-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, L5weXzGjGTCMV0yiKNZ2WUu9XqY3O2/Pu2ue4cGzr3OjiLDqiJGZ7qb+Usk15bLi Vtdw65t6vehPWi66y8vneg== 0000935069-08-000971.txt : 20080425 0000935069-08-000971.hdr.sgml : 20080425 20080424181451 ACCESSION NUMBER: 0000935069-08-000971 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20080229 FILED AS OF DATE: 20080425 DATE AS OF CHANGE: 20080424 EFFECTIVENESS DATE: 20080425 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Oppenheimer Transition 2015 Fund CENTRAL INDEX KEY: 0001368082 IRS NUMBER: 000000000 STATE OF INCORPORATION: MA FISCAL YEAR END: 0228 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-21921 FILM NUMBER: 08775504 BUSINESS ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 BUSINESS PHONE: 303-768-3200 MAIL ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 0001368082 S000013392 Oppenheimer Transition 2015 Fund C000036217 A C000036218 B C000036219 C C000036220 N C000036221 Y N-CSR 1 ra471_46200ncsr.txt RA471_46200NCSR.TXT UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-21921 Oppenheimer Transition 2015 Fund -------------------------------- (Exact name of registrant as specified in charter) 6803 South Tucson Way, Centennial, Colorado 80112-3924 ------------------------------------------------------ (Address of principal executive offices) (Zip code) Robert G. Zack, Esq. OppenheimerFunds, Inc. Two World Financial Center, New York, New York 10281-1008 --------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: (303) 768-3200 -------------- Date of fiscal year end: February 28 ----------- Date of reporting period: 02/29/2008 ---------- ITEM 1. REPORTS TO STOCKHOLDERS. FEBRUARY 29, 2008 - -------------------------------------------------------------------------------- Oppenheimer Management Transition 2015 Commentaries Fund and Annual Report - -------------------------------------------------------------------------------- MANAGEMENT COMMENTARIES Listing of Top Holdings ANNUAL REPORT Fund Performance Discussion Listing of Investments Financial Statements [OPPENHEIMERFUNDS LOGO] TOP HOLDINGS AND ALLOCATIONS - ------------------------------------------------------------------- ASSET CLASS ALLOCATION [PIE CHART] U.S. Equity Funds 61.7% Fixed Income Fund 15.5 Global Equity Funds 14.6 Alternative Investment Fund 6.6 Money Market Fund 1.6
Portfolio holdings and allocations are subject to change. Percentages are as of February 29, 2008, and are based on the total market value of investments in affiliated companies. 6 | OPPENHEIMER TRANSITION 2015 FUND FUND PERFORMANCE DISCUSSION - -------------------------------------------------------------------------------- HOW HAS THE FUND PERFORMED? BELOW IS A DISCUSSION BY OPPENHEIMERFUNDS, INC., OF THE FUND'S PERFORMANCE DURING ITS FISCAL YEAR ENDED FEBRUARY 29, 2008, FOLLOWED BY A GRAPHICAL COMPARISON OF THE FUND'S PERFORMANCE TO AN APPROPRIATE BROAD-BASED MARKET INDEX. MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE. In an especially volatile period for the financial markets, Oppenheimer Transition 2015 Fund's Class A shares (without sales charge) returned -2.12% for the twelve months ended February 29, 2008 and outperformed its equity benchmark, the S&P 500 Index, which returned -3.60% during the same time span. The equity and fixed income markets were quite volatile during the reporting period. As mentioned above, the U.S. equity market, as represented by the S&P 500 Index, returned -3.60%. The strongest-performing group in the S&P 500 Index was the energy sector, which benefited in part from continued-high oil prices. International equities, as represented by the MSCI World Index ex-U.S., did much better than the U.S. equity market, and gained 2.70% during the same time frame, with the materials sector performing particularly well. The U.S. fixed-income market, as measured by the Lehman Brothers Aggregate Bond Index, also performed much better than U.S. equities for the reporting period, with a return of 7.30%. The big story of the period was the summer's credit crunch. It began with sub-prime mortgages--high-interest loans made to homebuyers with very weak credit. As mortgage defaults and delinquencies rose, the housing market deteriorated, leading lenders to dramatically tighten their lending requirements. As credit became more difficult to come by, a number of financial institutions experienced significant losses. The troubles soon spread to all but the very safest pockets of the financial markets. Equities around the world fell sharply in July and in the first half of August, before rebounding in the second half of August. The rally was short-lived, however, as the U.S. equity market continued to fall amidst recession fears, high oil prices and continuing credit difficulties. The financial sector was among the hardest hit, as investors worried that new credit problems could surface and weigh even further on companies' earnings. Bonds were hardly immune from the market turmoil. Corporate bonds and other debt perceived as riskier saw their credit spreads--the amount of additional income an investor receives in exchange for taking on credit risk--widen from historically narrow levels. The riskier the bond, the more likely it was to underperform during the period's final months. In a "flight to quality," investors flocked to the safest parts of the bond market. U.S. Treasury bond yields, which had been rising earlier in the period, fell sharply beginning in June, while the bonds' prices rose accordingly (bond prices and yields move in opposite directions). Against this backdrop, the Federal Reserve Bank (the "Fed") moved aggressively to stop the spreading credit crunch from sinking the economy by cutting its target for the federal funds rate over its last several meetings. As of the 7 | OPPENHEIMER TRANSITION 2015 FUND FUND PERFORMANCE DISCUSSION - -------------------------------------------------------------------------------- reporting period's end on February 29, 2008, the most recent change the Federal Open Market Committee (FOMC) had made to the fed funds rate was a 50 basis point cut from 3.5% to 3.0% on January 30, 2008. This followed the unusually large 75 basis point cut made during a special January 22, 2008 meeting in response to the stock market volatility and U.S. recession fears. Subsequently, the Fed cut the fed funds rate again on March 18, 2008 to 2.25%, after cutting the federal discount rate a quarter point a few days prior in an unusual weekend session. The Fund's relative outperformance as compared to the S&P 500 Index can be attributed to the stellar performance in the commodities asset class, which resumed its bull run in 2007 and continued into 2008. The basic underpinnings of the reporting period's commodities returns included rising production costs, strong demand from developing economies, currency debasement, and investment capital flows. Our approximate 7% allocation to Oppenheimer Commodity Strategy Total Return Fund's Class Y shares was the best performing underlying fund, with a return of 41.27%. Our approximate 10% position in Oppenheimer International Growth Fund also served us well. The Class Y shares returned 3.01% and easily outpaced its benchmark the MSCI EAFE index, which returned 0.84%. Also contributing to performance was Oppenheimer Capital Appreciation Fund. Here the Class Y shares returned 0.48% as compared to the Russell 1000 Growth R Index's return of 0.40%. Similarly, our primary fixed income fund, Oppenheimer Core Bond Fund's Class Y shares, which returned 0.58%, contributed positively to overall Fund performance, but underperformed its benchmark, the Lehman Brothers Aggregate Bond Index, which gained 7.30%. While the performance in the fixed income sector falls short of our expectations, we are encouraged by the fact that the bulk of the underlying fund's difficulties occurred over a relatively short, concentrated time frame at year-end and in the first two months of the year. We view this recent period of difficulty for Oppenheimer Core Bond Fund as short term. Unfortunately, both our exposure in many of the domestic equity funds and in one international equity fund hurt the Fund's performance. Oppenheimer Value Fund's Class Y shares and Oppenheimer MidCap Fund's Class Y shares were also detractors. While Oppenheimer Value Fund performed well relative to its benchmark, its absolute return was -5.13% and we held approximately a 19% position in Oppenheimer Value Fund at period end. The other relative underperformer on the stock side of the portfolio was our approximate 9.5% allocation to Oppenheimer MidCap Fund, which lagged largely on disappointing security selection. On the international equity side, Oppenheimer Quest International Value Fund's Class A shares had a negative return, also due to disappointing stock selection and detracted from Fund performance. The Fund's exposure to Oppenheimer Quest International Value Fund was under 5% at period end. 8 | OPPENHEIMER TRANSITION 2015 FUND We made no material changes to the underlying mutual funds in Oppenheimer Transition 2015 Fund. Despite significant market volatility during the period, all of our portfolio allocations remained close to our target allocations as of the end of February, 2008. These targets include approximately 80% of the portfolio in Oppenheimer equity funds--65% in U.S. equity funds and 15% invested internationally (via Oppenheimer International Growth Fund and Oppenheimer Quest International Value Fund, Inc.)--and 15% allocated to fixed-income (via Oppenheimer Core Bond Fund). The remaining 5% is targeted toward Oppenheimer Commodity Strategy Total Return Fund, which invests in commodity-oriented securities and provides an additional level of diversification that we believe is extremely valuable for shareholders. We plan to make modest changes in the coming months to bring the Fund further along its "glide path." These changes will most likely entail reducing the Fund's equity allocation and modestly increasing its fixed-income weighting. As we near and eventually move past the Fund's 2015 target date, the portfolio is designed to become gradually more conservative while still maintaining a healthy exposure to equities to continue generating sufficient capital appreciation for today's ever-longer retirements. We do not plan any other immediate changes to the portfolio, although we'll continue to monitor it to ensure that Oppenheimer Transition 2015 Fund's allocations remain sufficiently close to our targets. We will not hesitate to step in, of course, if the portfolio begins to diverge too greatly from those targets. However, as we mentioned, the portfolio's actual allocations at period end were very close to our intended levels, and we do not expect that rebalancing will be necessary for the foreseeable future. As we saw during the period, the market can fluctuate greatly over the short term. We believe that the broad diversification offered by Oppenheimer Transition 2015 Fund and the other Oppenheimer LifeCycle Funds is an important tool to help investors manage market volatility and get closer to their long-term retirement goals. COMPARING THE FUND'S PERFORMANCE TO THE MARKET. The graphs that follow show the performance of a hypothetical $10,000 investment in each class of shares of the Fund held until February 29, 2008. Performance is measured from the inception of Classes A, B, C, N and Y on December 15, 2006. The Fund's performance reflects the deduction of the maximum initial sales charge on Class A shares, the applicable contingent deferred sales charge on Class B, Class C and Class N shares, and reinvestments of all dividends and capital gains distributions. Past performance cannot guarantee future results. 9 | OPPENHEIMER TRANSITION 2015 FUND FUND PERFORMANCE DISCUSSION - -------------------------------------------------------------------------------- The Fund's performance is compared to the performance of the S&P 500 Index and the Lehman Brothers Aggregate Bond Index. The S&P 500 Index is an unmanaged index of equity securities. The Lehman Brothers Aggregate Bond Index is an unmanaged index of U.S. corporate, government and mortgage-backed securities. Index performance reflects the reinvestment of income but does not consider the effect of transaction costs, and none of the data in the graphs shows the effect of taxes. The Fund's performance reflects the effects of the Fund's business and operating expenses. While index comparisons may be useful to provide a benchmark for the Fund's performance, it must be noted that the Fund's investments are not limited to the investments in the index. 10 | OPPENHEIMER TRANSITION 2015 FUND CLASS A SHARES COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN: [AVERAGE ANNUAL TOTAL RETURN LINE CHART]
OPPENHEIMER TRANSITION LEHMAN BROTHERS 2015 FUND (CLASS A) S & P 500 INDEX AGGREGATE BOND INDEX 12/15/2006 9,425 10,000 10,000 02/28/2007 9,595 10,093 10,091 05/31/2007 10,386 11,029 10,069 08/31/2007 10,132 10,667 10,247 11/30/2007 10,236 10,772 10,605 02/29/2008 9,391 9,729 10,828
AVERAGE ANNUAL TOTAL RETURNS OF CLASS A SHARES WITH SALES CHARGE OF THE FUND AT 02/29/08
1 Year Since Inception (12/15/06) - ------ -------------------------- - -7.75% -5.08%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM, OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE, REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES, THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 4% (SINCE INCEPTION); AND FOR CLASS C AND N SHARES, THE 1% CONTINGENT DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD. THERE IS NO SALES CHARGE FOR CLASS Y SHARES. SEE PAGE 16 FOR FURTHER INFORMATION. 11 | OPPENHEIMER TRANSITION 2015 FUND FUND PERFORMANCE DISCUSSION - -------------------------------------------------------------------------------- CLASS B SHARES COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN: [AVERAGE ANNUAL TOTAL RETURN LINE CHART]
OPPENHEIMER TRANSITION LEHMAN BROTHERS 2015 FUND (CLASS B) S & P 500 INDEX AGGREGATE BOND INDEX 12/15/2006 10,000 10,000 10,000 02/28/2007 10,170 10,093 10,091 05/31/2007 10,990 11,029 10,069 08/31/2007 10,690 10,667 10,247 11/30/2007 10,770 10,772 10,605 02/29/2008 9,487 9,729 10,828
AVERAGE ANNUAL TOTAL RETURNS OF CLASS B SHARES WITH SALES CHARGE OF THE FUND AT 02/29/08
1 Year Since Inception (12/15/06) - ------ -------------------------- - -7.67% -4.28%
12 | OPPENHEIMER TRANSITION 2015 FUND CLASS C SHARES COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN: [AVERAGE ANNUAL TOTAL RETURN LINE CHART]
OPPENHEIMER TRANSITION LEHMAN BROTHERS 2015 FUND (CLASS C) S & P 500 INDEX AGGREGATE BOND INDEX 12/15/2006 10,000 10,000 10,000 02/28/2007 10,170 10,093 10,091 05/31/2007 10,990 11,029 10,069 08/31/2007 10,700 10,667 10,247 11/30/2007 10,780 10,772 10,605 02/29/2008 9,877 9,729 10,828
AVERAGE ANNUAL TOTAL RETURNS OF CLASS C SHARES WITH SALES CHARGE OF THE FUND AT 02/29/08
1 Year Since Inception (12/15/06) - ------ -------------------------- - -3.83% -1.02%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM, OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE, REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES, THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 4% (SINCE INCEPTION); AND FOR CLASS C AND N SHARES, THE 1% CONTINGENT DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD. THERE IS NO SALES CHARGE FOR CLASS Y SHARES. SEE PAGE 16 FOR FURTHER INFORMATION. 13 | OPPENHEIMER TRANSITION 2015 FUND FUND PERFORMANCE DISCUSSION - -------------------------------------------------------------------------------- CLASS N SHARES COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN: [AVERAGE ANNUAL TOTAL RETURN LINE CHART]
OPPENHEIMER TRANSITION LEHMAN BROTHERS 2015 FUND (CLASS N) S & P 500 INDEX AGGREGATE BOND INDEX 12/15/2006 10,000 10,000 10,000 02/28/2007 10,180 10,093 10,091 05/31/2007 11,010 11,029 10,069 08/31/2007 10,730 10,667 10,247 11/30/2007 10,830 10,772 10,605 02/29/2008 9,827 9,729 10,828
AVERAGE ANNUAL TOTAL RETURNS OF CLASS N SHARES WITH SALES CHARGE OF THE FUND AT 02/29/08
1 Year Since Inception (12/15/06) - ------ -------------------------- - -3.47% -1.44%
14 | OPPENHEIMER TRANSITION 2015 FUND CLASS Y SHARES COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN: [AVERAGE ANNUAL TOTAL RETURN LINE CHART]
