Oppenheimer Series Fund

-----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, S/cxZniFSvDJNBxDw77hzHWget9BaxOg2Ys6TqQPmOwbIqpcQfG3OF42hvyn9xnK VoM+xAeA3+OnkxP/hWboqw== 0000356865-02-000036.txt : 20021024 0000356865-02-000036.hdr.sgml : 20021024 20021024165933 ACCESSION NUMBER: 0000356865-02-000036 CONFORMED SUBMISSION TYPE: 485APOS PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20021024 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER SERIES FUND INC CENTRAL INDEX KEY: 0000356865 IRS NUMBER: 061207374 STATE OF INCORPORATION: MD FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1933 Act SEC FILE NUMBER: 002-75276 FILM NUMBER: 02797626 BUSINESS ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: 14TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10018 BUSINESS PHONE: 2123230200 MAIL ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: 14TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10018 FORMER COMPANY: FORMER CONFORMED NAME: CONNECTICUT MUTUAL LIQUID ACCOUNT INC DATE OF NAME CHANGE: 19851106 FORMER COMPANY: FORMER CONFORMED NAME: CONNECTICUT MUTUAL INVESTMENT ACCOUNTS INC DATE OF NAME CHANGE: 19920703 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER SERIES FUND INC CENTRAL INDEX KEY: 0000356865 IRS NUMBER: 061207374 STATE OF INCORPORATION: MD FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-03346 FILM NUMBER: 02797627 BUSINESS ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: 14TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10018 BUSINESS PHONE: 2123230200 MAIL ADDRESS: STREET 1: 498 SEVENTH AVENUE STREET 2: 14TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10018 FORMER COMPANY: FORMER CONFORMED NAME: CONNECTICUT MUTUAL LIQUID ACCOUNT INC DATE OF NAME CHANGE: 19851106 FORMER COMPANY: FORMER CONFORMED NAME: CONNECTICUT MUTUAL INVESTMENT ACCOUNTS INC DATE OF NAME CHANGE: 19920703 485APOS 1 body.htm PROSPECTUSES AND SAIS WITHOUT FINANCIAL INFO Oppenheimer Series Fund

                                                                                           Registration No. 2-75276
                                                                                                  File No. 811-3346

                                        SECURITIES AND EXCHANGE COMMISSION
                                               WASHINGTON, DC 20549

                                                     FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933                [X]

         Pre-Effective Amendment No. __                                                                   [   ]


         Post-Effective Amendment No. 40                                                                  [X]
                                      --


                                                      and/or

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


         Amendment No. 41                                                                                 [X]
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                                           Oppenheimer Series Fund, Inc.
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                                (Exact Name of Registrant as Specified in Charter)

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                                 6803 South Tucson Way, Centennial, Colorado 80112

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                                (Address of Principal Executive Offices) (Zip Code)

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

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                                               Robert G. Zack, Esq.
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                                              OppenheimerFunds, Inc.
                                      498 Seventh Avenue, New York, NY 10018
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                                      (Name and Address of Agent for Service)

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


[   ]    Immediately upon filing pursuant to paragraph (b)
[   ]    On ______________ pursuant to paragraph (b)
[   ]    60 days after filing pursuant to paragraph (a)(1)
[X]      On December 23, 2002 pursuant to paragraph (a)(1)
[   ]    75 days after filing pursuant to paragraph (a)(2)
[   ]    On _______________ pursuant to paragraph (a)(2) of Rule 485


If appropriate, check the following box:

[   ]  This  post-effective  amendment  designates  a new  effective  date for a  previously  filed  post-effective
       amendment.

Oppenheimer
Disciplined Allocation Fund

Prospectus dated December 23, 2002

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

Oppenheimer Disciplined Allocation Fund is a mutual fund. It seeks to maximize total investment return by
allocating its assets primarily among investments in stocks, corporate bonds, U.S. government securities and
money market instruments.

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

(logo) OppenheimerFunds
The Right Way to Invest

Contents

About the Fund
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The Fund's Investment Objective and Strategies

Main Risks of Investing in the Fund

The Fund's Past Performance

Fees and Expenses of the Fund

About the Fund's Investments

How the Fund is Managed

About Your Account
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How to Buy Shares
Class A Shares
Class B Shares
Class C Shares
Class N Shares

Special Investor Services
AccountLink
PhoneLink
OppenheimerFunds Internet Website
Retirement Plans

How to Sell Shares
By Wire
By Mail
By Telephone

How to Exchange Shares

Shareholder Account Rules and Policies

Dividends, Capital Gains and Taxes

Financial Highlights

ABOUT the fund

The Fund's Investment Objective and Strategies

WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks to maximize total investment return (including capital
appreciation and income) principally by allocating its assets among stocks, corporate bonds, U.S. government
securities and money market instruments, according to changing market conditions.

WHAT DOES THE FUND MAINLY INVEST IN? The Fund invests mainly in stocks, bonds and money market instruments. The
Fund's investment Manager, OppenheimerFunds, Inc., can allocate the Fund's investments among these different
types of securities in different proportions at different times to seek the Fund's objective. That allocation is
based on the Manager's judgment of where the best opportunities are for total return after evaluating market and
economic conditions.

At least 25% of the Fund's total assets normally will be invested in fixed-income senior securities.
Otherwise, the Fund is not required to allocate its investments among stocks, bonds and money market instruments
in any fixed proportion but may have none or some of its assets invested in each asset class in relative
proportions that change over time.

Equity Securities. The Fund can buy a variety of domestic and foreign equity investments, including common and
preferred stocks, warrants and convertible securities (many of which are debt securities that the
Manager considers to be "equity substitutes" because of their conversion feature). The Fund currently
emphasizes its equity investments in stocks of domestic issuers. Although the Fund can buy securities of
companies in different capitalization ranges, it currently emphasizes its equity investments in stocks
of large-capitalization issuers.

Debt Securities. The Fund can invest in a variety of debt securities (including convertible securities), such as
securities issued or guaranteed by the U.S. government and its agencies and instrumentalities, including
mortgage-related securities and collateralized mortgage obligations ("CMOs"). It also can buy municipal
securities, foreign government securities, and domestic and foreign corporate debt obligations. The Fund
can buy debt securities rated below investment grade (these are commonly called "junk bonds"), but has
limits on those investments, as discussed below.

Money Market Instruments. Under normal market conditions (when the equity and debt securities markets are not
unstable, in the Manager's view), the Fund can hold up to 40% of its total assets in money market
instruments, such as short-term U.S. government securities and commercial paper.

HOW DO THE PORTFOLIO MANAGERS DECIDE WHAT SECURITIES TO BUY OR SELL? In selecting equity securities for purchase
or sale by the Fund, the Fund's portfolio managers use an investment process that combines both "value" and
"growth" investment styles. They use a value strategy to find issuers whose securities are believed to be
undervalued in the marketplace, in relation to factors such as the ratio of the stock's price to the issuer's
earnings. A lower price/earnings ratio would suggest an undervalued stock. A growth investing style encompasses a
search for companies whose stock price is expected to increase at a greater rate than the overall market. These
issuers may be entering a growth phase marked by increases in earnings, sales, cash flows or other factors, which
suggest that the stock may increase in value over time.

The portfolio managers construct the portfolio using a "bottom up" approach, focusing on the
fundamental prospects of individual companies and issuers, rather than on broad economic trends affecting entire
markets and industries. The portfolio managers focus on factors that may vary over time and in particular cases.
Currently they look for:
o Individual stocks that are attractive based on fundamental stock analysis and company characteristics;
o Growth stocks having high earnings potential and earnings and sales momentum;
o Dividend-paying common stocks of established companies for income; and
o Stocks with a longer time horizon of investment between three to five years.

The portfolio managers monitor individual issuers for changes in profit margins or slowing revenues that
might affect future cash flows or growth. The existence of these changes in a particular case may trigger a
decision to sell the security. This approach may change over time.

In selecting bonds, the portfolio managers normally expect that portion of the Fund's portfolio to have
an average maturity (measured on a dollar-weighted basis) of between 6 and 20 years. The Fund's portfolio
managers analyze the overall investment opportunities and risks in different sectors of the debt securities
markets by focusing on business cycle analysis and relative values between the corporate and government sectors.
The portfolio managers' overall strategy is to build a broadly diversified portfolio of corporate and government
bonds. The portfolio managers currently focus on the factors below (which may vary in particular cases and may
changes over time), looking for:
o Debt securities in market sectors that offer attractive relative value,
o Investment-grade securities that offer more income than U.S. Treasury obligations with a good balance of
risk and return,
o High income potential from different types of corporate and government securities, and
o Broad portfolio diversification to help reduce the volatility of the Fund's share prices.

WHO IS THE FUND DESIGNED FOR? The Fund is designed primarily for investors seeking total investment return over
the long term from a flexible portfolio investing in different asset classes, including stocks and bonds. Because
the Fund generally invests a substantial portion of its assets in stocks, those investors should be willing to
assume the risks of short-term share price fluctuations that are typical for a fund that can have substantial
stock investments. Because the Fund's income level will fluctuate and generally will not be significant, it is
not designed for investors needing an assured level of current income. Because of its focus on long-term total
return, the Fund may be appropriate for a portion of a retirement plan investment. However, the Fund is not a
complete investment program.

Main Risks of Investing in the Fund

All investments have risks to some degree. The Fund's investments are subject to changes in value from a number
of factors described below. There is also the risk that poor security selection by the Manager will cause the
Fund to under perform other funds having similar objectives. The share prices of the Fund will change daily based
on changes in market prices of securities and market conditions, and in response to other economic events.

Risks of Investing in Stocks. Stocks fluctuate in price, and their short-term volatility at times may be great.
Because the Fund currently has substantial investments in stocks, the value of the Fund's portfolio will be
affected by changes in the stock markets. Market risk will affect the Fund's per share prices, which will
fluctuate as the values of the Fund's portfolio securities change.

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

Additionally, stocks of issuers in a particular industry may be affected by changes in economic
conditions that affect that industry more than others, or by changes in government regulations, availability of
basic resources or supplies, or other events. To the extent that the Fund emphasizes investments in a particular
industry, its share values may fluctuate in response to events affecting that industry.

Other factors can affect a particular stock's price, such as poor earnings reports by the issuer, loss
of major customers, major litigation against the issuer, or changes in government regulations affecting the
issuer. The Fund can invest in securities of large companies but it can also buy stocks of small- and medium-size
companies, which may have more volatile stock prices than stocks of large companies.

Risks of Value Investing. Value investing seeks stocks having prices that are low in relation to their real worth
or prospects in the hope that the Fund will realize appreciation in the value of its holdings when other
investors realize the intrinsic value of those stocks. In using a value investing style, there is the
risk that the market will not recognize that the securities are undervalued and they might not
appreciate in value as the Manager anticipates.

CREDIT RISK. Debt securities are subject to credit risk. Credit risk relates to the ability of the issuer of a
security to make interest and principal payments on the security as they become due. If the issuer fails to pay
interest, the Fund's income might be reduced, and if the issuer fails to repay principal, the value of that
security and of the Fund's shares might be reduced. While the Fund's investments in U.S. government securities
are subject to little credit risk, the Fund's other investments in debt securities, particularly high-yield,
lower-grade debt securities, are subject to risks of default. A downgrade in an issuer's credit rating or other
adverse news about an issuer can reduce the value of that issuer's securities.

INTEREST RATE RISKS. Debt securities are subject to changes in value when prevailing interest rates change. When
interest rates fall, the values of outstanding debt securities generally rise. When interest rates rise, the
values of outstanding debt securities generally fall, and the securities may sell at a discount from their face
amount. The magnitude of these price changes is generally greater for debt securities with longer-term
maturities. However, interest rate changes may have different effects on the values of mortgage-related
securities because of prepayment risks, discussed below.

HOW RISKY IS THE FUND OVERALL? The risks described above collectively form the overall risk profile of the Fund,
and can affect the value of the Fund's investments, its investment performance and the prices of its shares.
Particular investments and investment strategies also have risks. These risks mean that you can lose money by
investing in the Fund. When you redeem your shares, they may be worth more or less than what you paid for them.
There is no assurance that the Fund will achieve its investment objective.

The stock markets can be volatile, and the prices of the Fund's shares will go up and down as a result.
The Fund's income-oriented investments may help cushion the Fund's total return from changes in stock prices, but
fixed-income securities have their own risks. The Fund seeks to reduce the effects of these risks by diversifying
its investments over different asset classes. In the OppenheimerFunds spectrum, the Fund is generally more
conservative than funds that invest only in stocks, but more aggressive than funds that invest solely in
investment-grade bonds.

The Fund's Past Performance

The bar chart and table below show one measure of the risks of investing in the Fund, by showing changes in the
Fund's performance (for its Class A shares) from year to year for the last 10 calendar years and by showing how
the average annual total returns of the Fund's shares, both before and after taxes, compare to those of a
broad-based market index. The after-tax returns are shown for Class A shares only and are calculated using the
historical highest individual federal marginal income tax rates in effect during the periods shown, and do not
reflect the impact of state or local taxes.

The after-tax returns for the other classes of shares will vary. In certain cases, the figure
representing "Return After Taxes on Distributions and Sale of Fund Shares" may be higher than the other return
figures for the same period. A higher after-tax return results when a capital loss occurs upon redemption and
translates into an assumed tax deduction that benefits the shareholder. The after-tax returns are calculated
based on certain assumptions mandated by regulation and your actual after-tax returns may differ from those
shown, depending on your individual tax situation. The after-tax returns set forth below are not relevant to
investors who hold their fund shares through tax-deferred arrangements such as 401(k) plans or IRAs or to
institutional investors not subject to tax. The Fund's past investment performance, before and after taxes, is
not necessarily an indication of how the Fund will perform in the future.

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

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

Sales charges and taxes are not included in the calculations of return in this bar chart, and if those charges
and taxes were included, the returns would be less than those shown.
For the period from 1/1/02 through 9/30/02, the cumulative return (not annualized) before taxes of Class A shares
was ____%.
During the period shown in the bar chart, the highest return (not annualized) before taxes for a calendar quarter
was _____% (_Qtr__) and the lowest return (not annualized) before taxes for a calendar quarter was ________%
(_Qtr__).

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10 Years

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Average Annual Total Returns for the (or life of class, if
periods ended December 31, 2001 1 Year 5 Years less)

Class A Shares (inception 9/16/85)
Return Before Taxes -11.37% 3.67% 7.33%
Return After Taxes on Distributions -12.11% 1.23% 4.45%
Return After Taxes on Distributions
and Sale of Fund Shares -6.93% 2.02% 4.73%

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S & P 500 Index (reflects no deduction -11.88% 10.70% 12.93%1
for fees, expenses or taxes)
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Merrill Lynch Gov't/Corp. Master Index
(reflects no deduction for fees,
expenses or taxes) 8.43% 7.41% 7.32%1

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Class B Shares (inception 10/02/95) -11.27% 3.83% 5.51%
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Class C Shares (inception 5/01/96) -7.51% 4.13% 4.91%
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Class N Shares (inception 3/1/01) N/A2 N/A N/A

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1 From 12/31/91.

2 Because this is a new class of shares, return data for the period specified is not available.

The Fund's average annual total returns include the applicable sales charge: for Class A, the current maximum
initial sales charge of 5.75%; for Class B, the contingent deferred sales charges of 5% (1-year) and 2% (5
years); and for Class C, the 1% contingent deferred sales charge for the 1-year period. Because Class B shares
convert to Class A shares 72 months after purchase, Class B "life-of-class" performance does not include any
contingent deferred sales charge and uses Class A performance for the period after conversion. The Fund's returns
measure the performance of a hypothetical account and assume that all dividends and capital gains distributions
have been reinvested in additional shares. The performance of the Fund's Class A shares is compared to the S & P
500 Index, an unmanaged index of common stocks, and the Merrill Lynch Government and Corporate Master Index, a
broad-based index of U.S. Treasury and government agency securities, corporate and Yankee bonds. The indices
performance includes reinvestment of income but does not reflect transaction costs. The Fund's investments vary
from the securities in the indices.

Fees and Expenses of the Fund

The following tables are provided to help you understand the fees and expenses you may pay if you buy and hold
shares of the Fund. The Fund pays a variety of expenses directly for management of its assets, administration,
distribution of its shares and other services. Those expenses are subtracted from the Fund's assets to calculate
the Fund's net asset values per share. All shareholders therefore pay those expenses indirectly. Shareholders
pay other transaction expenses directly, such as sales charges. The numbers below are based on the Fund's
expenses during its fiscal year ended October 31, 2001.

Shareholder Fees (charges paid directly from your investment):

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Class A Shares Class B Shares Class C Shares Class N Shares

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

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Class A Shares Class B Shares Class C Shares Class N Shares
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Management Fees 0.625% 0.625% 0.625% 0.625%
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Distribution and/or Service (12b-1) 0.25% 1.00% 1.00% 0.50%
Fees
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Other Expenses ____% ____% ____% ____%

Total Annual Operating Expenses ____% ____% ____% ____%

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Examples. The following examples are intended to help you compare the cost of investing in the Fund with the
cost of investing in other mutual funds. The examples assume that you invest $10,000 in a class of shares of the
Fund for the time periods indicated and reinvest your dividends and distributions.

The first example assumes that you redeem all of your shares at the end of those periods. The second
example assumes that you keep your shares. Both examples also assume that your investment has a 5% return each
year and that the class's operating expenses remain the same. Your actual costs may be higher or lower because
expenses will vary over time. Based on these assumptions your expenses would be as follows:

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If shares are redeemed: 1 Year 3 Years 5 Years 10 Years

Class A Shares

Class B Shares $_______1

Class C Shares

Class N Shares

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

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

Class A Shares

Class B Shares $_______1

Class C Shares

Class N Shares

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In the first example, expenses include the initial sales charge for Class A and the applicable Class B, Class C
and Class N contingent deferred sales charges. In the second example, the Class A expenses include the sales
charge, but Class B, Class C and Class N expenses do not include contingent deferred sales charges. There is no
sales charge on Class Y shares.
1. Class B expenses for years 7 through 10 are based on Class A expenses because Class B shares automatically
convert to Class A shares after 6 years.

About the Fund's Investments

THE FUND'S PRINCIPAL INVESTMENT POLICIES. The allocation of the Fund's portfolio among the different types of
investments will vary over time based upon the evaluation of economic and market trends by the Manager. The
Fund's portfolio might not always include all of the different types of investments described below. The Statement
of Additional Information contains more detailed information about the Fund's investment policies and risks.

The Manager tries to reduce risks by carefully researching securities before they are purchased, and in
some cases by using hedging techniques. The Fund attempts to reduce its exposure to market risks by diversifying
its investments, that is, by not holding a substantial amount of securities of any one issuer and by not
investing too great a percentage of the Fund's assets in any one company. Also, the Fund does not concentrate
25% or more of its total assets in any one industry.

However, changes in the overall market prices of securities and any income they may pay can occur at any
time. The price and yield of the Fund's shares will change daily based on changes in market prices of securities
and market conditions, and in response to other economic events.

Stock and Other Equity Investments. Equity securities include common stocks, preferred stocks and debt securities
convertible into common stock. The Fund's equity investments can include interests in real estate
investment trusts. Those securities may be sensitive to changes in interest rates, and because the real
estate market can be very volatile at times, the prices of those securities may change substantially.
Because total return has two components, capital appreciation and income, the Manager might select
stocks that offer the potential for either or both of those elements.

While many convertible securities are debt securities, the Manager considers some of them to be "equity
equivalents" because of the conversion feature. In that case their rating has less impact on the
investment decision than in the case of other debt securities. However, they are subject to credit
risks, discussed below in "Debt Securities," and interest rate risk. These securities might be selected
for the Fund because they offer the ability to participate in stock market movements while offering some
current income. Preferred stocks, while a form of equity security, typically have a fixed dividend that
may cause their prices to behave more like those of debt securities.

o Value Stocks. These are stocks that appear to be temporarily undervalued, by various measures such as
price/earnings ratios. Value investing seeks stocks with prices that are low relative to their real
worth or future prospects. The hope is that the Fund will realize appreciation in the value of its
holdings when other investors realize the intrinsic value of the stock. However, there is the risk
that the stock will not appreciate in value as anticipated.

o Growth Stocks. The types of growth companies the Manager focuses on are larger, more established growth
companies. Growth companies, for example, may be developing new products or services, such as companies
in the technology sector, or they may be expanding into new markets for their products, such as
companies in the energy sector. Newer growth companies tend to retain a large part of their earnings for
research, development or investment in capital assets. Therefore, they do not tend to emphasize paying
dividends and may not pay any dividends for some time. If they are selected for the Fund's portfolio, it
is because the Manager believes the price of the stock will increase over time.

The Fund is not required to allocate its equity investments among value and growth stocks in any fixed
proportion but may invest in relative proportions that change over time.

Debt Securities. The Fund can invest in a variety of debt securities to seek its objective. The debt securities
the Fund buys may be rated by nationally recognized rating organizations or they may be unrated
securities assigned an equivalent rating by the Manager. The Fund's debt investments may be "investment
grade" (that is, in the four highest rating categories of a nationally recognized rating organization)
or may be lower-grade securities (sometimes called "junk bonds") rated as low as "B" by Moody's Investor
Services, Inc. ("Moody's"), Standard & Poor's Rating Services ("S&P") or Fitch, Inc. ("Fitch") or having
comparable ratings by other nationally recognized rating organizations (or, if they are unrated, having
a comparable rating assigned by the Manager). The Fund does not invest more than 10% of its total assets
in unrated debt securities. A description of the ratings definitions of nationally recognized rating
organizations is included in Appendix A to the Statement of Additional Information.

While the Fund can invest as much as 20% of its total assets in lower-grade securities, currently it
does not intend to invest more than 10% of its total assets in these investments. Lower-grade debt
securities may be subject to greater market fluctuations and greater risks of loss of income and
principal than investment-grade debt securities. Securities that are (or that have fallen) below
investment grade are exposed to a greater risk that the issuers of those securities might not meet their
debt obligations. These risks can reduce the Fund's share prices and the income it earns.

U.S. Government Securities. The Fund can invest in securities issued or guaranteed by the U.S. Treasury or other
government agencies or federally-chartered corporate entities referred to as "instrumentalities." These
are referred to as "U.S. government securities" in this Prospectus.

o U.S. Treasury Obligations. These include Treasury bills (having maturities of one year or less when
issued), Treasury notes (having maturities of more than one year and up to ten years when issued), and
Treasury bonds (having maturities of more than ten years when issued). Treasury securities are backed by
the full faith and credit of the United States as to timely payments of interest and repayments of
principal. The Fund also can buy U. S. Treasury securities that have been "stripped" of their coupons by
a Federal Reserve Bank, zero-coupon U.S. Treasury securities, and Treasury Inflation-Protection
Securities.

o Obligations Issued or Guaranteed by U.S. Government Agencies or Instrumentalities. These include direct
obligations and mortgage-related securities that have different levels of credit support from the U.S.
government. Some are supported by the full faith and credit of the U.S. government, such as Government
National Mortgage Association pass-through mortgage certificates (called "Ginnie Maes"). Some are
supported by the right of the issuer to borrow from the U.S. Treasury under certain circumstances, such
as Federal National Mortgage Association bonds ("Fannie Maes"). Others are supported only by the credit
of the entity that issued them, such as Federal Home Loan Mortgage Corporation obligations ("Freddie
Macs").

o Mortgage-Related U.S. Government Securities. The Fund can buy interests in pools of residential or
commercial mortgages, in the form of CMO and other "pass-through" mortgage securities. CMOs that are
U.S. government securities have collateral to secure payment of interest and principal. They may be
issued in different series, each having different interest rates and maturities. The collateral is
either in the form of mortgage pass-through certificates issued or guaranteed by a U.S. agency or
instrumentality or mortgage loans insured by a U.S. government agency. The Fund can have substantial
amounts of its assets invested in mortgage-related U.S. government securities.

The prices and yields of CMOs are determined, in part, by assumptions about the cash flows from the rate
of payments of the underlying mortgages. Changes in interest rates may cause the rate of expected
prepayments of those mortgages to change. In general, prepayments increase when general interest rates
fall and decrease when general interest rates rise.

o Private-Issuer Mortgage-Backed Securities. The Fund can invest a substantial portion of its assets in
mortgage-backed securities issued by private issuers, which do not offer the credit backing of U.S.
government securities. Primarily these include multi-class debt or pass-through certificates secured by
mortgage loans. They may be issued by banks, savings and loans, mortgage bankers and other
non-governmental issuers. Private issuer mortgage-backed securities are subject to the credit risks of
the issuers (as well as the interest rate risks and prepayment risks of CMOs), although in some cases
they may be supported by insurance or guarantees.

o Forward Rolls. The Fund can enter into "forward roll" transactions with respect to mortgage-related
securities. In this type of transaction, the Fund sells a mortgage-related security to a buyer and
simultaneously agrees to repurchase a similar security at a later date at a set price.

During the period between the sale and the repurchase, the Fund will not be entitled to receive interest
and principal payments on the securities that have been sold. It is possible that the market value of
the securities the Fund sells may decline below the price at which the Fund is obligated to repurchase
securities, or that the counterparty might default in its obligation. A substantial portion of the
Fund's assets may be subject to forward roll transactions at any given time.

Prepayment Risk. Mortgage-related securities are subject to the risks of unanticipated prepayment. The
risk is that when interest rates fall, borrowers under the mortgages that underlie these securities will
prepay their mortgages more quickly than expected, causing the issuer of the security to prepay the
principal to the Fund prior to the security's expected maturity. The Fund may be required to reinvest
the proceeds at a lower interest rate, reducing its income. Mortgage-related securities subject to
prepayment risk generally offer less potential for gains when prevailing interest rates fall and have
greater potential for loss when prevailing interest rates rise. The impact of prepayments on the price
of a security may be difficult to predict and may increase the volatility of the price. If the Fund
buys mortgage-related securities at a premium, accelerated prepayments on those securities could cause
the Fund to lose a portion of its principal investment represented by the premium.

If interest rates rise rapidly, prepayments of mortgages may occur at a slower rate than expected, and
the expected maturity of long-term or medium-term mortgage-related securities could lengthen as a
result. That could cause their values to fluctuate more, and the prices of the Fund's shares, to fall.

Money Market Instruments and Short-Term Debt Securities. Under normal market conditions the Fund can invest in a
variety of short-term debt obligations having a maturity of one year or less. These include:

o Money market instruments. Generally, these are debt obligations having ratings in the top two rating
categories of nationally recognized rating organizations (or equivalent ratings assigned by the
Manager). Examples include commercial paper of domestic issuers or foreign companies (foreign issuers
must have assets of $1 billion or more).

o Short-term debt obligations of the U.S. government or corporations.
o Obligations of domestic or foreign banks or savings and loan associations, such as certificates of
deposit and bankers' acceptances.
Under normal market conditions this strategy would be used primarily for cash management or liquidity
purposes. The yields on shorter-term debt obligations tend to be less than on longer-term debt.
Therefore, to the extent that the Fund uses this strategy, it might help preserve principal but might
reduce opportunities to seek growth of capital as part of its objective of total return.

Can the Fund's Investment Objective and Policies Change? The Fund's Board of Directors can change
non-fundamental investment policies without shareholder approval, although significant changes will be described
in amendments to this Prospectus. Fundamental policies cannot be changed without the approval of a majority of
the Fund's outstanding voting shares. The Fund's investment objective is not a fundamental policy. Investment
restrictions that are fundamental policies are listed in the Statement of Additional Information. An investment
policy is not fundamental unless this Prospectus or the Statement of Additional Information says that it is.

OTHER INVESTMENT STRATEGIES. To seek its objective, the Fund can use the investment techniques and strategies
described below. The Fund might not always use all of them. These techniques have risks, although some are
designed to help reduce overall investment or market risks.

Zero-Coupon and "Stripped" Securities. Some of the government and corporate debt securities the Fund buys are
zero-coupon bonds that pay no interest. They are issued at a substantial discount from their face value.
"Stripped" securities are the separate income or principal components of a debt security. Some CMOs or
other mortgage-related securities may be stripped, with each component having a different proportion of
principal or interest payments. One class might receive all the interest and the other all the principal
payments.

Zero-coupon and stripped securities are subject to greater fluctuations in price from interest rate
changes than interest-bearing securities. The Fund may have to pay out the imputed income on zero-coupon
securities without receiving the actual cash currently. Interest-only securities are particularly
sensitive to changes in interest rates.

The values of interest-only mortgage-related securities are also very sensitive to prepayments of
underlying mortgages. Principal-only securities are also sensitive to changes in interest rates. When
prepayments tend to fall, the timing of the cash flows to these securities increases, making them more
sensitive to changes in interest rates. The market for some of these securities may be limited, making
it difficult for the Fund to dispose of its holdings at an acceptable price. The Fund can invest up to
50% of its total assets in zero-coupon securities issued by either the U.S. government or U.S. companies.

Foreign Securities. The Fund can invest up to 25% of its total assets in securities of companies or governments
in any country, developed or underdeveloped. However, the Fund currently does not expect to invest more
than 10% of its total assets in foreign securities.

Special Risks of Foreign Investing. While foreign securities offer special investment opportunities, there are
also special risks, such as the effects of a change in value of a foreign currency against the U.S.
dollar, which will result in a change in the U.S. dollar value of securities denominated in that foreign
o currency. Foreign issuers are not subject to the same accounting and disclosure requirements that
U.S. companies are subject to. The value of foreign investments may be affected by exchange control
regulations, expropriation or nationalization of a company's assets, foreign taxes, delays in settlement
of transactions, changes in governmental economic or monetary policy in the U.S. or abroad, or other
political and economic factors.

Derivative Investments. In general terms, a derivative investment is an investment contract whose value depends
on (or is derived from) the value of an underlying asset, interest rate or index. Options, futures,
mortgage-related securities, asset-backed securities and "stripped" securities are examples of
derivatives the Fund can use. Currently the Fund does not use derivative investments to a significant
degree.

o There are Special Risks in Using Derivative Investments. If the issuer of the derivative does not pay
the amount due, the Fund can lose money on the investment. Also, the underlying security or investment
on which the derivative is based, and the derivative itself, might not perform the way the Manager
expected it to perform. If that happens, the Fund's share prices could decline or the Fund could get
less income than expected. Interest rate and stock market changes in the U.S. and abroad may also
influence the performance of derivatives. Some derivative investments held by the Fund may be illiquid.
The Fund has limits on the amount of particular types of derivatives it can hold. However, using
derivatives can cause the Fund to lose money on its investment and/or increase the volatility of its
share prices.

o Hedging. The Fund can buy and sell futures contracts, put and call options, swaps, and forward
contracts. These are all referred to as "hedging instruments." The Fund does not use hedging
instruments for speculative purposes. o The Fund has limits on its use of hedging instruments and is
not required to use them in seeking its investment objective.

The Fund could buy and sell options, futures and forward contracts for a number of purposes. Some of
these strategies would hedge the Fund's portfolio against price fluctuations. Other hedging strategies,
such as buying futures and call options, would tend to increase the Fund's exposure to the securities
market. The Fund may also try to manage its exposure to changing interest rates.

