency Agreement of OppenheimerFunds
Distributor, Inc.: Previously filed with Post-Effective Amendment No. 45 to
the Registration Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076),
10/26/01, and incorporated herein by reference.
(f) Not applicable.
(g) (i) Global Custodial Services Agreement dated May 3, 2001 between
Registrant and Citibank, N.A., as amended July 15, 2003: Filed herewith.
(ii) Global Custodial Services Agreement dated May 3, 2001 between
Registrant and Citibank, N.A.: 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.
(iii) Amended and Restated Foreign Custody Manager Agreement dated May31, 2001 between Registrant and Citibank, N.A., as amended July 15, 2003:
Filed herewith.
(h) Not applicable.
(i) Opinion and Consent of Counsel: Filed herewith.
(j) Independent Auditors' Consent: Filed herewith.
(k) Not applicable.
(l) Investment Letter from OppenheimerFunds, Inc. to Registrant: Filed
herewith.
(m) (i) Service Plan and Agreement for Class A shares dated 5/28/03:
Previously filed with Registrant's Initial Registration Statement (Reg. No.
333-106014), 6/11/03 and incorporated herein by reference.
(ii) Distribution and Service Plan and Agreement for Class B shares
dated 5/28/03: Previously filed with Registrant's Initial Registration
Statement (Reg. No. 333-106014), 6/11/03 and incorporated herein by
reference.
(iii) Distribution and Service Plan and Agreement for Class C shares
dated 5/28/03: Previously filed with Registrant's Initial Registration
Statement (Reg. No. 333-106014), 6/11/03 and incorporated herein by reference.
(iv) Distribution and Service Plan and Agreement for Class N shares
dated 5/28/03: Previously filed with Registrant's Initial Registration
Statement (Reg. No. 333-106014), 6/11/03 and incorporated herein by reference.
(n) Oppenheimer Funds Multiple Class Plan under Rule 18f-3 updated through
5/21/03: Filed herewith.
(o) Powers of Attorney for all Trustees and Principal Officers: Previously
filed with Registrant's Initial Registration Statement (Reg. No. 333-106014),
6/11/03 and incorporated herein by reference.
(p) Amended and Restated Code of Ethics of the Oppenheimer Funds dated May15, 2002 under Rule 17j-1 of the Investment Company Act of 1940: Previously
filed with Post-Effective Amendment No. 29 to the Registration Statement of
Oppenheimer Discovery Fund (Reg. No. 33-371), 11/21/02, and incorporated
herein by reference.
Item 24. - Persons Controlled by or Under Common Control with the Fund
----------------------------------------------------------------------
None.
Item 25. - Indemnification
--------------------------
Reference is made to the provisions of Article Seven of Registrant's Amended
and Restated Declaration of Trust filed as Exhibit 23(a) to this Registration
Statement, and incorporated herein by reference.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to trustees, officers and controlling persons of
Registrant pursuant to the foregoing provisions or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a trustee, officer or controlling
person of Registrant in the successful defense of any action, suit or
proceeding) is asserted by such trustee, officer or controlling person,
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act of 1933 and will be governed
by the final adjudication of such issue.
Item 26. - Business and Other Connections of the Investment Adviser
-------------------------------------------------------------------
(a) OppenheimerFunds, Inc. is the investment adviser of the Registrant; it
and certain subsidiaries and affiliates act in the same capacity to other
investment companies, including without limitation those described in Parts A
and B hereof and listed in Item 26(b) below.
(b) There is set forth below information as to any other business,
profession, vocation or employment of a substantial nature in which each
officer and director of OppenheimerFunds, Inc. is, or at any time during the
past two fiscal years has been, engaged for his/her own account or in the
capacity of director, officer, employee, partner or trustee.
---------------------------------------------------------------------------------
Name and Current Position
with OppenheimerFunds, Inc. Other Business and Connections During the Past
Two Years
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Timothy L. Abbuhl, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Amy B. Adamshick, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles E. Albers, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik Anderson, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Janette Aprilante, As of January 2002: Secretary of
Vice President & Secretary OppenheimerFunds, Distributor, Inc., Centennial
Asset Management Corporation, Oppenheimer
Partnership Holdings, Inc., Oppenheimer Real
Asset Management, Inc., Shareholder Financial
Services, Inc., Shareholder Services, Inc.;
Assistant Secretary of HarbourView Asset
Management Corporation, OFI Private Investments,
Inc., OFI Trust Company and OFI Institutional
Asset Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hany S. Ayad, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Michael Banta, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joanne Bardell, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lerae A. Barela, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce L. Bartlett, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Bartling, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin Baum, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeff Baumgartner, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Connie Bechtolt, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Behal Assistant Vice President of HarbourView Asset
Assistant Vice President Management Corporation. Formerly.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen Beichert, Vice President of OppenheimerFunds Distributor,
Vice President Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gerald Bellamy, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Erik S. Berg, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Victoria Best, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rajeev Bhaman, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig Billings, Formerly President of Lorac Technologies, Inc.