OPPENHEIMER TRANSITION LEHMAN BROTHERS 2015 FUND (CLASS Y) S & P 500 INDEX AGGREGATE BOND INDEX 12/15/2006 10,000 10,000 10,000 02/28/2007 10,190 10,093 10,091 05/31/2007 11,040 11,029 10,069 08/31/2007 10,780 10,667 10,247 11/30/2007 10,880 10,772 10,605 02/29/2008 9,984 9,729 10,828
AVERAGE ANNUAL TOTAL RETURNS OF CLASS Y SHARES OF THE FUND AT 02/29/08
1 Year Since Inception (12/15/06) - ------ -------------------------- - -2.02% -0.13%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM, OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE, REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES, THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 4% (SINCE INCEPTION); AND FOR CLASS C AND N SHARES, THE 1% CONTINGENT DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD. THERE IS NO SALES CHARGE FOR CLASS Y SHARES. SEE PAGE 16 FOR FURTHER INFORMATION. 15 | OPPENHEIMER TRANSITION 2015 FUND NOTES - -------------------------------------------------------------------------------- Total returns and the ending account values in the graphs include changes in share price and reinvestment of dividends and capital gains distributions in a hypothetical investment for the periods shown. Cumulative total returns are not annualized. The Fund's total returns shown do not reflect the deduction of income taxes on an individual's investment. Taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. INVESTORS SHOULD CONSIDER THE FUND'S INVESTMENT OBJECTIVES, RISKS, AND OTHER CHARGES AND EXPENSES CAREFULLY BEFORE INVESTING. THE FUND'S PROSPECTUS CONTAINS THIS AND OTHER INFORMATION ABOUT THE FUND, AND MAY BE OBTAINED BY ASKING YOUR FINANCIAL ADVISOR, CALLING US AT 1.800.525.7048 OR VISITING OUR WEBSITE AT WWW.OPPENHEIMERFUNDS.COM. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING. The Fund's investment strategy and focus can change over time. The mention of specific fund holdings does not constitute a recommendation by OppenheimerFunds, Inc. CLASS A shares of the Fund were first publicly offered on 12/15/06. Class A returns include the current maximum initial sales charge of 5.75%. CLASS B shares of the Fund were first publicly offered on 12/15/06. Class B returns include the applicable contingent deferred sales charge of 5% (1-year) and 4% (since inception). Class B shares are subject to an annual 0.75% asset-based sales charge. CLASS C shares of the Fund were first publicly offered on 12/15/06. Class C returns include the contingent deferred sales charge of 1% for the 1-year period. Class C shares are subject to an annual 0.75% asset-based sales charge. CLASS N shares of the Fund were first publicly offered on 12/15/06. Class N shares are offered only through retirement plans. Unless otherwise noted, Class N returns include the contingent deferred sales charge of 1% for the 1-year period. Class N shares are subject to an annual 0.25% asset-based sales charge. CLASS Y shares of the Fund were first publicly offered on 12/15/06. Class Y shares are offered only to certain institutional investors under special agreements with the Distributor. An explanation of the calculation of performance is in the Fund's Statement of Additional Information. 16 | OPPENHEIMER TRANSITION 2015 FUND FUND EXPENSES - -------------------------------------------------------------------------------- FUND EXPENSES. As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions; and redemption fees (if applic-able); and (2) ongoing costs, including management fees; distribution and service fees; and other Fund expenses. These examples are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The examples are based on an investment of $1,000.00 invested at the beginning of the period and held for the entire 6-month period ended February 29, 2008. ACTUAL EXPENSES. The first section of the table provides information about actual account values and actual expenses. You may use the information in this section for the class of shares you hold, together with the amount you invested, to estimate the expense that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.60), then multiply the result by the number in the first section under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The second section of the table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio for each class of shares, and an assumed rate of return of 5% per year for each class before expenses, which is not the actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as front-end or contingent deferred sales charges (loads), or a $12.00 fee imposed annually on accounts valued at less than $500.00 (subject to exceptions described in the Statement of Additional Information). Therefore, the 17 | OPPENHEIMER TRANSITION 2015 FUND FUND EXPENSES Continued - -------------------------------------------------------------------------------- "hypothetical" section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
BEGINNING ENDING EXPENSES ACCOUNT ACCOUNT PAID DURING VALUE VALUE 6 MONTHS ENDED ACTUAL SEPTEMBER 1, 2007 FEBRUARY 29, 2008 FEBRUARY 29, 2008 - ------------------------------------------------------------------------------------------ Class A $ 1,000.00 $ 926.90 $ 4.13 - ------------------------------------------------------------------------------------------ Class B 1,000.00 923.60 7.78 - ------------------------------------------------------------------------------------------ Class C 1,000.00 923.10 7.15 - ------------------------------------------------------------------------------------------ Class N 1,000.00 924.90 5.33 - ------------------------------------------------------------------------------------------ Class Y 1,000.00 926.10 3.31 HYPOTHETICAL (5% return before expenses) - ------------------------------------------------------------------------------------------ Class A 1,000.00 1,020.59 4.33 - ------------------------------------------------------------------------------------------ Class B 1,000.00 1,016.81 8.16 - ------------------------------------------------------------------------------------------ Class C 1,000.00 1,017.45 7.50 - ------------------------------------------------------------------------------------------ Class N 1,000.00 1,019.34 5.59 - ------------------------------------------------------------------------------------------ Class Y 1,000.00 1,021.43 3.47
Expenses are equal to the Fund's annualized expense ratio for that class, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period). Those annualized expense ratios, excluding indirect expenses from affiliated funds, based on the 6-month period ended February 29, 2008 are as follows:
CLASS EXPENSE RATIOS - ---------------------------- Class A 0.86% - ---------------------------- Class B 1.62 - ---------------------------- Class C 1.49 - ---------------------------- Class N 1.11 - ---------------------------- Class Y 0.69
The expense ratios reflect reduction to custodian expenses and voluntary waivers or reimbursements of expenses by the Fund's Manager that can be terminated at any time, without advance notice. The "Financial Highlights" tables in the Fund's financial statements, included in this report, also show the gross expense ratios, without such waivers or reimbursements and reduction to custodian expenses, if applicable. 18 | OPPENHEIMER TRANSITION 2015 FUND STATEMENT OF INVESTMENTS February 29, 2008 - --------------------------------------------------------------------------------
SHARES VALUE - ------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------- INVESTMENT COMPANIES--101.7% 1 - ------------------------------------------------------------------------------------------------------------- ALTERNATIVE INVESTMENT FUND--6.7% Oppenheimer Commodity Strategy Total Return Fund, Cl. Y 101,327 $ 839,998 - ------------------------------------------------------------------------------------------------------------- FIXED INCOME FUND--15.8% Oppenheimer Core Bond Fund, Cl. Y 200,942 1,971,243 - ------------------------------------------------------------------------------------------------------------- GLOBAL EQUITY FUNDS--14.8% Oppenheimer International Growth Fund, Cl. Y 44,433 1,271,669 - ------------------------------------------------------------------------------------------------------------- Oppenheimer Quest International Value Fund, Inc., Cl. A 31,028 576,181 --------------- 1,847,850 - ------------------------------------------------------------------------------------------------------------- MONEY MARKET FUND--1.6% Oppenheimer Institutional Money Market Fund, Cl. E, 3.99% 2 202,998 202,998 - ------------------------------------------------------------------------------------------------------------- U.S. EQUITY FUNDS--62.8% Oppenheimer Capital Appreciation Fund, Cl. Y 26,373 1,245,029 - ------------------------------------------------------------------------------------------------------------- Oppenheimer Main Street Fund, Cl. Y 36,256 1,198,964 - ------------------------------------------------------------------------------------------------------------- Oppenheimer MidCap Fund, Cl. Y 3 64,678 1,198,493 - ------------------------------------------------------------------------------------------------------------- Oppenheimer Small- & Mid- Cap Value Fund, Cl. Y 53,970 1,817,685 - ------------------------------------------------------------------------------------------------------------- Oppenheimer Value Fund, Cl. Y 101,652 2,381,698 --------------- 7,841,869 - ------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS, AT VALUE (COST $13,841,359) 101.7% 12,703,958 - ------------------------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (1.7) (216,226) ------------------------------ NET ASSETS 100.0% $12,487,732 ==============================
INDUSTRY CLASSIFICATIONS ARE UNAUDITED. 19 | OPPENHEIMER TRANSITION 2015 FUND STATEMENT OF INVESTMENTS Continued - -------------------------------------------------------------------------------- FOOTNOTES TO STATEMENT OF INVESTMENTS 1. Is or was an affiliate, as defined in the Investment Company Act of 1940, at or during the period ended February 29, 2008, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the period in which the issuer was an affiliate are as follows:
SHARES SHARES FEBRUARY 28, GROSS GROSS FEBRUARY 29, 2007 ADDITIONS REDUCTIONS 2008 - ------------------------------------------------------------------------------------------------------------- Oppenheimer Capital Appreciation Fund, Cl. Y 4,867 25,022 3,516 26,373 Oppenheimer Commodity Strategy Total Return Fund, Cl. Y 18,004 95,018 11,695 101,327 Oppenheimer Core Bond Fund, Cl. Y 34,629 193,447 27,134 200,942 Oppenheimer Institutional Money Market Fund, Cl. E -- 7,649,465 7,446,467 202,998 Oppenheimer International Growth Fund, Cl. Y 8,381 41,934 5,882 44,433 Oppenheimer Main Street Fund, Cl. Y 5,720 35,356 4,820 36,256 Oppenheimer MidCap Fund, Cl. Y 11,787 61,758 8,867 64,678 Oppenheimer Quest International Value Fund, Inc., Cl. A 5,314 29,864 4,150 31,028 Oppenheimer Small- & Mid- Cap Value Fund, Cl. Y 9,265 51,928 7,223 53,970 Oppenheimer Value Fund, Cl. Y 17,516 97,867 13,731 101,652
DIVIDEND REALIZED VALUE INCOME LOSS - ------------------------------------------------------------------------------------------------ Oppenheimer Capital Appreciation Fund, Cl. Y $ 1,245,029 $ -- $ 10,762 Oppenheimer Commodity Strategy Total Return Fund, Cl. Y 839,998 75,408 3,644 Oppenheimer Core Bond Fund, Cl. Y 1,971,243 50,164 2,183 Oppenheimer Institutional Money Market Fund, Cl. E 202,998 2,562 -- Oppenheimer International Growth Fund, Cl. Y 1,271,669 13,274 9,333 Oppenheimer Main Street Fund, Cl. Y 1,198,964 15,707 32,117 Oppenheimer MidCap Fund, Cl. Y 1,198,493 -- 10,248 Oppenheimer Quest International Value Fund, Inc., Cl. A 576,181 5,900 9,181 Oppenheimer Small- & Mid- Cap Value Fund, Cl. Y 1,817,685 -- 37,603 Oppenheimer Value Fund, Cl. Y 2,381,698 25,088 49,719 -------------------------------------- $ 12,703,958 $ 188,103 $ 164,790 ======================================
2. Rate shown is the 7-day yield as of February 29, 2008. 3. Non-income producing security. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 20 | OPPENHEIMER TRANSITION 2015 FUND STATEMENT OF ASSETS AND LIABILITIES February 29, 2008 - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------- ASSETS - --------------------------------------------------------------------------------------------------- Investments, at value--affiliated companies (cost $13,841,359)-- see accompanying statement of investments $ 12,703,958 Cash 16,210 - --------------------------------------------------------------------------------------------------- Receivables and other assets: Shares of beneficial interest sold 21,351 Dividends 8,473 Other 999 -------------- Total assets 12,750,991 - --------------------------------------------------------------------------------------------------- LIABILITIES - --------------------------------------------------------------------------------------------------- Payables and other liabilities: Investments purchased 218,836 Shareholder communications 18,804 Legal, auditing and other professional fees 18,334 Distribution and service plan fees 3,892 Transfer and shareholder servicing agent fees 1,207 Shares of beneficial interest redeemed 248 Trustees' compensation 34 Other 1,904 -------------- Total liabilities 263,259 - --------------------------------------------------------------------------------------------------- NET ASSETS $ 12,487,732 ============== - --------------------------------------------------------------------------------------------------- COMPOSITION OF NET ASSETS - --------------------------------------------------------------------------------------------------- Par value of shares of beneficial interest $ 1,290 - --------------------------------------------------------------------------------------------------- Additional paid-in capital 13,526,173 - --------------------------------------------------------------------------------------------------- Accumulated net investment loss (15) - --------------------------------------------------------------------------------------------------- Accumulated net realized gain on investments 97,685 - --------------------------------------------------------------------------------------------------- Net unrealized depreciation on investments (1,137,401) -------------- NET ASSETS $ 12,487,732 ===============
21 | OPPENHEIMER TRANSITION 2015 FUND STATEMENT OF ASSETS AND LIABILITIES Continued - -------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------- NET ASSET VALUE PER SHARE - ---------------------------------------------------------------------------------------------------- Class A Shares: Net asset value and redemption price per share (based on net assets of $7,533,292 and 776,944 shares of beneficial interest outstanding) $ 9.70 Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price) $ 10.29 - ---------------------------------------------------------------------------------------------------- Class B Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $1,263,401 and 130,843 shares of beneficial interest outstanding) $ 9.66 - ---------------------------------------------------------------------------------------------------- Class C Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $1,993,903 and 206,655 shares of beneficial interest outstanding) $ 9.65 - ---------------------------------------------------------------------------------------------------- Class N Shares: Net asset value, redemption price (excludes applicable contingent deferred sales charge) and offering price per share (based on net assets of $1,509,444 and 155,874 shares of beneficial interest outstanding) $ 9.68 - ---------------------------------------------------------------------------------------------------- Class Y Shares: Net asset value, redemption price and offering price per share (based on net assets of $187,692 and 19,309 shares of beneficial interest outstanding) $ 9.72