There are also special risks in particular hedging strategies. Options trading involves the payment of
premiums and can increase portfolio turnover. For example, if a covered call written by the Fund is
exercised on an investment that has increased in value, the Fund will be required to sell the investment
at the call price and will not be able to realize any profit if the investment has increased in value
above the call price.

If the Manager used a hedging instrument at the wrong time or judged market conditions incorrectly, the
strategy could reduce the Fund's return. The Fund could also experience losses if the prices of its
futures and options positions were not correlated with its other investments or if it could not close
out a position because of an illiquid market.

Temporary Defensive and Interim Investments. When market or economic conditions are unstable or adverse, the Fund
can invest up to 100% of its assets in defensive securities. Generally, they would be short-term U.S.
government securities, high-grade commercial paper, bank obligations or repurchase agreements. The Fund
can also hold these types of securities pending the investment of proceeds from the sale of Fund shares
or portfolio securities or to meet anticipated redemptions of Fund shares. To the extent the Fund
invests in these securities, it might not achieve its investment objective.

Convertible Securities. Many convertible securities are a form of debt security, but the Manager regards some of
them as "equity substitutes" because of their feature allowing them to be converted into common stock.
Therefore, their ratings have less impact on the Manager's investment decision than in the case of other
debt securities. The Fund's investments in convertible securities may include securities rated as low as
"B" by Moody's, S&P or Fitch or having comparable ratings by other nationally recognized rating
organizations (or, if they are unrated, having comparable ratings assigned by the Manager and subject to
the Fund's limitation on investing in unrated securities as stated above). Those ratings are below
"investment grade" and the securities are subject to greater risk of default by the issuer than
investment-grade securities.

Asset-Backed Securities. The Fund can buy asset-backed securities, which are fractional interests in pools of
loans collateralized by the loans or other assets or receivables. They are issued by trusts and special
purpose corporations that pass the income from the underlying pool to the buyer of the interest. These
securities are subject to the risk of default by the issuer as well as by the borrowers of the
underlying loans in the pool.

Portfolio Turnover. The Fund may engage in short-term trading to try to achieve its objective. The Fund's
portfolio turnover rate will fluctuate from year to year, depending on market conditions. Portfolio
turnover increases the Fund's brokerage costs which reduces its performance. If the Fund realizes
capital gains when it sells its portfolio investments, it must generally pay those gains out to
shareholders, increasing their taxable distributions. The Financial Highlights table at the end of this
Prospectus shows the Fund's portfolio turnover rates during prior fiscal years.

How the Fund Is Managed

THE MANAGER. The Manager chooses the Fund's investments and handles its day-to-day business. The Manager carries
out its duties, subject to the policies established by the Fund's Board of Directors, under an investment
advisory agreement that states the Manager's responsibilities. The agreement sets the fees the Fund pays to the
Manager and describes the expenses that the Fund is responsible to pay to conduct its business.

The Manager and its subsidiaries and controlled affiliates managed more than $120 billion in assets as
of September 30, 2002, including other Oppenheimer funds with more than 7 million shareholder accounts. The
Manager is located at 498 Seventh Avenue, New York, New York 10018.

Portfolio Managers. The Fund is managed by a team of portfolio managers consisting of Bruce Bartlett, John
Kowalik, and Christopher Leavy. Messrs. Bartlett , Kowalik, and Leavy are Senior Vice Presidents of the
Manager, Vice Presidents of the Fund and all serve as officers and portfolio managers of other
Oppenheimer funds.

Prior to joining the Manager in April 1995, Mr. Bartlett was a Vice President and Senior Portfolio
Manager at First of America Investment Corp. (September 1986 - March 1995). Before joining the Manager
in July 1998, Mr. Kowalik was managing director and senior portfolio manager for Prudential Investments
Global Advisors (June 1989 - June 1998). Prior to joining the Manager in September 2000, Mr. Leavy was a
portfolio manager of Morgan Stanley Dean Witter Investment Management (from 1997), prior to which he was
a portfolio manager and equity analyst of Crestar Asset Management (from 1995).

Advisory Fees. Under the Investment Advisory Agreement, the Fund pays the Manager an advisory fee at an annual
rate that declines as the Fund's assets grow: 0.625% of the first $300 million of average annual net
assets of the Fund, 0.500% of the next $100 million, and 0.450% of average annual net assets in excess
of $400 million. The Fund's management fee for the last fiscal year ended October 31, 2002, was ____%
of average annual net assets for each class of shares.

ABOUT your account

How to Buy Shares

HOW DO YOU BUY SHARES? You can buy shares several ways, as described below. The Fund's Distributor,
OppenheimerFunds Distributor, Inc., may appoint servicing agents to accept purchase (and redemption) orders. The
Distributor, in its sole discretion, may reject any purchase order for the Fund's shares.

Buying Shares Through Your Dealer. You can buy shares through any dealer, broker or financial institution that
has a sales agreement with the Distributor. Your dealer will place your order with the Distributor on
your behalf.
Buying Shares Through the Distributor. Complete an OppenheimerFunds New Account Application and return it with a
check payable to "OppenheimerFunds Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217.
If you don't list a dealer on the application, the Distributor will act as your agent in buying the
shares. However, we recommend that you discuss your investment with a financial advisor before you make
a purchase to be sure that the Fund is appropriate for you.

o Paying by Federal Funds Wire. Shares purchased through the Distributor may be paid for by Federal Funds
wire. The minimum investment is $2,500. Before sending a wire, call the Distributor's Wire Department at
1.800.225.5677 to notify the Distributor of the wire and to receive further instructions.

o Buying Shares Through OppenheimerFunds AccountLink. With AccountLink, you pay for shares by electronic
funds transfers from your bank account. Shares are purchased for your account by a transfer of money
from your bank account through the Automated Clearing House (ACH) system. You can provide those
instructions automatically, under an Asset Builder Plan, described below, or by telephone instructions
using OppenheimerFunds PhoneLink, also described below. Please refer to "AccountLink," below for more
details.
o Buying Shares Through Asset Builder Plans. You may purchase shares of the Fund automatically each month
from your account at a bank or other financial institution under an Asset Builder Plan with AccountLink.
Details are in the Asset Builder Application and the Statement of Additional Information.

HOW MUCH MUST YOU INVEST? You can buy Fund shares with a minimum initial investment of $1,000 and make additional
investments at any time with as little as $50. There are reduced minimum investments under special investment
plans.
o With Asset Builder Plans, 403(b) plans, Automatic Exchange Plans and military allotment plans, you must
invest an initial amount of $500 and subsequent investments o may be made for as little as $50. For
accounts established under one of these plans prior to November 1, 2002, the minimum additional
investment will remain $25.
o Under retirement plans, such as IRAs, pension and profit-sharing plans and 401(k) plans, you can start
your account with as little as $500. If your IRA is started as an Asset Builder Plan, the minimum
initial investment and additional purchases is $50. For retirement accounts established prior to
November 1, 2002, the minimum additional investment will remain $25.

o The minimum investment requirement does not apply to reinvesting dividends from the Fund or other
Oppenheimer funds (a list of them appears in the Statement of Additional Information, or you can
ask your dealer or call the Transfer Agent), or reinvesting distributions from unit investment
trusts that have made arrangements with the Distributor.

AT WHAT PRICE ARE SHARES SOLD? Shares are sold at their offering price which is the net asset value per share
plus any initial sales charge that applies. The offering price that applies to a purchase order is based on the
next calculation of the net asset value per share that is made after the Distributor receives the purchase order
at its offices in Colorado, or after any agent appointed by the Distributor receives the order.

Net Asset Value. The Fund calculates the net asset value of each class of shares as of the close of The New York
Stock Exchange, on each day the Exchange is open for trading (referred to in this Prospectus as a
"regular business day"). The Exchange normally closes at 4:00 P.M., Eastern time, but may close earlier
on some days. All references to time in this Prospectus mean "Eastern time."

The net asset value per share is determined by dividing the value of the Fund's net assets attributable
to a class by the number of shares of that class that are outstanding. To determine net asset value, the
Fund's Board of Directors has established procedures to value the Fund's securities, in general, based
on market value. Because some foreign securities trade in markets and on exchanges that operate on
weekends and U.S. holidays, the values of some of the Fund's foreign investments may change on days when
investors cannot buy or redeem Fund shares. The Board has adopted special procedures for valuing
illiquid and restricted securities and obligations for which market values cannot be readily obtained.

If, after the close of the principal market on which a security held by the Fund is traded, and before
the time the Fund's securities are priced that day, an event occurs that the Manager deems likely to
cause a material change in the value of such security, the Fund's Board of Directors has authorized the
Manager, subject to the Board's review, to ascertain a fair value for such security. A security's
valuation may differ depending on the method used for determining value.

The Offering Price. To receive the offering price for a particular day, in most cases the Distributor or its
designated agent must receive your order by the time of day The New York Stock Exchange closes that day.
If your order is received on a day when the Exchange is closed or after it has closed, the order will
receive the next offering price that is determined after your order is received.

Buying Through a Dealer. If you buy shares through a dealer, your dealer must receive the order by the close of
The New York Stock Exchange and transmit it to the Distributor so that it is received before the
Distributor's close of business on a regular business day (normally 5:00 P.M.) to receive that day's
offering price, unless your dealer has made alternative arrangements with the Distributor. Otherwise,
the order will receive the next offering price that is determined.

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

Class A Shares. If you buy Class A shares, you pay an initial sales charge (on investments up to $1 million for
regular accounts or lesser amounts for certain retirement plans). The amount of that sales charge will
vary depending on the amount you invest. The sales charge rates are listed in "How Can You Buy Class A
Shares?" below.

WHICH CLASS OF SHARES SHOULD YOU CHOOSE? Once you decide that the Fund is an appropriate investment for you, the
decision as to which class of shares is best suited to your needs depends on a number of factors that you should
discuss with your financial advisor. Some factors to consider are how much you plan to invest and how long you
plan to hold your investment. If your goals and objectives change over time and you plan to purchase additional
shares, you should re-evaluate those factors to see if you should consider another class of shares. The Fund's
operating costs that apply to a class of shares and the effect of the different types of sales charges on your
investment will vary your investment results over time.

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

How Long Do You Expect to Hold Your Investment? While future financial needs cannot be predicted with certainty,
knowing how long you expect to hold your investment will assist you in selecting the appropriate class
of shares. Because of the effect of class-based expenses, your choice will also depend on how much you
plan to invest. For example, the reduced sales charges available for larger purchases of Class A shares
may, over time, offset the effect of paying an initial sales charge on your investment, compared to the
effect over time of higher class-based expenses on shares of Class B, Class C or Class N. For retirement
plans that qualify to purchase Class N shares, Class N shares will generally be more advantageous than
Class B and Class C shares.

o Investing for the Shorter Term. While the Fund is meant to be a long-term investment, if you have a
relatively short-term investment horizon (that is, you plan to hold your shares for not more than six
years), you should probably consider purchasing Class A or Class C shares rather than Class B shares.
That is because of the effect of the Class B contingent deferred sales charge if you redeem within six
years, as well as the effect of the Class B asset-based sales charge on the investment return for that
class in the short-term. Class C shares might be the appropriate choice (especially for investments of
less than $100,000), because there is no initial sales charge on Class C shares, and the contingent
deferred sales charge does not apply to amounts you sell after holding them one year.

However, if you plan to invest more than $100,000 for the shorter term, then as your investment horizon
increases toward six years, Class C shares might not be as advantageous as Class A shares. That is
because the annual asset-based sales charge on Class C shares will have a greater impact on your account
over the longer term than the reduced front-end sales charge available for larger purchases of Class A
shares.

And for non-retirement plan investors who invest $1 million or more, in most cases Class A shares will
be the most advantageous choice, no matter how long you intend to hold your shares. For that reason, the
Distributor normally will not accept purchase orders of $500,000 or more of Class B shares or $1 million
or more of Class C shares from a single investor.

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

Additionally, the dividends payable to Class B, Class C and Class N shareholders will be reduced by the
additional expenses borne by those classes that are not borne by Class A shares, such as the Class B,
Class C and Class N asset-based sales charge described below and in the Statement of Additional
Information. Share certificates are only available for Class A shares. If you are considering using your
shares as collateral for a loan, that may be a factor to consider.

How Do Share Classes Affect Payments to Your Broker? A financial advisor may receive different compensation for
selling one class of shares than for selling another class. It is important to remember that Class B,
Class C and Class N contingent deferred sales charges and asset-based sales charges have the same
purpose as the front-end sales charge on sales of Class A shares: to compensate the Distributor for
concessions and expenses it pays to dealers and financial institutions for selling shares. The
Distributor may pay additional compensation from its own resources to securities dealers or financial
institutions based upon the value of shares of the Fund owned by the dealer or financial institution for
its own account or for its customers.

SPECIAL SALES CHARGE ARRANGEMENTS AND WAIVERS. Appendix C to the Statement of Additional Information details the
conditions for the waiver of sales charges that apply in certain cases, and the special sales charge rates that
apply to purchases of shares of the Fund by certain groups, or under specified retirement plan arrangements or in
other special types of transactions. To receive a waiver or special sales charge rate, you must advise the
Distributor when purchasing shares or the Transfer Agent when redeeming shares that the special conditions apply.

HOW CAN YOU BUY CLASS A SHARES? Class A shares are sold at their offering price, which is normally net asset
value plus an initial sales charge. However, in some cases, described below, purchases are not subject to an
initial sales charge, and the offering price will be the net asset value. In other cases, reduced sales charges
may be available, as described below or in the Statement of Additional Information. Out of the amount you invest,
the Fund receives the net asset value to invest for your account.

The sales charge varies depending on the amount of your purchase. A portion of the sales charge may be
retained by the Distributor or allocated to your dealer as a concession. The Distributor reserves the right to
reallow the entire concession to dealers. The current sales charge rates and concessions paid to dealers and
brokers are as follows:

------------------------------------ ------------------------ ------------------------- -------------------------
Amount of Purchase Front-End Sales Front-End Sales Concession As
Charge As a Charge As a
Percentage of Percentage of Net Percentage of
Offering Price Amount Invested Offering Price
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
Less than $25,000 5.75% 6.10% 4.75%
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$25,000 or more but 5.50% 5.82% 4.75%
less than $50,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$50,000 or more but 4.75% 4.99% 4.00%
less than $100,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$100,000 or more but 3.75% 3.90% 3.00%
less than $250,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$250,000 or more but 2.50% 2.56% 2.00%
less than $500,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$500,000 or more but 2.00% 2.04% 1.60%
less than $1 million
------------------------------------ ------------------------ ------------------------- -------------------------

Can You Reduce Class A Sales Charges? You may be eligible to buy Class A shares at reduced sales charge rates
under the Fund's "Right of Accumulation" or a Letter of Intent, as described in "Reduced Sales Charges"
in the Statement of Additional Information.

Class A Contingent Deferred Sales Charge. There is no initial sales charge on purchases of Class A shares of any
one or more of the Oppenheimer funds aggregating $1 million or more, or for certain purchases by
particular types of retirement plans that were permitted to purchase such shares prior to March 1, 2001
("grandfathered retirement accounts"). Retirement plans are not permitted to make initial purchases of
Class A shares subject to a contingent deferred sales charge. The Distributor pays dealers of record
concessions in an amount equal to 1.0% of purchases of $1 million or more other than by grandfathered
retirement accounts. For grandfathered retirement accounts, the concession is 0.75% of the first $2.5
million of purchases plus 0.25% of purchases in excess of $2.5 million. In either case, the concession
will not be paid on purchases of shares by exchange or that were previously subject to a front-end sales
charge and dealer concession.

If you redeem any of those shares within an 18-month "holding period" measured from the beginning of the
calendar month of their purchase, a contingent deferred sales charge (called the "Class A contingent
deferred sales charge") may be deducted from the redemption proceeds. That sales charge will be equal to
1.0% of the lesser of:
o the aggregate net asset value of the redeemed shares at the time of redemption (excluding shares
purchased by reinvestment of dividends or capital gain distributions) or
o the original net asset value of the redeemed shares.

The Class A contingent deferred sales charge will not exceed the aggregate amount of the concessions the
Distributor paid to your dealer on all purchases of Class A shares of all Oppenheimer funds you made
that were subject to the Class A contingent deferred sales charge.

Purchases by Certain Retirement Plans. There is no initial sales charge on purchases of Class A shares of any one
or more Oppenheimer funds by retirement plans that have $10 million or more in plan assets and that have
entered into a special agreement with the Distributor and by retirement plans which are part of a
retirement plan product or platform offered by certain banks, broker-dealers, financial advisors,
insurance companies or recordkeepers which have entered into a special agreement with the Distributor.
The Distributor currently pays dealers of record concessions in an amount equal to 0.25% of the purchase
price of Class A shares by those retirement plans from its own resources at the time of sale, subject to
certain exceptions as described in the Statement of Additional Information. There is no contingent
deferred sales charge upon the redemption of such shares.

HOW CAN YOU BUY CLASS B SHARES? Class B shares are sold at net asset value per share without an initial sales
charge. However, if Class B shares are redeemed within six years from the beginning of the calendar month of
their purchase, a contingent deferred sales charge will be deducted from the redemption proceeds. The Class B
contingent deferred sales charge is paid to compensate the Distributor for its expenses of providing
distribution-related services to the Fund in connection with the sale of Class B shares.

The amount of the contingent deferred sales charge will depend on the number of years since you invested
and the dollar amount being redeemed, according to the following schedule for the Class B contingent deferred
sales charge holding period:

- ----------------------------------------------------------- ---------------------------------------------------------
Years Since Beginning of Month in Which Purchase Order Contingent Deferred Sales Charge on Redemptions in That
was Accepted Year
(As % of Amount Subject to Charge)
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
0 - 1 5.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
1 - 2 4.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
2 - 3 3.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
3 - 4 3.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
4 - 5 2.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------
5 - 6 1.0%
- ----------------------------------------------------------- ---------------------------------------------------------
- ----------------------------------------------------------- ---------------------------------------------------------

More than 6 None

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

Automatic Conversion of Class B Shares. Class B shares automatically convert to Class A shares 72 months after
you purchase them. This conversion feature relieves Class B shareholders of the asset-based sales
charge that applies to Class B shares under the Class B Distribution and Service Plan, described below.
The conversion is based on the relative net asset value of the two classes, and no sales load or other
charge is imposed. When any Class B shares that you hold convert, any other Class B shares that were
acquired by reinvesting dividends and distributions on the converted shares will also convert to Class A
shares. For further information on the conversion feature and its tax implications, see "Class B
Conversion" in the Statement of Additional Information.

How Can you Buy Class C Shares? Class C shares are sold at net asset value per share without an initial sales
charge. However, if Class C shares are redeemed within a holding period of 12 months from the beginning of the
calendar month of their purchase, a contingent deferred sales charge of 1.0% will be deducted from the redemption
proceeds. The Class C contingent deferred sales charge is paid to compensate the Distributor for its expenses of
providing distribution-related services to the Fund in connection with the sale of Class C shares.

HOW CAN YOU BUY CLASS N SHARES? Class N shares are offered for sale to retirement plans (including IRAs and
403(b) plans) that purchase $500,000 or more of Class N shares of one or more Oppenheimer funds or to group
retirement plans (which do not include IRAs and 403(b) plans) that have assets of $500,000 or more or 100 or more
eligible participants. See "Availability of Class N shares" in the Statement of Additional Information for other
circumstances where Class N shares are available for purchase.

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

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

DISTRIBUTION AND SERVICE (12b-1) PLANS.

Service Plan for Class A Shares. The Fund has adopted a Service Plan for Class A shares. It reimburses the
Distributor for a portion of its costs incurred for services provided to accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate of up to 0.25% of the average annual net
assets of Class A shares of the Fund. The Distributor currently uses all of those fees to pay dealers,
brokers, banks and other financial institutions quarterly for providing personal service and maintenance
of accounts of their customers that hold Class A shares. With respect to Class A shares subject to a
Class A contingent deferred sales charge purchased by grandfathered retirement accounts, the Distributor
pays the 0.25% service fee to dealers in advance for the first year after the shares are sold by the
dealer. After the shares have been held for a year, the Distributor pays the service fee to dealers on a
quarterly basis.

Distribution and Service Plans for Class B, Class C and Class N Shares. The Fund has adopted Distribution and
Service Plans for Class B, Class C and Class N shares to pay the Distributor for its services and costs
in distributing Class B, Class C and Class N shares and servicing accounts. Under the plans, the Fund
pays the Distributor an annual asset-based sales charge of 0.75% on Class B and Class C shares and 0.25%
on Class N shares. The Distributor also receives a service fee of 0.25% per year under the Class B,
Class C and Class N plans.

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

The Distributor uses the service fees to compensate dealers for providing personal services for accounts
that hold Class B, Class C or Class N shares. The Distributor pays the 0.25% service fees to dealers in
advance for the first year after the shares are sold by the dealer. After the shares have been held for
a year, the Distributor pays the service fees to dealers on a quarterly basis. The Distributor retains
the service fees for accounts for which it renders the required personal services.

The Distributor currently pays a sales concession of 3.75% of the purchase price of Class B shares to
dealers from its own resources at the time of sale. Including the advance of the service fee, the total
amount paid by the Distributor to the dealer at the time of sale of Class B shares is therefore 4.00% of
the purchase price. The Distributor retains the Class B asset-based sales charge. See the Statement of
Additional Information for exceptions.

The Distributor currently pays a sales concession of 0.75% of the purchase price of Class C shares to
dealers from its own resources at the time of sale. Including the advance of the service fee, the total
amount paid by the Distributor to the dealer at the time of sale of Class C shares is therefore 1.0% of
the purchase price. The Distributor pays the asset-based sales charge as an ongoing concession to the
dealer on Class C shares that have been outstanding for a year or more. See the Statement of Additional
Information for exceptions.

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

Special Investor Services

ACCOUNTLINK. You can use our AccountLink feature to link your Fund account with an account at a U.S. bank or
other financial institution. It must be an Automated Clearing House (ACH) member. AccountLink lets you:
o transmit funds electronically to purchase shares by telephone (through a service representative or by
PhoneLink) or automatically under Asset Builder Plans, or
o have the Transfer Agent send redemption proceeds or transmit dividends and distributions directly to
your bank account. Please call the Transfer Agent for more information.

You may purchase shares by telephone only after your account has been established. To purchase shares in
amounts up to $250,000 through a telephone representative, call the Distributor at 1.800.225.5677. The purchase
payment will be debited from your bank account.

AccountLink privileges should be requested on your Application or your dealer's settlement instructions
if you buy your shares through a dealer. After your account is established, you can request AccountLink
privileges by sending signature-guaranteed instructions and proper documentation to the Transfer Agent.
AccountLink privileges will apply to each shareholder listed in the registration on your account as well as to
your dealer representative of record unless and until the Transfer Agent receives written instructions
terminating or changing those privileges. After you establish AccountLink for your account, any change of bank
account information must be made by signature-guaranteed instructions to the Transfer Agent signed by all
shareholders who own the account.

PHONELINK. PhoneLink is the OppenheimerFunds automated telephone system that enables shareholders to perform a
number of account transactions automatically using a touch-tone phone. PhoneLink may be used on
already-established Fund accounts after you obtain a Personal Identification Number (PIN), by calling the
PhoneLink number, 1.800.225.5677.
Purchasing Shares. You may purchase shares in amounts up to $100,000 by phone, by calling 1.800.225.5677. You
must have established AccountLink privileges to link your bank account with the Fund to pay for these
purchases.

Exchanging Shares. With the OppenheimerFunds Exchange Privilege, described below, you can exchange shares
automatically by phone from your Fund account to another OppenheimerFunds account you have already
established by calling the special PhoneLink number.
Selling Shares. You can redeem shares by telephone automatically by calling the PhoneLink number and the Fund
will send the proceeds directly to your AccountLink bank account. Please refer to "How to Sell Shares,"
below for details.

CAN YOU SUBMIT TRANSACTION REQUESTS BY FAX? You may send requests for certain types of account transactions to
the Transfer Agent by fax (telecopier). Please call 1.800.225.5677 for information about which transactions may
be handled this way. Transaction requests submitted by fax are subject to the same rules and restrictions as
written and telephone requests described in this Prospectus.

OPPENHEIMERFUNDS INTERNET WEBSITE. You can obtain information about the Fund, as well as your account balance, on
the OppenheimerFunds Internet website, at WWW.OPPENHEIMERFUNDS.COM. Additionally, shareholders listed in the
------------------------
account registration (and the dealer of record) may request certain account transactions through a special
section of that website. To perform account transactions or obtain account information online, you must first
obtain a user I.D. and password on that website. If you do not want to have Internet account transaction
capability for your account, please call the Transfer Agent at 1.800.225.5677. At times, the website may be
inaccessible or its transaction features may be unavailable.

AUTOMATIC WITHDRAWAL AND EXCHANGE PLANS. The Fund has several plans that enable you to sell shares automatically
or exchange them to another OppenheimerFunds account on a regular basis. Please call the Transfer Agent or
consult the Statement of Additional Information for details.

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

Individual Retirement Accounts (IRAs). These include regular IRAs, Roth IRAs, SIMPLE IRAs and rollover IRAs.
SEP-IRAs. These are Simplified Employee Pension Plan IRAs for small business owners or self-employed individuals.
403(b)(7) Custodial Plans. These are tax-deferred plans for employees of eligible tax-exempt organizations, such
as schools, hospitals and charitable organizations.
401(k) Plans. These are special retirement plans for businesses.
Pension and Profit-Sharing Plans. These plans are designed for businesses and self-employed individuals.
Please call the Distributor for OppenheimerFunds retirement plan documents, which include applications
and important plan information.

How to Sell Shares

You can sell (redeem) some or all of your shares on any regular business day. Your shares will be sold at the
next net asset value calculated after your order is received in proper form (which means that it must comply with
the procedures described below) and is accepted by the Transfer Agent. The Fund lets you sell your shares by
writing a letter, by wire or by telephone. You can also set up Automatic Withdrawal Plans to redeem shares on a
regular basis. If you have questions about any of these procedures, and especially if you are redeeming shares in
a special situation, such as due to the death of the owner or from a retirement plan account, please call the
Transfer Agent first, at 1.800.225.5677, for assistance.

Certain Requests Require a Signature Guarantee. To protect you and the Fund from fraud, the following redemption
requests must be in writing and must include a signature guarantee (although there may be other
situations that also require a signature guarantee):
o You wish to redeem more than $100,000 and receive a check
o The redemption check is not payable to all shareholders listed on the account statement
o The redemption check is not sent to the address of record on your account statement
o Shares are being transferred to a Fund account with a different owner or name
o Shares are being redeemed by someone (such as an Executor) other than the owners.

Where Can You Have Your Signature Guaranteed? The Transfer Agent will accept a guarantee of your signature by a
number of financial institutions, including:
o a U.S. bank, trust company, credit union or savings association,
o a foreign bank that has a U.S. correspondent bank,
o a U.S. registered dealer or broker in securities, municipal securities or government securities, or
o a U.S. national securities exchange, a registered securities association or a clearing agency.
If you are signing on behalf of a corporation, partnership or other business or as a fiduciary, you must
also include your title in the signature.

Retirement Plan Accounts. There are special procedures to sell shares in an OppenheimerFunds retirement plan
account. Call the Transfer Agent for a distribution request form. Special income tax withholding
requirements apply to distributions from retirement plans. You must submit a withholding form with your
redemption request to avoid delay in getting your money and if you do not want tax withheld. If your
employer holds your retirement plan account for you in the name of the plan, you must ask the plan
trustee or administrator to request the sale of the Fund shares in your plan account.

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

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

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

HOW DO you SELL SHARES BY TELEPHONE? You and your dealer representative of record may also sell your shares by
telephone. To receive the redemption price calculated on a particular regular business day, your call must be
received by the Transfer Agent by the close of The New York Stock Exchange that day, which is normally 4:00 P.M.,
but may be earlier on some days. You may not redeem shares held in an OppenheimerFunds retirement plan account or
under a share certificate by telephone.

o To redeem shares through a service representative or automatically on PhoneLink, call 1.800.225.5677.
Whichever method you use, you may have a check sent to the address on the account statement, or, if you

have linked your Fund account to your bank account on AccountLink, you may have the proceeds sent to that bank
account.

Are There Limits on Amounts Redeemed by Telephone?
Telephone Redemptions Paid by Check. Up to $100,000 may be redeemed by telephone in any seven-day period. The
check must be payable to all owners of record of the shares and must be sent to the address on the
account statement. This service is not available within 30 days of changing the address on an account.

Telephone Redemptions Through AccountLink or by Wire. There are no dollar limits on telephone redemption proceeds
sent to a bank account designated when you establish AccountLink. Normally the ACH transfer to your bank
is initiated on the business day after the redemption. You do not receive dividends on the proceeds of
the shares you redeemed while they are waiting to be transferred.

If you have requested Federal Funds wire privileges for your account, the wire of the redemption
proceeds will normally be transmitted on the next bank business day after the shares are redeemed. There
is a possibility that the wire may be delayed up to seven days to enable the Fund to sell securities to
pay the redemption proceeds. No dividends are accrued or paid on the proceeds of shares that have been
redeemed and are awaiting transmittal by wire.

CAN YOU SELL SHARES THROUGH your DEALER? The Distributor has made arrangements to repurchase Fund shares from
dealers and brokers on behalf of their customers. Brokers or dealers may charge for that service. If your shares
are held in the name of your dealer, you must redeem them through your dealer.

HOW CONTINGENT DEFERRED SALES CHARGES AFFECT REDEMPTIONS. If you purchase shares subject to a Class A, Class B,
Class C or Class N contingent deferred sales charge and redeem any of those shares during the applicable holding
period for the class of shares, the contingent deferred sales charge will be deducted from the redemption
proceeds (unless you are eligible for a waiver of that sales charge based on the categories listed in Appendix C
to the Statement of Additional Information and you advise the Transfer Agent of your eligibility for the waiver
when you place your redemption request.)

A contingent deferred sales charge will be based on the lesser of the net asset value of the redeemed
shares at the time of redemption or the original net asset value. A contingent deferred sales charge is not
imposed on:
o the amount of your account value represented by an increase in net asset value over the initial purchase
price,
o shares purchased by the reinvestment of dividends or capital gains distributions, or

o shares redeemed in the special circumstances described in Appendix C to the Statement of Additional
Information.
To determine whether a contingent deferred sales charge applies to a redemption, the Fund redeems shares

in the following order:
1. shares acquired by reinvestment of dividends and capital gains distributions,
2. shares held for the holding period that applies to the class, and
3. shares held the longest during the holding period.

Contingent deferred sales charges are not charged when you exchange shares of the Fund for shares of
other Oppenheimer funds. However, if you exchange them within the applicable contingent deferred sales charge
holding period, the holding period will carry over to the fund whose shares you acquire. Similarly, if you
acquire shares of this Fund by exchanging shares of another Oppenheimer fund that are still subject to a
contingent deferred sales charge holding period, that holding period will carry over to this Fund.

How to Exchange Shares

Shares of the Fund may be exchanged for shares of certain Oppenheimer funds at net asset value per share at the
time of exchange, without sales charge. Shares of the Fund can be purchased by exchange of shares of other
Oppenheimer funds on the same basis. To exchange shares, you must meet several conditions:
o Shares of the fund selected for exchange must be available for sale in your state of residence.
o The prospectuses of both funds must offer the exchange privilege.
o You must hold the shares you buy when you establish your account for at least seven days before you can

exchange them. After the account is open seven days, you can exchange shares every regular business day.
o You must meet the minimum purchase requirements for the fund whose shares you purchase by exchange.
o Before exchanging into a fund, you must obtain and read its prospectus.