Assistant Vice President (June 1997-July 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Binning, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert J. Bishop, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Blinzer, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John R. Blomfield, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Chad Boll, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Bonomo, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lowell Scott Brooks, Vice President of OppenheimerFunds Distributor,
Vice President Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Buckmaster, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Burke, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Burns, Formerly a Marketing Manager with Alliance
Assistant Vice President Capital Management (October 1999-April 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce Burroughs None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Claudia Calich, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael A. Carbuto, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Debra Casey, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ronald G. Chibnik, Formerly Director of technology for Sapient
Assistant Vice President Corporation (July, 2000-August 2001); software
architect for Sapient Corporation (March
1997-July 2000).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brett Clark, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
H.C. Digby Clements, None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Peter V. Cocuzza, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Coulston, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie C. Cusker, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George Curry, None.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Damian, Formerly senior analyst/director for Citigroup
Vice President Asset Management (November 1999-September 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
O. Leonard Darling, Chairman of the Board and a director (since June
Vice Chairman, Executive Vice 1999) and Senior Managing Director (since
President, & Director December 1998) of HarbourView Asset Management
Corporation; a director (since July 2001) of
Oppenheimer Acquisition Corp.; a director (since
March 2000) of OFI Private Investments, Inc.;
Chairman of the Board, Senior Managing Director
and director (since February 2001) of OFI
Institutional Asset Management, Inc.; Trustee
(since 1993) of Awhtolia College - Greece.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John M. Davis, Assistant Vice President of OppenheimerFunds
Assistant Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ruggero de'Rossi, Vice President of HarbourView Asset Management
Senior Vice President Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Craig P. Dinsell, None
Executive Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Randall C. Dishmon, Formerly an Associate with Booz Allen & Hamilton
Assistant Vice President (1998-June 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rebecca K. Dolan None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven D. Dombrower, Vice President of OppenheimerFunds Distributor,
Vice President Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bruce C. Dunbar, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Edmiston, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel R. Engstrom, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Robert Erven Formerly an Assistant Vice President/Senior
Assistant Vice President Trader with Morgan Stanley Investment Management
(1999-April 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George R. Evans, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward N. Everett, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathy Faber, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Falicia, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott T. Farrar, Vice President of OFI Private Investments, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Katherine P. Feld, Vice President of OppenheimerFunds, Distributor,
Vice President, Senior Counsel Inc. and of Oppenheimer Real Asset Management,
Inc.; Vice President, Assistant Secretary and
Director of Centennial Asset Management
Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Emmanuel Ferreira, Formerly a portfolio manager with Lashire
Vice President Investments (July 1999-December 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ronald H. Fielding, Vice President of OppenheimerFunds Distributor,
Senior Vice President; Inc.; Director of ICI Mutual Insurance Company;
Chairman: Rochester Division Governor of St. John's College; Chairman of the
Board of Directors of International Museum of
Photography at George Eastman House.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Finley, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Forrest, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
J. Hayes Foster, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
P. Lyman Foster, Senior Vice President of OppenheimerFunds
Senior Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Foxhoven, Assistant Vice President of OppenheimerFunds
Assistant Vice President Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Colleen M. Franca, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Crystal French, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dominic Freud, Formerly, a Partner and European Equity
Vice President Portfolio manager at SLS Management (January
2002-February 2003) prior to which he was head
of the European equities desk and managing
director at SG Cowen (May 1994-January 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan Gagliardo, Formerly an Assistant Vice President with
Assistant Vice President Mitchell Hutchins (January 2000-October 2000).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Hazem Gamal, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dan P. Gangemi, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Subrata Ghose, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles W. Gilbert, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alan C. Gilston, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Sharon M. Giordano-Auleta, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill E. Glazerman, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul M. Goldenberg, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mike Goldverg, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bejamin J. Gord, Vice President of HarbourView Asset Management
Vice President Corporation and of OFI Institutional Asset
Management, Inc. Formerly Executive Director
with Miller Anderson Sherrerd, a division of
Morgan Stanley Investment Management. (April
1992-March 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Granger, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert B. Grill, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Guy, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Hager, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Haley, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marilyn Hall, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ping Han, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kelly Haney, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Neil Hanson, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shari Harley, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Hauenstein, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas B. Hayes, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Saba Hekmat, Formerly Director, Credit Research Analyst at
Assistant Vice President MetLife Investments (July 1996-October 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Henry, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine Heron, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dennis Hess, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dorothy F. Hirshman, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel Hoelscher, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward Hrybenko, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott T. Huebl, Assistant Vice President of OppenheimerFunds