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 22 | OPPENHEIMER TRANSITION 2015 FUND STATEMENT OF OPERATIONS For the Year Ended February 29, 2008 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- INVESTMENT INCOME - ------------------------------------------------------------------------------- Dividends from affiliated companies $ 188,103 - ------------------------------------------------------------------------------- Interest 452 ------------- Total investment income 188,555 - ------------------------------------------------------------------------------- EXPENSES - ------------------------------------------------------------------------------- Distribution and service plan fees: Class A 9,717 Class B 6,199 Class C 8,539 Class N 3,884 - ------------------------------------------------------------------------------- Transfer and shareholder servicing agent fees: Class A 4,393 Class B 1,187 Class C 1,459 Class N 857 Class Y 83 - ------------------------------------------------------------------------------- Shareholder communications: Class A 19,486 Class B 5,709 Class C 4,244 Class N 1,436 Class Y 175 - ------------------------------------------------------------------------------- Legal, auditing and other professional fees 21,768 - ------------------------------------------------------------------------------- Registration and filing fees 2,042 - ------------------------------------------------------------------------------- Insurance expenses 621 - ------------------------------------------------------------------------------- Trustees' compensation 83 - ------------------------------------------------------------------------------- Custodian fees and expenses 36 - ------------------------------------------------------------------------------- Other 4,700 ------------- Total expenses 96,618 Less reduction to custodian expenses (27) Less waivers and reimbursements of expenses (21,121) ------------- Net expenses 75,470 - ------------------------------------------------------------------------------- NET INVESTMENT INCOME 113,085 - ------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) - ------------------------------------------------------------------------------- Net realized gain (loss) on: Investments--affiliated companies (164,790) Distributions received from affiliated companies 447,330 ------------- Net realized gain 282,540 - ------------------------------------------------------------------------------- Net change in unrealized depreciation on investments (1,146,287) - ------------------------------------------------------------------------------- NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (750,662) =============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 23 | OPPENHEIMER TRANSITION 2015 FUND STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, 2008 2007 1 - --------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------- OPERATIONS - --------------------------------------------------------------------------------------------------------------- Net investment income $ 113,085 $ 597 - --------------------------------------------------------------------------------------------------------------- Net realized gain 282,540 -- - --------------------------------------------------------------------------------------------------------------- Net change in unrealized appreciation(depreciation) (1,146,287) 8,886 ------------------------------ Net increase(decrease) in net assets resulting from operations (750,662) 9,483 - --------------------------------------------------------------------------------------------------------------- DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS - --------------------------------------------------------------------------------------------------------------- Dividends from net investment income: Class A (173,172) -- Class B (20,356) -- Class C (36,066) -- Class N (36,346) -- Class Y (4,264) -- ------------------------------ (270,204) -- - --------------------------------------------------------------------------------------------------------------- BENEFICIAL INTEREST TRANSACTIONS - --------------------------------------------------------------------------------------------------------------- Net increase in net assets resulting from beneficial interest transactions: Class A 5,908,174 2,066,504 Class B 1,223,386 140,134 Class C 2,079,156 95,927 Class N 1,660,378 18,517 Class Y 202,939 -- ------------------------------ 11,074,033 2,321,082 - --------------------------------------------------------------------------------------------------------------- NET ASSETS - --------------------------------------------------------------------------------------------------------------- Total increase 10,053,167 2,330,565 - --------------------------------------------------------------------------------------------------------------- Beginning of period 2,434,565 104,000 2 ------------------------------ End of period (including accumulated net investment income (loss) of $(15) and $1,042, respectively) $ 12,487,732 $ 2,434,565 ==============================
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Reflects the value of the Manager's initial seed money investment on August 21, 2006. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 24 | OPPENHEIMER TRANSITION 2015 FUND FINANCIAL HIGHLIGHTS
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, CLASS A 2008 2007 1 - ----------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA - ----------------------------------------------------------------------------------------------- Net asset value, beginning of period $ 10.18 $ 10.00 - ----------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income 2 .15 .01 Net realized and unrealized gain (loss) (.34) .17 --------------------------- Total from investment operations (.19) .18 - ----------------------------------------------------------------------------------------------- Dividends and/or distributions to shareholders: Dividends from net investment income (.29) -- - ----------------------------------------------------------------------------------------------- Net asset value, end of period $ 9.70 $ 10.18 =========================== - ----------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE 3 (2.12)% 1.80% - ----------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA - ----------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $ 7,533 $ 2,177 - ----------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 5,227 $ 1,362 - ----------------------------------------------------------------------------------------------- Ratios to average net assets: 4 Net investment income 1.45% 0.25% Total expenses 5 1.03% 6.99% 6 Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 0.83% 0.87% - ----------------------------------------------------------------------------------------------- Portfolio turnover rate 24% 0%
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 4. Annualized for periods less than one full year. 5. Total expenses paid including all underlying fund expenses were as follows: Year Ended February 29, 2008 1.66% Period Ended February 28, 2007 7.62%
6. The fiscal 2007 total expenses ratio is higher than the anticipated total expense ratio of the class for future years due to the Fund's limited operating history at February 28, 2007. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 25 | OPPENHEIMER TRANSITION 2015 FUND FINANCIAL HIGHLIGHTS Continued
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, CLASS B 2008 2007 1 - ------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------ PER SHARE OPERATING DATA - ------------------------------------------------------------------------------------------------ Net asset value, beginning of period $ 10.17 $ 10.00 - ------------------------------------------------------------------------------------------------ Income (loss) from investment operations: Net investment income (loss) 2 .10 (.01) Net realized and unrealized gain (loss) (.38) .18 ---------------------------- Total from investment operations (.28) .17 - ------------------------------------------------------------------------------------------------ Dividends and/or distributions to shareholders: Dividends from net investment income (.23) -- - ------------------------------------------------------------------------------------------------ Net asset value, end of period $ 9.66 $ 10.17 ============================ - ------------------------------------------------------------------------------------------------ TOTAL RETURN, AT NET ASSET VALUE 3 (2.92)% 1.70% - ------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------ RATIOS/SUPPLEMENTAL DATA - ------------------------------------------------------------------------------------------------ Net assets, end of period (in thousands) $ 1,263 $ 139 - ------------------------------------------------------------------------------------------------ Average net assets (in thousands) $ 623 $ 20 - ------------------------------------------------------------------------------------------------ Ratios to average net assets: 4 Net investment income (loss) 0.95% (0.57)% Total expenses 5 2.49% 52.30% 6 Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.62% 1.55% - ------------------------------------------------------------------------------------------------ Portfolio turnover rate 24% 0%
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 4. Annualized for periods less than one full year. 5. Total expenses paid including all underlying fund expenses were as follows: Year Ended February 29, 2008 3.12% Period Ended February 28, 2007 52.93%
6. The fiscal 2007 total expenses ratio is higher than the anticipated total expense ratio of the class for future years due to the Fund's limited operating history at February 28, 2007. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 26 | OPPENHEIMER TRANSITION 2015 FUND
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, CLASS C 2008 2007 1 - ---------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA - ---------------------------------------------------------------------------------------------------- Net asset value, beginning of period $ 10.17 $ 10.00 - ---------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income (loss) 2 .17 (.01) Net realized and unrealized gain (loss) (.44) .18 ------------------------------- Total from investment operations (.27) .17 - ---------------------------------------------------------------------------------------------------- Dividends and/or distributions to shareholders: Dividends from net investment income (.25) -- - ---------------------------------------------------------------------------------------------------- Net asset value, end of period $ 9.65 $ 10.17 =============================== - ---------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE 3 (2.88)% 1.70% - ---------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA - ---------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $ 1,994 $ 99 - ---------------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 862 $ 60 - ---------------------------------------------------------------------------------------------------- Ratios to average net assets: 4 Net investment income (loss) 1.67% (0.65)% Total expenses 5 2.03% 17.07% 6 Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.52% 1.62% - ---------------------------------------------------------------------------------------------------- Portfolio turnover rate 24% 0%
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 4. Annualized for periods less than one full year. 5. Total expenses paid including all underlying fund expenses were as follows: Year Ended February 29, 2008 2.66% Period Ended February 28, 2007 17.70%
6. The fiscal 2007 total expenses ratio is higher than the anticipated total expense ratio of the class for future years due to the Fund's limited operating history at February 28, 2007. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 27 | OPPENHEIMER TRANSITION 2015 FUND FINANCIAL HIGHLIGHTS Continued - --------------------------------------------------------------------------------
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, CLASS N 2008 2007 1 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA - ---------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of period $ 10.18 $ 10.00 - ---------------------------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income (loss) 2 .20 -- 3 Net realized and unrealized gain (loss) (.44) .18 ------------------------------- Total from investment operations (.24) .18 - ---------------------------------------------------------------------------------------------------------------------- Dividends and/or distributions to shareholders: Dividends from net investment income (.26) -- - ---------------------------------------------------------------------------------------------------------------------- Net asset value, end of period $ 9.68 $ 10.18 =============================== - ---------------------------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE 4 (2.52)% 1.80% - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA - ---------------------------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $ 1,510 $ 19 - ---------------------------------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 783 $ 5 - ---------------------------------------------------------------------------------------------------------------------- Ratios to average net assets: 5 Net investment income 1.95% 0.02% Total expenses 6 1.16% 42.59% 7 Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 1.09% 1.12% - ---------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate 24% 0%
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Less than $0.005 per share. 4. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 5. Annualized for periods less than one full year. 6. Total expenses paid including all underlying fund expenses were as follows: Year Ended February 29, 2008 1.79% Period Ended February 28, 2007 43.22%
7. The fiscal 2007 total expenses ratio is higher than the anticipated total expense ratio of the class for future years due to the Fund's limited operating history at February 28, 2007. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 28 | OPPENHEIMER TRANSITION 2015 FUND
YEAR ENDED PERIOD ENDED FEBRUARY 29, FEBRUARY 28, CLASS Y 2008 2007 1 - ---------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------- PER SHARE OPERATING DATA - ---------------------------------------------------------------------------------------------------- Net asset value, beginning of period $ 10.19 $ 10.00 - ---------------------------------------------------------------------------------------------------- Income (loss) from investment operations: Net investment income 2 .22 .01 Net realized and unrealized gain (loss) (.40) .18 --------------------------------- Total from investment operations (.18) .19 - ---------------------------------------------------------------------------------------------------- Dividends and/or distributions to shareholders: Dividends from net investment income (.29) -- - ---------------------------------------------------------------------------------------------------- Net asset value, end of period $ 9.72 $ 10.19 ================================= - ---------------------------------------------------------------------------------------------------- TOTAL RETURN, AT NET ASSET VALUE 3 (2.02)% 1.90% - ---------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------- RATIOS/SUPPLEMENTAL DATA - ---------------------------------------------------------------------------------------------------- Net assets, end of period (in thousands) $ 188 $ 1 - ---------------------------------------------------------------------------------------------------- Average net assets (in thousands) $ 74 $ 1 - ---------------------------------------------------------------------------------------------------- Ratios to average net assets: 4 Net investment income 2.08% 0.48% Total expenses 5 0.75% 110.56% 6 Expenses after payments, waivers and/or reimbursements and reduction to custodian expenses 0.61% 0.55% - ---------------------------------------------------------------------------------------------------- Portfolio turnover rate 24% 0%
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. Per share amounts calculated based on the average shares outstanding during the period. 3. Assumes an investment on the business day before the first day of the fiscal period, with all dividends and distributions reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. Total returns are not annualized for periods less than one full year. Returns do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. 4. Annualized for periods less than one full year. 5. Total expenses paid including all underlying fund expenses were as follows: Year Ended February 29, 2008 1.38% Period Ended February 28, 2007 111.19%