Shares of a particular class of the Fund may be exchanged only for shares of the same class in the other
Oppenheimer funds. For example, you can exchange Class A shares of this Fund only for Class A shares of another
fund. In some cases, sales charges may be imposed on exchange transactions. For tax purposes, exchanges of shares
involve a sale of the shares of the fund you own and a purchase of the shares of the other fund, which may result
in a capital gain or loss. Please refer to "How to Exchange Shares" in the Statement of Additional Information
for more details.

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

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

Written Exchange Requests. Submit an OppenheimerFunds Exchange Request form, signed by all owners of the account.
Send it to the Transfer Agent at the address on the back cover. Exchanges of shares held under
certificates cannot be processed unless the Transfer Agent receives the certificates with the request.

Telephone Exchange Requests. Telephone exchange requests may be made either by calling a service representative
or by using PhoneLink for automated exchanges by calling 1.800.225.5677. Telephone exchanges may be made
only between accounts that are registered with the same name(s) and address. Shares held under
certificates may not be exchanged by telephone.

ARE THERE LIMITATIONS ON EXCHANGES? There are certain exchange policies you should be aware of:
o Shares are normally redeemed from one fund and purchased from the other fund in the exchange transaction
on the same regular business day on which the Transfer Agent receives an exchange request that conforms
to the policies described above. It must be received by the close of The New York Stock Exchange that
day, which is normally 4:00 P.M. but may be earlier on some days. However, either fund may delay the
purchase of shares of the fund you are exchanging into up to seven days if it determines it would be
disadvantaged by the same day exchange.
o The interests of the Fund's long-term shareholders and its ability to manage its investments may be
adversely affected when its shares are repeatedly bought and sold in response to short-term market
fluctuations--also known as "market timing." When large dollar amounts are involved, the Fund may have
difficulty implementing long-term investment strategies, because it cannot predict how much cash it will
have to invest. Market timing also may force the Fund to sell portfolio securities at disadvantageous
times to raise the cash needed to buy a market timer's Fund shares. These factors may hurt the Fund's
performance and its shareholders. When the Manager believes frequent trading would have a disruptive
effect on the Fund's ability to manage its investments, the Manager and the Fund may reject purchase
orders and exchanges into the Fund by any person, group or account that the Manager believes to be a
market timer.
o The Fund may amend, suspend or terminate the exchange privilege at any time. The Fund will provide you
notice whenever it is required to do so by applicable law, but it may impose changes at any time for
emergency purposes.
o If the Transfer Agent cannot exchange all the shares you request because of a restriction cited above,
only the shares eligible for exchange will be exchanged.

Shareholder Account Rules and Policies

More information about the Fund's policies and procedures for buying, selling and exchanging shares is contained
in the Statement of Additional Information.
A $12 annual fee is charged on any account valued at less than $500. See the Statement of Additional Information
for circumstances when this fee will not be charged.

The offering of shares may be suspended during any period in which the determination of net asset value is
suspended, and the offering may be suspended by the Board of Directors at any time the Board believes it
is in the Fund's best interest to do so.
Telephone transaction privileges for purchases, redemptions or exchanges may be modified, suspended or terminated
by the Fund at any time. The Fund will provide you notice whenever it is required to do so by applicable
law. If an account has more than one owner, the Fund and the Transfer Agent may rely on the instructions
of any one owner. Telephone privileges apply to each owner of the account and the dealer representative
of record for the account unless the Transfer Agent receives cancellation instructions from an owner of
the account.
The Transfer Agent will record any telephone calls to verify data concerning transactions and has adopted other
procedures to confirm that telephone instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by confirming such transactions in
writing. The Transfer Agent and the Fund will not be liable for losses or expenses arising out of
telephone instructions reasonably believed to be genuine.
Redemption or transfer requests will not be honored until the Transfer Agent receives all required documents in
proper form. From time to time, the Transfer Agent in its discretion may waive certain of the
requirements for redemptions stated in this Prospectus.
Dealers that perform account transactions for their clients by participating in NETWORKING through the National
Securities Clearing Corporation are responsible for obtaining their clients' permission to perform those
transactions, and are responsible to their clients who are shareholders of the Fund if the dealer
performs any transaction erroneously or improperly.
The redemption price for shares will vary from day to day because the value of the securities in the Fund's
portfolio fluctuates. The redemption price, which is the net asset value per share, will normally differ
for each class of shares. The redemption value of your shares may be more or less than their original
cost.
Payment for redeemed shares ordinarily is made in cash. It is forwarded by check, or through AccountLink or by
Federal Funds wire (as elected by the shareholder) within seven days after the Transfer Agent receives
redemption instructions in proper form. However, under unusual circumstances determined by the
Securities and Exchange Commission, payment may be delayed or suspended. For accounts registered in the
name of a broker-dealer, payment will normally be forwarded within three business days after redemption.

The Transfer Agent may delay processing any type of redemption payment as described under "How to Sell Shares"
for recently purchased shares, but only until the purchase payment has cleared. That delay may be as
much as 10 days from the date the shares were purchased. That delay may be avoided if you purchase
shares by Federal Funds wire or certified check, or arrange with your bank to provide telephone or
written assurance to the Transfer Agent that your purchase payment has cleared.

Involuntary redemptions of small accounts may be made by the Fund if the account has fewer than 100 shares. In
some cases involuntary redemptions may be made to repay the Distributor for losses from the cancellation
of share purchase orders.
Shares may be "redeemed in kind" under unusual circumstances (such as a lack of liquidity in the Fund's portfolio
to meet redemptions). This means that the redemption proceeds will be paid with liquid securities from
the Fund's portfolio.
"Backup withholding" of federal income tax may be applied against taxable dividends, distributions and redemption
proceeds (including exchanges) if you fail to furnish the Fund your correct, certified Social Security
or Employer Identification Number when you sign your application, or if you under-report your income to
the Internal Revenue Service.
To avoid sending duplicate copies of materials to households, the Fund will mail only one copy of each
prospectus, annual and semi-annual report and annual notice of the Fund's privacy policy to shareholders
having the same last name and address on the Fund's records. The consolidation of these mailings, called
householding, benefits the Fund through reduced mailing expense.

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

Dividends, Capital Gains and Taxes

Dividends. The Fund intends to declare dividends separately for each class of shares from net investment income
on a quarterly basis in March, June, September and December on a date selected by the Board of Directors.
Dividends and distributions paid to Class A shares will generally be higher than dividends for Class B, Class C
and Class N shares, which normally have higher expenses than Class A. The Fund has no fixed dividend rate and
cannot guarantee that it will pay any dividends or distributions.

Capital Gains. The Fund may realize capital gains on the sale of portfolio securities. If it does, it may make
distributions out of any net short-term or long-term capital gains in December of each year. The Fund may make
supplemental distributions of dividends and capital gains following the end of its fiscal year. There can be no
assurance that the Fund will pay any capital gains distributions in a particular year.

WHAT CHOICES DO YOU HAVE FOR RECEIVING DISTRIBUTIONS? When you open your account, specify on your application how
you want to receive your dividends and distributions. You have four options:
Reinvest All Distributions in the Fund. You can elect to reinvest all dividends and capital gains distributions
in additional shares of the Fund.
Reinvest Dividends or Capital Gains. You can elect to reinvest some distributions (dividends, short-term capital
gains or long-term capital gains distributions) in the Fund while receiving the other types of
distributions by check or having them sent to your bank account through AccountLink.
Receive All Distributions in Cash. You can elect to receive a check for all dividends and capital gains
distributions or have them sent to your bank through AccountLink.
Reinvest Your Distributions in Another OppenheimerFunds Account. You can reinvest all distributions in the same
class of shares of another OppenheimerFunds account you have established.

TAXES. If your shares are not held in a tax-deferred retirement account, you should be aware of the following tax
implications of investing in the Fund. Distributions are subject to federal income tax and may be subject to
state or local taxes. Dividends paid from short-term capital gains and net investment income are taxable as
ordinary income. Long-term capital gains are taxable as long-term capital gains when distributed to shareholders.
It does not matter how long you have held your shares. Whether you reinvest your distributions in additional
shares or take them in cash, the tax treatment is the same.

Every year the Fund will send you and the IRS a statement showing the amount of any taxable distribution
you received in the previous year. Any long-term capital gains will be separately identified in the tax
information the Fund sends you after the end of the calendar year.

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

Remember, There May be Taxes on Transactions. Because the Fund's share prices fluctuate, you may have a capital
gain or loss when you sell or exchange your shares. A capital gain or loss is the difference between the
price you paid for the shares and the price you received when you sold them. Any capital gain is subject
to capital gains tax.
Returns of Capital Can Occur. In certain cases, distributions made by the Fund may be considered a non-taxable
return of capital to shareholders. If that occurs, it will be identified in notices to shareholders.

This information is only a summary of certain federal income tax information about your investment. You
should consult with your tax advisor about the effect of an investment in the Fund on your particular tax
situation.

Financial Highlights

The Financial Highlights Table is presented to help you understand the Fund's financial performance for the past
five fiscal years. Certain information reflects financial results for a single Fund share. The total returns in
the table represent the rate that an investor would have earned (or lost) on an investment in the Fund (assuming
reinvestment of all dividends and distributions). This information has been audited by KPMG LLP the Fund's
independent auditors, whose report, along with the Fund's financial statements, is included in the Statement of
Additional Information, which is available on request.

INFORMATION AND SERVICES

For More Information on Oppenheimer Disciplined Allocation Fund
The following additional information about the Fund is available without charge upon request:

STATEMENT OF ADDITIONAL INFORMATION. This document includes additional information about the Fund's investment
policies, risks, and operations. It is incorporated by reference into this Prospectus (which means it is legally
part of this Prospectus).

ANNUAL AND SEMI-ANNUAL REPORTS. Additional information about the Fund's investments and performance is available
in the Fund's Annual and Semi-Annual Reports to shareholders. The Annual Report includes a discussion of market
conditions and investment strategies that significantly affected the Fund's performance during its last fiscal
year.

How to Get More Information

You can request the Statement of Additional Information, the Annual and Semi-Annual Reports, the notice
explaining the Fund's privacy policy and other information about the Fund or your account:

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

By Telephone: Call OppenheimerFunds Services toll-free:
1.800.CALL.OPP (225.5677)

Information about the Fund including the Statement of Additional Information can be reviewed and copied at the
SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be
obtained by calling the SEC at 1.202.942.8090. Reports and other information about the Fund are available on the
EDGAR database on the SEC's Internet website at WWW.SEC.GOV. Copies may be obtained after payment of a
-----------
duplicating fee by electronic request at the SEC's e-mail address: publicinfo@sec.gov or by writing to the SEC's
Public Reference Section, Washington, D.C. 20549-0102.
No one has been authorized to provide any information about the Fund or to make any representations about the
Fund other than what is contained in this Prospectus. This Prospectus is not an offer to sell shares of the Fund,
nor a solicitation of an offer to buy shares of the Fund, to any person in any state or other jurisdiction where
it is unlawful to make such an offer.
The Fund's shares are distributed by:
The Fund's SEC File No. 811-3346

PR0205.001.1202 Printed on recycled paper. [logo] OppenheimerFunds Distributor, Inc.

Appendix to Prospectus of
Oppenheimer Disciplined Allocation Fund

Graphic material included in the Prospectus of Oppenheimer Disciplined Allocation Fund (the "Fund")
under the heading "Annual Total Returns (Class A)(as of 12/31 each year)":

A bar chart will be included in the Prospectus of the Fund depicting the annual total returns of a
hypothetical investment in Class A shares of the Fund for each of the ten most recent calendar years, without
reflecting sales charges or taxes. Set forth below are the relevant data points that will appear in the bar chart:

Calendar Annual
Year Total
Ended Returns

1992 9.90%
1993 15.89%
1994 -2.11%
1995 23.95%
1996 9.59%
1997 17.90%
1998 10.85%
1999 -1.78%
2000 5.27%
2001 -5.96%

Oppenheimer
Value Fund

Prospectus dated December 23, 2002

Oppenheimer Value Fund is a mutual fund. It seeks long-term growth of capital by investing mainly in common
stocks with low price-earnings ratios and better-than-anticipated earnings.

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

(logo) OppenheimerFunds
The Right Way to Invest

34
Contents

About the Fund
- -------------------------------------------------------------------------------------------------------------------

The Fund's Investment Objective and Strategies

Main Risks of Investing in the Fund

The Fund's Past Performance

Fees and Expenses of the Fund

About the Fund's Investments

How the Fund is Managed

About Your Account
- -------------------------------------------------------------------------------------------------------------------

How to Buy Shares
Class A Shares
Class B Shares
Class C Shares
Class N Shares
Class Y Shares

Special Investor Services
AccountLink
PhoneLink
OppenheimerFunds Internet Website
Retirement Plans

How to Sell Shares
By Wire
By Mail
By Telephone

How to Exchange Shares

Shareholder Account Rules and Policies

Dividends, Capital Gains and Taxes

Financial Highlights

ABOUT the fund

The Fund's Investment Objective and Strategies

WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks long-term growth of capital by investing primarily in
common stocks with low price-earnings ratios and better-than-anticipated earnings. Realization of current income
is a secondary consideration.

WHAT DOES THE FUND MAINLY INVEST IN? The Fund may invest mainly in common stocks of different capitalization
ranges, and currently emphasizes large capitalization stocks. The Fund also can buy other investments, including:
o Preferred stocks, rights and warrants and convertible securities, and
o Securities of U.S. and foreign companies, although there are limits on the Fund's investments in foreign
securities.

HOW DOES THE PORTFOLIO MANAGER DECIDE WHAT SECURITIES TO BUY OR SELL? In selecting securities for purchase or
sale by the Fund, the Fund's portfolio manager selects securities one at a time. This is called a "bottom up
approach." The portfolio manager uses fundamental analysis to select securities for the Fund that he believes are
temporarily out of favor with or whose value is not fully recognized by the market (commonly referred to as
"value stocks"). While this process and the inter-relationship of the factors used may change over time and its
implementation may vary in particular cases, the portfolio manager currently considers the following factors when
assessing a company's business prospects:
o Future supply/demand conditions for its key products,
o Product cycles,
o Quality of management,
o Competitive position in the market place,
o Reinvestment plans for cash generated, and
o Better-than-expected earnings reports.
Not all factors are relevant for every individual security.
The portfolio manager may consider selling a stock for one or more of the following reasons:
o The stock price reached its target,
o The company's fundamentals appear to be deteriorating, or
o Better stock selections are believed to have been identified.

WHO IS THE FUND DESIGNED FOR? The Fund is designed primarily for investors seeking capital growth in their
investment over the long term. Because the Fund currently focuses its investments in stocks, those investors
should be willing to assume the risks of short-term share price fluctuations that are typical for a fund that can
have substantial stock investments. Since the Fund's income level will fluctuate and will likely be small, it is
not designed for investors needing an assured level of current income. Because of its focus on long-term total
growth of capital, the Fund may be appropriate for a portion of a retirement plan investment. However, the Fund
is not a complete investment program.

Main Risks of Investing in the Fund

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

Risks of Investing in Stocks. Stocks fluctuate in price, and their short-term volatility at times may be great.
Because the Fund currently focuses its investments in stocks, the value of the Fund's portfolio will be affected
by changes in the stock markets. Market risk will affect the Fund's per share prices, which will fluctuate as the
values of the Fund's portfolio securities change.

Additionally, stocks of issuers in a particular industry may be affected by changes in economic
conditions that affect that industry more than others, or by changes in government regulations, availability of
basic resources or supplies, or other events. At times, the Fund may increase the relative emphasis of its
investments in a particular industry. To the extent that the Fund is emphasizing investments in a particular
industry, its share values may fluctuate in response to events affecting that industry.

Other factors can affect a particular stock's price, such as poor earnings reports by the issuer, loss
of major customers, major litigation against the issuer, or changes in government regulations affecting the
issuer. The Fund emphasizes securities of large companies but it can also buy stocks of small- and medium-size
companies, which may have more volatile stock prices than stocks of large companies.

HOW RISKY IS THE FUND OVERALL? The risks described above collectively form the overall risk profile of the Fund,
and can affect the value of the Fund's investments, its investment performance and the prices of its shares.
Particular investments and investment strategies also have risks. These risks mean that you can lose money by
investing in the Fund. When you redeem your shares, they may be worth more or less than what you paid for them.
The share prices of the Fund will change daily based on changes in market prices of securities and market
conditions, and in response to other economic events. There is no assurance that the Fund will achieve its
investment objectives.

The Fund focuses its investments on stocks for long-term growth. In the short term, the stock markets
can be volatile, and the prices of the Fund's shares will go up and down. The Fund generally does not use
income-oriented investments to help cushion the Fund's total return from changes in stock prices, except for
defensive purposes. In the OppenheimerFunds spectrum, the Fund is generally more conservative than aggressive
growth stock funds, but more aggressive than funds that invest in stocks and bonds.

The Fund's Past Performance

The after-tax returns are shown for Class A shares only andsharesThe after-tax returns are shown for
Class A only are calculated using the historical highest individual federal marginal income tax rates in effect
during the periods shown, and do not reflect the impact of state or local taxes. The after-tax returns for the
other classes of shares will vary. In certain cases, the figure representing "Return After Taxes on Distributions
and Sale of Fund Shares" may be higher than the other return figures for the same period. A higher after-tax
return results when a capital loss occurs upon redemption and translates into an assumed tax deduction that
benefits the shareholder. The after-tax returns are calculated based on certain assumptions mandated by
regulation and your actual after-tax returns may differ from those shown, depending on your individual tax
situation. The after-tax returns set forth below are not relevant to investors who hold their fund shares
through tax-deferred arrangements such as 401(k) plans or IRAs or to institutional investors not subject to tax.
The Fund's past investment performance, before and after taxes, is not necessarily an indication of how the Fund
will perform in the future.

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

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

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

10 Years

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

Average Annual Total Returns for the (or life of class, if
periods ended December 31, 2001 1 Year 5 Years) less)

Class N Shares (inception 3/01/01) N/A2 N/A N/A

2 Because this is a new class of shares, return data for the period specified is not available.

The Fund's average annual total returns include the applicable sales charge: for Class A, the current maximum
initial sales charge of 5.75%; for Class B, the contingent deferred sales charges of 5% (1-year) and 2% (5
years); and for Class C, the 1% contingent deferred sales charge for the 1-year period. Because Class B shares
convert to Class A shares 72 months after purchase, Class B "life-of-class" performance does not include any
contingent deferred sales charge and uses Class A performance for the period after conversion. There is no sales
charge for Class Y shares. The Fund's returns measure the performance of a hypothetical account and assume that
all dividends and capital gains distributions have been reinvested in additional shares. The performance of the
Fund's Class A shares is compared to the S & P 500 Index, an unmanaged index of common stocks. The index
performance reflects the reinvestment of income but does not reflect transaction costs. The Fund's investments
vary from the securities in the index.

Fees and Expenses of the Fund

Shareholder Fees (charges paid directly from your investment):

- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
Class A Shares Class B Shares Class C Shares Class N Shares Class Y Shares
- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
Maximum Sales Charge (Load) on 5.75% None None None None
purchases
(as % of offering price)
- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
Maximum Deferred Sales Charge (Load) None1 5%2 1%3 1%4 None
(as % of the lower of the original
offering price or redemption
proceeds)
- -------------------------------------- --------------- ---------------- --------------- ---------------- ---------------
1. A contingent deferred sales charge may apply to redemptions of investments of $1 million or more
($500,000 for certain retirement plan accounts) of Class A shares. See "How to Buy Shares" for details.
2. Applies to redemptions in first year after purchase. The contingent deferred sales charge declines to 1%
in the sixth year and is eliminated after that.
3. Applies to shares redeemed within 12 months of purchase.
4. Applies to shares redeemed within 18 months of a retirement plan's first purchase of Class N shares.
Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)

- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
Class A Shares Class B Shares Class C Shares Class N Shares Class Y Shares
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
Management Fees 0.625% 0.625% 0.625% 0.625% 0.625%
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
Distribution and/or Service (12b-1) 0.24% 1.00% 1.00% 0.50% None
Fees
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------
- -------------------------------------- ---------------- ----------------- ---------------- ----------------- -----------------

Other Expenses ____% ____% ____% ____% ____%

Total Annual Operating Expenses ____% ____% ____% ____% ____%

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

Expenses may vary in future years. "Other Expenses" include transfer agent fees, custodial expenses, and
accounting and legal expenses the Fund pays. The "Other Expenses" in the table are based on, among other things,
the fees the Fund would have paid if the transfer agent had not waived a portion of its fee under a voluntary
undertaking to the Fund to limit these fees to 0.25% of average daily net assets per fiscal year for Class Y
shares and 0.35% of average daily net assets per fiscal year for all other classes. That undertaking was
effective October 1, 2001 (January 1, 2001 for Class Y), was pro-rated for the remainder of the fiscal year
ending after that date, and may be amended or withdrawn at any time. After the waiver, the actual "Other
Expenses" and "Total Annual Operating Expenses" as percentages of average daily net assets were ____% and ____%
for Class Y shares. For the Fund's fiscal year ended October 31, 2002, the transfer agent fees did not exceed the
expense limitation described above for the other classes of shares. Effective November 1, 2002, the limit on
transfer agent fees for Class Y shares increased to 0.35% of average daily net assets per fiscal year. Had that
limit been in effect during the Fund's prior fiscal year, the transfer agent fees would not have exceeded the
expense limitation described above. (TBD)

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

If shares are redeemed: 1 Year 3 Years 5 Years 10 Years

Class A Shares

Class B Shares $_______1

Class C Shares

Class N Shares

Class Y Shares

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

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

Class A Shares

Class B Shares $_______1

Class C Shares

Class N Shares

Class Y Shares

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

About the Fund's Investments

Stock Investments. The Fund invests primarily in a diversified portfolio of common stocks of issuers that may be
of small, medium or large capitalization, to seek capital growth. The Fund can invest in other equity
securities, including preferred stocks, rights and warrants, and securities convertible into common
stock. The Fund can buy securities issued by domestic or foreign companies. However, the Fund currently
emphasizes investments in large capitalization stocks of U.S. issuers.

Although many convertible securities are debt securities, the Manager considers some of them to be
"equity equivalents" because of their conversion feature. In those cases, their rating has less impact on
the investment decision than in the case of other debt securities. The Fund can buy convertible
securities rated as low as "B" by Moody's Investor Services, Inc. or Standard & Poor's Rating Service or
having comparable ratings by other nationally recognized rating organizations (or, if they are unrated,
having a comparable rating assigned by the Manager). Those ratings are below "investment grade" and the
securities are subject to greater risk of default by the issuer than investment-grade securities. These
investments are subject to the Fund's policy of not investing more than 10% of its net assets in debt
securities.

OTHER INVESTMENT STRATEGIES. To seek its objectives, the Fund can use the investment techniques and strategies
described below. The Fund might not always use all of them. These techniques have risks, although some are
designed to help reduce overall investment or market risks.

Cash and Cash Equivalents. Under normal market conditions the Fund can invest up to 15% of its net assets in cash
and cash equivalents such as commercial paper, repurchase agreements, Treasury bills and other
short-term U.S. government securities. This strategy would be used primarily for cash management or
liquidity purposes. To the extent that the Fund uses this strategy, it might reduce its opportunities to
seek its objective of long-term growth of capital.

Debt Securities. Under normal market conditions, the Fund can invest in debt securities, such as securities
issued or guaranteed by the U.S. government or its agencies and instrumentalities, foreign government
securities, and foreign and domestic corporate bonds and debentures. Normally these investments are
limited to not more than 10% of the Fund's net assets, including convertible debt securities.

The debt securities the Fund buys may be rated by nationally recognized rating organizations or they may
be unrated securities assigned an equivalent rating by the Manager. The Fund's debt investments may be
"investment grade" (that is, rated in the four highest rating categories of a nationally recognized
rating organization) or may be lower-grade securities (sometimes called "junk bonds") rated as low as
"B," as described above.

o Credit Risk. Debt securities are subject to credit risk. Credit risk relates to the ability of the
issuer of a security to make interest and principal payments on the security as they become due. If the
issuer fails to pay interest, the Fund's income might be reduced, and if the issuer fails to repay
principal, the value of that security and of the Fund's shares might be reduced. A downgrade in an
issuer's credit rating or other adverse news about an issuer can reduce the value of that issuer's
securities. While the Fund's investments in U.S. government securities are subject to little credit
risk, the Fund's other investments in debt securities, particularly high-yield, lower-grade debt
securities are subject to risks of default. Lower-grade debt securities may be subject to greater market
fluctuations and greater risks of loss of income and principal than investment-grade debt securities.

o Interest Rate Risk. The values of debt securities, including U.S. government securities, are subject to
change when prevailing interest rates change. When interest rates fall, the values of already-issued
debt securities generally rise. When interest rates rise, the values of already-issued debt securities
generally fall, and they may sell at a discount from their face amount. The magnitude of these
fluctuations will often be greater for longer-term debt securities than shorter-term debt securities.
The Fund's share prices can go up or down when interest rates change because of the effect of the
changes on the value of the Fund's investments in debt securities.

Special Risks of Foreign Investing. While foreign securities offer special investment opportunities,
there are also special risks, such as the effects of a change in value of a foreign currency against the
U.S. dollar, which will result in a change in the U.S. dollar value of securities denominated in that
foreign o currency. Foreign issuers are not subject to the same accounting and disclosure
requirements that U.S. companies are subject to. The value of foreign investments may be affected by
exchange control regulations, expropriation or nationalization of a company's assets, foreign taxes,
delays in settlement of transactions, changes in governmental economic or monetary policy in the U.S. or
abroad, or other political and economic factors.

Derivative Investments. In general terms, a derivative investment is an investment contract whose value depends
on (or is derived from) the value of an underlying asset, interest rate or index. Options, futures,
mortgage-related securities and "stripped" securities are examples of derivatives the Fund can use.
Currently the Fund does not use derivative investments to a significant degree.

o There Are Special Risks In Using Derivative Investments. If the issuer of the derivative does not pay
the amount due, the Fund can lose money on the investment. Also, the underlying security or investment
on which the derivative is based, and the derivative itself, might not perform the way the Manager
expected it to perform. If that happens, the Fund's share prices could decline or the Fund could get
less income than expected. Interest rate and stock market changes in the U.S. and abroad may also
influence the performance of derivatives. Some derivative investments held by the Fund may be illiquid.
The Fund has limits on the amount of particular types of derivatives it can hold. However, using
derivatives can cause the Fund to lose money on its investment and/or increase the volatility of its
share prices.

How the Fund Is Managed

Portfolio Manager. The Fund is managed by Christopher Leavy. Mr. Leavy is a Senior Vice President of the
Manager, Vice President of the Fund and serves as an officer and portfolio manager of other
Oppenheimer funds.

Prior to joining the Manager in September 2000, he was a portfolio manager of Morgan Stanley Dean Witter
Investment Management (from 1997) prior to which he was a portfolio manager and equity analyst of
Crestar Asset Management (from 1995).

Advisory Fees. Under the Investment Advisory Agreement, the Fund pays the Manager an advisory fee at an annual
rate that declines on additional assets as the Fund grows: 0.625% of the first $300 million of average
annual net assets of the Fund, 0.500% of the next $100 million, and 0.450% of average annual net assets
in excess of $400 million. The Fund's management fee for the fiscal year ended October 31, 2002, was
___% of average annual net assets for each class of shares.

ABOUT your account

How to Buy Shares

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

- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Class B Shares. If you buy Class B shares, you pay no sales charge at the time of purchase, but you will pay an
annual asset-based sales charge. If you sell your shares within 6 years of buying them, you will
normally pay a contingent deferred sales charge. That contingent deferred sales charge varies depending
on how long you own your shares, as described in "How Can You Buy Class B Shares?" below.
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Class C Shares. If you buy Class C shares, you pay no sales charge at the time of purchase, but you will pay an
annual asset-based sales charge. If you sell your shares within 12 months of buying them, you will
normally pay a contingent deferred sales charge of 1.0%, as described in "How Can You Buy Class C
Shares?" below.
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Class N Shares. If you buy Class N shares (available only through certain retirement plans), you pay no sales
charge at the time of purchase, but you will pay an annual asset-based sales charge. If you sell your
shares within 18 months of the retirement plan's first purchase of Class N shares, you may pay a
contingent deferred sales charge of 1.0%, as described in "How Can You Buy Class N Shares?" below.
- -------------------------------------------------------------------------------------------------------------------
Class Y Shares. Class Y shares are offered only to certain institutional investors that have special agreements
with the Distributor.

o Investing for the Longer Term. If you are investing less than $100,000 for the longer-term, for example
for retirement, and do not expect to need access to your money for seven years or more, Class B shares
may be appropriate.
Are There Differences in Account Features That Matter to You? Some account features may not be available to Class
B, Class C and Class N shareholders. Other features may not be advisable (because of the effect of the
contingent deferred sales charge) for Class B, Class C and Class N shareholders. Therefore, you should
carefully review how you plan to use your investment account before deciding which class of shares to
buy.

Additionally, the dividends payable to Class B, Class C and Class N shareholders will be reduced by the
additional expenses borne by those classes that are not borne by Class A or Class Y shares, such as the
Class B, Class C and Class N asset-based sales charge described below and in the Statement of Additional
Information. Share certificates are only available for Class A shares. If you are considering using your
shares as collateral for a loan, that may be a factor to consider.

More than 6 None

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

Who Can Buy Class Y Shares? Class Y shares are sold at net asset value per share without a sales charge directly
to institutional investors that have special agreements with the Distributor for this purpose. They may include
insurance companies, registered investment companies and employee benefit plans. Individual investors cannot buy
Class Y shares directly.

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

DISTRIBUTION AND SERVICE (12b-1) PLANS.

Special Investor Services

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

RETIREMENT PLANS. You may buy shares of the Fund for your retirement plan account. If you participate in a plan
sponsored by your employer, the plan trustee or administrator must buy the shares for your plan account. The
Distributor also offers a number of different retirement plans that individuals and employers can use:
Individual Retirement Accounts (IRAs). These include regular IRAs, Roth IRAs, SIMPLE IRAs and rollover IRAs.
SEP-IRAs. These are Simplified Employee Pension Plan IRAs for small business owners or self-employed individuals.
403(b)(7) Custodial Plans. These are tax-deferred plans for employees of eligible tax-exempt organizations, such
as schools, hospitals and charitable organizations.
401(k) Plans. These are special retirement plans for businesses.
Pension and Profit-Sharing Plans. These plans are designed for businesses and self-employed individuals.
Please call the Distributor for OppenheimerFunds retirement plan documents, which include applications
and important plan information.

How to Sell Shares

have linked your Fund account to your bank account on AccountLink, you may have the proceeds sent to that bank
account.

How to Exchange Shares

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

Shareholder Account Rules and Policies

Dividends, Capital Gains and Taxes

Dividends. The Fund intends to declare dividends separately for each class of shares from net investment income
on an annual basis and to pay them to shareholders in December on a date selected by the Board of Directors.
Dividends and distributions paid to Class A and Class Y shares will generally be higher than dividends for Class
B, Class C and Class N shares, which normally have higher expenses than Class A and Class Y shares. The Fund has
no fixed dividend rate and cannot guarantee that it will pay any dividends or distributions.