Vice President Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Margaret Hui, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Huttlin, Vice President (Director of the International
Vice President Division) of OFI Institutional Asset Management,
Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James G. Hyland, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve P. Ilnitzki, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives, Vice President of OppenheimerFunds Distributor,
Vice President & Assistant Inc.; Vice President and Assistant Secretary of
Counsel Shareholder Services, Inc.; Assistant Secretary
of OppenheimerFunds Legacy Program and
Shareholder Financial Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Jaume, Senior Vice President and Chief Compliance
Vice President Officer (since April 2000) of HarbourView Asset
Management Corporation; Senior Vice President of
OFI Institutional Asset Management, Inc. (since
February 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Frank V. Jennings, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Jennings, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Michael Johnson, Formerly Vice President, Senior
Assistant Vice President Analyst/Portfolio Manager at Aladdin Capital
Holdings Inc. (February 2001-May 2002) prior to
which he was Vice President and Senior Analyst
at Merrill Lynch Investment Managers (October
1996-February 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lewis A. Kamman, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Kandilis, Formerly managing director of Kandilis Capital
Assistant Vice President Management (September 1993-August 2002); CFO of
Kandi Corp. (October 1989-August 1993).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer E. Kane, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lynn O. Keeshan, Treasurer and Secretary of OppenheimerFunds
Senior Vice President Legacy Program
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas W. Keffer, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cristina J. Keller, Vice President of OppenheimerFunds Distributor,
Vice President Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Keogh, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Garrett K. Kolb, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Walter G. Konops, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Kourkoulakos, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Kramer, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Latino, Formerly a Senior Trader/Portfolio Engineer at
Assistant Vice President Jacobs Levy Equity Management (June 1996-August
2002)..
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Guy E. Leaf, Formerly a Vice President of Merrill Lynch
Vice President (January 2000-September 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher M. Leavy, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dina C. Lee, None
Assistant Vice President &
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dana Lehrer, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Laura Leitzinger, Senior Vice President of Shareholder Services,
Vice President Inc.; Vice President of Shareholder Financial
Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael S. Levine, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gang Li, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Shanquan Li, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mitchell J. Lindauer, None
Vice President & Assistant
General Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bill Linden, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Malissa B. Lischin, Assistant Vice President of OppenheimerFunds
Assistant Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Reed Litcher, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David P. Lolli, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel G. Loughran None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patricia Lovett, Vice President of Shareholder Financial
Vice President Services, Inc. and Senior Vice President of
Shareholder Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steve Macchia, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Magee, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jerry Madzij, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Angelo G. Manioudakis Senior Vice President of HarbourView Asset
Senior Vice President Management Corporation and of OFI Institutional
Asset Management, Inc. Formerly Executive
Director and portfolio manager for Miller,
Anderson & Sherrerd, a division of Morgan
Stanley Investment Management (August 1993-April
2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Philip T. Masterson, None
Vice President & Assistant
Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elizabeth McCormack, Assistant Secretary of HarbourView Asset
Assistant Vice President Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph McGovern, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles L. McKenzie, Senior Vice President of HarbourView Asset
Senior Vice President Management Corporation and OFI Institutional
Asset Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Migan, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew J. Mika, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joy Milan, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Denis R. Molleur, None
Vice President & Senior
Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Nikolaos D. Monoyios, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles Moon, Vice President of HarbourView Asset Management
Vice President Corporation and of OFI Institutional Asset
Management, Inc. Formerly an Executive Director
and Portfolio Manager with Miller Anderson &
Sherrerd, a division of Morgan Stanley
Investment Management (June 1999-March 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stacey Morrell, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Murphy, Director of OppenheimerFunds Distributor, Inc.,
Chairman, President, Chief Centennial Asset Management Corporation,
Executive Officer & Director HarbourView Asset Management Corporation, OFI
Private Investments, Inc., OFI Institutional
Asset Management, Inc. and Tremont Advisers,
Inc.; Director (Class A) of Trinity Investments
Management Corporation; President and Director
of Oppenheimer Acquisition Corp., Oppenheimer
Partnership Holdings, Inc., Oppenheimer Real
Asset Management, Inc.; Chairman and Director of
Shareholder Financial Services, Inc. and
Shareholder Services, Inc.; Executive Vice
President of MassMutual Life Insurance Company;
director of DLB Acquisition Corp.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin Murray, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas J. Murray, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth Nadler, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Nichols, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Barbara Niederbrach, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William Norman, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raymond C. Olson, Assistant Vice President and Treasurer of
Assistant Vice President OppenheimerFunds Distributor, Inc.; Treasurer of
Centennial Asset Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Frank J. Pavlak, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David P. Pellegrino, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Allison C. Pells, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan Pergament, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian Petersen, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James F. Phillips, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gary Pilc,
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Peter E. Pisapia, Formerly, Associate Counsel at SunAmerica Asset
Assistant Vice President & Management Corp. (December 2000-December 2002).