6. The fiscal 2007 total expenses ratio is higher than the anticipated total expense ratio of the class for future years due to the Fund's limited operating history at February 28, 2007. SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS. 29 | OPPENHEIMER TRANSITION 2015 FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. SIGNIFICANT ACCOUNTING POLICIES Oppenheimer Transition 2015 Fund (the "Fund") is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund's investment objective is to seek total return until the target retirement date included in its name and then seeks income and secondarily capital growth. The Fund is a special type of mutual fund known as a "fund of funds" because it invests in other mutual funds. The Fund normally invests in a portfolio consisting of a target weighted allocation in Class A or Class Y shares of other Oppenheimer funds (the "Underlying Funds"). The Fund's investment adviser is OppenheimerFunds, Inc. (the "Manager"). The Fund offers Class A, Class B, Class C, Class N and Class Y shares. Class A shares are sold at their offering price, which is normally net asset value plus a front-end sales charge. Class B, Class C and Class N shares are sold without a front-end sales charge but may be subject to a contingent deferred sales charge ("CDSC"). Class N shares are sold only through retirement plans. Retirement plans that offer Class N shares may impose charges on those accounts. Class Y shares are sold to certain institutional investors without either a front-end sales charge or a CDSC, however, the institutional investor may impose charges on those accounts. All classes of shares have identical rights and voting privileges with respect to the Fund in general and exclusive voting rights on matters that affect that class alone. Earnings, net assets and net asset value per share may differ due to each class having its own expenses, such as transfer and shareholder servicing agent fees and shareholder communications, directly attributable to that class. Class A, B, C and N have separate distribution and/or service plans. No such plan has been adopted for Class Y shares. Class B shares will automatically convert to Class A shares 72 months after the date of purchase. The following is a summary of significant accounting policies consistently followed by the Fund. - -------------------------------------------------------------------------------- SECURITIES VALUATION. The Fund calculates the net asset value of each class of its shares based upon the net asset value of the applicable Underlying Fund. For each Underlying Fund, the net asset value per share for a class of shares is determined as of the close of the New York Stock Exchange (the "Exchange"), normally 4:00 P. M. Eastern time, on each day the Exchange is open for trading by dividing the value of the Underlying Fund's net assets attributable to that class by the number of outstanding shares of that class on that day. To determine net asset values, the Underlying Fund's assets are valued primarily on the basis of current market quotations. Securities for which market quotations are not readily available are valued at their fair value. Securities whose values have been materially affected by what the Manager identifies as a significant event occurring before the Underlying Fund's assets are valued but after the close of their respective exchanges will be fair valued. Fair value is determined in good faith using consistently applied procedures under the supervision of the Underlying Fund's Board of Trustees. "Money market-type" debt instruments with remaining maturities of sixty days or less are valued at cost adjusted by the amortization of discount or premium to maturity (amortized cost), which approximates market value. 30 | OPPENHEIMER TRANSITION 2015 FUND - -------------------------------------------------------------------------------- RISKS OF INVESTING IN THE UNDERLYING FUNDS. Each of the Underlying Funds in which the Fund invests has its own investment risks, and those risks can affect the value of the Fund's investments and therefore the value of the Fund's shares. To the extent that the Fund invests more of its assets in one Underlying Fund than in another, the Fund will have greater exposure to the risks of that Underlying Fund. - -------------------------------------------------------------------------------- INVESTMENT IN OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND. The Fund is permitted to invest daily available cash balances in an affiliated money market fund. The Fund may invest the available cash in Class E shares of Oppenheimer Institutional Money Market Fund ("IMMF") to seek current income while preserving liquidity. IMMF is a registered open-end management investment company, regulated as a money market fund under the Investment Company Act of 1940, as amended. The Manager is also the investment adviser of IMMF. The Fund's investment in IMMF is included in the Statement of Investments. As a shareholder, the Fund is subject to its proportional share of IMMF's Class E expenses, including its management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund's investment in IMMF. - -------------------------------------------------------------------------------- ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than those attributable to a specific class), gains and losses are allocated on a daily basis to each class of shares based upon the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against the operations of that class. - -------------------------------------------------------------------------------- FEDERAL TAXES. The Fund intends to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its investment company taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required, however, during the year ended February 29, 2008, the Fund paid federal excise tax of $23. The Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on the Fund's tax return filings generally remain open for the three preceding fiscal reporting period ends. The tax components of capital shown in the following table represent distribution requirements the Fund must satisfy under the income tax regulations, losses the Fund may be able to offset against income and gains realized in future years and unrealized appreciation or depreciation of securities and other investments for federal income tax purposes.
NET UNREALIZED DEPRECIATION BASED ON COST OF SECURITIES AND OTHER UNDISTRIBUTED NET UNDISTRIBUTED ACCUMULATED LOSS INVESTMENTS FOR FEDERAL INVESTMENT INCOME LONG-TERM GAIN CARRYFORWARD INCOME TAX PURPOSES - ---------------------------------------------------------------------------------------------- $ -- $ 154,773 $ -- $ 1,194,489
31 | OPPENHEIMER TRANSITION 2015 FUND NOTES TO FINANCIAL STATEMENTS Continued - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. SIGNIFICANT ACCOUNTING POLICIES Continued Net investment income (loss) and net realized gain (loss) may differ for financial statement and tax purposes. The character of dividends and distributions made during the fiscal year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. Also, due to timing of dividends and distributions, the fiscal year in which amounts are distributed may differ from the fiscal year in which the income or net realized gain was recorded by the Fund. Accordingly, the following amounts have been reclassified for February 29, 2008. Net assets of the Fund were unaffected by the reclassifications.
REDUCTION TO REDUCTION TO ACCUMULATED NET INCREASE TO ACCUMULATED NET REALIZED GAIN ON PAID-IN CAPITAL INVESTMENT LOSS INVESTMENTS 1 ------------------------------------------------------------------- $ 28,793 $ 156,062 $ 184,855
1. $28,867, all of which was long-term capital gain, was distributed in connection with Fund share redemptions. The tax character of distributions paid during the year ended February 29, 2008 and the period ended February 28, 2007 was as follows:
YEAR ENDED PERIOD ENDED FEBRUARY 29, 2008 FEBRUARY 28, 2007 ------------------------------------------------------------------- Distributions paid from: Ordinary income $ 270,204 $ --
The aggregate cost of securities and other investments and the composition of unrealized appreciation and depreciation of securities and other investments for federal income tax purposes as of February 29, 2008 are noted below. The primary difference between book and tax appreciation or depreciation of securities and other investments, if applicable, is attributable to the tax deferral of losses or tax realization of financial statement unrealized gain or loss. Federal tax cost of securities $ 13,898,447 ============== Gross unrealized appreciation $ 118,592 -------------- Gross unrealized depreciation (1,313,081) -------------- Net unrealized depreciation $ (1,194,489) ==============
- -------------------------------------------------------------------------------- TRUSTEES' COMPENSATION. The Fund has adopted an unfunded retirement plan (the "Plan") for the Fund's independent trustees. Benefits are based on years of service and fees paid to each trustee during their period of service. The Plan was frozen with respect to adding new participants effective December 31, 2006 (the "Freeze Date") and existing Plan Participants as of the Freeze Date will continue to receive accrued benefits under the Plan. Active independent trustees as of the Freeze Date have each elected a distribution method with respect to their benefits under the Plan. During the year ended February 32 | OPPENHEIMER TRANSITION 2015 FUND 29, 2008, the Fund's projected benefit obligations, payments to retired trustees and accumulated liability were as follows: Projected Benefit Obligations Increased $ 12 Payments Made to Retired Trustees 18 Accumulated Liability as of February 29, 2008 --
The Board of Trustees has adopted a compensation deferral plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Fund. For purposes of determining the amount owed to the Trustee under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of the Fund or in other Oppenheimer funds selected by the Trustee. The Fund purchases shares of the funds selected for deferral by the Trustee in amounts equal to his or her deemed investment, resulting in a Fund asset equal to the deferred compensation liability. Such assets are included as a component of "Other" within the asset section of the Statement of Assets and Liabilities. Deferral of trustees' fees under the plan will not affect the net assets of the Fund, and will not materially affect the Fund's assets, liabilities or net investment income per share. Amounts will be deferred until distributed in accordance to the compensation deferral plan. - -------------------------------------------------------------------------------- DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to shareholders, which are determined in accordance with income tax regulations and may differ from U.S. generally accepted accounting principles, are recorded on the ex-dividend date. Income and capital gain distributions, if any, are declared and paid annually or at other times as deemed necessary by the Manager. - -------------------------------------------------------------------------------- INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon ex-dividend notification in the case of certain foreign dividends where the ex-dividend date may have passed. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Interest income is recognized on an accrual basis. Discount and premium, which are included in interest income on the Statement of Operations, are amortized or accreted daily. - ------------------------------------------------------------------------------- CUSTODIAN FEES. "Custodian fees and expenses" in the Statement of Operations may include interest expense incurred by the Fund on any cash overdrafts of its custodian account during the period. Such cash overdrafts may result from the effects of failed trades in portfolio securities and from cash outflows resulting from unanticipated shareholder redemption activity. The Fund pays interest to its custodian on such cash overdrafts, to the extent they are not offset by positive cash balances maintained by the Fund, at a rate equal to the Federal Funds Rate plus 0.50%. The "Reduction to custodian expenses" line item, if applicable, represents earnings on cash balances maintained by the Fund during the period. Such interest expense and other custodian fees may be paid with these earnings. 33 | OPPENHEIMER TRANSITION 2015 FUND NOTES TO FINANCIAL STATEMENTS Continued - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. SIGNIFICANT ACCOUNTING POLICIES Continued SECURITY TRANSACTIONS. Security transactions are recorded on the trade date. Realized gains and losses on securities sold are determined on the basis of identified cost. - -------------------------------------------------------------------------------- INDEMNIFICATIONS. The Fund's organizational documents provide current and former trustees and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote. - -------------------------------------------------------------------------------- OTHER. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. - -------------------------------------------------------------------------------- 2. SHARES OF BENEFICIAL INTEREST The Fund has authorized an unlimited number of $0.001 par value shares of beneficial interest of each class. Transactions in shares of beneficial interest were as follows:
YEAR ENDED FEBRUARY 29, 2008 PERIOD ENDED FEBRUARY 28, 2007 1,2 SHARES AMOUNT SHARES AMOUNT - ----------------------------------------------------------------------------------------------------------- CLASS A Sold 683,235 $ 7,225,902 203,792 $ 2,066,504 Dividends and/or distributions reinvested 16,055 168,420 -- -- Redeemed (136,138) (1,486,148) -- -- ------------------------------------------------------------------------ Net increase 563,152 $ 5,908,174 203,792 $ 2,066,504 ======================================================================== - ----------------------------------------------------------------------------------------------------------- CLASS B Sold 127,657 $ 1,332,860 13,612 $ 140,843 Dividends and/or distributions reinvested 1,877 20,067 -- -- Redeemed (12,334) (129,541) (69) (709) ------------------------------------------------------------------------ Net increase 117,200 $ 1,223,386 13,543 $ 140,134 ======================================================================== - ----------------------------------------------------------------------------------------------------------- CLASS C Sold 207,400 $ 2,185,546 9,606 $ 95,927 Dividends and/or distributions reinvested 3,297 34,452 -- -- Redeemed (13,748) (140,842) -- -- ------------------------------------------------------------------------ Net increase 196,949 $ 2,079,156 9,606 $ 95,927 ========================================================================
34 | OPPENHEIMER TRANSITION 2015 FUND
YEAR ENDED FEBRUARY 29, 2008 PERIOD ENDED FEBRUARY 28, 2007 1,2 SHARES AMOUNT SHARES AMOUNT - ------------------------------------------------------------------------------------------------- CLASS N Sold 219,066 $ 2,331,873 1,807 $ 18,517 Dividends and/or distributions reinvested 3,455 36,238 -- -- Redeemed (68,554) (707,733) -- -- ------------------------------------------------------------------- Net increase 153,967 $ 1,660,378 1,807 $ 18,517 =================================================================== - ------------------------------------------------------------------------------------------------- CLASS Y Sold 23,372 $ 247,714 -- $ -- Dividends and/or distributions reinvested 403 4,236 -- -- Redeemed (4,566) (49,011) -- -- ------------------------------------------------------------------- Net increase 19,209 $ 202,939 -- $ -- ===================================================================