Financial Highlights

INFORMATION AND SERVICES

For More Information on Oppenheimer Value Fund
The following additional information about the Fund is available without charge upon request:

How to Get More Information

You can request the Statement of Additional Information, the Annual and Semi-Annual Reports, the notice
explaining the Fund's privacy policy and other information about the Fund or your account:

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

By Telephone: Call OppenheimerFunds Services toll-free:
1.800.CALL.OPP (225.5677)

The Fund's shares are distributed by:
The Fund's SEC File No. 811-3346

PR0375.001.1202 Printed on recycled paper. [logo] OppenheimerFunds Distributor, Inc.

Appendix to Prospectus of
Oppenheimer Value Fund

Graphic material included in the Prospectus of Oppenheimer Value Fund (the "Fund") under the heading
"Annual Total Returns (Class A)(as of 12/31 each year)":

Calendar Annual
Year Total
Ended Returns

1992 11.99%
1993 20.91%
1994 -0.65%
1995 36.40%
1996 18.38%
1997 24.00%
1998 8.54%
1999 -4.71%
2000 -1.54%
2001 2.98%

Oppenheimer
Disciplined Allocation Fund
(A series of Oppenheimer Series Fund, Inc.)

6803 S. Tucson Way, Centennial, CO 80112

1.800.225.5567

Statement of Additional Information dated December 23, 2002

This Statement of Additional Information is not a prospectus. This document contains additional information about
the Fund and supplements information in the Prospectus dated December 23, 2002. It should be read together with the
Prospectus, which may be obtained by writing to the Fund's Transfer Agent, OppenheimerFunds Services, at P.O. Box
5270, Denver, Colorado 80217, by calling the Transfer Agent at the toll-free number shown above, or by downloading it
from the OppenheimerFunds Internet website at www.oppenheimerfunds.com.

Contents
Page

About the Fund

Additional Information About the Fund's Investment Policies and Risks..................................... 2
The Fund's Investment Policies....................................................................... 2
Other Investment Techniques and Strategies........................................................... 13
Other Investment Restrictions........................................................................ 31
How the Fund is Managed .................................................................................. 33
Organization and History............................................................................. 33
Board of Directors and Oversight Committees......................................................... 34
Directors and Officers............................................................................... 35
The Manager.......................................................................................... 43
Brokerage Policies of the Fund............................................................................ 45
Distribution and Service Plans............................................................................ 47
Performance of the Fund................................................................................... 52

About Your Account

How to Buy Shares......................................................................................... 56
How to Sell Shares........................................................................................ 66
How to Exchange Shares.................................................................................... 66
Dividends, Capital Gains and Taxes........................................................................ 74
Additional Information About the Fund..................................................................... 79

Financial Information About the Fund

Independent Auditors' Report.............................................................................. 80
Financial Statements...................................................................................... 81

Appendix A: Ratings Definitions........................................................................A-1
Appendix B: Industry Classifications...................................................................B-1
Appendix C: OppenheimerFunds Special Sales Charge Arrangements and Waivers.............................C-1

ABOUT The FUnd

Additional Information About the Fund's Investment Policies and Risks

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

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

In selecting equity investments for the Fund's portfolio, the portfolio managers currently use both
"value" and "growth" investing styles.

|X| Value Investing. In selecting equity investments for the Fund's portfolio, the portfolio managers
currently use a value investing style coupled with fundamental analysis of issuers. In using a value approach,
the managers look for stocks and other equity securities that appear to be temporarily undervalued, by various
measures, such as price/earnings ratios. Value investing seeks stocks having prices that are low in relation to
their real worth or future prospects, with the expectation that the Fund will realize appreciation in the value
of its holdings when other investors realize the intrinsic value of the stock.

Using value investing requires research as to the issuer's underlying financial condition and prospects.
Some of the measures used to identify these securities include, among others:
o Price/Earnings ratio, which is the stock's price divided by its earnings per share. A stock having a
price/earnings ratio lower than its historical range, or lower than the market as a whole or that of similar
companies may offer attractive investment opportunities.
o Price/book value ratio, which is the stock price divided by the book value of the company per share. It
measures the company's stock price in relation to its asset value.
o Dividend Yield, which is measured by dividing the annual dividend by the stock price per share.
o Valuation of Assets which compares the stock price to the value of the company's underlying assets,
including their projected value in the marketplace and liquidation value.

|X| Growth Investing. In using a growth approach, the Funds' portfolio managers look for high-growth
companies. Currently, the portfolio managers, look for:
o Companies that have exceptional revenue growth
o Companies with above-average earnings growth
o Companies that can sustain exceptional revenue and earnings growth
o Companies that are well established as leaders in high growth markets

|X| Portfolio Turnover. "Portfolio turnover" describes the rate at which the Fund traded its portfolio
securities during its last fiscal year. For example, if a fund sold all of its securities during the year, its
portfolio turnover rate would have been 100%. The Fund's portfolio turnover rate will fluctuate from year to
year. Increased portfolio turnover creates higher brokerage and transaction costs for the Fund, which may reduce
its overall performance. Additionally, the realization of capital gains from selling portfolio securities may
result in distributions of taxable long-term capital gains to shareholders, since the Fund will normally
distribute all of its capital gains realized each year, to avoid excise taxes under the Internal Revenue Code.

|X| Investments in Stocks and Other Equity Securities. The Fund does not limit its investments in
equity securities to issuers having a market capitalization of a specified size or range, and therefore may
invest in securities of small-, mid- and large-capitalization issuers. At times, the Fund may have substantial
amounts of its assets invested in securities of issuers in one or more capitalization ranges, based upon the
Manager's use of its investment strategies and its judgment of where the best market opportunities are to seek
the Fund's objective.

At times, the market may favor or disfavor securities of issuers of a particular capitalization range.
Securities of small capitalization issuers may be subject to greater price volatility in general than securities
of larger companies. Therefore, if the Fund has substantial investments in smaller capitalization companies at
times of market volatility, the Fund's share price may fluctuate more than that of funds focusing on larger
capitalization issuers.

At times, the Fund may increase the emphasis of its investments in a particular industry. Therefore, it
may be subject to the risks that economic, political or other events can have a negative effect on the values of
issuers in that particular industry (this is referred to as "industry risk"). Stocks of issuers in a particular
industry may be affected by changes in economic conditions that affect that industry more than others, or changes
in government regulations, availability of basic resources or supplies, or other events. To the extent that the
Fund is emphasizing investments in a particular industry, its share values may fluctuate in response to events
affecting that industry.

o Rights and Warrants. The Fund can invest up to 5% of its total assets in warrants or rights. That limit
does not apply to warrants and rights that the Fund has acquired as part of units of securities or that are
attached to other securities. Warrants basically are options to purchase equity securities at specific prices
valid for a specific period of time. Their prices do not necessarily move parallel to the prices of the
underlying securities. Rights are similar to warrants, but normally have a short duration and are distributed
directly by the issuer to its shareholders. Rights and warrants have no voting rights, receive no dividends and
have no rights with respect to the assets of the issuer.

o Convertible Securities. While some convertible securities are a form of debt security, in many cases
their conversion feature (allowing conversion into equity securities) causes them to be regarded by the Manager
more as "equity equivalents." As a result, the rating assigned to the security has less impact on the Manager's
investment decision with respect to convertible securities than in the case of non-convertible debt fixed-income
securities. Convertible securities are subject to the credit risks and interest rate risks described above.

The value of a convertible security is a function of its "investment value" and its "conversion value."
If the investment value exceeds the conversion value, the security will behave more like a debt security and the
security's price will likely increase when interest rates fall and decrease when interest rates rise. If the
conversion value exceeds the investment value, the security will behave more like an equity security. In that
case, it will likely sell at a premium over its conversion value and its price will tend to fluctuate directly
with the price of the underlying security.

To determine whether convertible securities should be regarded as "equity equivalents," the Manager
examines the following factors:
(1) whether, at the option of the investor, the convertible security can be exchanged for a fixed number of
shares of common stock of the issuer,
(2) whether the issuer of the convertible securities has restated its earnings per share of common stock on
a fully diluted basis (considering the effect of conversion of the convertible securities), and
(3) the extent to which the convertible security may be a defensive "equity substitute," providing the
ability to participate in any appreciation in the price of the issuer's common stock.

o Preferred Stocks. Preferred stocks are equity securities but have certain attributes of debt securities.
Preferred stock, unlike common stock, has a stated dividend rate payable from the corporation's earnings.
Preferred stock dividends may be cumulative or non-cumulative, participating, or auction rate. "Cumulative"
dividend provisions require all or a portion of prior unpaid dividends to be paid before the issuer can pay
dividends on common shares.

If interest rates rise, the fixed dividend on preferred stocks may be less attractive, causing the price
of preferred stocks to decline. Preferred stock may have mandatory sinking fund provisions, as well as provisions
for their call or redemption prior to maturity which can have a negative effect on their prices when interest
prior to maturity rates decline. Preferred stock may be "participating" stock, which means that it may be
entitled to a dividend exceeding the stated dividend in certain cases.

Preferred stocks are equity securities because they do not constitute a liability of the issuer and
therefore do not offer the same degree of protection of capital as debt securities and may not offer the same
degree of assurance of continued income as debt securities. The rights of preferred stock on distribution of a
corporation's assets in the event of its liquidation are generally subordinate to the rights associated with a
corporation's debt securities. Preferred stock generally has a preference over common stock on the distribution
of a corporation's assets in the event of its liquidation.

|X| Investments in Bonds and Other Debt Securities. The Fund can invest in a variety of bonds,
debentures and other debt securities to seek its objective. It will invest at least 25% of its assets in
fixed-income senior securities and could have a larger portion of its assets in debt investments.

The Fund's debt investments can include investment-grade and non-investment-grade bonds (commonly
referred to as "junk bonds"). Investment-grade bonds are bonds rated at least "Baa" by Moody's Investors Service,
Inc., ("Moody's") or at least "BBB" by Standard & Poor's Rating Services ("S&P") or Fitch, Inc., ("Fitch") or
that have comparable ratings by another nationally-recognized rating organization. In making investments in debt
securities, the Manager may rely to some extent on the ratings of ratings organizations or it may use its own
research to evaluate a security's credit-worthiness. If the securities that the Fund buys are unrated, to be
considered part of the Fund's holdings of investment-grade securities, they must be judged by the Manager to be
of comparable quality to bonds rated as investment grade by a rating organization.
|X| Special Risks of Lower-Grade Securities. It is not anticipated that the Fund will normally invest a
substantial portion of its assets in lower-grade debt securities. Because lower-grade securities tend to offer
higher yields than investment-grade securities, the Fund may invest in lower grade securities if the Manager is
trying to achieve greater income (and, in some cases, the appreciation possibilities of lower-grade securities
might be a reason they are selected for the Fund's portfolio). High-yield convertible debt securities might be
selected as "equity substitutes," as described above.

"Lower-grade" debt securities are those rated below "investment grade," which means they have a rating
lower than "Baa" by Moody's or lower than "BBB" by S&P or Fitch, or similar ratings by other nationally
recognized rating organizations. If they are unrated, and are determined by the Manager to be of comparable
quality to debt securities rated below investment grade, they are included in the limitation on the percentage of
the Fund's assets that can be invested in lower-grade securities, as stated in the Prospectus. The Fund can
invest in securities rated as low as "B" at the time the Fund buys them.

Some of the special credit risks of lower-grade securities are discussed in the Prospectus. There is a
greater risk that the issuer may default on its obligation to pay interest or to repay principal than in the case
of investment grade securities. The issuer's low creditworthiness may increase the potential for its insolvency.
An overall decline in values in the high yield bond market is also more likely during a period of a general
economic downturn. An economic downturn or an increase in interest rates could severely disrupt the market for
high yield bonds, adversely affecting the values of outstanding bonds as well as the ability of issuers to pay
interest or repay principal. In the case of foreign high yield bonds, these risks are in addition to the special
risks of foreign investing discussed in the Prospectus and in this Statement of Additional Information.

However, the Fund's limitations on buying these investments may reduce the risks to the Fund, as will
the Fund's policy of diversifying its investments. Additionally, to the extent they can be converted into stock,
convertible securities may be less subject to some of these risks than non-convertible high yield bonds, since
stock may be more liquid and less affected by some of these risk factors.

While securities rated "Baa" by Moody's or "BBB" by S&P or Fitch are investment grade and are not
regarded as junk bonds, those securities may be subject to greater risks than other investment-grade securities,
and have some speculative characteristics. Definitions of the debt security ratings categories of Moody's, S&P
and Fitch are included in Appendix A to this Statement of Additional Information.

Fluctuations in the market value of fixed-income securities after the Fund buys them will not affect the
interest income payable on those securities (unless the security pays interest at a variable rate pegged to
interest rate changes). However, those price fluctuations will be reflected in the valuations of the securities,
and therefore the Fund's net asset values will be affected by those fluctuations.

|X| Mortgage-Related Securities. Mortgage-related securities are a form of derivative investment
collateralized by pools of commercial or residential mortgages. Pools of mortgage loans are assembled as
securities for sale to investors by government agencies or instrumentalities or by private issuers. These
securities include collateralized mortgage obligations ("CMOs"), mortgage pass-through securities, stripped
mortgage pass-through securities, interests in real estate mortgage investment conduits ("REMICs") and other real
estate-related securities.

Mortgage-related securities that are issued or guaranteed by agencies or instrumentalities of the U.S.
government have relatively little credit risk (depending on the nature of the issuer) but are subject to interest
rate risks and prepayment risks, as described in the Prospectus. Mortgage-related securities issued by private
issuers have greater credit risk.

As with other debt securities, the prices of mortgage-related securities tend to move inversely to
changes in interest rates. The Fund can buy mortgage-related securities that have interest rates that move
inversely to changes in general interest rates, based on a multiple of a specific index. Although the value of a
mortgage-related security may decline when interest rates rise, the converse is not always the case.

In periods of declining interest rates, mortgages are more likely to be prepaid. Therefore, a
mortgage-related security's maturity can be shortened by unscheduled prepayments on the underlying mortgages, and
it is not possible to predict accurately the security's yield. The principal that is returned earlier than
expected may have to be reinvested in other investments having a lower yield than the prepaid security. As a
result, these securities may be less effective as a means of "locking in" attractive long-term interest rates,
and they may have less potential for appreciation during periods of declining interest rates, than conventional
bonds with comparable stated maturities.

Prepayment risks can lead to substantial fluctuations in the value of a mortgage-related security. In
turn, this can affect the value of the Fund's shares. If a mortgage-related security has been purchased at a
premium, all or part of the premium the Fund paid may be lost if there is a decline in the market value of the
security, whether that results from interest rate changes or prepayments on the underlying mortgages. In the case
of stripped mortgage-related securities, if they experience greater rates of prepayment than were anticipated,
the Fund may fail to recoup its initial investment on the security.

During periods of rapidly rising interest rates, prepayments of mortgage-related securities may occur at
slower than expected rates. Slower prepayments effectively may lengthen a mortgage-related security's expected
maturity. Generally, that would cause the value of the security to fluctuate more widely in response to changes
in interest rates. If the prepayments on the Fund's mortgage-related securities were to decrease broadly, the
Fund's effective duration, and therefore its sensitivity to interest rate changes, would increase.

As with other debt securities, the values of mortgage-related securities may be affected by changes in
the market's perception of the creditworthiness of the entity issuing the securities or guaranteeing them. Their
values may also be affected by changes in government regulations and tax policies.

o Collateralized Mortgage Obligations. CMOs are multi-class bonds that are backed by pools of mortgage
loans or mortgage pass-through certificates. They may be collateralized by:
(1) pass-through certificates issued or guaranteed by Ginnie Mae, Fannie Mae, or Freddie Mac,
(2) unsecuritized mortgage loans insured by the Federal Housing Administration or guaranteed by the
Department of Veterans' Affairs,
(3) unsecuritized conventional mortgages,
(4) other mortgage-related securities, or
(5) any combination of these.

Each class of CMO, referred to as a "tranche," is issued at a specific coupon rate and has a stated
maturity or final distribution date. Principal prepayments on the underlying mortgages may cause the CMO to be
retired much earlier than the stated maturity or final distribution date. The principal and interest on the
underlying mortgages may be allocated among the several classes of a series of a CMO in different ways. One or
more tranches may have coupon rates that reset periodically at a specified increase over an index. These are
floating rate CMOs, and typically have a cap on the coupon rate. Inverse floating rate CMOs have a coupon rate
that moves in the opposite direction of an applicable index. The coupon rate on these CMOs will increase as
general interest rates decrease. These are usually much more volatile than fixed rate CMOs or floating rate CMOs.

o Forward Rolls. The Fund can enter into "forward roll" transactions with respect to mortgage-related
securities in amounts up to 50% of its net assets. In this type of transaction, the Fund sells a mortgage-related
security to a buyer and simultaneously agrees to repurchase a similar security (the same type of security, and
having the same coupon and maturity) at a later date at a set price. The securities that are repurchased will
have the same interest rate as the securities that are sold, but typically will be collateralized by different
pools of mortgages (with different prepayment histories) than the securities that have been sold. Proceeds from
the sale are invested in short-term instruments, such as repurchase agreements. The income from those
investments, plus the fees from the forward roll transaction, are expected to generate income to the Fund in
excess of the yield on the securities that have been sold.

The Fund will only enter into "covered" rolls. To assure its future payment of the purchase price, the
Fund will identify on its books liquid assets in an amount equal to the payment obligation under the roll.

These transactions have risks. During the period between the sale and the repurchase, the Fund will not
be entitled to receive interest and principal payments on the securities that have been sold. It is possible that
the market value of the securities the Fund sells may decline below the price at which the Fund is obligated to
repurchase securities.

|X| U.S. Government Securities. These are securities issued or guaranteed by the U.S. Treasury or other
government agencies or federally-chartered corporate entities referred to as "instrumentalities." The obligations
of U.S. government agencies or instrumentalities in which the Fund may invest may or may not be guaranteed or
supported by the "full faith and credit" of the United States. "Full faith and credit" means generally that the
taxing power of the U.S. government is pledged to the payment of interest and repayment of principal on a
security. If a security is not backed by the full faith and credit of the United States, the owner of the
security must look principally to the agency issuing the obligation for repayment. The owner might not be able to
assert a claim against the United States if the issuing agency or instrumentality does not meet its commitment.
The Fund will invest in securities of U.S. government agencies and instrumentalities only if the Manager is
satisfied that the credit risk with respect to the agency or instrumentality is minimal.

o U.S. Treasury Obligations. These include Treasury bills (maturities of one year or less when issued),
Treasury notes (maturities of 1 to 10 years), and Treasury bonds (maturities of more than 10 years). Treasury
securities are backed by the full faith and credit of the United States as to timely payments of interest and
repayments of principal. They also can include U. S. Treasury securities that have been "stripped" by a Federal
Reserve Bank, zero-coupon U.S. Treasury securities described below, and Treasury Inflation-Protection Securities
("TIPS").

o Treasury Inflation-Protection Securities. The Fund can buy these TIPS,
which are designed to provide an investment vehicle that is not vulnerable to inflation. The interest rate paid
by TIPS is fixed. The principal value rises or falls semi-annually based on changes in the published Consumer
Price Index. If inflation occurs, the principal and interest payments on TIPS are adjusted to protect investors
from inflationary loss. If deflation occurs, the principal and interest payments will be adjusted downward,
although the principal will not fall below its face amount at maturity.

o Obligations Issued or Guaranteed by U.S. Government Agencies or Instrumentalities. These include direct
obligations and mortgage-related securities that have different levels of credit support from the government.
Some are supported by the full faith and credit of the U.S. government, such as Government National Mortgage
Association ("GNMA") pass-through mortgage certificates (called "Ginnie Maes"). Some are supported by the right
of the issuer to borrow from the U.S. Treasury under certain circumstances, such as Federal National Mortgage
Association bonds ("Fannie Maes"). Others are supported only by the credit of the entity that issued them, such
as Federal Home Loan Mortgage Corporation obligations ("Freddie Macs").

|X| U.S. Government Mortgage-Related Securities. The Fund can invest in a variety of mortgage-related
securities that are issued by U.S. government agencies or instrumentalities, some of which are described below.

o GNMA Certificates. The Government National Mortgage Association is a wholly-owned corporate
instrumentality of the United States within the U.S. Department of Housing and Urban Development. GNMA's
principal programs involve its guarantees of privately-issued securities backed by pools of mortgages. Ginnie
Maes are debt securities representing an interest in one mortgage or a pool of mortgages that are insured by the
Federal Housing Administration or the Farmers Home Administration or guaranteed by the Veterans Administration.

The Ginnie Maes in which the Fund invests are of the "fully modified pass-through" type. They provide
that the registered holders of the Ginnie Maes will receive timely monthly payments of the pro-rata share of the
scheduled principal payments on the underlying mortgages, whether or not those amounts are collected by the
issuers. Amounts paid include, on a pro rata basis, any prepayment of principal of such mortgages and interest
(net of servicing and other charges) on the aggregate unpaid principal balance of the Ginnie Maes, whether or not
the interest on the underlying mortgages has been collected by the issuers.

The Ginnie Maes purchased by the Fund are guaranteed as to timely payment of principal and interest by
GNMA. In giving that guaranty, GNMA expects that payments received by the issuers of Ginnie Maes on account of
the mortgages backing the Ginnie Maes will be sufficient to make the required payments of principal of and
interest on those Ginnie Maes. However, if those payments are insufficient, the guaranty agreements between the
issuers of the Ginnie Maes and GNMA require the issuers to make advances sufficient for the payments. If the
issuers fail to make those payments, GNMA will do so.

Under federal law, the full faith and credit of the United States is pledged to the payment of all
amounts that may be required to be paid under any guaranty issued by GNMA as to such mortgage pools. An opinion
of an Assistant Attorney General of the United States, dated December 9, 1969, states that such guaranties
"constitute general obligations of the United States backed by its full faith and credit." GNMA is empowered to
borrow from the United States Treasury to the extent necessary to make any payments of principal and interest
required under those guaranties.

Ginnie Maes are backed by the aggregate indebtedness secured by the underlying FHA-insured, FMHA-insured
or VA-guaranteed mortgages. Except to the extent of payments received by the issuers on account of such
mortgages, Ginnie Maes do not constitute a liability of those issuers, nor do they evidence any recourse against
those issuers. Recourse is solely against GNMA. Holders of Ginnie Maes (such as the Fund) have no security
interest in or lien on the underlying mortgages.

Monthly payments of principal will be made, and additional prepayments of principal may be made, to the
Fund with respect to the mortgages underlying the Ginnie Maes owned by the Fund. All of the mortgages in the
pools relating to the Ginnie Maes in the Fund are subject to prepayment without any significant premium or
penalty, at the option of the mortgagors. While the mortgages on one-to-four-family dwellings underlying certain
Ginnie Maes have a stated maturity of up to 30 years, it has been the experience of the mortgage industry that
the average life of comparable mortgages, as a result of prepayments, refinancing and payments from foreclosures,
is considerably less.

o Federal Home Loan Mortgage Corporation ("FHLMC") Certificates. FHLMC, a corporate instrumentality of the
United States, issues FHLMC Certificates representing interests in mortgage loans. FHLMC guarantees to each
registered holder of a FHLMC Certificate timely payment of the amounts representing a holder's proportionate
share in:
(i) interest payments less servicing and guarantee fees,
(ii) principal prepayments, and
(iii) the ultimate collection of amounts representing the holder's proportionate interest in principal
payments on the mortgage loans in the pool represented by the FHLMC Certificate, in
each case whether or not such amounts are actually received.

The obligations of FHLMC under its guarantees are obligations solely of FHLMC and are not backed by the
full faith and credit of the United States.

o Federal National Mortgage Association (Fannie Mae) Certificates. Fannie Mae, a federally-chartered and
privately-owned corporation, issues Fannie Mae Certificates which are backed by a pool of mortgage loans. Fannie
Mae guarantees to each registered holder of a Fannie Mae Certificate that the holder will receive amounts
representing the holder's proportionate interest in scheduled principal and interest payments, and any principal
prepayments, on the mortgage loans in the pool represented by such Certificate, less servicing and guarantee
fees, and the holder's proportionate interest in the full principal amount of any foreclosed or other liquidated
mortgage loan. In each case the guarantee applies whether or not those amounts are actually received. The
obligations of Fannie Mae under its guarantees are obligations solely of Fannie Mae and are not backed by the
full faith and credit of the United States or any of its agencies or instrumentalities other than Fannie Mae.

|X| Zero-Coupon U.S. Government Securities. The Fund may buy zero-coupon U.S. government securities. These
will typically be U.S. Treasury Notes and Bonds that have been stripped of their unmatured interest coupons, the
coupons themselves, or certificates representing interests in those stripped debt obligations and coupons.

Zero-coupon securities do not make periodic interest payments and are sold at a deep discount from their
face value at maturity. The buyer recognizes a rate of return determined by the gradual appreciation of the
security, which is redeemed at face value on a specified maturity date. This discount depends on the time
remaining until maturity, as well as prevailing interest rates, the liquidity of the security and the credit
quality of the issuer. The discount typically decreases as the maturity date approaches.

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

The Fund's investment in zero-coupon securities may cause the Fund to recognize income and make
distributions to shareholders before it receives any cash payments on the zero-coupon investment. To generate
cash to satisfy those distribution requirements, the Fund may have to sell portfolio securities that it otherwise
might have continued to hold or to use cash flows from other sources such as the sale of Fund shares.

|X| Commercial (Privately-Issued) Mortgage Related Securities. The Fund can invest in commercial
mortgage related securities issued by private entities. Generally these are multi-class debt or pass through
certificates secured by mortgage loans on commercial properties. They are subject to the credit risk of the
issuer. These securities typically are structured to provide protection to investors in senior classes from
possible losses on the underlying loans. They do so by having holders of subordinated classes take the first loss
if there are defaults on the underlying loans. They may also be protected to some extent by guarantees, reserve
funds or additional collateralization mechanisms.

|X| Asset-Backed Securities. Asset-backed securities are fractional interests in pools of assets,
typically accounts receivable or consumer loans. They are issued by trusts or special-purpose corporations. They
are similar to mortgage-backed securities, described above, and are backed by a pool of assets that consist of
obligations of individual borrowers. The income from the pool is passed through to the holders of participation
interest in the pools. The pools may offer a credit enhancement, such as a bank letter of credit, to try to
reduce the risks that the underlying debtors will not pay their obligations when due. However, the enhancement,
if any, might not be for the full par value of the security. If the enhancement is exhausted and any required
payments of interest or repayments of principal are not made, the Fund could suffer losses on its investment or
delays in receiving payment.

The value of an asset-backed security is affected by changes in the market's perception of the asset
backing the security, the creditworthiness of the servicing agent for the loan pool, the originator of the loans,
or the financial institution providing any credit enhancement, and is also affected if any credit enhancement has
been exhausted. The risks of investing in asset-backed securities are ultimately related to payment of consumer
loans by the individual borrowers. As a purchaser of an asset-backed security, the Fund would generally have no
recourse to the entity that originated the loans in the event of default by a borrower. The underlying loans are
subject to prepayments, which may shorten the weighted average life of asset-backed securities and may lower
their return, in the same manner as in the case of mortgage-backed securities and CMOs, described above. Unlike
mortgage-backed securities, asset-backed securities typically do not have the benefit of a security interest in
the underlying collateral.

|X| Municipal Securities. The Fund can buy municipal bonds and notes, tax-exempt commercial paper,
certificates of participation in municipal leases and other debt obligations. These debt obligations are issued
by the governments of states, as well as their political subdivisions (such as cities, towns and counties), or by
the District of Columbia and their agencies and authorities. The Fund can also buy securities issued by any
commonwealths, territories or possessions of the United States, or their respective agencies, instrumentalities
or authorities. The Fund would invest in municipal securities because of the income and portfolio diversification
they offer rather than for the tax-exempt nature of the income they pay.

The Fund can buy both long-term and short-term municipal securities. Long-term securities have a
maturity of more than one year. In selecting municipal securities the Fund would normally focus on longer-term
securities, to seek higher income. In general, the values of longer-term bonds are more affected by changes in
interest rates than are short-term bonds.

Municipal securities are issued to raise money for a variety of public or private purposes, including
financing state or local governments, financing specific projects or public facilities. The Fund can invest in
municipal securities that are "general obligations," secured by the issuer's pledge of its full faith, credit and
taxing power for the payment of principal and interest.

The Fund can also buy "revenue obligations," payable only from the revenues derived from a particular
facility or class of facilities, or a specific excise tax or other revenue source. Some of these revenue
obligations are private activity bonds that pay interest that may be a tax preference for investors subject to
alternative minimum tax.

o Municipal Lease Obligations. Municipal leases are used by state and local government authorities to
obtain funds to acquire land, equipment or facilities. The Fund may invest in certificates of participation that
represent a proportionate interest in payments made under municipal lease obligations. If the government stops
making payments or transfers its payment obligations to a private entity, the obligation could lose value or
become taxable.

|X| Money Market Instruments and Short-Term Debt Obligations. The Fund can invest in a variety of high
quality money market instruments and short-term debt obligations, both under normal market conditions and for
defensive purposes. The following is a brief description of the types of money market securities and short-term
debt obligations the Fund can invest in. Those money market securities are high-quality, short-term debt
instruments that are issued by the U.S. government, corporations, banks or other entities. They may have fixed,
variable or floating interest rates. The Fund's investments in foreign money market instruments and short-term
debt obligations are subject to its limits on investing in foreign securities and the risks of foreign investing,
described above.

o U.S. Government Securities. These include obligations issued or guaranteed by the U.S. government or any
of its agencies or instrumentalities.

o Bank Obligations. The Fund can buy time deposits, certificates of deposit and bankers' acceptances. They
must be :
o obligations issued or guaranteed by a domestic or foreign bank (including a foreign branch of a domestic
bank) having total assets of at least U.S. $1 billion,
o banker's acceptances (which may or may not be supported by letters of credit) only if guaranteed by a
U.S. commercial bank with total assets of at least U.S. $1 billion.

The Fund can make time deposits. These are non-negotiable deposits in a bank for a specified period of
time. They may be subject to early withdrawal penalties. Time deposits that are subject to early withdrawal
penalties are subject to the Fund's limits on illiquid investments, as described below. "Banks" include
commercial banks, savings banks and savings and loan associations.

o Commercial Paper. The Fund can invest in commercial paper if it is rated within the top two rating
categories of S&P and Moody's. If the paper is not rated, it may be purchased if issued by a company having a
credit rating of at least "AA" by S&P or "Aa" by Moody's.

The Fund can buy commercial paper, including U.S. dollar-denominated securities of foreign branches of
U.S. banks, issued by other entities if the commercial paper is guaranteed as to principal and interest by a
bank, government or corporation whose certificates of deposit or commercial paper may otherwise be purchased by
the Fund.

o Variable Amount Master Demand Notes. Master demand notes are corporate obligations that permit the
investment of fluctuating amounts by the Fund at varying rates of interest under direct arrangements between the
Fund, as lender, and the borrower. They permit daily changes in the amounts borrowed. The Fund has the right to
increase the amount under the note at any time up to the full amount provided by the note agreement, or to
decrease the amount. The borrower may prepay up to the full amount of the note without penalty. These notes may
or may not be backed by bank letters of credit.