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raghaw Prasad, Formerly Associate Vice President with
Assistant Vice President Prudential Securities New York (January
2001-November 2001) prior to which he was a
Director/Analytics with Prudential Investments
New Jersey (April 1997-November 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jane C. Putnam, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael E. Quinn, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Julie S. Radtke, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Norma J. Rapini, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian N. Reid, Formerly an Assistant Vice President with Eaton
Assistant Vice President Vance Management (January 2000-January 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marc Reinganum, Formerly (until August 2002) Vaughn Rauscher
Vice President Chair in Financial Investments and Director,
Finance Institute of Southern Methodist
University, Texas.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kristina Richardson, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Claire Ring, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Robertson, Senior Vice President of OppenheimerFunds
Senior Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rob Robis, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Antoinette Rodriguez, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stacey Roode, Formerly, Assistant Vice President of Human
Vice President Resources of OFI (200-July 2002)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey S. Rosen, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James H. Ruff, President and Director of OppenheimerFunds
Executive Vice President Distributor, Inc. and Centennial Asset
Management Corporation; Executive Vice President
of OFI Private Investments, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew Ruotolo Director, Treasurer and Chief Financial Officer
Executive Vice President and of Oppenheimer Acquisition Corp.; President and
Director director of Shareholder Services, Inc. and
Shareholder Financial Services, Inc.; Director
(Class A) of Trinity Investment Management
Corporation; Chairman of the Board, Chief
Executive Officer, President and Director or OFI
Trust Company.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rohit Sah, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Valerie Sanders, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Karen Sandler, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tricia Scarlata, Formerly, Marketing Manager of OppenheimerFunds,
Assistant Vice President Inc. (April 2001-August 2002); Client Service
Support Manager for Sanford C. Bernstein
(December 1999-April 2001)
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Rudi Schadt, Formerly a consultant for Arthur Andersen
Vice President (August 2001-February 2002); director, senior
quantitative analyst at Brinson Partners
(September 2000,April 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey R. Schneider, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ellen P. Schoenfeld, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maria Schulte, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David Schultz, Chief Executive Officer, President & Senior
Senior Vice President Managing Director & Director of OFI
Institutional Asset Management, Inc. and
HarbourView Asset Management Corporation;
Director (Class A) and Chairman of Trinity
Investment Management Corporation; Director of
OFI Trust Company.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Scott A. Schwegel, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Allan P. Sedmak None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jennifer L. Sexton, Vice President of OFI Private Investments, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Martha A. Shapiro, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Navin Sharma, Formerly, Manager at BNP Paribas Cooper Neff
Vice President Advisors (May 2001-April 2002) prior to which he
was Development Manager at Reality
Online/Reuters America Inc. (June 2000-May 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven J. Sheerin, Formerly consultant with Pricewaterhouse Coopers
Vice President (November 2000-May 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bonnie Sherman, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David C. Sitgreaves, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward James Sivigny Formerly a Director for ABN Amro Securities
Assistant Vice President (July 2001-July 2002) prior to which he was
Associate Director for Barclays Capital
(1998-July 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Enrique H. Smith, Formerly a business analyst with Goldman Sachs
Assistant Vice President (August 1999-August 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard A. Soper, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Louis Sortino, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Keith J. Spencer, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Marco Antonio Spinar, Formerly, Director of Business Operations at AOL
Assistant Vice President Time Warner, AOL Time Warner Book Group (June
2000-December 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard A. Stein, None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Arthur P. Steinmetz, Senior Vice President of HarbourView Asset
Senior Vice President Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gregory J. Stitt, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John P. Stoma, Senior Vice President of OppenheimerFunds
Senior Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wayne Strauss, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Stricker, Vice President of Shareholder Services, Inc.
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Deborah A. Sullivan, Since December 2001, Secretary of OFI Trust
Assistant Vice President, Company.
Assistant Counsel
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mary Sullivan, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin L. Surrett, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Sussman, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan B. Switzer, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Martin Telles, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul Temple, Formerly a Vice President of Merrill Lynch
Vice President (October 2001-January 2002) prior to which he
was a Vice President with OppenheimerFunds, Inc.