1. For the period from December 15, 2006 (commencement of operations) to February 28, 2007. 2. The Fund sold 10,000 shares of Class A at a value of $100,000 and 100 shares each of Class B, Class C, Class N and Class Y at a value of $1,000, respectively, to the Manager upon seeding of the Fund on August 21, 2006. - -------------------------------------------------------------------------------- 3. PURCHASES AND SALES OF SECURITIES The aggregate cost of purchases and proceeds from sales of securities, other than short-term obligations and investments in IMMF, for the year ended February 29, 2008, were as follows:
PURCHASES SALES ------------------------------------------------------- Investment securities $ 13,081,406 $ 1,834,007
- -------------------------------------------------------------------------------- 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES MANAGEMENT FEES. Under the investment advisory agreement, the Manager does not charge a management fee, but rather collects indirect management fees from investments in the Underlying Funds. The weighted indirect management fees collected from the Underlying Funds, as a percent of average daily net assets of the Fund for the year ended February 29, 2008 was 0.56%. - -------------------------------------------------------------------------------- TRANSFER AGENT FEES. OppenheimerFunds Services ("OFS"), a division of the Manager, acts as the transfer and shareholder servicing agent for the Fund. The Fund pays OFS a per account fee. For the year ended February 29, 2008, the Fund paid $6,789 to OFS for services to the Fund. Additionally, Class Y shares are subject to minimum fees of $10,000 annually for assets of $10 million or more. The Class Y shares are subject to the minimum fees in the event that the per account fee does not equal or exceed the applicable minimum fees. OFS may voluntarily waive the minimum fees. - -------------------------------------------------------------------------------- OFFERING AND ORGANIZATIONAL COSTS. The Manager paid all initial offering and organizational costs associated with the registration and seeding of the Fund. 35 | OPPENHEIMER TRANSITION 2015 FUND NOTES TO FINANCIAL STATEMENTS Continued - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued DISTRIBUTION AND SERVICE PLAN (12B-1) FEES. Under its General Distributor's Agreement with the Fund, OppenheimerFunds Distributor, Inc. (the "Distributor") acts as the Fund's principal underwriter in the continuous public offering of the Fund's classes of shares. - -------------------------------------------------------------------------------- SERVICE PLAN FOR CLASS A SHARES. The Fund has adopted a Service Plan (the "Plan") for Class A shares under Rule 12b-1 of the Investment Company Act of 1940. Under the Plan, the Fund reimburses the Distributor for a portion of its costs incurred for services provided to accounts that hold Class A shares. Reimbursement is made periodically at an annual rate 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 periodically for providing personal service and maintenance of accounts of their customers that hold Class A shares. Any unreimbursed expenses the Distributor incurs with respect to Class A shares in any fiscal year cannot be recovered in subsequent periods. Fees incurred by the Fund under the Plan are detailed in the Statement of Operations. - -------------------------------------------------------------------------------- DISTRIBUTION AND SERVICE PLANS FOR CLASS B, CLASS C AND CLASS N SHARES. The Fund has adopted Distribution and Service Plans (the "Plans") for Class B, Class C and Class N shares under Rule 12b-1 of the Investment Company Act of 1940 to compensate the Distributor for its services in connection with the distribution of those shares and servicing accounts. Under the Plans, the Fund pays the Distributor an annual asset-based sales charge of 0.75% on Class B and Class C shares and 0.25% on Class N shares. The Distributor also receives a service fee of 0.25% per year under each plan. If either the Class B, Class C or Class N plan is terminated by the Fund or by the shareholders of a class, the Board of Trustees and its independent trustees must determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the service fee and/or asset-based sales charge in respect to shares sold prior to the effective date of such termination. The Distributor's aggregate uncompensated expenses under the Plans at December 31, 2007 for Class B, Class C and Class N shares were $19,170, $12,457 and $14,388, respectively. Fees incurred by the Fund under the Plans are detailed in the Statement of Operations. - -------------------------------------------------------------------------------- SALES CHARGES. Front-end sales charges and contingent deferred sales charges ("CDSC") do not represent expenses of the Fund. They are deducted from the proceeds of sales of Fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. The sales charges retained by the Distributor from the sale of shares and the CDSC retained by the Distributor on the redemption of shares is shown in the following table for the period indicated. 36 | OPPENHEIMER TRANSITION 2015 FUND
CLASS A CLASS B CLASS C CLASS N CONTINGENT CONTINGENT CONTINGENT CONTINGENT CLASS A DEFERRED SALES DEFERRED SALES DEFERRED SALES DEFERRED SALES FRONT-END SALES CHARGES CHARGES CHARGES CHARGES CHARGES RETAINED RETAINED BY RETAINED BY RETAINED BY RETAINED BY YEAR ENDED BY DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR - -------------------------------------------------------------------------------------------------------------------- February 29, 2008 $ 42,013 $ -- $ 1,530 $ 1 $ 336
- -------------------------------------------------------------------------------- WAIVERS AND REIMBURSEMENTS OF EXPENSES. The Manager has voluntarily agreed to a total expense limitation on the aggregate amount of combined direct (fund-of-funds level) and indirect expense so that as a percentage of average daily net assets they will not exceed the following annual rates: 1.50%, 2.25%, 2.25%, 1.75% and 1.25%, for Class A, Class B, Class C, Class N and Class Y, respectively. During the year ended February 29, 2008, the Manager reimbursed the Fund $10,372, $5,336, $4,314, $457 and $93 for the Class A, Class B, Class C, Class N and Class Y shares, respectively. The Manager may modify or terminate this undertaking at any time without notice to shareholders. OFS has voluntarily agreed to limit transfer and shareholder servicing agent fees for all classes to 0.35% of average annual net assets per class. This undertaking may be amended or withdrawn at any time. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund's investment in IMMF. During the year ended February 29, 2008, the Manager waived $58 for IMMF management fees. The Distributor reimbursed Fund expenses in an amount equal to the distribution and service plan fees incurred through the Fund's investment in the Class A shares of Oppenheimer Quest International Value Fund, Inc. which, for the year ended February 29, 2008, was $491. - -------------------------------------------------------------------------------- 5. RECENT ACCOUNTING PRONOUNCEMENT In September 2006, Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 157, FAIR VALUE MEASUREMENTS. This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value and expands disclosures about fair value measurements. SFAS No. 157 applies to fair value measurements already required or permitted by existing standards. SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. As of February 29, 2008, the Manager does not believe the adoption of SFAS No. 157 will materially impact the financial statement amounts; however, additional disclosures may be required about the inputs used to develop the measurements and the effect of certain of the measurements on changes in net assets for the period. 37 | OPPENHEIMER TRANSITION 2015 FUND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER TRANSITION 2015 FUND: We have audited the accompanying statement of assets and liabilities of Oppenheimer Transition 2015 Fund, including the statement of investments, as of February 29, 2008, the related statement of operations for the year then ended, and the statements of changes in net assets and the financial highlights for the year then ended and for the period December 15, 2006 (commencement of operations) to February 28, 2007. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of February 29, 2008, by correspondence with the custodian and Transfer Agent or by other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Oppenheimer Transition 2015 Fund as of February 29, 2008, the results of its operations for the year then ended, and the changes in its net assets and the financial highlights for the year then ended and for the period December 15, 2006 (commencement of operations) to February 28, 2007, in conformity with U.S. generally accepted accounting principles. KPMG LLP Denver, Colorado April 18, 2008 38 | OPPENHEIMER TRANSITION 2015 FUND FEDERAL INCOME TAX INFORMATION Unaudited - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- In early 2008, if applicable, shareholders of record received information regarding all dividends and distributions paid to them by the Fund during calendar year 2007. Regulations of the U.S. Treasury Department require the Fund to report this information to the Internal Revenue Service. Dividends, if any, paid by the Fund during the fiscal year ended February 29, 2008 which are not designated as capital gain distributions should be multiplied by 20.01% to arrive at the amount eligible for the corporate dividend-received deduction. A portion, if any, of the dividends paid by the Fund during the fiscal year ended February 29, 2008 which are not designated as capital gain distributions are eligible for lower individual income tax rates to the extent that the Fund has received qualified dividend income as stipulated by recent tax legislation. $83,606 of the Fund's fiscal year taxable income may be eligible for the lower individual income tax rates. In early 2008, shareholders of record received information regarding the percentage of distributions that are eligible for lower individual income tax rates. Recent tax legislation allows a regulated investment company to designate distributions not designated as capital gain distributions, as either interest related dividends or short-term capital gain dividends, both of which are exempt from the U.S. withholding tax applicable to non U.S. taxpayers. For the fiscal year ended February 29, 2008, $352 or 0.13% of the ordinary distributions paid by the Fund qualifies as an interest related dividend. The foregoing information is presented to assist shareholders in reporting distributions received from the Fund to the Internal Revenue Service. Because of the complexity of the federal regulations which may affect your individual tax return and the many variations in state and local tax regulations, we recommend that you consult your tax advisor for specific guidance. 39 | OPPENHEIMER TRANSITION 2015 FUND PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF INVESTMENTS Unaudited - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The Fund and each underlying fund have adopted Portfolio Proxy Voting Policies and Procedures under which the Fund and each underlying fund votes proxies relating to securities ("portfolio proxies") held. A description of the Portfolio Proxy Voting Policies and Procedures is available (i) without charge, upon request, by calling the Fund toll-free at 1.800.525.7048, (ii) on the Fund's website at www.oppenheimerfunds.com, and (iii) on the SEC's website at www.sec.gov. In addition, the Fund and each underlying fund is required to file Form N-PX, with its complete proxy voting record for the 12 months ended June 30th, no later than August 31st of each year. The Fund's voting record is available (i) without charge, upon request, by calling toll-free at 1.800.525.7048, and (ii) in the Form N-PX filing on the SEC's website at www.sec.gov. The Fund files its complete schedule of portfolio holdings with the SEC for the first quarter and the third quarter of each fiscal year on Form N-Q. The Fund's Form N-Q filings are available on the SEC's website at http://www.sec.gov. Those forms may 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 1-800-SEC-0330. 40 | OPPENHEIMER TRANSITION 2015 FUND TRUSTEES AND OFFICERS Unaudited - --------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------ NAME, POSITION(s) HELD WITH PRINCIPAL OCCUPATION(s) DURING THE PAST 5 YEARS; OTHER TRUSTEESHIPS/DIRECTORSHIPS THE FUND, LENGTH OF SERVICE, AGE HELD; NUMBER OF PORTFOLIOS IN THE FUND COMPLEX CURRENTLY OVERSEEN INDEPENDENT THE ADDRESS OF EACH TRUSTEE IN THE CHART BELOW IS 6803 S. TUCSON WAY, CENTENNIAL, TRUSTEES COLORADO 80112-3924. EACH TRUSTEE SERVES FOR AN INDEFINITE TERM, OR UNTIL HIS OR HER RESIGNATION, RETIREMENT, DEATH OR REMOVAL. BRIAN F. WRUBLE, General Partner of Odyssey Partners, L.P. (hedge fund) (September 1995-December Chairman of the Board of 2007); Director of Special Value Opportunities Fund, LLC (registered investment Trustees (since 2007) and company) (affiliate of the Manager's parent company) (since September 2004); Trustee (since 2006) Chairman (since August 2007) and Trustee (since August 1991) of the Board of Age: 65 Trustees of The Jackson Laboratory (non-profit); Treasurer and Trustee of the Institute for Advanced Study (non-profit educational institute) (since May 1992); Member of Zurich Financial Investment Management Advisory Council (insurance) (2004-2007); Special Limited Partner of Odyssey Investment Partners, LLC (private equity investment) (January 1999-September 2004). Oversees 67 portfolios in the OppenheimerFunds complex. DAVID K. DOWNES, Independent Chairman GSK Employee Benefit Trust (since April 2006); Director Trustee (since 2007) of Correctnet (since January 2006); Trustee of Employee Trusts (since January Age: 68 2006); President, Chief Executive Officer and Board Member of CRAFund Advisors, Inc. (investment management company) (since January 2004); Director of Internet Capital Group (information technology company) (since October 2003); Independent Chairman of the Board of Trustees of Quaker Investment Trust (registered investment company) (2004-2007); President of The Community Reinvestment Act Qualified Investment Fund (investment management company) (2004-2007); Chief Operating Officer and Chief Financial Officer of Lincoln National Investment Companies, Inc. (subsidiary of Lincoln National Corporation, a publicly traded company) and Delaware Investments U.S., Inc. (investment management subsidiary of Lincoln National Corporation) (1993- 2003); President, Chief Executive Officer and Trustee of Delaware Investment Family of Funds (1993-2003); President and Board Member of Lincoln National Convertible Securities Funds, Inc. and the Lincoln National Income Funds, TDC (1993-2003); Chairman and Chief Executive Officer of Retirement Financial Services, Inc. (registered transfer agent and investment adviser and subsidiary of Delaware Investments U.S., Inc.) (1993-2003); President and Chief Executive Officer of Delaware Service Company, Inc. (1995-2003); Chief Administrative Officer, Chief Financial Officer, Vice Chairman and Director of Equitable Capital Management Corporation (investment subsidiary of Equitable Life Assurance Society) (1985-1992); Corporate Controller of Merrill Lynch & Company (financial services holding company) (1977-1985); held the following positions at the Colonial Penn Group, Inc. (insurance company): Corporate Budget Director (1974-1977), Assistant Treasurer (1972-1974) and Director of Corporate Taxes (1969-1972); held the following positions at Price Waterhouse & Company (financial services firm): Tax Manager (1967-1969), Tax Senior (1965-1967) and Staff Accountant (1963-1965); United States Marine Corps (1957-1959). Oversees 67 portfolios in the OppenheimerFunds complex. MATTHEW P. FINK, Trustee of the Committee for Economic Development (policy research foundation) Trustee (since 2006) (since 2005); Director of ICI Education Foundation (education foundation) Age: 67 (October 1991-August 2006); President of the Investment Company Institute (trade association) (October 1991-June 2004); Director of ICI Mutual Insurance Company (insurance company) (October 1991-June 2004). Oversees 57 portfolios in the OppenheimerFunds complex.