Because these notes are direct lending arrangements between the lender and borrower, it is not expected
that there will be a trading market for them. There is no secondary market for these notes, although they are
redeemable (and thus are immediately repayable by the borrower) at principal amount, plus accrued interest, at
any time. Accordingly, the Fund's right to redeem such notes is dependent upon the ability of the borrower to pay
principal and interest on demand.

The Fund has no limitations on the type of issuer from whom these notes will be purchased. However, in
connection with such purchases and on an ongoing basis, the Manager will consider the earning power, cash flow
and other liquidity ratios of the issuer, and its ability to pay principal and interest on demand, including a
situation in which all holders of such notes made demand simultaneously. Investments in master demand notes are
subject to the limitation on investments by the Fund in illiquid securities, as described below. Currently, the
Fund does not intend that its investments in variable amount master demand notes will exceed 5% of its total
assets.

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

|X| Foreign Securities. The Fund can purchase up to 25% of its total assets in foreign securities.
"Foreign securities" include equity and debt securities of companies organized under the laws of countries other
than the United States and debt securities of foreign governments and their agencies and instrumentalities. Those
securities may be traded on foreign securities exchanges or in the foreign over-the-counter markets.

Securities of foreign issuers that are represented by American Depository Receipts or that are listed on
a U.S. securities exchange or traded in the U.S. over-the-counter markets are not considered "foreign securities"
for the purpose of the Fund's investment allocations. That is because they are not subject to many of the special
considerations and risks, discussed below, that apply to foreign securities traded and held abroad.

Because the Fund can purchase securities denominated in foreign currencies, a change in the value of a
foreign currency against the U.S. dollar could result in a change in the amount of income the Fund has available
for distribution. Because a portion of the Fund's investment income may be received in foreign currencies, the
Fund will be required to compute its income in U.S. dollars for distribution to shareholders, and therefore the
Fund will absorb the cost of currency fluctuations. After the Fund has distributed income, subsequent foreign
currency losses may result in the Fund's having distributed more income in a particular fiscal period than was
available from investment income, which could result in a return of capital to shareholders.

Investing in foreign securities offers potential benefits not available from investing solely in
securities of domestic issuers. They include the opportunity to invest in foreign issuers that appear to offer
growth potential, or in foreign countries with economic policies or business cycles different from those of the
U.S., or to reduce fluctuations in portfolio value by taking advantage of foreign stock markets that do not move
in a manner parallel to U.S. markets. The Fund will hold foreign currency only in connection with the purchase or
sale of foreign securities.

o Risks of Foreign Investing. Investments in foreign securities may offer special opportunities for
investing but also present special additional risks and considerations not typically associated with investments
in domestic securities. Some of these additional risks are:
o reduction of income by foreign taxes;
o fluctuation in value of foreign investments due to changes in currency rates or currency control
regulations (for example, currency blockage);
o transaction charges for currency exchange;
o lack of public information about foreign issuers;
o lack of uniform accounting, auditing and financial reporting standards in foreign countries comparable
to those applicable to domestic issuers;
o less volume on foreign exchanges than on U.S. exchanges;
o greater volatility and less liquidity on foreign markets than in the U.S.;
o less governmental regulation of foreign issuers, stock exchanges and brokers than in the U.S.;
o foreign exchange contracts;
o greater difficulties in commencing lawsuits;
o higher brokerage commission rates than in the U.S.;
o increased risks of delays in settlement of portfolio transactions or loss of certificates for portfolio
securities;
o foreign withholding taxes on interest and dividends;
o possibilities in some countries of expropriation, nationalization, confiscatory taxation, political,
financial or social instability or adverse diplomatic developments; and
o unfavorable differences between the U.S. economy and foreign economies.

In the past, U.S. government policies have discouraged certain investments abroad by U.S. investors,
through taxation or other restrictions, and it is possible that such restrictions could be re-imposed.

o Special Risks of Emerging Markets. Emerging and developing markets abroad may also offer special
opportunities for investing but have greater risks than more developed foreign markets, such as those in Europe,
Canada, Australia, New Zealand and Japan. There may be even less liquidity in their securities markets, and
settlements of purchases and sales of securities may be subject to additional delays. They are subject to greater
risks of limitations on the repatriation of income and profits because of currency restrictions imposed by local
governments. Those countries may also be subject to the risk of greater political and economic instability, which
can greatly affect the volatility of prices of securities in those countries. The Manager will consider these
factors when evaluating securities in these markets, because the selection of those securities must be consistent
with the Fund's investment o objective. The Fund currently expect that it will not invest significantly in
emerging market countries.

o Foreign Debt Obligations. The debt obligations of foreign governments and entities may or may not be
supported by the full faith and credit of the foreign government. The Fund may buy securities issued by certain
supra-national entities, which include entities designated or supported by governments to promote economic
reconstruction or development, international banking organizations and related government agencies. Examples are
the International Bank for Reconstruction and Development (commonly called the "World Bank"), the Asian
Development bank and the Inter-American Development Bank.

The governmental members of these supra-national entities are "stockholders" that typically make capital
contributions and may be committed to make additional capital contributions if the entity is unable to repay its
borrowings. A supra-national entity's lending activities may be limited to a percentage of its total capital,
reserves and net income. There can be no assurance that the constituent foreign governments will continue to be
able or willing to honor their capitalization commitments for those entities.

|X| Floating Rate and Variable Rate Obligations. Some securities the Fund can purchase have variable or
floating interest rates. Variable rates are adjusted at stated periodic intervals. Variable rate obligations can
have a demand feature that allows the Fund to tender the obligation to the issuer or a third party prior to its
maturity. The tender may be at par value plus accrued interest, according to the terms of the obligations.

The interest rate on a floating rate demand note is adjusted automatically according to a stated
prevailing market rate, such as a bank's prime rate, the 91-day U.S. Treasury Bill rate, or some other standard.
The instrument's rate is adjusted automatically each time the base rate is adjusted. The interest rate on a
variable rate note is also based on a stated prevailing market rate but is adjusted automatically at specified
intervals of not less than one year. Generally, the changes in the interest rate on such securities reduce the
fluctuation in their market value. As interest rates decrease or increase, the potential for capital appreciation
or depreciation is less than that for fixed-rate obligations of the same maturity. The Manager may determine that
an unrated floating rate or variable rate demand obligation meets the Fund's quality standards by reason of being
backed by a letter of credit or guarantee issued by a bank that meets those quality standards.

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

|X| "Stripped" Mortgage-Related Securities. The Fund may invest in stripped mortgage-related securities
that are created by segregating the cash flows from underlying mortgage loans or mortgage securities to create
two or more new securities. Each has a specified percentage of the underlying security's principal or interest
payments. These are a form of derivative investment.

Mortgage securities may be partially stripped so that each class receives some interest and some
principal. However, they may be completely stripped. In that case all of the interest is distributed to holders
of one type of security, known as an "interest-only" security, or "I/O," and all of the principal is distributed
to holders of another type of security, known as a "principal-only" security or "P/O." Strips can be created for
pass-through certificates or CMOs.

The yields to maturity of I/Os and P/Os are very sensitive to principal repayments (including
prepayments) on the underlying mortgages. If the underlying mortgages experience greater than anticipated
prepayments of principal, the Fund might not fully recoup its investment in an I/O based on those assets. If
underlying mortgages experience less than anticipated prepayments of principal, the yield on the P/Os based on
them could decline substantially.

|X| Participation Interests. The Fund may invest in participation interests, subject to the Fund's
limitation on investments in illiquid investments. A participation interest is an undivided interest in a loan
made by the issuing financial institution in the proportion that the buyer's participation interest bears to the
total principal amount of the loan. No more than 5% of the Fund's net assets can be invested in participation
interests of the same borrower. The issuing financial institution may have no obligation to the Fund other than
to pay the Fund the proportionate amount of the principal and interest payments it receives.
Participation interests are primarily dependent upon the creditworthiness of the borrowing corporation,
which is obligated to make payments of principal and interest on the loan. There is a risk that a borrower may
have difficulty making payments. If a borrower fails to pay scheduled interest or principal payments, the Fund
could experience a reduction in its income. The value of that participation interest might also decline, which
could affect the net asset value of the Fund's shares. If the issuing financial institution fails to perform its
obligations under the participation agreement, the Fund might incur costs and delays in realizing payment and
suffer a loss of principal and/or interest.

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

When such transactions are negotiated, the price (which is generally expressed in yield terms) is fixed
at the time the commitment is made. Delivery and payment for the securities take place at a later date. The
securities are subject to change in value from market fluctuations during the period until settlement. The value
at delivery may be less than the purchase price. For example, changes in interest rates in a direction other than
that expected by the Manager before settlement will affect the value of such securities and may cause a loss to
the Fund. During the period between purchase and settlement, the Fund makes no payment to the issuer and no
interest accrues to the Fund from the investment until it receives the security at settlement. There is a risk of
loss to the Fund if the value of the security changes prior to the settlement date, and there is the risk that
the other party may not perform.

The Fund may engage in when-issued transactions to secure what the Manager considers to be an
advantageous price and yield at the time the obligation is entered into. When the Fund enters into a when-issued
or delayed-delivery transaction, it relies on the other party to complete the transaction. Its failure to do so
may cause the Fund to lose the opportunity to obtain the security at a price and yield the Manager considers to
be advantageous.

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

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

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

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

In a repurchase transaction, the Fund buys a security from, and simultaneously resells it to, an
approved vendor for delivery on an agreed-upon future date. The resale price exceeds the purchase price by an
amount that reflects an agreed-upon interest rate effective for the period during which the repurchase agreement
is in effect. Approved vendors include U.S. commercial banks, U.S. branches of foreign banks, or broker-dealers
that have been designated as primary dealers in government securities. They must meet credit requirements set by
the Manager from time to time.

The majority of these transactions run from day to day, and delivery pursuant to the resale typically
occurs within one to five days of the purchase. Repurchase agreements having a maturity beyond seven days are
subject to the Fund's policy limits on holding illiquid investments, described below. The Fund cannot enter into
a repurchase agreement that causes more than 10% of its net assets to be subject to repurchase agreements having
a maturity beyond seven days. There is no limit on the amount of the Fund's net assets that may be subject to
repurchase agreements having maturities of seven days or less.

Repurchase agreements, considered "loans" under the Investment Company Act of 1940 (the `Investment
Company Act"), are collateralized by the underlying security. The Fund's repurchase agreements require that at
all times while the repurchase agreement is in effect, the value of the collateral must equal or exceed the
repurchase price to fully collateralize the repayment obligation. However, if the vendor fails to pay the resale
price on the delivery date, the Fund may incur costs in disposing of the collateral and may experience losses if
there is any delay in its ability to do so. The Manager will monitor the vendor's creditworthiness to confirm
that the vendor is financially sound and will continuously monitor the collateral's value.

Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along
with other affiliated entities managed by the Manager, may transfer uninvested cash balances into one or more
joint repurchase accounts. These balances are invested in one or more repurchase agreements, secured by U.S.
government securities. Securities that are pledged as collateral for repurchase agreements are held by a
custodian bank until the agreements mature. Each joint repurchase arrangement requires that the market value of
the collateral be sufficient to cover payments of interest and principal; however, in the event of default by the
other party to the agreement, retention or sale of the collateral may be subject to legal proceedings.

o Reverse Repurchase Agreements. The Fund can use reverse repurchase agreements on debt obligations it
owns. Under a reverse repurchase agreement, the Fund sells an underlying debt obligation and simultaneously
agrees to repurchase the same security at an agreed-upon price at an agreed-upon date. The Fund will identify on
its books liquid assets in an amount sufficient to cover its obligations under reverse repurchase agreements,
including interest, until payment is made to the seller.

These transactions involve the risk that the market value of the securities sold by the Fund under a
reverse repurchase agreement could decline below the price at which the Fund is obligated to repurchase them.
These agreements are considered borrowings by the Fund and will be subject to the asset coverage requirement
under the Fund's policy on borrowing discussed below.

|X| Illiquid and Restricted Securities. Under the policies and procedures established by the Fund's
Board of Directors, the Manager determines the liquidity of certain of the Fund's investments. To enable the Fund
to sell its holdings of a restricted security not registered under the Securities Act of 1933, the Fund may have
to cause those securities to be registered. The expenses of registering restricted securities may be negotiated
by the Fund with the issuer at the time the Fund buys the securities. When the Fund must arrange registration
because the Fund wishes to sell the security, a considerable period may elapse between the time the decision is
made to sell the security and the time the security is registered so that the Fund could sell it. The Fund would
bear the risks of any downward price fluctuation during that period.

The Fund cannot invest more than 10% of its net assets in illiquid or restricted securities (including
repurchase agreements maturing beyond seven days). Certain restricted securities that are eligible for resale to
qualified institutional purchasers, as described below, may not be subject to that limit. The Manager monitors
holdings of illiquid securities on an ongoing basis to determine whether to sell any holdings to maintain
adequate liquidity.

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

The Fund has limitations that apply to purchases of restricted securities, as stated above. Those
percentage restrictions do not limit purchases of restricted securities that are eligible for sale to qualified
institutional purchasers under Rule 144A of the Securities Act of 1933, if those securities have been determined
to be liquid by the Manager under Board-approved guidelines. Those guidelines take into account the trading
activity for such securities and the availability of reliable pricing information, among other factors. If there
is a lack of trading interest in a particular Rule 144A security, the Fund's holdings of that security may be
considered to be illiquid.

Illiquid securities include repurchase agreements maturing in more than seven days and participation
interests that do not have puts exercisable within seven days.

|X| Borrowing. From time to time, the Fund may borrow from banks or affiliated investment companies. Such
borrowing may be used to fund shareholder redemptions or for other purposes. Under the requirements of the
Investment Company Act, the Fund may borrow only to the extent that the value of that Fund's total assets, less
its liabilities other than borrowings, is equal to at least 300% of all borrowings including the proposed
borrowing. If the value of the Fund's assets so computed should fail to meet the 300% asset coverage requirement,
the Fund is required within three days to reduce its bank debt to the extent necessary to meet such requirement.
It might have to sell a portion of its investments at a time when independent investment judgment would not
dictate such sale.

Since substantially all of the Fund's assets fluctuate in value, but borrowing obligations are fixed, when
the Fund has outstanding borrowings, its net asset value per share correspondingly will tend to increase and
decrease more when portfolio assets fluctuate in value than otherwise would be the case. While borrowings may
represent up to one-third of the Fund's total assets, the Fund currently does not expect its borrowings to exceed
5% of its total assets.

The Fund will pay interest on its borrowings. Borrowing may subject the Fund to greater risks and costs
than funds that do not borrow. These risks may include the possible reduction of income and increased
fluctuation in the Fund's net asset value per share.

Loans of Portfolio Securities. To attempt to generate income, the Fund may lend its portfolio
securities to brokers, dealers, and other financial institutions. The Fund must receive collateral for a loan.
The Fund presently does not intend to lend its portfolio securities, but if it does, these loans are limited to
not more than one-third of the Fund's net assets and are subject to other conditions described below.

There are some risks in connection with securities lending. The Fund might experience a delay in
receiving additional collateral to secure a loan, or a delay in recovery of the loaned securities if the borrower
defaults. The Fund must receive collateral for a loan. Under current applicable regulatory requirements (which
are subject to change), on each business day the loan collateral must be at least equal to the value of the
loaned securities. It must consist of cash, bank letters of credit, securities of the U.S. government or its
agencies or instrumentalities, or other cash equivalents in which the Fund is permitted to invest. To be
acceptable as collateral, letters of credit must obligate a bank to pay amounts demanded by the Fund if the
demand meets the terms of the letter. The terms of the letter of credit and the issuing bank both must be
satisfactory to the Fund.

When it lends securities, the Fund receives amounts equal to the dividends or interest on loaned
securities. It also receives one or more of (a) negotiated loan fees, (b) interest on securities used as
collateral, and (c) interest on any short-term debt securities purchased with such loan collateral. Each type of
interest may be shared with the borrower. The Fund may also pay reasonable finders', custodian and
administrative fees in connection with these loans. The terms of the Fund's loans must meet applicable tests
under the Internal Revenue Code and must permit the Fund to reacquire loaned securities on five days' notice or
in time to vote on any important matter.

|X| Inter-Fund Borrowing and Lending Arrangements. Consistent with its fundamental policies and pursuant to
an exemptive order issued by the Securities and Exchange Commission ("SEC"), the Fund may engage in borrowing and
lending activities with other funds in the OppenheimerFunds complex. Borrowing money from affiliated funds may
afford the Fund the flexibility to use the most cost-effective alternative to satisfy its borrowing requirements.
Lending money to an affiliated fund may allow the Fund to obtain a higher rate of return than it could from
interest rates on alternative short-term investments. Implementation of inter-fund lending would be accomplished
consistent with applicable regulatory requirements, including the provisions of the SEC order. The Fund currently
anticipates that it will not engage in either an inter-fund borrowing or lending arrangement to a significant
degree.

o Inter-Fund Borrowing. The Fund will not borrow from affiliated funds unless the terms of the borrowing
arrangement are at least as favorable as the terms the Fund could otherwise negotiate with a third party. To
assure that the Fund will not be disadvantaged by borrowing from an affiliated fund, certain safeguards may be
implemented. Examples of these safeguards include the following:
o the Fund will not borrow money from affiliated funds unless the interest rate is more favorable than
available bank loan rates;
o the Fund's borrowing from affiliated funds must be consistent with its investment objective and
investment policies;
o the loan rates will be determined by a pre-established formula based on quotations from independent
banks;
o if the Fund has outstanding borrowings from all sources greater than 10% of its total assets, then the
Fund must secure each additional outstanding inter-fund loan by segregating liquid
assets of the Fund as collateral;
o the Fund cannot borrow from an affiliated fund in excess of 125% of its total redemptions for the
preceding seven days;
o each inter-fund loan may be repaid on any day by the Fund; and
o the Trustees will be provided with a report of all inter-fund loans and the Trustees will monitor all
such borrowings to ensure that the Fund's participation is appropriate.

There is a risk that a borrowing fund could have a loan called on one day's notice. In that
circumstance, the borrowing fund might have to borrow from a bank at a higher interest cost if money to lend were
not available from another Oppenheimer fund.

o Inter-Fund Lending. To assure that the Fund will not be disadvantaged by making loans to affiliated
funds, certain safeguards will be implemented. Examples of these safeguards include the following:
o the Fund will not lend money to affiliated funds unless the interest rate on such loan is determined to
be reasonable under the circumstances;
o the Fund may not make inter-fund loans in excess of 7.5% of its net assets;
o an inter-fund loan to any one affiliated fund shall not exceed 5% of the Fund's net assets;
o an inter-fund loan may not be outstanding for more than seven days;
o each inter-fund loan may be called on one business day's notice; and
o the Manager will provide the Trustees reports on all inter-fund loans demonstrating that the Fund's
participation is appropriate and that the loan is consistent with its investment
objectives and policies.

When the Fund lends assets to another affiliated fund, the Fund is subject to the credit that the
borrowing fund fails to repay the loan.

|X| Derivatives. The Fund may invest in a variety of derivative investments to seek income for
liquidity needs or for hedging purposes. Some derivative investments the Fund may use are the hedging instruments
described below in this Statement of Additional Information.

Some of the derivative investments the Fund can use include debt exchangeable for common stock of an
issuer or "equity-linked debt securities" of an issuer. At maturity, the debt security is exchanged for common
stock of the issuer or it is payable in an amount based on the price of the issuer's common stock at the time of
maturity. Both alternatives present a risk that the amount payable at maturity will be less than the principal
amount of the debt because the price of the issuer's common stock may not be as high as the Manager expected.
Other derivative investments the Fund may invest in include "index-linked" notes. Principal and/or
interest payments on these notes depend on the performance of an underlying index. Currency-indexed securities
are another derivative the Fund may use. Typically these are short-term or intermediate-term debt securities.
Their value at maturity or the rates at which they pay income are determined by the change in value of the U.S.
dollar against one or more foreign currencies or an index. In some cases, these securities may pay an amount at
maturity based on a multiple of the amount of the relative currency movements. This type of index security offers
the potential for increased income or principal payments but at a greater risk of loss than a typical debt
security of the same maturity and credit quality.

o "Structured" Notes. The Fund can buy "structured" notes, which are specially-designed derivative debt
investments with principal payments or interest payments that are linked to the value of an index (such as a
currency or securities index) or commodity. The terms of the instrument may be "structured" by the purchaser (the
Fund) and the borrower issuing the note.

The principal and/or interest payments depend on the performance of one or more other securities or
indices, and the values of these notes will therefore fall or rise in response to the changes in the values of
the underlying security or index. They are subject to both credit and interest rate risks and therefore the Fund
could receive more or less than it originally invested when the notes mature, or it might receive less interest
than the stated coupon payment if the underlying investment or index does not perform as anticipated. There
values may be very volatile and they may have a limited trading market, making it difficult for the Fund to sell
its investment at an acceptable price.

o "Inverse Floaters." Certain types of variable rate bonds known as "inverse floaters" pay interest at
rates that vary as the yields generally available on short-term tax-exempt bonds change. However, the yields on
inverse floaters move in the opposite direction of yields on short-term bonds in response to market changes. As
interest rates rise, inverse floaters produce less current income, and their market value can become volatile.
Inverse floaters are a type of "derivative security." Some have a "cap," so that if interest rates rise above the
"cap," the security pays additional interest income. If rates do not rise above the "cap," the Fund will have
paid an additional amount for a feature that proves worthless. The Fund will not invest more than 5% of its total
assets in inverse floaters.

|X| Hedging. The Fund can use hedging to attempt to protect against declines in the market value of the
Fund's portfolio, to permit the Fund to retain unrealized gains in the value of portfolio securities which have
appreciated, or to facilitate selling securities for investment reasons. To do so, the Fund could:
o sell futures contracts,
o buy puts on futures or on securities, or
o write covered calls on securities or futures. Covered calls can also be used to increase the Fund's

income, but the Manager does not expect to engage extensively in that practice.

The Fund might use hedging to establish a position in the securities market as a temporary substitute
for purchasing particular securities. In that case, the Fund would normally seek to purchase the securities and
then terminate that hedging position. The Fund might also use this type of hedge to attempt to protect against
the possibility that its portfolio securities would not be fully included in a rise in value of the market. To do
so the Fund could:
o buy futures, or
o buy calls on such futures or on securities.

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

o Futures. The Fund can buy and sell exchange-traded futures contracts that relate to (1) broadly-based
stock indices ("stock index futures") (2) debt securities (these are referred to as "interest rate futures"), (3)
other broadly-based securities indices (these are referred to as "financial futures"), (4) foreign currencies
(these are referred to as "forward contracts"), or (5) securities.

A broadly-based stock index is used as the basis for trading stock index futures. An index may in some
cases be based on stocks of issuers in a particular industry or group of industries. A stock index assigns
relative values to the common stocks included in the index and its value fluctuates in response to the changes in
value of the underlying stocks. A stock index cannot be purchased or sold directly. Financial futures are similar
contracts based on the future value of the basket of securities that comprise the index. These contracts obligate
the seller to deliver, and the purchaser to take, cash to settle the futures transaction. There is no delivery
made of the underlying securities to settle the futures obligation. Either party may also settle the transaction
by entering into an offsetting contract.

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

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

At any time prior to expiration of the future, the Fund may elect to close out its position by taking an
opposite position, at which time a final determination of variation margin is made and any additional cash must
be paid by or released to the Fund. Any loss or gain on the future is then realized by the Fund for tax
purposes. All futures transactions, except forward contracts, are effected through a clearinghouse associated
with the exchange on which the contracts are traded.

o Put and Call Options. The Fund can buy and sell certain kinds of put options ("puts") and call options
("calls"). The Fund can buy and sell exchange-traded and over-the-counter put and call options, including index
options, securities options, currency options, commodities options, and options on the other types of futures
described above.

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

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

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

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

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

To terminate its obligation on a call it has written, the Fund may purchase a corresponding call in a
"closing purchase transaction." The Fund will then realize a profit or loss, depending upon whether the net of
the amount of the option transaction costs and the premium received on the call the Fund wrote is more or less
than the price of the call the Fund purchases to close out the transaction. The Fund may realize a profit if the
call expires unexercised, because the Fund will retain the underlying security and the premium it received when
it wrote the call. Any such profits are considered short-term capital gains for federal income tax purposes, as
are the premiums on lapsed calls. When distributed by the Fund they are taxable as ordinary income. If the Fund
cannot effect a closing purchase transaction due to the lack of a market, it will have to hold the callable
securities until the call expires or is exercised.

The Fund may also write calls on a futures contract without owning the futures contract or securities
deliverable under the contract. To do so, at the time the call is written, the Fund must cover the call by
identifying on its books an equivalent dollar amount of liquid assets. The Fund will segregate additional liquid
assets if the value of the segregated assets drops below 100% of the current value of the future. Because of
this segregation requirement, in no circumstances would the Fund's receipt of an exercise notice as to that
future require the Fund to deliver a futures contract. It would simply put the Fund in a short futures position,
which is permitted by the Fund's hedging policies.

o Writing Put Options. The Fund can sell put options. A put option on securities gives the purchaser the
right to sell, and the writer the obligation to buy, the underlying investment at the exercise price during the
option period. The Fund will not write puts if, as a result, more than 50% of the Fund's net assets would be
required to be segregated to cover such put options.

If the Fund writes a put, the put must be covered by segregated liquid assets. The premium the Fund
receives from writing a put represents a profit, as long as the price of the underlying investment remains equal
to or above the exercise price of the put. However, the Fund also assumes the obligation during the option
period to buy the underlying investment from the buyer of the put at the exercise price, even if the value of the
investment falls below the exercise price. If a put the Fund has written expires unexercised, the Fund realizes
a gain in the amount of the premium less the transaction costs incurred. If the put is exercised, the Fund must
fulfill its obligation to purchase the underlying investment at the exercise price. That price will usually
exceed the market value of the investment at that time. In that case, the Fund may incur a loss if it sells the
underlying investment. That loss will be equal to the sum of the sale price of the underlying investment and the
premium received minus the sum of the exercise price and any transaction costs the Fund incurred.

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

As long as the Fund's obligation as the put writer continues, it may be assigned an exercise notice by
the broker-dealer through which the put was sold. That notice will require the Fund to take delivery of the
underlying security and pay the exercise price. The Fund has no control over when it may be required to purchase
the underlying security, since it may be assigned an exercise notice at any time prior to the termination of its
obligation as the writer of the put. That obligation terminates upon expiration of the put. It may also
terminate if, before it receives an exercise notice, the Fund effects a closing purchase transaction by
purchasing a put of the same series as it sold. Once the Fund has been assigned an exercise notice, it cannot
effect a closing purchase transaction.

The Fund may decide to effect a closing purchase transaction to realize a profit on an outstanding put
option it has written or to prevent the underlying security from being put. Effecting a closing purchase
transaction will also permit the Fund to write another put option on the security, or to sell the security and
use the proceeds from the sale for other investments. The Fund will realize a profit or loss from a closing
purchase transaction depending on whether the cost of the transaction is less or more than the premium received
from writing the put option. Any profits from writing puts are considered short-term capital gains for federal
tax purposes, and when distributed by the Fund, are taxable as ordinary income.

o Purchasing Calls and Puts. The Fund can purchase calls to protect against the possibility that the
Fund's portfolio will not participate in an anticipated rise in the securities market. When the Fund buys a call
(other than in a closing purchase transaction), it pays a premium. The Fund then has the right to buy the
underlying investment from a seller of a corresponding call on the same investment during the call period at a
fixed exercise price. The Fund benefits only if it sells the call at a profit or if, during the call period, the
market price of the underlying investment is above the sum of the call price plus the transaction costs and the
premium paid for the call and the Fund exercises the call. If the Fund does not exercise the call or sell it
(whether or not at a profit), the call will become worthless at its expiration date. In that case the Fund will
have paid the premium but lost the right to purchase the underlying investment.

The Fund can buy puts whether or not it holds the underlying investment in its portfolio. When the Fund
purchases a put, it pays a premium and, except as to puts on indices, has the right to sell the underlying
investment to a seller of a put on a corresponding investment during the put period at a fixed exercise price.
Buying a put on securities or futures the Fund owns enables the Fund to attempt to protect itself during the put
period against a decline in the value of the underlying investment below the exercise price by selling the
underlying investment at the exercise price to a seller of a corresponding put. If the market price of the
underlying investment is equal to or above the exercise price and, as a result, the put is not exercised or
resold, the put will become worthless at its expiration date. In that case the Fund will have paid the premium
but lost the right to sell the underlying investment. However, the Fund may sell the put prior to its expiration.
That sale may or may not be at a profit.

When the Fund purchases a call or put on an index or future, it pays a premium, but settlement is in
cash rather than by delivery of the underlying investment to the Fund. Gain or loss depends on changes in the
index in question (and thus on price movements in the securities market generally) rather than on price movements
in individual securities or futures contracts.

The Fund may buy a call or put only if, after the purchase, the value of all call and put options held
by the Fund will not exceed 5% of the Fund's total assets.

o Buying and Selling Call and Put Options on Foreign Currencies. The Fund can buy and sell calls and puts
on foreign currencies. They include puts and calls that trade on a securities or commodities exchange or in the
over-the-counter markets or are quoted by major recognized dealers in such options. The Fund could use these
calls and puts to try to protect against declines in the dollar value of foreign securities and increases in the
dollar cost of foreign securities the Fund wants to acquire

If the Manager anticipates a rise in the dollar value of a foreign currency in which securities to be acquired
are denominated, the increased cost of those securities may be partially offset by purchasing calls or writing
puts on that foreign currency. If the Manager anticipates a decline in the dollar value of a foreign currency,
the decline in the dollar value of portfolio securities denominated in that currency might be partially offset by
writing calls or purchasing puts on that foreign currency. However, the currency rates could fluctuate in a
direction adverse to the Fund's position. The Fund will then have incurred option premium payments and
transaction costs without a corresponding benefit.

A call the Fund writes on a foreign currency is "covered" if the Fund owns the underlying foreign
currency covered by the call or has an absolute and immediate right to acquire that foreign currency without
additional cash consideration (or it can do so for additional cash consideration held in a segregated account by
its custodian bank) upon conversion or exchange of other foreign currency held in its portfolio.

The Fund could write a call on a foreign currency to provide a hedge against a decline in the U.S.
dollar value of a security which the Fund owns or has the right to acquire and which is denominated in the
currency underlying the option. That decline might be one that occurs due to an expected adverse change in the
exchange rate. This is known as a "cross-hedging" strategy. In those circumstances, the Fund covers the option
by identifying on its books liquid assets in an amount equal to the exercise price of the option.

o Risks of Hedging with Options and Futures. The use of hedging instruments requires special skills and
knowledge of investment techniques that are different than what is required for normal portfolio management. If
the Manager uses a hedging instrument at the wrong time or judges market conditions incorrectly, hedging
strategies may reduce the Fund's return. The Fund could also experience losses if the prices of its futures and
options positions were not correlated with its other investments.