(May 2000-October 5, 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Toner, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eamon Tubridy, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Keith Tucker, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James F. Turner, Formerly portfolio manager for Technology
Vice President Crossover Ventures (May 2000-March 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cameron Ullyat, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Angela Utaro, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark S. Vandehey, Vice President of OppenheimerFunds Distributor,
Vice President Inc., Centennial Asset Management Corporation
and Shareholder Services, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Maureen Van Norstrand, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Vincent Vermette, Assistant Vice President of OppenheimerFunds
Assistant Vice President Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Phillip F. Vottiero, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Teresa M. Ward, Vice President of OppenheimerFunds Distributor,
Vice President Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jerry A. Webman, Senior Vice President of HarbourView Asset
Senior Vice President Management Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher D. Weiler, None
Assistant Vice President:
Rochester Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Barry D. Weiss, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Melissa Lynn Weiss, Formerly an Associate at Hoguet Newman & Regal,
Vice President LLP (January 1998-May 2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christine Wells, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph J. Welsh, Vice President of HarbourView Asset Management
Vice President Corporation.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Diederick Wermolder, Director of OppenheimerFunds International Ltd.;
Vice President Senior Vice President (Managing Director of the
International Division) of OFI Institutional
Asset Management, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Catherine M. White, Assistant Vice President of OppenheimerFunds
Assistant Vice President Distributor, Inc. Formerly, Assistant Vice
President with Gruntal & Co. LLC (September 1998
- October 2000); member of the American Society
of Pension Actuaries (ASPA) since 1995.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William L. Wilby, Formerly Senior Vice President of HarbourView
Senior Vice President Asset Management Corporation (May 1999-July
2002).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Donna M. Winn, President, Chief Executive Officer and Director
Senior Vice President of OFI Private Investments, Inc.; Director and
President of OppenheimerFunds Legacy Program;
Senior Vice President of OppenheimerFunds
Distributor, Inc.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth Winston, Formerly, principal at Richards & Tierney, Inc.
Senior Vice President (March 1994-May 2001).
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Philip Witkower, None
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian W. Wixted, Treasurer of HarbourView Asset Management
Senior Vice President and Corporation; OppenheimerFunds International
Treasurer Ltd., Oppenheimer Partnership Holdings, Inc.,
Oppenheimer Real Asset Management Corporation,
Shareholder Services, Inc., Shareholder
Financial Services, Inc., OFI Private
Investments, Inc. and OFI Institutional Asset
Management, Inc.; Treasurer and Chief Financial
Officer of OFI Trust Company; Assistant
Treasurer of Oppenheimer Acquisition Corp. and
OppenheimerFunds Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Carol Wolf, Serves on the Board of the Colorado Ballet.
Senior Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kurt Wolfgruber, Director of Tremont Advisers, Inc. (as of
Executive Vice President & January 2002).
Chief Investment Officer
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Caleb C. Wong, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward C. Yoensky, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill Zachman, None
Vice President: Rochester
Division
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lucy Zachman, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert G. Zack General Counsel and Director of OppenheimerFunds
Senior Vice President and Distributor, Inc.; General Counsel of Centennial
General Counsel Asset Management Corporation; Senior Vice
President and General Counsel of HarbourView
Asset Management Corporation and OFI
Institutional Asset Management, Inc.; Senior
Vice President, General Counsel and Director of
Shareholder Financial Services, Inc.,
Shareholder Services, Inc., OFI Private
Investments, Inc. and OFI Trust Company; Vice
President and Director of Oppenheimer
Partnership Holdings, Inc.; Secretary and
General Counsel of Oppenheimer Acquisition
Corp.; Director and Assistant Secretary of
OppenheimerFunds International Ltd.; Director of
Oppenheimer Real Asset Management, Inc.; Vice
President of OppenheimerFunds Legacy Program.
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Neal A. Zamore, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark D. Zavanelli, None
Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Alex Zhou, None
Assistant Vice President
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Arthur J. Zimmer, Senior Vice President (since April 1999) of
Senior Vice President HarbourView Asset Management Corporation.
---------------------------------------------------------------------------------
The Oppenheimer Funds include the following:
Centennial America Fund, L.P.
Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust
Limited Term New York Municipal Fund (Rochester Portfolio Series)
Oppenheimer AMT-Free New York Municipals
Oppenheimer Bond Fund (a series of Oppenheimer Integrity Funds)
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Capital Income Fund
Oppenheimer Capital Preservation Fund
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Concentrated Growth Fund
Oppenheimer Convertible Securities Fund (Bond Fund Series)
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Emerging Growth Fund
Oppenheimer Emerging Technologies Fund
Oppenheimer Enterprise Fund
Oppenheimer Europe Fund
Oppenheimer Global Fund
Oppenheimer Global Growth & Income Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer High Yield Fund
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer International Small Company Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Limited Term Municipal Fund (a series of Oppenheimer Municipal
Fund)
Oppenheimer Main Street Fund (a series of Oppenheimer Main Street Funds, Inc.)