41 | OPPENHEIMER TRANSITION 2015 FUND TRUSTEES AND OFFICERS Unaudited / Continued - -------------------------------------------------------------------------------- ROBERT G. GALLI, A director or trustee of other Oppenheimer funds. Oversees 67 portfolios in the Trustee (since 2006) OppenheimerFunds complex. Age: 74 PHILLIP A. GRIFFITHS, Fellow of the Carnegie Corporation (since 2007); Distinguished Presidential Trustee (since 2006) Fellow for International Affairs (since 2002) and Member (since 1979) of the Age: 69 National Academy of Sciences; Council on Foreign Relations (since 2002); Director of GSI Lumonics Inc. (precision technology products company) (since 2001); Senior Advisor of The Andrew W. Mellon Foundation (since 2001); Chair of Science Initiative Group (since 1999); Member of the American Philosophical Society (since 1996); Trustee of Woodward Academy (since 1983); Foreign Associate of Third World Academy of Sciences; Director of the Institute for Advanced Study (1991-2004); Director of Bankers Trust New York Corporation (1994-1999); Provost at Duke University (1983-1991). Oversees 57 portfolios in the OppenheimerFunds complex. MARY F. MILLER, Trustee of International House (not-for-profit) (since June 2007); Trustee of the Trustee (since 2006) American Symphony Orchestra (not-for-profit) (since October 1998); and Senior Age: 65 Vice President and General Auditor of American Express Company (financial services company) (July 1998-February 2003). Oversees 57 portfolios in the OppenheimerFunds complex. JOEL W. MOTLEY, Managing Director of Public Capital Advisors, LLC (privately held financial advisor) Trustee (since 2006) (since January 2006); Managing Director of Carmona Motley, Inc. (privately-held Age: 55 financial advisor) (since January 2002); Director of Columbia Equity Financial Corp. (privately-held financial advisor) (2002-2007); Managing Director of Carmona Motley Hoffman Inc. (privately-held financial advisor) (January 1998-December 2001); Member of the Finance and Budget Committee of the Council on Foreign Relations, Member of the Investment Committee of the Episcopal Church of America, Member of the Investment Committee and Board of Human Rights Watch and Member of the Investment Committee of Historic Hudson Valley. Oversees 57 portfolios in the OppenheimerFunds complex. RUSSELL S. REYNOLDS, JR., Chairman of RSR Partners (formerly "The Directorship Search Group, Inc.") (corporate Trustee (since 2006) governance consulting and executive recruiting) (since 1993); Life Trustee of Age: 76 International House (non-profit educational organization); Former Trustee of The Historical Society of the Town of Greenwich; Former Director of Greenwich Hospital Association. Oversees 57 portfolios in the OppenheimerFunds complex. JOSEPH M. WIKLER, Director of C-TASC (bio-statistics services) (since 2007); Director of the following Trustee (since 2006) medical device companies: Medintec (since 1992) and Cathco (since 1996); Age: 67 Director of Lakes Environmental Association (environmental protection organization) (since 1996); Member of the Investment Committee of the Associated Jewish Charities of Baltimore (since 1994); Director of Fortis/Hartford mutual funds (1994- December 2001). Director of C-TASC (a privately-held bio-statistics company) (since May 2007). Oversees 57 portfolios in the OppenheimerFunds complex. PETER I. WOLD, President of Wold Oil Properties, Inc. (oil and gas exploration and production Trustee (since 2006) company) (since 1994); Vice President of American Talc Company, Inc. (talc mining Age: 60 and milling) (since 1999); Managing Member of Hole-in-the-Wall Ranch (cattle ranching) (since 1979); Vice President, Secretary and Treasurer of Wold Trona Company, Inc. (soda ash processing and production) (1996-2006); Director and Chairman of the Denver Branch of the Federal Reserve Bank of Kansas City (1993-1999); and Director of PacifiCorp. (electric utility) (1995-1999). Oversees 57 portfolios in the OppenheimerFunds complex.
42 | OPPENHEIMER TRANSITION 2015 FUND - ------------------------------------------------------------------------------------------------------------------------------------ INTERESTED TRUSTEE AND THE ADDRESS OF MR. MURPHY IS TWO WORLD FINANCIAL CENTER, 225 LIBERTY STREET, 11TH OFFICER FLOOR, NEW YORK, NEW YORK 10281-1008. MR. MURPHY SERVES AS A TRUSTEE FOR AN INDEFINITE TERM, OR UNTIL HIS RESIGNATION, RETIREMENT, DEATH OR REMOVAL AND AS AN OFFICER FOR AN INDEFINITE TERM, OR UNTIL HIS RESIGNATION, RETIREMENT, DEATH OR REMOVAL. MR. MURPHY IS AN INTERESTED TRUSTEE DUE TO HIS POSITIONS WITH OPPENHEIMERFUNDS, INC. AND ITS AFFILIATES. JOHN V. MURPHY, Chairman, Chief Executive Officer and Director of the Manager (since June 2001); President and Principal President of the Manager (September 2000-February 2007); President and director Executive Officer and or trustee of other Oppenheimer funds; President and Director of Oppenheimer Trustee (since 2006) Acquisition Corp. ("OAC") (the Manager's parent holding company) and of Age: 58 Oppenheimer Partnership Holdings, Inc. (holding company subsidiary of the Manager) (since July 2001); Director of OppenheimerFunds Distributor, Inc. (subsidiary of the Manager) (November 2001-December 2006); Chairman and Director of Shareholder Services, Inc. and of Shareholder Financial Services, Inc. (transfer agent subsidiaries of the Manager) (since July 2001); President and Director of OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since July 2001); Director of the following investment advisory subsidiaries of the Manager: OFI Institutional Asset Management, Inc., Centennial Asset Management Corporation, Trinity Investment Management Corporation and Tremont Capital Management, Inc. (since November 2001), HarbourView Asset Management Corporation and OFI Private Investments, Inc. (since July 2001); President (since November 2001) and Director (since July 2001) of Oppenheimer Real Asset Management, Inc.; Executive Vice President of Massachusetts Mutual Life Insurance Company (OAC's parent company) (since February 1997); Director of DLB Acquisition Corporation (holding company parent of Babson Capital Management LLC) (since June 1995); Chairman (since October 2007) and Member of the Investment Company Institute's Board of Governors (since October 2003). Oversees 106 portfolios in the OppenheimerFunds complex. - ------------------------------------------------------------------------------------------------------------------------------------ OTHER OFFICERS OF THE THE ADDRESSES OF THE OFFICERS IN THE CHART BELOW ARE AS FOLLOWS: FOR MESSRS. SCHADT, FUND WEBMAN, WOLFGRUBER, LEAVY, ZACK, GILLESPIE AND MS. BLOOMBERG, TWO WORLD FINANCIAL CENTER, 225 LIBERTY STREET, NEW YORK, NEW YORK 10281-1008, FOR MESSRS. VANDEHEY, WIXTED, PETERSEN, SZILAGYI AND MS. IVES, 6803 S. TUCSON WAY, CENTENNIAL, COLORADO 80112-3924. EACH OFFICER SERVES FOR AN INDEFINITE TERM OR UNTIL HIS OR HER RESIGNATION, RETIREMENT, DEATH OR REMOVAL. RUDI W. SCHADT, Vice President, Director of Equity Analytics and Risk in Product Design and Risk Vice President and Portfolio Management of the Manager (since February 2002). Prior to joining the Manager (since 2006) Manager in February 2002, a Director and Senior Quantitative Analyst (2000- Age: 50 2001) at UBS Asset Management prior to which an Associate Director of Research (since June 1999) and Senior Researcher and Portfolio Manager (from June 1997) at State Street Global Advisors. An officer of 14 portfolios in the OppenheimerFunds complex. DR. JERRY A. WEBMAN, Chief Economist of the Manager (since 2006); Senior Vice President (since Vice President and Portfolio February 1996) and Senior Investment Officer and Director (since 1997) of the Manager (since 2006) Manager's Fixed Income Investments; Senior Vice President (since May 1999) of Age: 58 HarbourView Asset Management Corporation. An officer of 11 portfolios in the OppenheimerFunds complex. KURT WOLFGRUBER, President (since March 2007) and Chief Investment Officer and Director (since Vice President and Portfolio July 2003) of the Manager; Executive Vice President of the Manager (March Manager (since 2006) 2003-March 2007); Director of HarbourView Asset Management Corporation Age: 57 and of OFI Institutional Asset Management, Inc. (since June 2003) and of Tremont Capital Management, Inc. (since October 2001). A portfolio manager and officer of 11 portfolios in the OppenheimerFunds complex.