The Fund's option activities could affect its portfolio turnover rate and brokerage commissions. The
exercise of calls written by the Fund might cause the Fund to sell related portfolio securities, thus increasing
its turnover rate. The exercise by the Fund of puts on securities will cause the sale of underlying investments,
increasing portfolio turnover. Although the decision whether to exercise a put it holds is within the Fund's
control, holding a put might cause the Fund to sell the related investments for reasons that would not exist in
the absence of the put.

The Fund could pay a brokerage commission each time it buys a call or put, sells a call or put, or buys
or sells an underlying investment in connection with the exercise of a call or put. Those commissions could be
higher on a relative basis than the commissions for direct purchases or sales of the underlying investments.
Premiums paid for options are small in relation to the market value of the underlying investments. Consequently,
put and call options offer large amounts of leverage. The leverage offered by trading in options could result in
the Fund's net asset value being more sensitive to changes in the value of the underlying investment.

If a covered call written by the Fund is exercised on an investment that has increased in value, the
Fund will be required to sell the investment at the call price. It will not be able to realize any profit if the
investment has increased in value above the call price.

An option position may be closed out only on a market that provides secondary trading for options of the
same series, and there is no assurance that a liquid secondary market will exist for any particular option. The
Fund might experience losses if it could not close out a position because of an illiquid market for the future or
option.

There is a risk in using short hedging by selling futures or purchasing puts on broadly-based indices or
futures to attempt to protect against declines in the value of the Fund's portfolio securities. The risk is that
the prices of the futures or the applicable index will correlate imperfectly with the behavior of the cash prices
of the Fund's securities. For example, it is possible that while the Fund has used hedging instruments in a
short hedge, the market might advance and the value of the securities held in the Fund's portfolio might decline.
If that occurred, the Fund would lose money on the hedging instruments and also experience a decline in the value
of its portfolio securities. However, while this could occur for a very brief period or to a very small degree,
over time the value of a diversified portfolio of securities will tend to move in the same direction as the
indices upon which the hedging instruments are based.

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

The ordinary spreads between prices in the cash and futures markets are subject to distortions, due to
differences in the nature of those markets. First, all participants in the futures market are subject to margin
deposit and maintenance requirements. Rather than meeting additional margin deposit requirements, investors may
close futures contracts through offsetting transactions which could distort the normal relationship between the
cash and futures markets. Second, the liquidity of the futures market depends on participants entering into
offsetting transactions rather than making or taking delivery. To the extent participants decide to make or take
delivery, liquidity in the futures market could be reduced, thus producing distortion. Third, from the point of
view of speculators, the deposit requirements in the futures market are less onerous than margin requirements in
the securities markets. Therefore, increased participation by speculators in the futures market may cause
temporary price distortions.

The Fund can use hedging instruments to establish a position in the securities markets as a temporary
substitute for the purchase of individual securities (long hedging) by buying o futures and/or calls on such
futures, broadly-based indices or on securities. It is possible that when the Fund does so the market might
decline. If the Fund then concludes not to invest in securities because of concerns that the market might
decline further or for other reasons, the Fund will realize a loss on the hedging instruments that is not offset
by a reduction in the price of the securities purchased.

o Forward Contracts. Forward contracts are foreign currency exchange contracts. They are used to buy or
sell foreign currency for future delivery at a fixed price. The Fund uses them to "lock in" the U.S. dollar
price of a security denominated in a foreign currency that the Fund has bought or sold, or to protect against
possible losses from changes in the relative values of the U.S. dollar and a foreign currency. The Fund may also
use "cross-hedging" where the Fund hedges against changes in currencies other than the currency in which a
security it holds is denominated

Under a forward contract, one party agrees to purchase, and another party agrees to sell, a specific
currency at a future date. That date may be any fixed number of days from the date of the contract agreed upon by
the parties. The transaction price is set at the time the contract is entered into. These contracts are traded
in the inter-bank market conducted directly among currency traders (usually large commercial banks) and their
customers.

The Fund may use forward contracts to protect against uncertainty in the level of future exchange
rates. The use of forward contracts does not eliminate the risk of fluctuations in the prices of the underlying
securities the Fund owns or intends to acquire, but it does fix a rate of exchange in advance. Although forward
contracts may reduce the risk of loss from a decline in the value of the hedged currency, at the same time they
limit any potential gain if the value of the hedged currency increases.

When the Fund enters into a contract for the purchase or sale of a security denominated in a foreign
currency, or when it anticipates receiving dividend payments in a foreign currency, the Fund might desire to
"lock-in" the U.S. dollar price of the security or the U.S. dollar equivalent of the dividend payments. To do so,
the Fund could enter into a forward contract for the purchase or sale of the amount of foreign currency involved
in the underlying transaction, in a fixed amount of U.S. dollars per unit of the foreign currency. This is called
a "transaction hedge." The transaction hedge will protect the Fund against a loss from an adverse change in the
currency exchange rates during the period between the date on which the security is purchased or sold or on which
the payment is declared, and the date on which the payments are made or received.

The Fund could also use forward contracts to lock in the U.S. dollar value of portfolio positions. This
is called a "position hedge." When the Fund believes that foreign currency might suffer a substantial decline
against the U.S. dollar, it could enter into a forward contract to sell an amount of that foreign currency
approximating the value of some or all of the Fund's portfolio securities denominated in that foreign currency.
When the Fund believes that the U.S. dollar might suffer a substantial decline against a foreign currency, it
could enter into a forward contract to buy that foreign currency for a fixed dollar amount. Alternatively, the
Fund could enter into a forward contract to sell a different foreign currency for a fixed U.S. dollar amount if
the Fund believes that the U.S. dollar value of the foreign currency to be sold pursuant to its forward contract
will fall whenever there is a decline in the U.S. dollar value of the currency in which portfolio securities of
the Fund are denominated. That is referred to as a "cross hedge."

The Fund will cover its short positions in these cases by identifying to its custodian bank assets
having a value equal to the aggregate amount of the Fund's commitment under forward contracts. The Fund will not
enter into forward contracts or maintain a net exposure to such contracts if the consummation of the contracts
would obligate the Fund to deliver an amount of foreign currency in excess of the value of the Fund's portfolio
securities or other assets denominated in that currency or another currency that is the subject of the hedge.

However, to avoid excess transactions and transaction costs, the Fund may maintain a net exposure to
forward contracts in excess of the value of the Fund's portfolio securities or other assets denominated in
foreign currencies if the excess amount is "covered" by liquid securities denominated in any currency. The cover
must be at least equal at all times to the amount of that excess.

The precise matching of the amounts under forward contracts and the value of the securities involved
generally will not be possible because the future value of securities denominated in foreign currencies will
change as a consequence of market movements between the date the forward contract is entered into and the date it
is sold. In some cases the Manager might decide to sell the security and deliver foreign currency to settle the
original purchase obligation. If the market value of the security is less than the amount of foreign currency the
Fund is obligated to deliver, the Fund might have to purchase additional foreign currency on the "spot" (that is,
cash) market to settle the security trade. If the market value of the security instead exceeds the amount of
foreign currency the Fund is obligated to deliver to settle the trade, the Fund might have to sell on the spot
market some of the foreign currency received upon the sale of the security. There will be additional transaction
costs on the spot market in those cases.

The projection of short-term currency market movements is extremely difficult, and the successful
execution of a short-term hedging strategy is highly uncertain. Forward contracts involve the risk that
anticipated currency movements will not be accurately predicted, causing the Fund to sustain losses on these
contracts and to pay additional transactions costs. The use of forward contracts in this manner might reduce the
Fund's performance if there are unanticipated changes in currency prices to a greater degree than if the Fund had
not entered into such contracts.

At or before the maturity of a forward contract requiring the Fund to sell a currency, the Fund might
sell a portfolio security and use the sale proceeds to make delivery of the currency. In the alternative the Fund
might retain the security and offset its contractual obligation to deliver the currency by purchasing a second
contract. Under that contract the Fund will obtain, on the same maturity date, the same amount of the currency
that it is obligated to deliver. Similarly, the Fund might close out a forward contract requiring it to purchase
a specified currency by entering into a second contract entitling it to sell the same amount of the same currency
on the maturity date of the first contract. The Fund would realize a gain or loss as a result of entering into
such an offsetting forward contract under either circumstance. The gain or loss will depend on the extent to
which the exchange rate or rates between the currencies involved moved between the execution dates of the first
contract and offsetting contract.

The costs to the Fund of engaging in forward contracts vary with factors such as the currencies
involved, the length of the contract period and the market conditions then prevailing. Because forward contracts
are usually entered into on a principal basis, no brokerage fees or commissions are involved. Because these
contracts are not traded on an exchange, the Fund must evaluate the credit and performance risk of the
counterparty under each forward contract.

Although the Fund values its assets daily in terms of U.S. dollars, it does not intend to convert its
holdings of foreign currencies into U.S. dollars on a daily basis. The Fund may convert foreign currency from
time to time, and will incur costs in doing so. Foreign exchange dealers do not charge a fee for conversion, but
they do seek to realize a profit based on the difference between the prices at which they buy and sell various
currencies. Thus, a dealer might offer to sell a foreign currency to the Fund at one rate, while offering a
lesser rate of exchange if the Fund desires to resell that currency to the dealer.

o Interest Rate Swap Transactions. The Fund can enter into interest rate swap agreements. In an interest
rate swap, the Fund and another party exchange their right to receive or their obligation to pay interest on a
security. For example, they might swap the right to receive floating rate payments for fixed rate payments. The
Fund can enter into swaps only on securities that it owns. Also, the Fund will identify on its books liquid
assets (such as cash or U.S. government securities) to cover any amounts it could owe under swaps that exceed the
amounts it is entitled to receive, and it will adjust that amount daily, as needed.

Swap agreements entail both interest rate risk and credit risk. There is a risk that, based on
movements of interest rates in the future, the payments made by the Fund under a swap agreement will be greater
than the payments it received. Credit risk arises from the possibility that the counterparty will default. If
the counterparty defaults, the Fund's loss will consist of the net amount of contractual interest payments that
the Fund has not yet received. The Manager will monitor the creditworthiness of counterparties to the Fund's
interest rate swap transactions on an ongoing basis.

The Fund can enter into swap transactions with certain counterparties pursuant to master netting
agreements. A master netting agreement provides that all swaps done between the Fund
and that counterparty shall be regarded as parts of an integral agreement. If amounts are payable on a
particular date in the same currency in respect of one or more swap transactions, the amount payable on that date
in that currency shall be the net amount. In addition, the master netting agreement may provide that if one
party defaults generally or on one swap, the counterparty can

o Regulatory Aspects of Hedging Instruments. When using futures and options on futures, the Fund is
required to operate within certain guidelines and restrictions with respect to the use of futures as established
by the Commodities Futures Trading Commission (the "CFTC"). In particular, the Fund is exempted from
registration with the CFTC as a "commodity pool operator" if the Fund complies with the requirements of Rule 4.5
adopted by the CFTC. The Rule does not limit the percentage of the Fund's assets that may be used for futures
margin o and related options premiums for a bona fide hedging position. However, under the Rule, the Fund must
limit its aggregate initial futures margin and related options premiums to not more than 5% of the Fund's net
assets for hedging strategies that are not considered bona fide hedging strategies under the Rule. Under the
Rule, the Fund must also use short futures and options on futures solely for bona fide hedging purposes within
the meaning and intent of the applicable provisions of the Commodity Exchange Act.

Transactions in options by the Fund are subject to limitations established by the option exchanges. The
exchanges limit the maximum number of options that may be written or held by a single investor or group of
investors acting in concert. Those limits apply regardless of whether the options were written or purchased on
the same or different exchanges or are held in one or more accounts or through one or more different exchanges or
through one or more brokers. Thus, the number of options that the Fund may write may be affected by options
written or held by other entities, including other investment companies having the same advisor as the Fund (or
an advisor that is an affiliate of the Fund's advisor). The exchanges also impose position limits on futures
transactions. An exchange may order the liquidation of positions found to be in violation of those limits and
may impose certain other sanctions.

Under the Investment Company Act, when the Fund purchases a future, it must maintain cash or readily
marketable short-term debt instruments in an amount equal to the market value of the securities underlying the
future, less the margin deposit applicable to it.

o Tax Aspects of Certain Hedging Instruments. Certain foreign currency exchange contracts in which the
Fund may invest are treated as "Section 1256 contracts" under the Internal Revenue Code. In general, gains or
losses relating to Section 1256 contracts are characterized as 60% long-term and 40% short-term capital gains or
losses under the Code. However, foreign currency gains or losses arising from Section 1256 contracts that are
forward contracts generally are treated as ordinary income or loss. In addition, Section 1256 contracts held by
the Fund at the end of each taxable year are "marked-to-market," and unrealized gains or losses are treated as
though they were realized. These contracts also may be marked-to-market for purposes of determining the excise
tax applicable to investment company distributions and for other purposes under rules prescribed pursuant to the
Internal Revenue Code. An election can be made by the Fund to exempt those transactions from this
marked-to-market treatment.

Certain forward contracts the Fund enters into may result in "straddles" for federal income tax
purposes. The straddle rules may affect the character and timing of gains (or losses) recognized by the Fund on
straddle positions. Generally, a loss sustained on the disposition of a position making up a straddle is allowed
only to the extent that the loss exceeds any unrecognized gain in the offsetting positions making up the
straddle. Disallowed loss is generally allowed at the point where there is no unrecognized gain in the
offsetting positions making up the straddle, or the offsetting position is disposed of.

Under the Internal Revenue Code, the following gains or losses are treated as ordinary income or loss:
(1) gains or losses attributable to fluctuations in exchange rates that occur between the(1) time
the Fund accrues interest or other receivables or accrues expenses or other liabilities
denominated in a foreign currency and the time the Fund actually collects such receivables or
pays such liabilities, and
(1) gains or losses attributable to fluctuations in the value of a foreign currency(2) between the
date of acquisition of a debt security denominated in a foreign currency or foreign currency
forward contracts and the date of disposition.

Currency gains and losses are offset against market gains and losses on each trade before determining a
net "Section 988" gain or loss under the Internal Revenue Code for that trade, which may increase or decrease the
amount of the Fund's investment income available for distribution to its shareholders.

Investment in Other Investment Companies. The Fund can also invest in the securities of other investment
companies, which can include open-end funds, closed-end funds and unit investment trusts, subject to the limits
set forth in the Investment Company Act that apply to those types of investments. For example, the Fund can
invest in Exchange-Traded Funds, which are typically open-end funds or unit investment trusts, listed on a stock
exchange. The Fund might do so as a way of gaining exposure to the segments of the equity or fixed-income
markets represented by the Exchange-Traded Funds' portfolio, at times when the Fund may not be able to buy those
portfolio securities directly.

Investing in another investment company may involve the payment of substantial premiums above the value
of such investment company's portfolio securities and is subject to limitations under the Investment Company
Act. The Fund does not intend to invest in other investment companies unless the Manager believes that the
potential benefits of the investment justify the payment of any premiums or sales charges. As a shareholder of
an investment company, the Fund would be subject to its ratable share of that investment company's expenses,
including its advisory and administration expenses. The Fund does not anticipate investing a substantial amount
of its net assets in shares of other investment companies.

Other Investment Restrictions

|X| What Are "Fundamental Policies?" Fundamental policies are those policies that the Fund has adopted
to govern its investments that can be changed only by the vote of a "majority" of the Fund's outstanding voting
securities. Under the Investment Company Act, a "majority" vote is defined as the vote of the holders of the
lesser of:
o 67% or more of the shares present or represented by proxy at a shareholder meeting, if the holders of
more than 50% of the outstanding shares are present or represented by proxy, or
o more than 50% of the outstanding shares.

Policies described in the Prospectus or this Statement of Additional Information are "fundamental" only
if they are identified as such. The Fund's Board of Directors can change non-fundamental policies without
shareholder approval. However, significant changes to investment policies will be described in supplements or
updates to the Prospectus or this Statement of Additional Information, as appropriate. The Fund's principal
investment policies are described in the Prospectus.

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

o The Fund cannot issue senior securities. However, it can make payments or deposits of margin in
connection with options or futures transactions, lend its portfolio securities, enter into repurchase agreements,
borrow money and pledge its assets as permitted by its other fundamental policies. For purposes of this
restriction, the issuance of shares of common stock in multiple classes or series, the purchase or sale of
options, futures contracts and options on futures contracts, forward commitments, and repurchase agreements
entered into in accordance with theo Fund's investment policies, and the pledge, mortgage or
hypothecation of the Fund's assets are not deemed to be senior securities.

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

o The Fund cannot invest 25% or more of its total assets in any one industry. That limit does not apply
to securities issued or guaranteed by the U.S. government or its agencies and instrumentalities or securities
issued by investment companies.

o The Fund cannot invest in physical commodities or commodities contracts. However, the Fund can invest
in hedging instruments permitted by any of its other investment policies, and can buy or sell options, futures,
securities or other instruments backed by, or the investment return from which is linked to, changes in the price
of physical commodities, commodity contracts or currencies.

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

o The Fund cannot underwrite securities of other issuers. A permitted exception is in case it is deemed to
be an underwriter under the Securities Act of 1933 in reselling its portfolio securities.

o The Fund cannot make loans, except to the extent permitted under the 1940 Act, the rules or regulations
thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules or regulations may
be amended or interpreted from time to time. 1

o The Fund may not borrow money, except to the extent permitted under the 1940 Act, the rules or
regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules or
regulations may be amended or interpreted from time to time. 2

|X| Does the Fund Have Additional Restrictions That Are Not "Fundamental" Policies? The Fund has additional
operating policies which are stated below, that are not "fundamental," and which can be changed by the Board of
Directors without shareholder approval.

o The Fund cannot invest in securities of other investment companies, except to the extent permitted under
the 1940 Act, the rules or regulations thereunder or any exemption therefrom, as such statute, rules or
regulations may be amended or interpreted from time to time.

Unless the Prospectus or this Statement of Additional Information states that a percentage restriction
applies on an ongoing basis, it applies only at the time the Fund makes an investment. The Fund need not sell
securities to meet the percentage limits if the value of the investment increases in proportion to the size of
the Fund.

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

How the Fund is Managed

Organization and History. The Fund is one of two investment portfolios, or "series," of Oppenheimer Series Fund,
Inc. That corporation is an open-end, management investment company organized as a Maryland corporation in 1981,
and was called Connecticut Mutual Investment Accounts, Inc. until March 18, 1996, when the Manager became the
Fund's investment advisor. The Fund is a diversified mutual fund, and until March 18, 1996 was called Connecticut
Mutual Total Return Account.

|X| Classes of Shares. The Directors are authorized, without shareholder approval, to create new series
and classes of shares. The Directors may reclassify unissued shares of the Fund into additional series or classes
of shares. The Directors also may divide or combine the shares of a class into a greater or lesser number of
shares without changing the proportionate beneficial interest of a shareholder in the Fund. Shares do not have
cumulative voting rights or preemptive or subscription rights. Shares may be voted in person or by proxy at
shareholder meetings.

The Fund currently has four classes of shares: Class A, Class B, Class C and Class N. All classes invest
in the same investment portfolio. Only retirement plans may purchase Class N shares. Each class of shares:
o has its own dividends and distributions,
o pays certain expenses which may be different for the different classes,
o may have a different net asset value,
o may have separate voting rights on matters in which interests of one class are different from interests
of another class, and
o votes as a class on matters that affect that class alone.

Shares are freely transferable, and each share of each class has one vote at shareholder meetings, with
fractional shares voting proportionally on matters submitted to the vote of shareholders. Each share of the Fund
represents an interest in the Fund proportionately equal to the interest of each other share of the same class.

|X| Meetings of Shareholders. Although the Fund is not required by Maryland law to hold annual
meetings, it may hold shareholder meetings from time to time on important matters. The shareholders of the Fund's
parent corporation have the right to call a meeting to remove a Director or to take certain other action
described in the Articles of Incorporation or under Maryland law.

The Fund will hold meetings when required to do so by the Investment Company Act or other applicable
law. The Fund will hold a meeting when the Directors call a meeting or upon proper request of shareholders. If
the Fund's parent corporation receives a written request of the record holders of at least 25% of the outstanding
shares eligible to be voted at a meeting to call a meeting for a specified purpose (which might include the
removal of a Director), the Directors will call a meeting of shareholders for that specified purpose. The Fund's
parent corporation has undertaken that it will then either give the applicants access to the Fund's shareholder
list or mail the applicants' communication to all other shareholders at the applicants' expense.

Shareholders of the Fund and of its parent corporation's other series vote together in the aggregate on
certain matters at shareholders' meetings. Those matters include the election of Directors and ratification of
appointment of the independent auditors. Shareholders of a particular series or class vote separately on
proposals that affect that series or class. Shareholders of a series or class that is not affected by a proposal
are not entitled to vote on the proposal. For example, only shareholders of a particular series vote on any
material amendment to the investment advisory agreement for that series. Only shareholders of a particular class
of a series vote on certain amendments to the Distribution and/or Service Plans if the amendments affect only
that class.

Board of Directors and Oversight Committees . The Fund's parent corporation is governed by a Board of Directors,
which is responsible for protecting the interests of shareholders under Maryland law. The Directors meet
periodically throughout the year to oversee the Fund's activities, review its performance, and review the actions
of the Manager. Although the Fund will not normally hold annual meetings of its shareholders, it may hold
shareholder meetings from time to time on important matters, and shareholders have the right to call a meeting to
remove a Director or to take other action described in the Fund's Articles of Incorporation.

The Board of Directors has an Audit Committee, a Study Committee and a Proxy Committee. The members of
the Audit Committee are Kenneth Randall (Chairman), Benjamin Lipstein and Edward Regan. The Audit Committee held
four meetings during the Fund's fiscal year ended October 31, 2001. The Audit Committee provides the Board with
recommendations regarding the selection of the Fund's independent auditor. The Audit Committee also reviews the
scope and results of audits and the audit fees charged, reviews reports from the Fund's independent auditor
concerning the Fund's internal accounting procedures, and controls and reviews reports of the Manager's internal
auditor, among other duties as set forth in the Committee's charter.

The members of the Study Committee are Benjamin Lipstein (Chairman), Robert Galli and Elizabeth
Moynihan. The Study Committee held seven meetings during the Fund's fiscal year ended October 31, 2001. The Study
Committee evaluates and reports to the Board on the Fund's contractual arrangements, including the Investment
Advisory and Distribution Agreements, transfer and shareholder service agreements and custodian agreements as
well as the policies and procedures adopted by the Fund to comply with the Investment Company Act and other
applicable law, among other duties as set forth in the Committee's charter.

The members of the Proxy Committee are Edward Regan (Chairman), Russell Reynolds and Clayton Yeutter.
The Proxy Committee held one meeting during the fiscal year ended October 31, 2001.The Proxy Committee provides
the Board with recommendations for proxy voting and monitors proxy voting by the Fund.

Directors and Officers of the Fund. Except for Mr. Murphy, each of the Directors is an independent director of
the Fund ("Independent Director"). Mr. Murphy is an "Interested Director," because he is affiliated with the
Manager by virtue of his positions as an officer and director of the Manager, and as a shareholder of its parent
company.

Oppenheimer California Municipal Fund Oppenheimer International Growth Fund
Oppenheimer Capital Appreciation Fund Oppenheimer International Small Company Fund
Oppenheimer Capital Preservation Fund Oppenheimer Money Market Fund, Inc.
Oppenheimer Developing Markets Fund Oppenheimer Multiple Strategies Fund
Oppenheimer Discovery Fund Oppenheimer Multi-Sector Income Trust
Oppenheimer Emerging Growth Fund Oppenheimer Multi-State Municipal Trust
Oppenheimer Emerging Technologies Fund Oppenheimer Municipal Bond Fund
Oppenheimer Enterprise Fund Oppenheimer New York Municipal Fund
Oppenheimer Europe Fund Oppenheimer Series Fund, Inc.
Oppenheimer Global Fund Oppenheimer Trinity Core Fund
Oppenheimer Global Growth & Income Fund Oppenheimer Trinity Large Cap Growth Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Trinity Value Fund
Oppenheimer Growth Fund Oppenheimer U.S. Government Trust

In addition to being a trustee or director of the Board I Funds, Mr. Galli is also a director or trustee
of 10 other portfolios in the OppenheimerFunds complex. Present or former officers, directors, trustees and
employees (and their immediate family members) of the Fund, the Manager and its affiliates, and retirement plans
established by them for their employees are permitted to purchase Class A shares of the Fund and the other
Oppenheimer funds at net asset value without sales charge. The sales charges on Class A shares is waived for that
group because of the economies of sales efforts realized by the Distributor.

Messrs. Spiro, Murphy, Bartlett, Leavy, Manioudakis, Molleur, Wixted and Zack and Mses. Bechtolt, Feld
and Ives respectively hold the same offices with one or more of the other Board I Funds as with the Fund. As of
November __, 2002, the Directors and officers of the Fund as a group owned of record or beneficially less than 1%
of each class of shares of the Fund. The foregoing statement does not reflect ownership of shares of the Fund
held of record by an employee benefit plan for employees of the Manager, other than the shares beneficially owned
under the plan by the officers of the Fund listed above. In addition, each Independent Director, and his family
members, do not own securities of either the Manager or Distributor of the Board I Funds or any person directly
or indirectly controlling, controlled by or under common control with the Manager or Distributor.

|X| Affiliated Transactions and Material Business Relationships. Mr. Reynolds has reported he has a
controlling interest in The Directorship Search Group, Inc. ("The Directorship Search Group"), a director
recruiting firm that provided consulting services to Massachusetts Mutual Life Insurance Company (which controls
the Manager) for fees aggregating $$110,000 from January 1, 2000 through December 31, 2001, an amount
representing less than 5% of |X| the annual revenues of The Directorship Search Group, Inc. Mr. Reynolds
estimates that The Directorship Search Group will bill Massachusetts Mutual Life Insurance Company $150,000 for
services to be provided during the calendar year 2002.

The Independent Directors have unanimously (except for Mr. Reynolds, who abstained) determined that the
consulting arrangements between The Directorship Search Group, Inc. and Massachusetts Mutual Life Insurance
Company were not material business or professional relationships that would compromise Mr. Reynolds' status as an
Independent Director. Nonetheless, to assure certainty as to determinations of the Board and the Independent
Directors as to matters upon which the Investment Company Act or the rules thereunder require approval by a
majority of Independent Directors, Mr. Reynolds will not be counted for purposes of determining whether a quorum
of Independent Directors was present or whether a majority of Independent Directors approved the matter.

The address of each Director in the chart below is 6803 S. Tucson Way, Centennial, CO 80112-3924. Each
Director serves for an indefinite term, until his or her resignation, retirement, death or removal.

- --------------------------------------------------------------------------------------------------------------------------
Independent Directors
- --------------------------------------------------------------------------------------------------------------------------
- ------------------------- ---------------------------------------------------------------- -------------- ----------------
Name, Address, Age, Principal Occupation(s) During Past 5 Years / Other Dollar Range Aggregate
Dollar Range
of Shares
Beneficially
Owned in any
of Shares of the
Position(s) Held with Beneficially Oppenheimer
Fund and Length of Trusteeships/Directorships Held by Director / Number of Owned in the Funds Overseen
Service Portfolios in Fund Complex Currently Overseen by Director Fund by Director
- ------------------------- ---------------------------------------------------------------- -------------- ----------------
- ------------------------- ---------------------------------------------------------------- -------------------------------
As of December 31, 2001
- ------------------------- ---------------------------------------------------------------- -------------------------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Leon Levy, Chairman of General Partner (since 1982) of Odyssey Partners, L.P. None None
the Board of Directors (investment partnership) and Chairman of the Board (since
Director since 1985 1981) of Avatar Holdings, Inc. (real estate development).
Age: 76 Oversees 31 portfolios in the OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Robert G. Galli, A trustee or director of other Oppenheimer funds. Formerly
Director since 1993 Vice Chairman (October 1995-December 1997) of the Manager. None Over $100,000
Age: 69 Oversees 41 portfolios in the OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Phillip A. Griffiths, The Director (since 1991) of the Institute for Advanced Study,
Director since 1999 Princeton, N.J., director (since 2001) of GSI Lumonics and a
Age: 63 member of the National Academy of Sciences (since 1979);
formerly (in descending chronological order) a director of
Bankers Trust Corporation, Provost and Professor of None Over $100,000
Mathematics at Duke University, a director of Research
Triangle Institute, Raleigh, N.C., and a Professor of
Mathematics at Harvard University. Oversees 31 portfolios in
the OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Benjamin Lipstein, Professor Emeritus of Marketing, Stern Graduate School of
Director since 1985 Business Administration, New York University. Oversees 31 None Over $100,000
Age: 79 portfolios in the OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Joel W. Motley, Director (January 2002-present), Columbia Equity Financial
Director since 2002 Corp. (privately-held financial adviser); Managing Director
Age: 50 (January 2002-present), Carmona Motley, Inc. (privately-held
financial adviser); Formerly he held the following positions:
Managing Director (January 1998-December 2001), Carmona Motley $None3 None3
Hoffman Inc. (privately-held financial adviser); Managing
Director (January 1992-December 1997), Carmona Motley & Co.
(privately-held financial adviser). Oversees 31 portfolios in
the OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Elizabeth B. Moynihan, Author and architectural historian; a trustee of the Freer
Director since 1992 Gallery of Art and Arthur M. Sackler Gallery (Smithsonian
Age: 72 Institute), Trustees Council of the National Building Museum; $50,001 -
a member of the Trustees Council, Preservation League of New None $100,000
York State. Oversees 31 portfolios in the OppenheimerFunds
complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Kenneth A. Randall, A director of Dominion Resources, Inc. (electric utility
Director since 1985 holding company) and Prime Retail, Inc. (real estate
Age: 75 investment trust); formerly a director of Dominion Energy,
Inc. (electric power and oil & gas producer), President and
Chief Executive Officer of The Conference Board, Inc.
(international economic and business research) and a director None Over $100,000
of Lumbermens Mutual Casualty Company, American Motorists
Insurance Company and American Manufacturers Mutual Insurance
Company. Oversees 31 portfolios in the OppenheimerFunds
complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Edward V. Regan, President, Baruch College, CUNY; a director of RBAsset (real
Director since 1993 estate manager); a director of OffitBank; formerly Trustee,
Age: 72 Financial Accounting Foundation (FASB and GASB), Senior Fellow
of Jerome Levy Economics Institute, Bard College, Chairman of $50,001 -
Municipal Assistance Corporation for the City of New York, New None $100,000
York State Comptroller and Trustee of New York State and Local
Retirement Fund. Oversees 31 investment companies in the
OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Russell S. Reynolds, Chairman (since 1993) of The Directorship Search Group, Inc.
Jr., (corporate governance consulting and executive recruiting); a
Director since 1989 life trustee of International House (non-profit educational $10,001 -
Age: 70 organization), and a trustee (since 1996) of the Greenwich None $50,000
Historical Society. Oversees 31 portfolios in the
OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Donald W. Spiro, Vice Chairman Emeritus (since January 1991) of the Manager.
Chairman of the Board Formerly a director (January 1969-August 1999) of the Manager.
of Directors, Oversees 31 portfolios in the OppenheimerFunds complex. None Over $100,000
Director since 1985
Age: 76
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
- ------------------------- ---------------------------------------------------------------- ------------- -----------------
Clayton K. Yeutter, Of Counsel (since 1993), Hogan & Hartson (a law firm). Other None $50,001 -
Director since 1991 directorships: Caterpillar, Inc. (since 1993) and Weyerhaeuser
Age: 71 Co. (since 1999). Oversees 31 portfolios in the $100,000
OppenheimerFunds complex.
- ------------------------- ---------------------------------------------------------------- ------------- -----------------

The address of Mr. Murphy in the chart below is 498 Seventh Avenue, New York, NY 10018. Mr. Murphy
serves for an indefinite term, until his resignation, death or removal.