Oppenheimer Main Street Opportunity Fund
Oppenheimer Main Street Small Cap Fund
Oppenheimer MidCap Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi Cap Value Fund
Oppenheimer Multiple Strategies Fund
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust (3 series):
Oppenheimer New Jersey Municipal Fund
Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Rochester National Municipals
Oppenheimer Municipal Bond Fund
Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds (3 series)
Oppenheimer Quest Balanced Value Fund
Oppenheimer Quest Opportunity Value Fund
Oppenheimer Small Cap Value Fund
Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Real Asset Fund
Oppenheimer Real Estate Fund
Oppenheimer Select Managers (6 series):
Gartmore Millennium Growth Fund II
Jennison Growth Fund
Mercury Advisors Focus Growth Fund
Mercury Advisors S&P 500 Index Fund
QM Active Balanced Fund
Salomon Brothers All Cap Fund
Oppenheimer Senior Floating Rate Fund
Oppenheimer Series Fund, Inc. (2 series):
Oppenheimer Disciplined Allocation Fund
Oppenheimer Value Fund
Oppenheimer Special Value Fund
Oppenheimer Strategic Income Fund
Oppenheimer Total Return Bond Fund
Oppenheimer Total Return Fund, Inc.
Oppenheimer Tremont Market Neutral Fund LLC
Oppenheimer Tremont Opportunity Fund LLC
Oppenheimer Trinity Core Fund
Oppenheimer Trinity Large Cap Growth Fund
Oppenheimer Trinity Value Fund
Oppenheimer U.S. Government Trust
Oppenheimer Variable Account Funds (11 series):
Oppenheimer Aggressive Growth Fund/VA
Oppenheimer Bond Fund/VA
Oppenheimer Capital Appreciation Fund/VA
Oppenheimer Global Securities Fund/VA
Oppenheimer High Income Fund/VA
Oppenheimer Main Street Fund/VA
Oppenheimer Main Street Small Cap Fund/VA
Oppenheimer Money Fund/VA
Oppenheimer Multiple Strategies Fund/VA
Oppenheimer Strategic Bond Fund/VA
Oppenheimer Value Fund/VA
Panorama Series Fund, Inc. (4 series):
Growth Portfolio
Government Securities Portfolio
Oppenheimer International Growth Fund/VA
Total Return Portfolio
Rochester Fund Municipals
The address of the Oppenheimer funds listed above, Shareholder Financial
Services, Inc., Shareholder Services, Inc., OppenheimerFunds Services,
Centennial Asset Management Corporation, Centennial Capital Corp.,
Oppenheimer Real Asset Management, Inc. and OppenheimerFunds Legacy Program
is 6803 South Tucson Way, Centennial, Colorado80112-3924.
The address of OppenheimerFunds, Inc., OppenheimerFunds Distributor, Inc.,
HarbourView Asset Management Corporation, Oppenheimer Partnership Holdings,
Inc., Oppenheimer Acquisition Corp., OFI Private Investments, Inc., OFI
Institutional Asset Management, Inc. and Oppenheimer Trust Company is 498
Seventh Avenue, New York, New York10018.
The address of Tremont Advisers, Inc. is 555 Theodore Fremd Avenue, Suite
206-C, Rye, New York10580.
The address of OppenheimerFunds International Ltd. is Bloc C, Irish Life
Center, Lower Abbey Street, Dublin 1, Ireland.
The address of Trinity Investment Management Corporation is 301 North Spring
Street, Bellefonte, Pennsylvania16823.
Item 27. Principal Underwriter
------------------------------
(a) OppenheimerFunds Distributor, Inc. is the Distributor of the
Registrant's shares. It is also the Distributor of each of the other
registered open-end investment companies for which OppenheimerFunds, Inc. is
the investment adviser, as described in Part A and B of this Registration
Statement and listed in Item 26(b) above (except Oppenheimer Multi-Sector
Income Trust and Panorama Series Fund, Inc.) and for MassMutual Institutional
Funds.
(b) The directors and officers of the Registrant's principal underwriter
are:
---------------------------------------------------------------------------------
Name & Principal Position & Office Position and Office
Business Address with Underwriter with Registrant
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Agan(1) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Janette Aprilante(1) Secretary None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jason R. Bach Vice President None
3264 Winthrop Cricle
Marietta, GA30067
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James Barker Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen Beichert(1) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gabriella Bercze(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas S. Blankenship Vice President None
17011 Woodbark
Spring, TX77379
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Blinzler(1) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michelle Brennan Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
L. Scott Brooks(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin E. Brosmith Senior Vice President None
170 Phillip Court
Lake Bluff, IL60044
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey W. Bryan(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Susan Burton Vice President None
412 Towne Green Circle
Addison, TX75001
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen Mary Byron Vice President None
6 Dahlia Drive
Irvine, CA92618
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Andrew Chonofsky Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert A. Coli Vice President None
12 White Tail Lane
Bedminster, NJ07921
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jill E. Crockett(2) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Jeffrey D. Damia(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Davis(2) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Stephen J. Demetrovits(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Joseph A. DiMauro Vice President None
244 McKinley Avenue
Grosse Pointe Farms, MI48236
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven Dombrower(w) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George P. Dougherty Vice President None
4090 Redbud Circle
Doylestown, PA18901
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Cliff H. Dunteman Vice President None