43 | OPPENHEIMER TRANSITION 2015 FUND TRUSTEES AND OFFICERS Unaudited/Continued - -------------------------------------------------------------------------------- CHRISTOPHER LEAVY, Director of Equities of the Manager (since January 2007); Senior Vice President Vice President and Portfolio of the Manager (since September 2000). Portfolio manager of Morgan Stanley Manager (since 2007) Dean Witter Investment Management (1997-September 2000). A portfolio manager Age: 37 and officer of 15 portfolios in the OppenheimerFunds complex. MARK S. VANDEHEY, Senior Vice President and Chief Compliance Officer of the Manager (since Vice President and Chief March 2004); Chief Compliance Officer of OppenheimerFunds Distributor, Inc., Compliance Officer Centennial Asset Management and Shareholder Services, Inc. (since March 2004); (since 2006) Vice President of OppenheimerFunds Distributor, Inc., Centennial Asset Age: 57 Management Corporation and Shareholder Services, Inc. (since June 1983); Former Vice President and Director of Internal Audit of the Manager (1997- February 2004). An officer of 106 portfolios in the OppenheimerFunds complex. BRIAN W. WIXTED, Senior Vice President and Treasurer of the Manager (since March 1999); Treasurer Treasurer and Principal of the following: HarbourView Asset Management Corporation, Shareholder Financial & Accounting Financial Services, Inc., Shareholder Services, Inc., Oppenheimer Real Asset Officer (since 2006) Management, Inc. and Oppenheimer Partnership Holdings, Inc. (since March Age: 48 1999), OFI Private Investments, Inc. (since March 2000), OppenheimerFunds International Ltd. and OppenheimerFunds plc (since May 2000), OFI Institutional Asset Management, Inc. (since November 2000), and OppenheimerFunds Legacy Program (charitable trust program established by the Manager) (since June 2003); Treasurer and Chief Financial Officer of OFI Trust Company (trust company subsidiary of the Manager) (since May 2000); Assistant Treasurer of the following: OAC (since March 1999), Centennial Asset Management Corporation (March 1999-October 2003) and OppenheimerFunds Legacy Program (April 2000-June 2003). An officer of 106 portfolios in the OppenheimerFunds complex. BRIAN S. PETERSEN, Vice President of the Manager (since February 2007); Assistant Vice President of Assistant Treasurer the Manager (August 2002-February 2007); Manager/Financial Product (since 2004) Accounting of the Manager (November 1998-July 2002). An officer of 106 portfolios Age: 37 in the OppenheimerFunds complex. BRIAN C. SZILAGYI, Assistant Vice President of the Manager (since July 2004); Director of Financial Assistant Treasurer Reporting and Compliance of First Data Corporation (April 2003-July 2004); (since 2005) Manager of Compliance of Berger Financial Group LLC (May 2001-March 2003). Age: 38 An officer of 106 portfolios in the OppenheimerFunds complex. ROBERT G. ZACK, Executive Vice President (since January 2004) and General Counsel (since March Secretary 2002) of the Manager; General Counsel and Director of the Distributor (since (since 2006) December 2001); General Counsel of Centennial Asset Management Corporation Age: 59 (since December 2001); Senior Vice President and General Counsel of HarbourView Asset Management Corporation (since December 2001); Secretary and General Counsel of OAC (since November 2001); Assistant Secretary (since September 1997) and Director (since November 2001) of OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and Director of Oppenheimer Partnership Holdings, Inc. (since December 2002); Director of Oppenheimer Real Asset Management, Inc. (since November 2001); Senior Vice President, General Counsel and Director of Shareholder Financial Services, Inc. and Shareholder Services, Inc. (since December 2001); Senior Vice President, General Counsel and Director of OFI Private Investments, Inc. and OFI Trust Company (since November 2001); Vice President of OppenheimerFunds Legacy Program (since June 2003); Senior Vice President and General Counsel of OFI Institutional Asset Management, Inc. (since November 2001); Director of OppenheimerFunds International Distributor Limited (since December 2003); Senior Vice President (May 1985- December 2003). An officer of 106 portfolios in the OppenheimerFunds complex.
44 | OPPENHEIMER TRANSITION 2015 FUND LISA I. BLOOMBERG, Vice President and Associate Counsel of the Manager (since May 2004); First Assistant Secretary Vice President (April 2001-April 2004), Associate General Counsel (December (since 2006) 2000-April 2004) of UBS Financial Services, Inc. An officer of 106 portfolios in Age: 40 the OppenheimerFunds complex. PHILLIP S. GILLESPIE, Senior Vice President and Deputy General Counsel of the Manager (since Assistant Secretary September 2004); First Vice President (2000-September 2004), Director (2000- (since 2006) September 2004) and Vice President (1998-2000) of Merrill Lynch Investment Age: 44 Management. An officer of 106 portfolios in the OppenheimerFunds complex. KATHLEEN T. IVES, Vice President (since June 1998) and Senior Counsel and Assistant Secretary (since Assistant Secretary October 2003) of the Manager; Vice President (since 1999) and Assistant Secretary (since 2006) (since October 2003) of the Distributor; Assistant Secretary of Centennial Asset Age: 42 Management Corporation (since October 2003); Vice President and Assistant Secretary of Shareholder Services, Inc. (since 1999); Assistant Secretary of OppenheimerFunds Legacy Program and Shareholder Financial Services, Inc. (since December 2001); Assistant Counsel of the Manager (August 1994-October 2003). An officer of 106 portfolios in the OppenheimerFunds complex.
THE FUND'S STATEMENT OF ADDITIONAL INFORMATION CONTAINS ADDITIONAL INFORMATION ABOUT THE FUND'S TRUSTEES AND OFFICERS AND IS AVAILABLE WITHOUT CHARGE UPON REQUEST, BY CALLING 1.800.525.7048. 45 | OPPENHEIMER TRANSITION 2015 FUND ITEM 2. CODE OF ETHICS. The registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. The Board of Trustees of the registrant has determined that David Downes, a member of the Board's Audit Committee, is an audit committee financial expert and that Mr. Downes is "independent" for purposes of this Item 3. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. (a) Audit Fees The principal accountant for the audit of the registrant's annual financial statements billed $17,000 in fiscal 2008 and $16,500 in fiscal 2007. (b) Audit-Related Fees The principal accountant for the audit of the registrant's annual financial statements billed no such fees during the last two fiscal years. The principal accountant for the audit of the registrant's annual financial statements billed $256,236 in fiscal 2008 and no such fees in fiscal 2007 to the registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant. Such services include: internal control reviews and professional services relating to FAS 123R. (c) Tax Fees The principal accountant for the audit of the registrant's annual financial statements billed no such fees to the registrant during the last two fiscal years. The principal accountant for the audit of the registrant's annual financial statements billed no such fees to the registrant during the last two fiscal years to the registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant. (d) All Other Fees The principal accountant for the audit of the registrant's annual financial statements billed no such fees to the registrant during the last two fiscal years. The principal accountant for the audit of the registrant's annual financial statements billed no such fees during the last two fiscal years to the registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant. (e) (1) During its regularly scheduled periodic meetings, the registrant's audit committee will pre-approve all audit, audit-related, tax and other services to be provided by the principal accountants of the registrant. The audit committee has delegated pre-approval authority to its Chairman for any subsequent new engagements that arise between regularly scheduled meeting dates provided that any fees such pre-approved are presented to the audit committee at its next regularly scheduled meeting. Under applicable laws, pre-approval of non-audit services maybe waived provided that: 1) the aggregate amount of all such services provided constitutes no more than five percent of the total amount of fees paid by the registrant to it principal accountant during the fiscal year in which services are provided 2) such services were not recognized by the registrant at the time of engagement as non-audit services and 3) such services are promptly brought to the attention of the audit committee of the registrant and approved prior to the completion of the audit. (2) 100% (f) Not applicable as less than 50%. (g) The principal accountant for the audit of the registrant's annual financial statements billed $256,236 in fiscal 2008 and no such fees in fiscal 2007 to the registrant and the registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant related to non-audit fees. Those billings did not include any prohibited non-audit services as defined by the Securities Exchange Act of 1934. (h) No such services were rendered. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. THE FUND'S GOVERNANCE COMMITTEE PROVISIONS WITH RESPECT TO NOMINATIONS OF DIRECTORS/TRUSTEES TO THE RESPECTIVE BOARDS 1. The Fund's Governance Committee (the "Committee") will evaluate potential Board candidates to assess their qualifications. The Committee shall have the authority, upon approval of the Board, to retain an executive search firm to assist in this effort. The Committee may consider recommendations by business and personal contacts of current Board members and by executive search firms which the Committee may engage from time to time and may also consider shareholder recommendations. The Committee may consider the advice and recommendation of the Funds' investment manager and its affiliates in making the selection. 2. The Committee shall screen candidates for Board membership. The Committee has not established specific qualifications that it believes must be met by a trustee nominee. In evaluating trustee nominees, the Committee considers, among other things, an individual's background, skills, and experience; whether the individual is an "interested person" as defined in the Investment Company Act of 1940; and whether the individual would be deemed an "audit committee financial expert" within the meaning of applicable SEC rules. The Committee also considers whether the individual's background, skills, and experience will complement the background, skills, and experience of other nominees and will contribute to the Board. There are no differences in the manner in which the Committee evaluates nominees for trustees based on whether the nominee is recommended by a shareholder. 3. The Committee may consider nominations from shareholders for the Board at such times as the Committee meets to consider new nominees for the Board. The Committee shall have the sole discretion to determine the candidates to present to the Board and, in such cases where required, to shareholders. Recommendations for trustee nominees should, at a minimum, be accompanied by the following: o the name, address, and business, educational, and/or other pertinent background of the person being recommended; o a statement concerning whether the person is an "interested person" as defined in the Investment Company Act of 1940; o any other information that the Funds would be required to include in a proxy statement concerning the person if he or she was nominated; and o the name and address of the person submitting the recommendation and, if that person is a shareholder, the period for which that person held Fund shares. The recommendation also can include any additional information which the person submitting it believes would assist the Committee in evaluating the recommendation. 4. Shareholders should note that a person who owns securities issued by Massachusetts Mutual Life Insurance Company (the parent company of the Funds' investment adviser) would be deemed an "interested person" under the Investment Company Act of 1940. In addition, certain other relationships with Massachusetts Mutual Life Insurance Company or its subsidiaries, with registered broker-dealers, or with the Funds' outside legal counsel may cause a person to be deemed an "interested person." 5. Before the Committee decides to nominate an individual as a trustee, Committee members and other directors customarily interview the individual in person. In addition, the individual customarily is asked to complete a detailed questionnaire which is designed to elicit information which must be disclosed under SEC and stock exchange rules and to determine whether the individual is subject to any statutory disqualification from serving as a trustee of a registered investment company. ITEM 11. CONTROLS AND PROCEDURES. Based on their evaluation of the registrant's disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR 270.30a-3(c)) as of 02/29/2008, the registrant's principal executive officer and principal financial officer found the registrant's disclosure controls and procedures to provide reasonable assurances that information required to be disclosed by the registrant in the reports that it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated to registrant's management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure, and (b) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the U.S. Securities and Exchange Commission. There have been no changes in the registrant's internal controls over financial reporting that occurred during the registrant's second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a) (1) Exhibit attached hereto. (2) Exhibits attached hereto. (3) Not applicable. (b) Exhibit attached hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Oppenheimer Transition 2015 Fund By: /s/ John V. Murphy --------------------------- John V. Murphy Principal Executive Officer Date: 04/16/2008 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ John V. Murphy --------------------------- John V. Murphy Principal Executive Officer Date: 04/16/2008 By: /s/ Brian W. Wixted --------------------------- Brian W. Wixted Principal Financial Officer Date: 04/16/2008 EX-99.CERT 2 ra471_46200cert302.txt RA471_46200CERT302.TXT Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, John V. Murphy, certify that: 1. I have reviewed this report on Form N-CSR of Oppenheimer Transition 2015 Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of Trustees (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 04/16/2008 /s/ John V. Murphy - ---------------------------- John V. Murphy Principal Executive Officer Exhibit 99.CERT Section 302 Certifications CERTIFICATIONS I, Brian W. Wixted, certify that: 1. I have reviewed this report on Form N-CSR of Oppenheimer Transition 2015 Fund; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of Trustees (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: 04/16/2008 /s/ Brian W. Wixted - ---------------------------- Brian W. Wixted Principal Financial Officer EX-99.906CERT 3 ra471_46200cert906.txt RA471_46200CERT906.TXT EX-99.906CERT Section 906 Certifications CERTIFICATION PURSUANT TO 18 U.S.C SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 John V. Murphy, Principal Executive Officer, and Brian W. Wixted, Principal Financial Officer, of Oppenheimer Transition 2015 Fund (the "Registrant"), each certify to the best of his knowledge that: 1. The Registrant's periodic report on Form N-CSR for the period ended 02/29/2008 (the "Form N-CSR") fully complies with the requirements of Section 15(d) of the Securities Exchange Act of 1934, as amended; and 2. The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. This certification is being furnished to the Commission solely pursuant to 18 U.S.C. Section 1350 and is not being filed as part of the Form N-CSR filed with the Commission. Principal Executive Officer Principal Financial Officer Oppenheimer Transition 2015 Fund Oppenheimer Transition 2015 Fund /s/ John V. Murphy /s/ Brian W. Wixted - -------------------------------- -------------------------------- John V. Murphy Brian W. Wixted Date: 04/16/2008 Date: 04/16/2008 EX-99.CODE ETH 4 ra471_46200codeeth.txt