John V. Murphy, Chairman, Chief Executive Officer and director (since June
President and 2001) and President (since September 2000) of the Manager; None Over $100,000
Director, President and a director or trustee of other Oppenheimer
Director since funds; President and a director (since July 2001) of
October 2001 Oppenheimer Acquisition Corp. (the Manager's parent holding
Age: 53 company) and of Oppenheimer Partnership Holdings, Inc. (a
holding company subsidiary of the Manager); a director (since
November 2001) of OppenheimerFunds Distributor, Inc. (a
subsidiary of the Manager); Chairman and a director (since
July 2001) of Shareholder Services, Inc. and of Shareholder
Financial Services, Inc. (transfer agent subsidiaries of the
Manager); President and a director (since July 2001) of
OppenheimerFunds Legacy Program (a charitable trust program
established by the Manager); a director of the investment
advisory subsidiaries of the Manager: OFI Institutional Asset
Management, Inc. and Centennial Asset Management Corporation
(since November 2001), HarbourView Asset Management
Corporation and OFI Private Investments, Inc. (since July
2001); President (since November 1, 2001) and a director
(since July 2001) of Oppenheimer Real Asset Management, Inc.;
a director (since November 2001) of Trinity Investment
Management Corp. and Tremont Advisers, Inc. (Investment
advisory affiliates of the Manager); Executive Vice President
(since February 1997) of Massachusetts Mutual Life Insurance
Company (the Manager's parent company); a director (since
June 1995) of DBL Acquisition Corporation; formerly, Chief
Operating Officer (September 2000-June 2001) of the Manager;
President and trustee (November 1999-November 2001) of MML
Series Investment Fund and MassMutual Institutional Funds
(open-end investment companies); a director (September
1999-August 2000) of C.M. Life Insurance Company; President,
Chief Executive Officer and director (September 1999-August
2000) of MML Bay State Life Insurance Company; a director
(June 1989-June 1998) of Emerald Isle Bancorp and Hibernia
Savings Bank (a wholly-owned subsidiary of Emerald Isle
Bancorp). Oversees 69 portfolios in the OppenheimerFunds
complex.

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

The address of the Officers in the chart below is as follows: Messrs. Leavy, Molleur and Zack and Ms. Feld
is 498 Seventh Avenue, New York, NY 10018, Messrs. Masterson, Vottiero and Wixted and Mses. Bechtolt and Ives is
6803 S. Tucson Way, Centennial, CO 80112-3924. Each Officer serves for an annual term or until his or her
resignation, death or removal.

- ---------------------------------------------------------------------------------------------------------------------------
Officers of the Fund
- ---------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Name, Address, Age, Position(s) Held with Principal Occupation(s) During Past 5 Years
Fund and Length of Service
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Bruce Bartlett, Vice President and Senior Vice President (since January 1999) of the Manager; an officer and
Portfolio Manager (since November 2000) portfolio manager of other Oppenheimer funds, prior to joining the Manager in
Age: 51 April, 1995, he was a Vice President and Senior Portfolio Manager at First of
America Investment Corp. (September 1986 - April 1995).
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Christopher Leavy, Vice President and Senior Vice President (since September 2000) of the Manager; prior to joining
Portfolio Manager (since November 2000) the Manager in September 2000, he was a portfolio manager of Morgan Stanley
Age: 30 Dean Witter Investment Management (from 1997) prior to which he was a
portfolio manager and equity analyst of Crestar Asset Management (from 1995).
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Angelo Manioudakis, Vice Senior Vice President of the Manager (since April 2002); an officer and
President and Portfolio Manager portfolio manager of other Oppenheimer funds; formerly Executive Director and
(since April 2002) portfolio manager for Miller, Anderson & Sherrerd, a division of Morgan
Age: 35. Stanley Investment Management (August 1993-March 2002).
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Brian W. Wixted, Senior Vice President and Treasurer (since March 1999) of the Manager;
Treasurer, Principal Financial and Treasurer (since March 1999) of HarbourView Asset Management Corporation,
Accounting Officer (since April 1999) Shareholder Services, Inc., Oppenheimer Real Asset Management Corporation,
Age: 42 Shareholder Financial Services, Inc., Oppenheimer Partnership Holdings, Inc.,
OFI Private Investments, Inc. (since March 2000), OppenheimerFunds
International Ltd. and Oppenheimer Millennium Funds plc (since May 2000) and
OFI Institutional Asset Management, Inc. (since November 2000) (offshore fund
management subsidiaries of the Manager); Treasurer and Chief Financial
Officer (since May 2000) of Oppenheimer Trust Company (a trust company
subsidiary of the Manager); Assistant Treasurer (since March 1999) of
Oppenheimer Acquisition Corp. and OppenheimerFunds Legacy Program (since
April 2000); formerly Principal and Chief Operating Officer (March 1995-March
1999), Bankers Trust Company-Mutual Fund Services Division. An officer of 85
portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Connie Bechtolt, Assistant Vice President of the Manager (since September 1998); formerly
Assistant Treasurer (since October 10,
2002) Manager/Fund Accounting (September 1994-September 1998) of the Manager. An
Age: 39 officer of 72 portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Philip Vottiero, Vice President/Fund Accounting of the Manager (since March 2002); formerly
Assistant Treasurer (since August 15, Vice President/Corporate Accounting of the Manager (July 1999-March 2002)
2002) prior to which he was Chief Financial Officer at Sovlink Corporation (April
Age: 39 1996-June 1999). An officer of 72 portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Robert G. Zack, Senior Vice President (since May 1985) and General Counsel (since February
Secretary (since November 1, 2001) 2002) of the Manager; General Counsel and a director (since November 2001) of
Age: 54 OppenheimerFunds Distributor, Inc.; Senior Vice President and General Counsel
(since November 2001) of HarbourView Asset Management Corporation; Vice
President and a director (since November 2000) of Oppenheimer Partnership
Holdings, Inc.; Senior Vice President, General Counsel and a director (since
November 2001) of Shareholder Services, Inc., Shareholder Financial Services,
Inc., OFI Private Investments, Inc., Oppenheimer Trust Company and OFI
Institutional Asset Management, Inc.; General Counsel (since November 2001)
of Centennial Asset Management Corporation; a director (since November 2001)
of Oppenheimer Real Asset Management, Inc.; Assistant Secretary and a
director (since November 2001) of OppenheimerFunds International Ltd.; Vice
President (since November 2001) of OppenheimerFunds Legacy Program; Secretary
(since November 2001) of Oppenheimer Acquisition Corp.; formerly Acting
General Counsel (November 2001-February 2002) and Associate General Counsel
(May 1981-October 2001) of the Manager; Assistant Secretary of Shareholder
Services, Inc. (May 1985-November 2001), Shareholder Financial Services, Inc.
(November 1989-November 2001); OppenheimerFunds International Ltd. and
Oppenheimer Millennium Funds plc (October 1997-November 2001). An officer of
85 portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Philip T. Masterson, Vice President and Assistant Counsel of the Manager (since July 1998);
Assistant Secretary
(since August 15, 2002) formerly, an associate with Davis, Graham, & Stubbs LLP (January 1997-June
Age: 38 1998). An officer of 72 portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Denis R. Molleur, Vice President and Senior Counsel of the Manager (since July 1999); formerly
Assistant Secretary
(since November 1, 2001) a Vice President and Associate Counsel of the Manager (September 1995-July
Age: 44 1999). An officer of 82 portfolios in the OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Katherine P. Feld, Vice President and Senior Counsel (since July 1999) of the Manager; Vice
Assistant Secretary President (since June 1990) of OppenheimerFunds Distributor, Inc.; Director,
(since November 1, 2001) Vice President and Assistant Secretary (since June 1999) of Centennial Asset
Age: 44 Management Corporation; Vice President (since 1997) of Oppenheimer Real Asset
Management, Inc.; formerly Vice President and Associate Counsel of the
Manager (June 1990-July 1999). An officer of 85 portfolios in the
OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------
- ------------------------------------------- -------------------------------------------------------------------------------
Kathleen T. Ives, Vice President and Assistant Counsel (since June 1998) of the Manager; Vice
Assistant Secretary President (since 1999) of OppenheimerFunds Distributor, Inc.; Vice President
(since November 1, 2001) and Assistant Secretary (since 1999) of Shareholder Services, Inc.; Assistant
Age: 36 Secretary (since December 2001) of OppenheimerFunds Legacy Program and
Shareholder Financial Services, Inc.; formerly Assistant Vice President and
Assistant Counsel of the Manager (August 1997-June 1998); Assistant Counsel
of the Manager (August 1994-August 1997). An officer of 85 portfolios in the
OppenheimerFunds complex.
- ------------------------------------------- -------------------------------------------------------------------------------

|X| Remuneration of Directors. The officers of the Fund and one of the Directors of the Fund (Mr.
Murphy) who are affiliated with the Manager receive no salary or fee from the Fund. The remaining Directors of
the Fund received the compensation shown below from the Fund with respect to the Fund's fiscal year ended October
31, 2002. The compensation from all of the Board I Funds (including the Fund) represents compensation received as
a director, trustee or member of a committee of the boards of those funds during the calendar year 2001.

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

Director Name and Other Fund For Fiscal Year Ended For Calendar Year
Position(s)
(as applicable) 07/31/02 Ended12/31/01

Aggregate Retirement Estimated Annual Total Compensation From
Retirement Benefits All Oppenheimer Funds
Paid at Retirement For Which Individual
Benefits Accrued from all Board I Serves As
Compensation as Part of Fund Funds Trustee/Director
from Fund1 Expenses (33 Funds) 2 (33 Funds)

Leon Levy $ $ $ $173,700
Chairman

Robert G. Galli $ 2 $202,8863
Study Committee Member

Phillip Griffiths $ 4 $ $ $54,889

Benjamin Lipstein $ $ $ $150,152
Study Committee Chairman, Audit
Committee Member

Joel W. Motley4 $ $ $0 $0

Elizabeth B. Moynihan $ $ $ $105,760
Study Committee Member

Kenneth A. Randall $ $ $ $97,012
Audit Committee Chairman

Edward V. Regan $ $ $ $95,960
Proxy Committee Chairman, Audit
Committee Member

Russell S. Reynolds, Jr. $ $ $ $71,792
Proxy Committee Member

Donald Spiro $ $ $ $64,080

Clayton K. Yeutter $ $ $ $71,792
Proxy Committee Member

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

1. Aggregate compensation from the Fund includes fees and deferred compensation, if any. No trustee fee
expenses were accrued to the Fund during its last fiscal year for any Trustee.
Estimated annual retirement benefits paid at retirement is based on a straight life payment plan election. The
amount for Mr. Galli includes $14,818 for serving as a trustee or director of 10 Oppenheimer funds that are not
Board I Funds.
3. Includes $97,126 for Mr. Galli for serving as trustee or director of 10 Oppenheimer funds that are not
Board I Funds.
Appointed to the Board on October 10, 2002 and therefore did not receive any compensation.

|X| Retirement Plan for Directors. The Fund and its parent corporation have adopted a retirement plan that
provides for payments to retired Directors. Payments are up to 80% of the average compensation paid during a
Director's five years of service in which the highest compensation was received. A Director must serve as
director or trustee for any of the Board I Funds for at least 15 years to be eligible for the maximum payment.
Each Director's retirement benefits will depend on the amount of the Director's future compensation and length of
service. Therefore the amount of those benefits cannot be determined at this time, nor can we estimate the number
of years of credited service that will be used to determine those benefits.

|X| Deferred Compensation Plan. The Board of Directors has adopted a Deferred Compensation Plan for
disinterested directors that enables them to elect to defer receipt of all or a portion of the annual fees they
are entitled to receive from the Fund. Under the plan, the compensation deferred by a Director is periodically
adjusted as though an equivalent amount had been invested in shares of one or more Oppenheimer funds selected by
the Director. The amount paid to the Director under the plan will be determined based upon the performance of the
selected funds.

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

|X| Major Shareholders. As of November __, 2002, the only persons who owned of record or were known by
the Fund to own beneficially 5% or more of any class of the Fund's outstanding shares were:

RPSS TR Country Hills Health Care Inc, 401K Plan, Attn: Sandi Steers, 580 Broadway, El Cajon, CA
92021-5124, which owned 2,255.090 Class N shares (48.84% of the Class N shares then outstanding).

R J FLETCHER & PEARSON SPAGHT TR, Fletcher Spaght PSP & Trust BDA FBO Lisa Granick, 222 Berkeley
St., Boston, MA 02116-3748, which owned 1,747.957 Class N shares (37.85% of the Class N shares then
outstanding).

RPSS TR ROLLOVER IRA FBO Bruce L. Frank, 16 Meer Dr., Langhorne, PA 19053-1516 which owned 233.033
Class N shares (5.04% of the Class N shares then outstanding).

The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a holding company controlled by
Massachusetts Mutual Life Insurance Company.

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

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

|X| |X| The Investment Advisory Agreement. The Manager provides investment advisory and management
services to the Fund under an investment advisory agreement between the Manager and the Fund. The Manager selects
securities for the Fund's portfolio and handles its day-to-day business. The portfolio managers of the Fund are
employed by the Manager and are the persons who are principally responsible for the day-to-day management of the
Fund's portfolio. Other members of the Manager's Equity Portfolio Department provide the portfolio managers with
counsel and support in managing the Fund's portfolio.

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

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

------------------------------------- ---------------------------------------------------------------------------
Fiscal Year ended 10/31: Management Fees Paid to OppenheimerFunds, Inc.
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2000 $1,230,427
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2001 $927,181
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------

2002 $

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

The investment advisory agreement states that in the absence of willful misfeasance, bad faith, gross
negligence in the performance of its duties or reckless disregard of its obligations and duties under the
investment advisory agreement, the Manager is not liable for any loss resulting from a good faith error or
omission on its part with respect to any of its duties under the agreement.

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

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

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

The Board reviewed the foregoing information in arriving at its decision to renew the investment
advisory agreement. Among other factors, the Board considered:
o The nature, cost, and quality of the services provided to the Fund and its shareholders;
o The profitability of the Fund to the Manager;
o The investment performance of the Fund in comparison to regular market indices
o Economies of scale that may be available to the Fund from the Manager;
o Fees paid by other mutual funds for similar services;
o The value and quality of any other benefits or services received by the Fund from its relationship with
the Manager, and
o The direct and indirect benefits the Manager received from its relationship with the Fund. These
included services provided by the Distributor and the Transfer Agent, and brokerage and soft dollar
arrangements permissible under Section 28(e) of the Securities Exchange Act.

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

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

In arriving at a decision, the Board did not single out any one factor or group of factors as being more
important than other factors, but considered all factors together. The Board judged the terms and conditions of
the investment advisory agreement, including the investment advisory fee, in light of all of the surrounding
circumstances.

Brokerage Policies of the Fund

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

Under the investment advisory agreement, the Manager may select brokers (other than affiliates) that
provide brokerage and/or research services for the Fund and/or the other accounts over which the Manager or its
affiliates have investment discretion. The commissions paid to such brokers may be higher than another qualified
broker would charge, if the Manager makes a good faith determination that the commission is fair and reasonable
in relation to the services provided. Subject to those considerations, as a factor in selecting brokers for the
Fund's portfolio transactions, the Manager may also consider sales of shares of the Fund and other investment
companies for which the Manager or an affiliate serves as investment advisor.

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

Transactions in securities other than those for which an exchange is the primary market are generally
done with principals or market makers. In transactions on foreign exchanges, the Fund may be required to pay
fixed brokerage commissions and therefore would not have the benefit of negotiated commissions available in U.S.
markets. Brokerage commissions are paid primarily for transactions in listed securities or for certain
fixed-income agency transactions in the secondary market. Otherwise brokerage commissions are paid only if it
appears likely that a better price or execution can be obtained by doing so. In an option transaction, the Fund
ordinarily uses the same broker for the purchase or sale of the option and any transaction in the securities to
which the option relates.

Other funds advised by the Manager have investment policies similar to those of the Fund. Those other
funds may purchase or sell the same securities as the Fund at the same time as the Fund, which could affect the
supply and price of the securities. If two or more funds advised by the Manager purchase the same security on the
same day from the same dealer, the transactions under those combined orders are averaged as to price and
allocated in accordance with the purchase or sale orders actually placed for each account.

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

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

Investment research services include information and analysis on particular companies and industries as
well as market or economic trends and portfolio strategy, market quotations for portfolio evaluations,
information systems, computer hardware and similar products and services. If a research service also assists the
Manager in a non-research capacity (such as bookkeeping or other administrative functions), then only the
percentage or component that provides assistance to the Manager in the investment decision-making process may be
paid in commission dollars.

The Board of Directors permits the Manager to use stated commissions on secondary fixed-income agency
trades to obtain research if the broker represents to the Manager that: (i) the trade is not from or for the
broker's own inventory, (ii) the trade was executed by the broker on an agency basis at the stated commission,
and (iii) the trade is not a riskless principal transaction. The Board of Directors permits the Manager to use
commissions on fixed-price offerings to obtain research, in the same manner as is permitted for agency
transactions.

The research services provided by brokers broadens the scope and supplements the research activities of
the Manager. That research provides additional views and comparisons for consideration, and helps the Manager to
obtain market information for the valuation of securities that are either held in the Fund's portfolio or are
being considered for purchase. The Manager provides information to the Board about the commissions paid to
brokers furnishing such services, together with the Manager's representation that the amount of such commissions
was reasonably related to the value or benefit of such services.

- --------------------------------------- ----------------------------------------------------------------------------
Fiscal Year Ended 10/31: Total Brokerage Commissions Paid by the Fund1
- --------------------------------------- ----------------------------------------------------------------------------
- --------------------------------------- ----------------------------------------------------------------------------
2000 $224,949
- --------------------------------------- ----------------------------------------------------------------------------
- --------------------------------------- ----------------------------------------------------------------------------

2001 $390,844

2002$ $__________2

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

1. Amounts do not include spreads or commissions on principal transactions on a net trade basis.
2. In the fiscal year ended 10/31/02, the amount of transactions directed to brokers for research services
was $_______ and the amount of the commissions paid to broker-dealers for those services was $_____.

Distribution and Service Plans

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

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

- --------------- ----------------------- -----------------------
Fiscal Year Aggregate Front-End Class A Front-End
Sales Charges
Ended 10/31: Sales Charges on Retained by
Class A Shares Distributor1
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------
2000 $155,566 $112,021
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------
2001 $109,771 $72,391
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------

2002 $ $

- --------------- ----------------------- -----------------------
1. Includes amounts retained by a broker-dealer that is an affiliate or a parent of the Distributor.

- ------------ ------------------------ ------------------------ ------------------------ ------------------------
Fiscal Concessions on Class A Concessions on Class B Concessions on Class C Concessions on Class N
Year Ended Shares Advanced by Shares Advanced by Shares Advanced by Shares Advanced by
10/31: Distributor1 Distributor1 Distributor1 Distributor1
- ------------ ------------------------ ------------------------ ------------------------ ------------------------
- ------------ ------------------------ ------------------------ ------------------------ ------------------------
2000 $9,827 $98,076 $11,259 N/A
- ------------ ------------------------ ------------------------ ------------------------ ------------------------
- ------------ ------------------------ ------------------------ ------------------------ ------------------------
2001 $10,575 $88,402 $5,518 $72
- ------------ ------------------------ ------------------------ ------------------------ ------------------------
- ------------ ------------------------ ------------------------ ------------------------ ------------------------

2002 $ $ $ $

- ------------ ------------------------ ------------------------ ------------------------ ------------------------
1. The Distributor advances concession payments to dealers for certain sales of Class A shares and for
sales of Class B, Class C and Class N shares from its own resources at the time of sale.
2. The inception date of Class N shares was March 1, 2001.

- ------------ ------------------------- ----------------------- ------------------------ ------------------------
Fiscal Class A Contingent Class B Contingent Class C Contingent Class N Contingent
Deferred Sales
Year Ended Deferred Sales Charges Charges Retained by Deferred Sales Charges Deferred Sales Charges
10/31 Retained by Distributor Distributor Retained by Distributor Retained by Distributor
- ------------ ------------------------- ----------------------- ------------------------ ------------------------
- ------------ ------------------------- ----------------------- ------------------------ ------------------------

2002 $ $ $ $

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

Distribution and Service Plans. The Fund has adopted a Service Plan for Class A shares and Distribution and
Service Plans for Class B, Class C and Class N shares under Rule 12b-1 of the Investment Company Act. Under those
plans the Fund pays the Distributor for all or a portion of its costs incurred in connection with the
distribution and/or servicing of the shares of the particular class.

Each plan has been approved by a vote of the Board of Directors, including a majority of the Independent
Directors4, cast in person at a meeting called for the purpose of voting on that plan.

Under the plans, the Manager and the Distributor, in their sole discretion, from time to time, may use
their own resources (at no direct cost to the Fund) to make payments to brokers, dealers or other financial
institutions for distribution and administrative services they perform. The Manager may use its profits from the
advisory fee it receives from the Fund. In their sole discretion, the Distributor and the Manager may increase or
decrease the amount of payments they make from their own resources to plan recipients.

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

The Board of Directors and the Independent Directors must approve all material amendments to a plan. An
amendment to increase materially the amount of payments to be made under a plan must be approved by shareholders
of the class affected by the amendment. Because Class B shares of the Fund automatically convert into Class A
shares after six years, the Fund must obtain the approval of both Class A and Class B shareholders for a proposed
material amendment to the Class A Plan that would materially increase payments under the Plan. That approval must
be by a "majority" (as defined in the Investment Company Act) of the shares of each class, voting separately by
class.

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

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

Under the plan for a class, no payment will be made to any recipient in any quarter in which the
aggregate net asset value of all Fund shares of that class held by the recipient for itself and its customers
does not exceed a minimum amount, if any, that may be set from time to time by a majority of the Independent
Directors. The Board of Directors has set no minimum amount of assets to qualify for payments under the plans.

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

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

For the fiscal year ended October 31, 2002 payments under the Class A plan totaled $______, of which
$_____ was retained by the Distributor and included $_______, all of which was paid to an affiliate of the
Distributor's parent company. Any unreimbursed expenses the Distributor incurs with respect to Class A shares in
any fiscal year cannot be recovered in subsequent years. The Distributor may not use payments received under the
Class A plan to pay any of its interest expenses, carrying charges, or other financial costs, or allocation of
overhead.

|X| Class B, Class C and Class N Service and Distribution Plan Fees. Under each plan, service fees and
distribution fees are computed on the average of the net asset value of shares in the respective class,
determined as of the close of each regular business day during the period. Each plan provides for the Distributor
to be compensated at a flat rate, whether the Distributor's distribution expenses are more or less than the
amounts paid by the Fund under the plan during the period for which the fee is paid. The types of services that
recipients provide are similar to the services provided under the Class A service plan, described above.

Each Plan permits the Distributor to retain both the asset-based sales charges and the service fees or
to pay recipients the service fee on a quarterly basis, without payment in advance. However, the Distributor
currently intends to pay the service fee to recipients in advance for the first year after Class B, Class C and
Class N shares are purchased. After the first year Class B, Class C or Class N shares are outstanding, after
their purchase, the Distributor makes service fee payments quarterly on those shares. The advance payment is
based on the net asset value of shares sold. Shares purchased by exchange do not qualify for the advance service
fee payment. If Class B, Class C or Class N shares are redeemed during the first year after their purchase, the
recipient of the service fees on those shares will be obligated to repay the Distributor a pro rata portion of
the advance payment of the service fee made on those shares. In cases where the Distributor is the broker of
record for Class B, Class C and Class N shares, i.e. shareholders without the services of a broker directly
invest in the Fund, the Distributor will retain the asset-based sales charge and service fee for Class B, Class C
and Class N shares.

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

The Distributor retains the asset-based sales charge on Class B and Class N shares. The Distributor
retains the asset-based sales charge on Class C shares during the first year the shares are outstanding. It pays
the asset-based sales charge as an ongoing concession to the recipient on Class C shares outstanding for a year
or more. If a dealer has a special agreement with the Distributor, the Distributor will pay the Class B, Class C
and/or Class N service fee and the asset-based sales charge to the dealer quarterly in lieu of paying the sales
concessions and service fee in advance at the time of purchase.

The asset-based sales charges on Class B, Class C and Class N shares allow investors to buy shares
without a front-end sales charge while allowing the Distributor to compensate dealers that sell those shares. The
Fund pays the asset-based sales charges to the Distributor for its services rendered in distributing Class B,
Class C and Class N shares. The payments are made to the Distributor in recognition that the Distributor:
o pays sales concessions to authorized brokers and dealers at the time of sale and pays service fees as
described above,
o may finance payment of sales concessions and/or the advance of the service fee payment to recipients
under the plans, or may provide such financing from its own resources or from the resources of an
affiliate,
o employs personnel to support distribution of Class B, Class C and Class N shares, and
o bears the costs of sales literature, advertising and prospectuses (other than those furnished to current
shareholders) and state "blue sky" registration fees and certain other distribution expenses.
o may not be able to adequately compensate dealers that sell Class B, Class C and Class N shares without
receiving payment under the plans and therefore may not be able to offer such Classes for sale
absent the plans,
o receives payments under the plans consistent with the service fees and asset-based sales charges paid by
other non-proprietary funds that charge 12b-1 fees,
o may use the payments under the plan to include the Fund in various third-party distribution programs
that may increase sales of Fund shares,
o may experience increased difficulty selling the Fund's shares if payments under the plan are
discontinued because most competitor funds have plans that pay dealers for rendering distribution
services as much or more than the amounts currently being paid by the Fund, and
o may not be able to continue providing, at the same or at a lesser cost, the same quality distribution
sales efforts and services, or to obtain such services from brokers and dealers, if the plan
payments were to be discontinued.

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

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

Distribution Fees Paid to the Distributor for the Year Ended 10/31/02

Class B Plan $ 1 $ %

Class C Plan $ 2 $ %

Class N Plan $ $ %

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

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

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

Performance of the Fund

Explanation of Performance Terminology. The Fund uses a variety of terms to illustrate its investment
performance. Those terms include "cumulative total return," "average annual total return," "average annual total
return at net asset value" and "total return at net asset value." An explanation of how total returns are
calculated is set forth below. The charts below show the Fund's performance as of the Fund's most recent fiscal
year end. You can obtain current performance information by calling the Fund's Transfer Agent at 1.800.225.5567
or by visiting the OppenheimerFunds Internet website at www.oppenheimerfunds.com.

The Fund's illustrations of its performance data in advertisements must comply with rules of the
Securities and Exchange Commission. Those rules describe the types of performance data that may be used and how
it is to be calculated. In general, any advertisement by the Fund of its performance data must include the
average annual total returns for the advertised class of shares of the Fund. Those returns must be shown for the
1-, 5- and 10-year periods (or the life of the class, if less) ending as of the most recently ended calendar
quarter prior to the publication of the advertisement (or its submission for publication).

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

o An investment in the Fund is not insured by the FDIC or any other government agency.
o The principal value of the Fund's shares, and total returns are not guaranteed and normally will
fluctuate on a daily basis.
o When an investor's shares are redeemed, they may be worth more or less than their original cost.
o Total returns for any given past period represent historical performance information and are not, and
should not be considered, a prediction of future returns.

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

|X| Total Return Information. There are different types of "total returns" to measure the Fund's
performance. Total return is the change in value of a hypothetical investment in the Fund over a given period,
assuming that all dividends and capital gains distributions are reinvested in additional shares and that the
investment is redeemed at the end of the period. Because of differences in expenses for each class of shares, the
total returns for each class are separately measured. The cumulative total return measures the change in value
over the entire period (for example, 10 years). An average annual total return shows the average rate of return
for each year in a period that would produce the cumulative total return over the entire period. However, average
annual total returns do not show actual year-by-year performance. The Fund uses standardized calculations for its
total returns as prescribed by the SEC. The methodology is discussed below.

In calculating total returns for Class A shares, the current maximum sales charge of 5.75% (as a
percentage of the offering price) is deducted from the initial investment ("P") (unless the return is shown
without sales charge, as described below). For Class B shares, payment of the applicable contingent deferred
sales charge is applied, depending on the period for which the return is shown: 5.0% in the first year, 4.0% in
the second year, 3.0% in the third and fourth years, 2.0% in the fifth year, 1.0% in the sixth year and none
thereafter. For Class C shares, the 1.0% contingent deferred sales charge is deducted for returns for the
one-year period. For Class N shares, the 1.0% contingent deferred sales charge is deducted for returns for the
one-year period, and total returns for the periods prior to 03/01/02 (the inception date for Class N shares) is
based on the Fund's Class A returns, adjusted to reflect the higher Class N 12b-1 fees.

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

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

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

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

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

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

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

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

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

The Fund's Total Returns for the Periods Ended 10/31/02

Class of Cumulative Total Average Annual Total Returns
Returns (10 years
Shares or life of Class)

1-Year 5-Year 10-Year
(or life of class) (or life of class) (or life of class)

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

Class A1

Class B

Class C

Class N

- --------------- ----------- ----------- ------------ ------------ ------------ ------------ ------------ ------------
1. Inception of Class A: 9/16/85
2. Inception of Class B: 10/2/95
3. Inception of Class C: 5/1/96
4. Inception of Class N: 3/1/01

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

Average Annual Total Returns for Class A Shares (After Sales Charge)
For the Periods Ended 10/31/02

1-Year 5-Year 10-Year
(or life of class)

After Taxes on Distributions % % %1

After Taxes on Distributions and % % %1
Redemption of Fund Shares

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

1. Inception date of Class A: 9/16/85

Other Performance Comparisons. The Fund compares its performance annually to that of an appropriate broadly-based
market index in its Annual Report to shareholders. You can obtain that information by contacting the Transfer
Agent at the addresses or telephone numbers shown on the cover of this Statement of Additional Information. The
Fund may also compare its performance to that of other investments, including other mutual funds, or use rankings
of its performance by independent ranking entities. Examples of these performance comparisons are set forth below.

|X| Lipper Rankings. From time to time the Fund may publish the ranking of the performance of its
classes of shares by Lipper, Inc. Lipper is a widely-recognized independent mutual fund monitoring service.
Lipper monitors the performance of regulated investment companies, including the Fund, and ranks their
performance for various periods in categories based on investment styles. The Lipper performance rankings are
based on total returns that include the reinvestment of capital gain distributions and income dividends but do
not take sales charges or taxes into consideration. Lipper also publishes "peer-group" indices of the performance
of all mutual funds in a category that it monitors and averages of the performance of the funds in particular
categories.

|X| Morningstar Rankings. From time to time the Fund may publish the star ranking of the performance of its
classes of shares by Morningstar, Inc., an independent mutual fund monitoring service. Morningstar ranks mutual
funds in their specialized market sector. The Fund is included in the domestic stock funds category.