1196 Fieldstone Dr.
Crystal Lake, IL60014-1642
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John Eiler(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kent M. Elwell Vice President None
35 Crown Terrace
Yardley, PA19067
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gregg A. Everett Vice President None
7124 Trysail Circle
Tampa, FL33607
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
George R. Fahey Vice President None
9 Townview Court
Flemington, NJ08822
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric C. Fallon Vice President None
10 Worth Circle
Newton, MA02458
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Katherine P. Feld(2) Vice President Assistant Secretary
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark J. Ferro(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ronald H. Fielding(3) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Patrick W. Flynn (1) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John E. Forrest(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John ("J) Fortuna(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
P. Lyman Foster(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Luiggino J. Galleto Vice President None
10302 Riesling Court
Charlotte, NC28277
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lucio Giliberti Vice President None
6 Cyndi Court
Flemington, NJ08822
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raquel Granahan(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ralph Grant(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael D. Guman Vice President None
3913 Pleasant Avenue
Allentown, PA18103
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Clifford W. Heidinger Vice President None
90 Gates Street
Portsmouth, NH03801
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Phillipe D. Hemery Vice President None
184 Park Avenue
Rochester, NY14607
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elyse R. Jurman Herman Vice President None
1194 Hillsboro Mile, Villa 51
Hillsboro Beach, FL33062
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy G. Hetson Vice President None
4 Craig Street
Jericho, NY11753
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William E. Hortz(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Edward Hrybenko(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian F. Husch(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kathleen T. Ives(1) Vice President Assistant Secretary
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Eric K. Johnson Vice President None
28 Oxford Avenue
Mill Valley, CA94941
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark D. Johnson Vice President None
15792 Scenic Green Court
Chesterfield, MO63017
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John S. Kavanaugh Vice President None
2 Cervantes, Apt. #301
San Francisco, CA94123
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina J. Keller(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian G. Kelly Vice President None
60 Larkspur Road
Fairfield, CT06430
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Keogh(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Lisa Klassen(1) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Klein Senior Vice President None
4820 Fremont Avenue So.
Minneapolis, MN55409
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Richard Knott(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dean Kopperud(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brent A. Krantz Senior Vice President None
P. O. Box 1313
Seahurst, WA98062
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David T. Kuzia Vice President None
9697 S. Golden Eagle Dr.
Highlands, CO80126
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Tracey Lange(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Paul R. LeMire Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dawn Lind Vice President None
21 Meadow Lane
Rockville Centre, NY11570
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Malissa Lischin(2) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James V. Loehle Vice President None
30 Wesley Hill Lane
Warwick, NY10990
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Montana Low Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John J. Lynch Vice President None
5341 Ellsworth
Dallas, TX75206
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Macken Vice President None
462 Lincoln Avenue
Sayville, NY11782
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael Magee(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Steven C. Manns Vice President None
1941 W. Wolfram
Chicago, IL60657
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Todd A. Marion Vice President None
3 St. Marks Place
Cold Spring Harbor, NY11724
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
LuAnn Mascia(2) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Theresa-Marie Maynier Vice President None
2421 Charlotte Drive
Charlotte, NC28203
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Anthony P. Mazzariello Vice President None
704 Beaver Road
Leetsdale, PA15056
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John C. McDonough Vice President None
3812 Leland Street
Chevy Chase, MD20815
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kent C. McGowan Vice President None
18424 12th Avenue West
Lynnwood, WA98037
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Daniel Melehan Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Mark Mezzanotte Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Robert Moser Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
John V. Murphy(2) Director President, Principal
Executive Officer,
Chairman
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Wendy Jean Murray Vice President None
32 Carolin Road
Upper Montclair, NJ07043
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christina Nasta(2) Assistant Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kevin P. Neznek(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Chad V. Noel Vice President None
2408 Eagleridge Drive
Henderson, NV89014
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Bradford Norford Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Raymond C. Olson(1) Assistant Vice President None
& Treasurer
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Brian C. Perkes Vice President None
8734 Shady Shore Drive
Frisco, TX75034
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Charles K. Pettit Vice President None
22 Fall Meadow Drive
Pittsford, NY14534
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gazell Pettway Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Elaine Puleo-Carter(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Christopher L. Quinson Vice President None
19 Cayuga Street
Rye, NY10580
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Minnie Ra Vice President None
100 Dolores Street, #203
Carmel, CA93923
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Gary D. Rakan Vice President None
25031 Woodridge Triangle
Farmington, MI48335
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Dusting Raring Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Michael A. Raso Vice President None
16 N. Chatsworth Ave., Apt. 301
Larchmont, NY10538
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Douglas Rentschler Vice President None
677 Middlesex Road
Grosse Pointe Park, MI48230
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Ruxandra Risko(2) Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
David R. Robertson(2) Senior Vice President None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Kenneth A. Rosenson Vice President None