RA471_46200CODEETH.TXT EX-99.CODE ETH CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS OF THE OPPENHEIMER FUNDS AND OF OPPENHEIMERFUNDS, INC. This Code of Ethics for Principal Executive and Senior Financial Officers (referred to in this document as the "Code") has been adopted by each of the investment companies for which OppenheimerFunds, Inc. or one of its subsidiaries or affiliates (referred to collectively in this document as "OFI") acts as investment adviser (individually, a "Fund" and collectively, the "Funds"), and by OFI to effectuate compliance with Section 406 under the Sarbanes-Oxley Act of 2002 and the rules adopted to implement Section 406. This Code applies to OFI's and each Fund's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions ("Covered Officers"). A listing of positions currently within the ambit of Covered Officers is attached as EXHIBIT A. 1 1. PURPOSE OF THE CODE ------------------- This Code sets forth standards and procedures that are reasonably designed to deter wrongdoing and promote: o honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; o full, fair, accurate, timely, and understandable disclosure in reports and documents that a Fund files with, or submits to, the U.S. Securities and Exchange Commission ("SEC") and in other public communications made by the Fund; o compliance with applicable governmental laws, rules and regulations; o the prompt internal reporting of violations of this Code to the Code Administrator identified below; and o accountability for adherence to this Code. - --------------------------------------- 1 The obligations imposed by this Code on Covered Officers are separate from and in addition to any obligations that may be imposed on such persons as Covered Persons under the Code of Ethics adopted by OFI and the Funds under Rule 17j-1 of the Investment Company Act of 1940, as amended and any other code of conduct applicable to Covered Officers in whatever capacity they serve. This Code does not incorporate by reference any provisions of the Rule 17j-1 Code of Ethics and accordingly, any violations or waivers granted under the Rule 17j-1 Code of Ethics will not be considered a violation or waiver under this Code. In general, the principles that govern honest and ethical conduct, including the avoidance of conflicts of interest between personal and professional relationships, reflect, at the minimum, the following: (1) the duty at all times in performing any responsibilities as a Fund financial officer, controller, accountant or principal executive officer to place the interests of the Funds ahead of personal interests; (2) the fundamental standard that Covered Officers should not take inappropriate advantage of their positions; (3) the duty to assure that a Fund's financial statements and reports to its shareholders are prepared honestly and accurately in accordance with applicable rules, regulations and accounting standards; and (4) the duty to conduct the Funds' business and affairs in an honest and ethical manner. Each Covered Officer should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. It is acknowledged that, as a result of the contractual relationship between each Fund and OFI, of which the Covered Officers are also officers or employees, and subject to OFI's fiduciary duties to each Fund, the Covered Officers will, in the normal course of their duties, be involved in establishing policies and implementing decisions that will have different effects on OFI and the Funds. It is further acknowledged that the participation of the Covered Officers in such activities is inherent in the contractual relationship between each Fund and OFI and is consistent with the expectations of the Board of Trustees/Directors of the performance by the Covered Officers of their duties as officers of the Funds. 2. PROHIBITIONS ------------ The specific provisions and reporting requirements of this Code are concerned primarily with promoting honest and ethical conduct and avoiding conflicts of interest in personal and professional relationships. No Covered Officer may use information concerning the business and affairs of a Fund, including the investment intentions of a Fund, or use his or her ability to influence such investment intentions, for personal gain to himself or herself, his or her family or friends or any other person or in a manner detrimental to the interests of a Fund or its shareholders. No Covered Officer may use his or her personal influence or personal relationships to influence the preparation and issuance of financial reports of a Fund whereby the Covered Officer would benefit personally to the detriment of the Fund and its shareholders. No Covered Officer shall intentionally for any reason take any action or fail to take any action in connection with his or her official acts on behalf of a Fund that causes the Fund to violate applicable laws, rules and regulations. No Covered Officer shall, in connection with carrying out his or her official duties and responsibilities on behalf of a Fund: (i) employ any device, scheme or artifice to defraud a Fund or its shareholders; (ii) intentionally cause a Fund to make any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading in its official documents, regulatory filings, financial statements or communications to the public; (iii) engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any Fund or its shareholders; (iv) engage in any manipulative practice with respect to any Fund; (v) use his or her personal influence or personal relationships to influence any business decision, investment decisions, or financial reporting by a Fund whereby the Covered Officer would benefit personally to the detriment of the Fund or its shareholders; (vi) intentionally cause a Fund to fail to comply with applicable laws, rules and regulations, including failure to comply with the requirement of full, fair, accurate, understandable and timely disclosure in reports and documents that a Fund files with, or submits to, the SEC and in other public communications made by the Fund; (vii) intentionally mislead or omit to provide material information to the Fund's independent auditors or to the Board of Trustees/Directors or the officers of the Fund or its investment adviser in connection with financial reporting matters; (viii) fail to notify the Code Administrator or the Chief Executive Officer of the Fund or its investment adviser promptly if he or she becomes aware of any existing or potential violations of this Code or applicable laws; (ix) retaliate against others for, or otherwise discourage the reporting of, actual or apparent violations of this Code; or (x) fails to acknowledge or certify compliance with this Code if requested to do so. 3. REPORTS OF CONFLICTS OF INTERESTS --------------------------------- If a Covered Officer becomes aware of a conflict of interest under this Code or, to the Covered Officer's reasonable belief, the appearance of one, he or she must immediately report the matter to the Code's Administrator. If the Code Administrator is involved or believed to be involved in the conflict of interest or appearance of conflict of interest, the Covered Officer shall report the matter directly to the OFI's Chief Executive Officer. Upon receipt of a report of a conflict, the Code Administrator will take prompt steps to determine whether a conflict of interest exists. If the Code Administrator determines that an actual conflict of interest exists, the Code Administrator will take steps to resolve the conflict. If the Code Administrator determines that the appearance of a conflict exists, the Code Administrator will take appropriate steps to remedy such appearance. If the Code Administrator determines that no conflict or appearance of a conflict exists, the Code Administrator shall meet with the Covered Officer to advise him or her of such finding and of his or her reason for taking no action. In lieu of determining whether a conflict or appearance of conflict exists, the Code Administrator may in his or her discretion refer the matter to the Fund's Board of Trustees/Directors. 4. WAIVERS ------- Any Covered Officer requesting a waiver of any of the provisions of this Code must submit a written request for such waiver to the Code Administrator, setting forth the basis of such request and all necessary facts upon which such request can be evaluated. The Code Administrator shall review such request and make a written determination thereon, which shall be binding. The Code Administrator may in reviewing such request, consult at his discretion with legal counsel to OFI or to the Fund. In determining whether to waive any of the provisions of this Code, the Code Administrator shall consider whether the proposed waiver: (i) is prohibited by this Code; (ii) is consistent with honest and ethical conduct; and (iii) will result in a conflict of interest between the Covered Officer's personal and professional obligations to a Fund. In lieu of determining whether to grant a waiver, the Code Administrator in his or her discretion may refer the matter to the appropriate Fund's Board of Trustees/Directors. 5. REPORTING REQUIREMENTS ---------------------- (a) Each Covered Officer shall, upon becoming subject to this Code, be provided with a copy of this Code and shall affirm in writing that he or she has received, read, understands and shall adhere to this Code. (b) At least annually, all Covered Officers shall be provided with a copy of this Code and shall certify that they have read and understand this Code and recognize that they are subject thereto. (c) At least annually, all Covered Officers shall certify that they have complied with the requirements of this Code and that they have disclosed or reported any violations of this Code to the Code Administrator or the Chief Executive Officer of the Fund or its investment adviser. (d) The Code Administrator shall submit a quarterly report to the Board of Trustees/Directors of each Fund containing (i) a description of any report of a conflict of interest or apparent conflict and the disposition thereof; (ii) a description of any request for a waiver from this Code and the disposition thereof; (iii) any violation of the Code that has been reported or found and the sanction imposed; (iv) interpretations issued under the Code by the Code Administrator; and (v) any other significant information arising under the Code including any proposed amendments. (e) Each Covered Officer shall notify the Code Administrator promptly if he or she knows of or has a reasonable belief that any violation of this Code has occurred or is likely to occur. Failure to do so is itself a violation of this Code. (f) Any changes to or waivers of this Code, including "implicit" waivers as defined in applicable SEC rules, will, to the extent required, be disclosed by the Code Administrator or his or her designee as provided by applicable SEC rules. 2 6. ANNUAL RENEWAL -------------- At least annually, the Board of Trustees/Directors of each Fund shall review the Code and determine whether any amendments (including any amendments that may be recommended by OFI or the Fund's legal counsel) are necessary or desirable, and shall consider whether to renew and/or amend the Code. 7. SANCTIONS --------- Any violation of this Code of Ethics shall be subject to the imposition of such sanctions by OFI as may be deemed appropriate under the circumstances to achieve the purposes of this Code and may include, without limitation, a letter of censure, suspension from employment or termination of employment, in the sole discretion of OFI. 8. ADMINISTRATION AND CONSTRUCTION ------------------------------- (a) The administration of this Code of Ethics shall be the responsibility of OFI's General Counsel or his designee as the "Code Administrator" of this Code, acting under the terms of this Code and the oversight of the Trustees/Directors of the Funds. (b) The duties of such Code Administrator will include: (i) Continuous maintenance of a current list of the names of all Covered Officers; (ii) Furnishing all Covered Officers a copy of this Code and initially and periodically informing them of their duties and obligations thereunder; (iii) Maintaining or supervising the maintenance of all records required by this Code, including records of waivers granted hereunder; - ----------------------------------------- 2 An "implicit waiver" is the failure to take action within a reasonable period oftime regarding a material departure from a provision of this Code that has been made known to the General Counsel, the Code Administrator, and an executive officer of the Fund or OFI. (iv) Issuing interpretations of this Code which appear to the Code Administrator to be consistent with the objectives of this Code and any applicable laws or regulations; (v) Conducting such inspections or investigations as shall reasonably be required to detect and report any violations of this Code, with his or her recommendations, to the Chief Executive Officer of OFI and to the Trustees/Directors of the affected Fund(s) or any committee appointed by them to deal with such information; and (vi) Periodically conducting educational training programs as needed to explain and reinforce the terms of this Code. (c) In carrying out the duties and responsibilities described under this Code, the Code Administrator may consult with legal counsel, who may include legal counsel to the applicable Funds, and such other persons as the Administrator shall deem necessary or desirable. The Code Administrator shall be protected from any liability hereunder or under any applicable law, rule or regulation, for decisions made in good faith based upon his or her reasonable judgment. 9. REQUIRED RECORDS ---------------- The Administrator shall maintain and cause to be maintained in an easily accessible place, the following records for the period required by applicable SEC rules (currently six years following the end of the fiscal year of OFI in which the applicable event or report occurred): (a) A copy of any Code which has been in effect during the period; (b) A record of any violation of any such Code and of any action taken as a result of such violation, during the period; (c) A copy of each annual report pursuant to the Code made by a Covered Officer during the period; (d) A copy of each report made by the Code Administrator pursuant to this Code during the period; (e) A list of all Covered Officers who are or have been required to make reports pursuant to this Code during the period, plus those person(s) who are or were responsible for reviewing these reports; (f) A record of any request to waive any requirement of this Code, the decision thereon and the reasons supporting the decision; and (g) A record of any report of any conflict of interest or appearance of a conflict of interest received by the Code Administrator or discovered by the Code Administrator during the period, the decision thereon and the reasons supporting the decision. 10. AMENDMENTS AND MODIFICATIONS ---------------------------- Other than non-substantive or administrative changes, this Code may not be amended or modified unless approved or ratified by the Board of Trustees/Directors of each Fund. 11. CONFIDENTIALITY. ---------------- This Code is identified for the internal use of the Funds and OFI. Reports and records prepared or maintained under this Code are considered confidential and shall be maintained and protected accordingly to the extent permitted by applicable laws, rules and regulations. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Trustees/Directors of the affected Fund(s) and their counsel, the independent auditors of the affected Funds and/or OFI, and to OFI, except as such disclosure may be required pursuant to applicable judicial or regulatory process. Dated as of: June 25, 2003, as revised August 30, 2006. Exhibit A POSITIONS COVERED BY THIS CODE OF ETHICS FOR SENIOR OFFICERS EACH OPPENHEIMER OR CENTENNIAL FUND Principal Executive Officer Principal Financial Officer Treasurer Assistant Treasurer PERSONNEL OF OFI, WHO BY VIRTUE OF THEIR JOBS PERFORM CRITICAL FINANCIAL AND ACCOUNTING FUNCTIONS FOR OFI ON BEHALF OF A FUND, INCLUDING: Chief Financial Officer Treasurer Senior Vice President/Fund Accounting Vice President/Fund Accounting -----END PRIVACY-ENHANCED MESSAGE-----