24753 Bantage Point Terr.
Malibu, CA90265
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
James H. Ruff(2) President & Director None
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
William R. Rylander Vice President None
85 Evergreen Road
Vernon, CT06066
---------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Thomas Sabow(2) Vice President None
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John Saunders Vice President None
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Tonya Sax Vice President None
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Alfredo Scalzo Vice President None
9616 Lake Chase Island Way
Tampa, FL33626
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Thomas Schmitt Vice President None
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Eric Sharp Vice President None
862 McNeill Circle
Woodland, CA95695
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Debbie Simon(2) Vice President None
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Douglas Bruce Smith Vice President None
808 South 194th Street
Seattle,WA98148
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Bryan Stein(2) Vice President None
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John Stoma(2) Senior Vice President None
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Brian C. Summe Vice President None
239 N. Colony Drive
Edgewood, KY41017
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Michael Sussman(2) Vice President None
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George T. Sweeney Senior Vice President None
5 Smoke House Lane
Hummelstown, PA17036
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James Taylor(2) Assistant Vice President None
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Martin Telles(2) Senior Vice President None
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David G. Thomas Vice President None
1328 N. Cleveland Street
Arlington, VA22201
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Bryan K.Toma Vice President None
14575 S. Gallery
Olathe, KS66062
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Floyd A. Tucker Vice President None
1930 W. Barry Ave., #2
Chicago, IL60657
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Mark Vandehey(1) Vice President None
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Vincent Vermete Assistant Vice President None
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Teresa Ward(1) Vice President None
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Michael J. Weigner Vice President None
4905 W. San Nicholas Street
Tampa, FL33629
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Donn Weise Vice President None
3249 Earlmar Drive
Los Angeles, CA90064
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Catherine White(2) Assistant Vice President None
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Thomas Wilson(2) Vice President None
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Donna Winn(2) Senior Vice President None
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Philip Witkower(2) Senior Vice President None
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Cary Patrick Wozniak Vice President None
18808 Bravata Court
San Diego, CA92128
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Gregor D. Yuska Vice President None
16035 Canterbury Estates Dr.
Ellisville, MO63021
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Robert G. Zack(2) General Counsel & Secretary
Director
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(1)6803 South Tucson Way, Centennial, CO80112-3924
(2)498 Seventh Avenue, New York, NY10018
(3)350 Linden Oaks, Rochester, NY14623
(c) Not applicable.
(c) Not applicable.
Item 28. Location of Accounts and Records
-----------------------------------------
The accounts, books and other documents required to be maintained by
Registrant pursuant to Section 31(a) of the Investment Company Act of 1940
and rules promulgated thereunder are in the possession of OppenheimerFunds,
Inc. at its offices at 6803 South Tucson Way, Centennial, Colorado80112-3924.
Item 29. Management Services
----------------------------
Not applicable
Item 30. Undertakings
---------------------
Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and/or the
Investment Company Act of 1940, the Registrant has duly caused this Initial
Registration Statement on Form N-1A 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 5th day of August 2003.
OPPENHEIMER INTERNATIONAL LARGE-CAP
CORE TRUST
By: /s/ John V. Murphy
--------------------------------------------------
John V. Murphy, President, Principal
Executive Officer, Chairman & Trustee
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities on
the dates indicated:
Signatures Title Date
---------- ----- ----
/s/ John V. Murphy President, Principal
----------------------- Executive Officer, August 5, 2003John V. Murphy Chairman and Trustee
/s/ Brian W. Wixted* Treasurer and Principal August 5, 2003
----------------------- Financial and Accounting
Brian W. Wixted Officer
/s/ Ronald J. Abdow*
------------------------ Trustee August 5, 2003Ronald J. Abdow
/s/ Eustis Walcott*
--------------------- Trustee August 5, 2003Eustis Walcott
/s/ Joseph M. Wikler*
------------------------ Trustee August 5, 2003Joseph M. Wikler
/s/ Peter I. Wold*
------------------- Trustee August 5, 2003Peter I. Wold
*By: /s/ Robert G. Zack
-----------------------------------------
Robert G. Zack, Attorney-in-Fact
OPPENHEIMER INTERNATIONAL LARGE-CAP CORE TRUST
Initial Registration Statement
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
(g) (i) Global Custodial Services Agreement
(iii) Amended and Restated Foreign Custody Manager Agreement
(i) Opinion and Consent of Counsel
(j) Independent Auditor's consent
(l) Investment Letter
(n) Multiple Class Plan under Rule 18f-3
Dates Referenced Herein and Documents Incorporated by Reference