Morningstar proprietary star rankings reflect historical risk-adjusted total investment return. For each
fund with at least a three-year history, Morningstar calculates a Morningstar Rating(TM)based on a Morningstar
Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects
of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding
consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars,
the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. (Each share
class is counted as a fraction of one fund within this scale and rated separately, which may cause slight
variations in the distribution percentages.) The Overall Morningstar Rating for a fund is derived from a weighted
average of the performance figures associated with its three-, five-and 10-year (if applicable) Morningstar
Rating metrics.

|X| Performance Rankings and Comparisons by Other Entities and Publications. From time to time the Fund
may include in its advertisements and sales literature performance information about the Fund cited in newspapers
and other periodicals such as The New York Times, The Wall Street Journal, Barron's, or similar publications.
That information may include performance quotations from other sources, including Lipper and Morningstar. The
performance of the Fund's classes of shares may be compared in publications to the performance
of various market indices or other investments, and averages, performance rankings or other benchmarks prepared
by recognized mutual fund statistical services.

Investors may also wish to compare the returns on the Fund's share classes to the return on fixed-income
investments available from banks and thrift institutions. Those include certificates of deposit, ordinary
interest-paying checking and savings accounts, and other forms of fixed or variable time deposits, and various
other instruments such as Treasury bills. However, the Fund's returns and share price are not guaranteed or
insured by the FDIC or any other agency and will fluctuate daily, while bank depository obligations may be
insured by the FDIC and may provide fixed rates of return. Repayment of principal and payment of interest on
Treasury securities is backed by the full faith and credit of the U.S. government.

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

From time to time the Fund may include in its advertisements and sales literature the total return
performance of a hypothetical investment account that includes shares of the Fund and other Oppenheimer funds.
The combined account may be part of an illustration of an asset allocation model or similar presentation. The
account performance may combine total return performance of the Fund and the total return performance of other
Oppenheimer funds included in the account. Additionally, from time to time, the Fund's advertisements and sales
literature may include, for illustrative or comparative purposes, statistical data or other information about
general or specific market and economic conditions. That may include, for example,
o information about the performance of certain securities or commodities markets or segments of those
markets,
o information about the performance of the economies of particular countries or regions,
o the earnings of companies included in segments of particular industries, sectors, securities markets,
countries or regions,
o the availability of different types of securities or offerings of securities,
o information relating to the gross national or gross domestic product of the United States or other
countries or regions,
o comparisons of various market sectors or indices to demonstrate performance, risk, or other
characteristics of the Fund.

ABOUT your account

How to Buy Shares

Additional information is presented below about the methods that can be used to buy shares of the Fund. Appendix
C contains more information about the special sales charge arrangements offered by the Fund, and the
circumstances in which sales charges may be reduced or waived for certain classes of investors.

AccountLink. When shares are purchased through AccountLink, each purchase must be at least $25. Each purchase
through AccountLink must be at least $50 and shareholders must invest at least $500 before an Asset Builder Plan
---
can be established on a new account. Accounts established prior to November 1, 2002 will remain at $25 for
additional purchases. Shares will be purchased on the regular business day the Distributor is instructed to
initiate the Automated Clearing House ("ACH") transfer to buy the shares. Dividends will begin to accrue on
shares purchased with the proceeds of ACH transfers on the business day the Fund receives Federal Funds for the
purchase through the ACH system before the close of The New York Stock Exchange. The Exchange normally closes at
4:00 P.M., but may close earlier on certain days. If Federal Funds are received on a business day after the
close of the Exchange, the shares will be purchased and dividends will begin to accrue on the next regular
business day. The proceeds of ACH transfers are normally received by the Fund three days after the transfers are
initiated. If the proceeds of the ACH transfer are not received on a timely basis, the Distributor reserves the
right to cancel the purchase order. The Distributor and the Fund are not responsible for any delays in purchasing
shares resulting from delays in ACH transmissions.

Reduced Sales Charges. As discussed in the Prospectus, a reduced sales charge rate may be obtained for Class A
shares under Right of Accumulation and Letters of Intent because of the economies of sales efforts and reduction
in expenses realized by the Distributor, dealers and brokers making such sales. No sales charge is imposed in
certain other circumstances described in Appendix C to this Statement of Additional Information because the
Distributor or dealer or broker incurs little or no selling expenses.

|X| Right of Accumulation. To qualify for the lower sales charge rates that apply to larger purchases
of Class A shares, you and your spouse can add together:
o Class A and Class B shares you purchase for your individual accounts (including IRAs and 403(b) plans),
or for your joint accounts, or for trust or custodial accounts on behalf of your children who
are minors, and
o Current purchases of Class A and Class B shares of the Fund and other Oppenheimer funds to reduce the
sales charge rate that applies to current purchases of Class A shares, and
o Class A and Class B shares of Oppenheimer funds you previously purchased subject to an initial or
contingent deferred sales charge to reduce the sales charge rate for current purchases of Class
A shares, provided that you still hold your investment in one of the Oppenheimer funds.

A fiduciary can count all shares purchased for a trust, estate or other fiduciary account (including one
or more employee benefit plans of the same employer) that has multiple accounts. The Distributor will add the
value, at current offering price, of the shares you previously purchased and currently own to the value of
current purchases to determine the sales charge rate that applies. The reduced sales charge will apply only to
current purchases. You must request it when you buy shares.

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

Oppenheimer Bond Fund Oppenheimer Municipal Bond Fund
Oppenheimer California Municipal Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Appreciation Fund Oppenheimer New York Municipal Fund
Oppenheimer Capital Preservation Fund Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Capital Income Fund Oppenheimer Quest Balanced Value Fund
Oppenheimer Champion Income Fund Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Convertible Securities Fund Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Developing Markets Fund Oppenheimer Quest Opportunity Value Fund
Oppenheimer Disciplined Allocation Fund Oppenheimer Quest Value Fund, Inc.
Oppenheimer Discovery Fund Oppenheimer Real Asset Fund
Oppenheimer Emerging Growth Fund Oppenheimer Rochester National Municipals
Oppenheimer Emerging Technologies Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Enterprise Fund Oppenheimer Small Cap Value Fund
Oppenheimer Europe Fund Oppenheimer Strategic Income Fund
Oppenheimer Global Fund Oppenheimer Total Return Fund, Inc.
Oppenheimer Global Growth & Income Fund Oppenheimer Trinity Core Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Trinity Large Cap Growth Fund
Oppenheimer Growth Fund Oppenheimer Trinity Value Fund
Oppenheimer High Yield Fund Oppenheimer U.S. Government Trust
Oppenheimer International Bond Fund Oppenheimer Value Fund
Oppenheimer International Growth Fund Limited-Term New York Municipal Fund
Oppenheimer International Small Company Fund Rochester Fund Municipals
Oppenheimer Limited-Term Government Fund OSM1- Gartmore Millennium Growth Fund II
Oppenheimer Limited Term Municipal Fund OSM1 - Jennison Growth Fund
Oppenheimer Main Street Growth & Income Fund OSM1 - Mercury Advisors S&P 500 Index Fund
Oppenheimer Main Street Opportunity Fund OSM1 - Mercury Advisors Focus Growth Fund
Oppenheimer Main Street Small Cap Fund OSM1 - QM Active Balanced Fund
Oppenheimer MidCap Fund OSM1 - Salomon Brothers All Cap Fund
Oppenheimer Multiple Strategies Fund
And the following money market funds:

Centennial America Fund, L. P. Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust Centennial Tax Exempt Trust
Centennial Government Trust Oppenheimer Cash Reserves
Centennial Money Market Trust Oppenheimer Money Market Fund, Inc.
1 - "OSM" stands for Oppenheimer Select Managers

There is an initial sales charge on the purchase of Class A shares of each of the Oppenheimer funds
described above except the money market funds. Under certain circumstances described in this Statement of
Additional Information, redemption proceeds of certain money market fund shares may be subject to a contingent
deferred sales charge.

Letters of Intent. Under a Letter of Intent, if you purchase Class A shares or Class A and Class B shares of the
Fund and other Oppenheimer funds during a 13-month period, you can reduce the sales charge rate that applies to
your purchases of Class A shares. The total amount of your intended purchases of both Class A and Class B shares
will determine the reduced sales charge rate for the Class A shares purchased during that period. You can
include purchases made up to 90 days before the date of the Letter. Letters of Intent do not consider Class C or
Class N shares you purchase or may have purchased.

A Letter of Intent is an investor's statement in writing to the Distributor of the intention to purchase
Class A shares or Class A and Class B shares of the Fund (and other Oppenheimer funds) during a 13-month period
(the "Letter of Intent period"). At the investor's request, this may include purchases made up to 90 days prior
to the date of the Letter. The Letter states the investor's intention to make the aggregate amount of purchases
of shares which, when added to the investor's holdings of shares of those funds, will equal or exceed the amount
specified in the Letter. Purchases made by reinvestment of dividends or distributions of capital gains and
purchases made at net asset value without sales charge do not count toward satisfying the amount of the Letter.

A Letter enables an investor to count the Class A and Class B shares purchased under the Letter to
obtain the reduced sales charge rate on purchases of Class A shares of the Fund (and other Oppenheimer funds)
that applies under the Right of Accumulation to current purchases of Class A shares. Each purchase of Class A
shares under the Letter will be made at the offering price (including the sales charge) that applies to a single
lump-sum purchase of shares in the amount intended to be purchased under the Letter.

In submitting a Letter, the investor makes no commitment to purchase shares. However, if the investor's
purchases of shares within the Letter of Intent period, when added to the value (at offering price) of the
investor's holdings of shares on the last day of that period, do not equal or exceed the intended purchase
amount, the investor agrees to pay the additional amount of sales charge applicable to such purchases. That
amount is described in "Terms of Escrow," below (those terms may be amended by the Distributor from time to
time). The investor agrees that shares equal in value to 5% of the intended purchase amount will be held in
escrow by the Transfer Agent subject to the Terms of Escrow. Also, the investor agrees to be bound by the terms
of the Prospectus, this Statement of Additional Information and the application used for a Letter of Intent. If
those terms are amended, as they may be from time to time by the Fund, the investor agrees to be bound by the
amended terms and that those amendments will apply automatically to existing Letters of Intent.

If the total eligible purchases made during the Letter of Intent period do not equal or exceed the
intended purchase amount, the concessions previously paid to the dealer of record for the account and the amount
of sales charge retained by the Distributor will be adjusted to the rates applicable to actual total purchases.
If total eligible purchases during the Letter of Intent period exceed the intended purchase amount and exceed the
amount needed to qualify for the next sales charge rate reduction set forth in the Prospectus, the sales charges
paid will be adjusted to the lower rate. That adjustment will be made only if and when the dealer returns to the
Distributor the excess of the amount of concessions allowed or paid to the dealer over the amount of concessions
that apply to the actual amount of purchases. The excess concessions returned to the Distributor will be used to
purchase additional shares for the investor's account at the net asset value per share in effect on the date of
such purchase, promptly after the Distributor's receipt thereof.

The Transfer Agent will not hold shares in escrow for purchases of shares of the Fund and other
Oppenheimer funds by OppenheimerFunds prototype 401(k) plans under a Letter of Intent. If the intended purchase
amount under a Letter of Intent entered into by an OppenheimerFunds prototype 401(k) plan is not purchased by the
plan by the end of the Letter of Intent period, there will be no adjustment of concessions paid to the
broker-dealer or financial institution of record for accounts held in the name of that plan.

In determining the total amount of purchases made under a Letter, shares redeemed by the investor prior
to the termination of the Letter of Intent period will be deducted. It is the responsibility of the dealer of
record and/or the investor to advise the Distributor about the Letter in placing any purchase orders for the
investor during the Letter of Intent period. All of such purchases must be made through the Distributor.

|X| Terms of Escrow That Apply to Letters of Intent.

1. Out of the initial purchase (or subsequent purchases if necessary) made pursuant to a Letter,
shares of the Fund equal in value up to 5% of the intended purchase amount specified in the Letter shall be held
in escrow by the Transfer Agent. For example, if the intended purchase amount is $50,000, the escrow shall be
shares valued in the amount of $2,500 (computed at the offering price adjusted for a $50,000 purchase). Any
dividends and capital gains distributions on the escrowed shares will be credited to the investor's account.

2. If the total minimum investment specified under the Letter is completed within the 13-month Letter
of Intent period, the escrowed shares will be promptly released to the investor.

3. If, at the end of the 13-month Letter of Intent period the total purchases pursuant to the Letter
are less than the intended purchase amount specified in the Letter, the investor must remit to the Distributor an
amount equal to the difference between the dollar amount of sales charges actually paid and the amount of sales
charges which would have been paid if the total amount purchased had been made at a single time. That sales
charge adjustment will apply to any shares redeemed prior to the completion of the Letter. If the difference in
sales charges is not paid within twenty days after a request from the Distributor or the dealer, the Distributor
will, within sixty days of the expiration of the Letter, redeem the number of escrowed shares necessary to
realize such difference in sales charges. Full and fractional shares remaining after such redemption will be
released from escrow. If a request is received to redeem escrowed shares prior to the payment of such additional
sales charge, the sales charge will be withheld from the redemption proceeds.

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

Oppenheimer funds that were acquired subject to a Class A initial or contingent deferred sales
charge or (2) Class B shares of one of the (c) other Oppenheimer funds that were acquired
subject to a contingent deferred sales charge.

6. Shares held in escrow hereunder will automatically be exchanged for shares of another fund to which
an exchange is requested, as described in the section of the Prospectus entitled "How to Exchange Shares" and the
escrow will be transferred to that other fund.

Asset Builder Plans. To establish an Asset Builder Plan to buy shares directly from a bank account, you must
enclose a check (the minimum is $25) for the initial purchase with your application. The minimum investment for
new Asset Builder Plans is $50, each purchase must be at least $50 and shareholders must invest at least $500
before an Asset Builder Plan can be established. Shares purchased by Asset Builder Plan payments from bank
accounts are subject to the redemption restrictions for recent purchases described in the Prospectus. Asset
Builder Plans are available only if your bank is an ACH member. Asset Builder Plans may not be used to buy
shares for OppenheimerFunds employer-sponsored qualified retirement accounts. Asset Builder Plans also enable
shareholders of Oppenheimer Cash Reserves to use their fund account to make monthly automatic purchases of shares
of up to four other Oppenheimer funds.

If you make payments from your bank account to purchase shares of the Fund, your bank account will be
debited automatically. Normally the debit will be made two business days prior to the investment dates you
selected on your application. Neither the Distributor, the Transfer Agent nor the Fund shall be responsible for
any delays in purchasing shares that result from delays in ACH transmissions.
Before you establish Asset Builder payments, you should obtain a prospectus of the selected fund(s) from
your financial advisor (or the Distributor) and request an application from the Distributor. Complete the
application and return it. You may change the amount of your Asset Builder payment or you can terminate these
automatic investments at any time by writing to the Transfer Agent. The Transfer Agent requires a reasonable
period (approximately 10 days) after receipt of your instructions to implement them. The Fund reserves the right
to amend, suspend or discontinue offering Asset Builder plans at any time without prior notice.

Retirement Plans. Certain types of retirement plans are entitled to purchase shares of the Fund without sales
charge or at reduced sales charge rates, as described in Appendix C to this Statement of Additional Information.
Certain special sales charge arrangements described in that Appendix apply to retirement plans whose records are
maintained on a daily valuation basis by Merrill Lynch Pierce Fenner & Smith, Inc. ("Merrill Lynch") or an
independent record keeper that has a contract or special arrangement with Merrill Lynch. If on the date the plan
sponsor signed the Merrill Lynch record keeping service agreement the plan has less than $3 million in assets
(other than assets invested in money market funds) invested in applicable investments, then the retirement plan
may purchase only Class B shares of the Oppenheimer funds. Any retirement plans in that category that currently
invest in Class B shares of the Fund will have their Class B shares converted to Class A shares of the Fund when
the plan's applicable investments reach $5 million. OppenheimerFunds has entered into arrangements with certain
record keepers whereby the Transfer Agent compensates the record keeper for its record keeping and account
servicing functions that it performs on behalf of the participant level accounts of a retirement plan. While
such compensation may act to reduce the record keeping fees charged by the retirement plan's record keeper, that
compensation arrangement may be terminated at any time, potentially affecting the record keeping fees charged by
the retirement plan's record keeper.

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

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

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

The Distributor will not accept any order in the amount of $500,000 or more for Class B shares or $1
million or more for Class C shares on behalf of a single investor (not including dealer "street name" or omnibus
accounts). That is because generally it will be more advantageous for that investor to purchase Class A shares of
the Fund.

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

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

The sales concession and the advance of the service fee, as described in the Prospectus, will not be
paid to dealers of record on sales of Class N shares on:
o purchases of Class N shares in amounts of $500,000 or more by a retirement plan that pays for the
purchase with the redemption proceeds of Class A shares of one or more Oppenheimer funds (other
than rollovers from an OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan to any IRA
invested in the Oppenheimer funds),
o purchases of Class N shares in amounts of $500,000 or more by a retirement plan that pays for the
purchase with the redemption proceeds of Class C shares of one or more Oppenheimer funds held
by the plan for more than one year (other than rollovers from an OppenheimerFunds-sponsored
Pinnacle or Ascender 401(k) plan to any IRA invested in the Oppenheimer funds), and
o on purchases of Class N shares by an OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan made
with the redemption proceeds of Class A shares of one or more Oppenheimer funds.

No sales concessions will be paid to the broker-dealer of record, as described in the Prospectus, on
sales of Class N shares purchased with the redemption proceeds of shares of another mutual fund offered as an
investment option in a retirement plan in which Oppenheimer funds are also offered as investment options under a
special arrangement with the Distributor, if the purchase occurs more than 30 days after the Oppenheimer funds
are added as an investment option under that plan.

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

The methodology for calculating the net asset value, dividends and distributions of the Fund's share
classes recognizes two types of expenses. General expenses that do not pertain specifically to any one class are
allocated pro rata to the shares of all classes. The allocation is based on the percentage of the Fund's total
assets that is represented by the assets of each class, and then equally to each outstanding share within a given
class. Such general expenses include management fees, legal, bookkeeping and audit fees, printing and mailing
costs of shareholder reports, Prospectuses, Statements of Additional Information and other materials for current
shareholders, fees to unaffiliated Directors, custodian expenses, share issuance costs, organization and start-up
costs, interest, taxes and brokerage commissions, and non-recurring expenses, such as litigation costs.

Other expenses that are directly attributable to a particular class are allocated equally to each
outstanding share within that class. Examples of such expenses include distribution and service plan (12b-1)
fees, transfer and shareholder servicing agent fees and expenses, and shareholder meeting expenses (to the extent
that such expenses pertain only to a specific class).

Account Fees. As stated in the Prospectus, a $12 annual fee is charged on any account valued at less than $500.
This fee will not be charged for:
o Accounts that have balances below $500 due to the automatic conversion of shares from Class B to Class A
shares;
o Accounts with an active Asset Builder Plan, payroll deduction plan or a military allotment plan;
o OppenheimerFunds-sponsored group retirement accounts that are making continuing purchases;
o Certain accounts held by broker-dealers through the National Securities Clearing Corporation; and
o Accounts that fall below the $500 threshold due solely to market fluctuations within the 12-month period
preceding the date the fee is deducted.

The fee is charged annually on or about the second to last business day of September. This annual fee
will be waived for any shareholders who elect to access their account documents through electronic document
delivery rather than in paper copy and who elect to utilize the Internet or PhoneLink as their primary source for
their general servicing needs. To sign up to access account documents electronically via eDocs Direct, please
visit the Service Center on our website at WWW.OPPENHEIMERFUNDS.COM or call 1.888.470.0862 for instructions.
------------------------

Determination of Net Asset Values Per Share. The net asset values per share of each class of shares of the Fund
are determined as of the close of business of The New York Stock Exchange ("the Exchange") on each day that the
Exchange is open. The calculation is done by dividing the value of the Fund's net assets attributable to a class
by the number of shares of that class that are outstanding. The Exchange normally closes at 4:00 P.M., Eastern
time, but may close earlier on some other days (for example, in case of weather emergencies or on days falling
before a U.S. holiday). All references to time in this Statement of Additional Information mean "Eastern time."
The Exchange's most recent annual announcement (which is subject to change) states that it will close on New
Year's Day, Presidents' Day, Martin Luther King, Jr. Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day. It may also close on other days.

Dealers other than Exchange members may conduct trading in certain securities on days on which the
Exchange is closed (including weekends and holidays) or after 4:00 P.M. on a regular business day. Because the
Fund's net asset values will not be calculated on those days, the Fund's net asset values per share may be
significantly affected on such days when shareholders may not purchase or redeem shares. Additionally, trading on
European and Asian stock exchanges and over-the-counter markets normally is completed before the close of The New
York Stock Exchange.

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

o Long-term debt securities having a remaining maturity in excess of 60 days are valued based on the mean
between the "bid" and "asked" prices determined by a o portfolio pricing service approved by the Fund's
Board of Directors or obtained by the Manager from two active market makers in the security on the basis of
reasonable inquiry.

o The following securities are valued at the mean between the "bid" and "asked" prices determined by a
pricing service approved by the Fund's Board of Directors or obtained by the Manager from two active market
makers in the security on the basis of reasonable inquiry:
(1) debt instruments that have a maturity of more than 397 days when issued,
(2) debt instruments that had a maturity of 397 days or less when issued and have a remaining maturity of
more than 60 days, and
(3) non-money market debt instruments that had a maturity of 397 days or less when issued and which have a
remaining maturity of 60 days or less.
o The following securities are valued at cost, adjusted for amortization of premiums and accretion of
discounts:
(1) money market debt securities held by a non-money market fund that had a maturity of less than 397 days
when issued that have a remaining maturity of 60 days or less, and
(2) debt instruments held by a money market fund that have a remaining maturity of 397 days or less.
o Securities (including restricted securities) not having readily-available market quotations are valued
at fair value determined under the Board's procedures. If the Manager is unable to locate two market makers
willing to give quotes, a security may be priced at the mean between the "bid" and "asked" prices provided by a
single active market maker (which in certain cases may be the "bid" price if no "asked" price is available).

The closing prices in the London foreign exchange market on a particular business day that are provided
to the Manager by a bank, dealer or pricing service that the Manager has determined to be reliable are used to
value foreign currency, including forward contracts, and to convert to U.S. dollars securities that are
denominated in foreign currency.

Puts, calls, and futures are valued at the last sale price on the principal exchange on which they are
traded or on Nasdaq, as applicable, as determined by a pricing service approved by the Board of Directors or by
the Manager. If there were no sales that day, they shall be valued at the last sale price on the preceding
trading day if it is within the spread of the closing "bid" and "asked" prices on the principal exchange or on
Nasdaq on the valuation date. If not, the value shall be the closing bid price on the principal exchange or on
Nasdaq on the valuation date. If the put, call or future is not traded on an exchange or on Nasdaq, it shall be
valued by the mean between "bid" and "asked" prices obtained by the Manager from two active market makers. In
certain cases that may be at the "bid" price if no "asked" price is available.

When the Fund writes an option, an amount equal to the premium received is included in the Fund's
Statement of Assets and Liabilities as an asset. An equivalent credit is included in the liability section. The
credit is adjusted ("marked-to-market") to reflect the current market value of the option. In determining the
Fund's gain on investments, if a call or put written by the Fund is exercised, the proceeds are increased by the
premium received. If a call or put written by the Fund expires, the Fund has a gain in the amount of the
premium. If the Fund enters into a closing purchase transaction, it will have a gain or loss, depending on
whether the premium received was more or less than the cost of the closing transaction. If the Fund exercises a
put it holds, the amount the Fund receives on its sale of the underlying investment is reduced by the amount of
premium paid by the Fund.

How to Sell Shares

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

Sending Redemption Proceeds by Federal Funds Wire. The Federal Funds wire of redemption proceeds may be delayed
if the Fund's custodian bank is not open for business on a day when the Fund would normally authorize the wire to
be made, which is usually the Fund's next regular business day following the redemption. In those circumstances,
the wire will not be transmitted until the next bank business day on which the Fund is open for business. No
dividends will be paid on the proceeds of redeemed shares awaiting transfer by Federal Funds wire.

Reinvestment Privilege. Within six months of a redemption, a shareholder may reinvest all or part of the
redemption proceeds of:
o Class A shares purchased subject to an initial sales charge or Class A shares on which a contingent
deferred sales charge was paid, or
o Class B shares that were subject to the Class B contingent deferred sales charge when redeemed.
The reinvestment may be made without sales charge only in Class A shares of the Fund or any of the other
Oppenheimer funds into which shares of the Fund are exchangeable as described in "How to Exchange Shares" below.
Reinvestment will be at the net asset value next computed after the Transfer Agent receives the reinvestment
order. The shareholder must ask the Transfer Agent for that privilege at the time of reinvestment. This
privilege does not apply to Class C and Class N shares. The Fund may amend, suspend or cease offering this
reinvestment privilege at any time as to shares redeemed after the date of such amendment, suspension or
cessation.

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

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

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

Involuntary Redemptions. The Fund's Board of Directors has the right to cause the involuntary redemption of the
shares held in any account if the account holds fewer than 100 shares. If the Board exercises this right, it may
also fix the requirements for any notice to be given to the shareholders in question (not less than 30 days). The
Board may alternatively set requirements for the shareholder to increase the investment, or set other terms and
conditions so that the shares would not be involuntarily redeemed.

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

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

Distributions From Retirement Plans. Requests for distributions from OppenheimerFunds-sponsored IRAs, SEP-IRAs,
SIMPLE IRAs, 403(b)(7) custodial plans, 401(k) plans or pension or profit-sharing plans should be addressed to
"Trustee, OppenheimerFunds Retirement Plans," c/o the Transfer Agent at its address listed in "How To Sell Shares"
in the Prospectus or on the back cover of this Statement of Additional Information. The request must:
(1) state the reason for the distribution;
(2) state the owner's awareness of tax penalties if the distribution is premature; and
(3) conform to the requirements of the plan and the Fund's other redemption requirements.

Participants (other than self-employed plan sponsors) in OppenheimerFunds-sponsored pension or
profit-sharing plans with shares of the Fund held in the name of the plan or its fiduciary may not directly
request redemption of their accounts. The plan administrator or fiduciary must sign the request.

Distributions from pension and profit sharing plans are subject to special requirements under the
Internal Revenue Code and certain documents (available from the Transfer Agent) must be completed and submitted
to the Transfer Agent before the distribution may be made. Distributions from retirement plans are subject to
withholding requirements under the Internal Revenue Code, and IRS Form W-4P (available from the Transfer Agent)
must be submitted to the Transfer Agent with the distribution request, or the distribution may be delayed.
Unless the shareholder has provided the Transfer Agent with a certified tax identification number, the Internal
Revenue Code requires that tax be withheld from any distribution even if the shareholder elects not to have tax
withheld. The Fund, the Manager, the Distributor, and the Transfer Agent assume no responsibility to determine
whether a distribution satisfies the conditions of applicable tax laws and will not be responsible for any tax
penalties assessed in connection with a distribution.

Special Arrangements for Repurchase of Shares from Dealers and Brokers. The Distributor is the Fund's agent to
repurchase its shares from authorized dealers or brokers on behalf of their customers. Shareholders should
contact their broker or dealer to arrange this type of redemption. The repurchase price per share will be the net
asset value next computed after the Distributor receives an order placed by the dealer or broker. However, if the
Distributor receives a repurchase order from a dealer or broker after the close of The New York Stock Exchange on
a regular business day, it will be processed at that day's net asset value if the order was received by the
dealer or broker from its customers prior to the time the Exchange closes. Normally, the Exchange closes at 4:00
P.M., but may do so earlier on some days. Additionally, the order must have been transmitted to and received by
the Distributor prior to its close of business that day (normally 5:00 P.M.).

Automatic Withdrawal and Exchange Plans. Investors owning shares of the Fund valued at $5,000 or more can
authorize the Transfer Agent to redeem shares (having a value of at least $50) automatically on a monthly,
quarterly, semi-annual or annual basis under an Automatic Withdrawal Plan. Shares will be redeemed three
business days prior to the date requested by the shareholder for receipt of the payment. Automatic withdrawals
of up to $1,500 per month may be requested by telephone if payments are to be made by check payable to all
shareholders of record. Payments must also be sent to the address of record for the account and the address must
not have been changed within the prior 30 days. Required minimum distributions from OppenheimerFunds-sponsored
retirement plans may not be arranged on this basis.

Payments are normally made by check, but shareholders having AccountLink privileges (see "How To Buy
Shares") may arrange to have Automatic Withdrawal Plan payments transferred to the bank account designated on the
account application or by signature-guaranteed instructions sent to the Transfer Agent. Shares are normally
redeemed pursuant to an Automatic Withdrawal Plan three business days before the payment transmittal date you
select in the account application. If a contingent deferred sales charge applies to the redemption, the amount
of the check or payment will be reduced accordingly.

The Fund cannot guarantee receipt of a payment on the date requested. The Fund reserves the right to
amend, suspend or discontinue offering these plans at any time without prior notice. Because of the sales charge
assessed on Class A share purchases, shareholders should not make regular additional Class A share purchases
while participating in an Automatic Withdrawal Plan. Class B, Class C and Class N shareholders should not
establish automatic withdrawal plans, because of the potential imposition of the contingent deferred sales charge
on such withdrawals (except where the Class B, Class C or Class N contingent deferred sales charge is waived as
described in Appendix C to this Statement of Additional Information).

By requesting an Automatic Withdrawal or Exchange Plan, the shareholder agrees to the terms and
conditions that apply to such plans, as stated below. These provisions may be amended from time to time by the
Fund and/or the Distributor. When adopted, any amendments will automatically apply to existing Plans.

|X| Automatic Exchange Plans. Shareholders can authorize the Transfer Agent to exchange a
pre-determined amount of shares of the Fund for shares (of the same class) of other Oppenheimer funds
automatically on a monthly, quarterly, semi-annual or annual basis under an Automatic Exchange Plan. The minimum
amount that may be exchanged to each other fund account is $50. Instructions should be provided on the
OppenheimerFunds Application or signature-guaranteed instructions. Exchanges made under these plans are subject
to the restrictions that apply to exchanges as set forth in "How to Exchange Shares" in the Prospectus and below
in this Statement of Additional Information.

|X| Automatic Withdrawal Plans. Fund shares will be redeemed as necessary to meet withdrawal payments.
Shares acquired without a sales charge will be redeemed first. Shares acquired with reinvested dividends and
capital gains distributions will be redeemed next, followed by shares acquired with a sales charge, to the extent
necessary to make withdrawal payments. Depending upon the amount withdrawn, the investor's principal may be
depleted. Payments made under these plans should not be considered as a yield or income on your investment.

The Transfer Agent will administer the investor's Automatic Withdrawal Plan as agent for the
shareholder(s) (the "Planholder") who executed the Plan authorization and application submitted to the Transfer
Agent. Neither the Fund nor the Transfer Agent shall incur any liability to the Planholder for any action taken
or not taken by the Transfer Agent in good faith to administer the Plan. Share certificates will not be issued
for shares of the Fund purchased for and held under the Plan, but the Transfer Agent will credit all such shares
to the account of the Planholder on the records of the Fund. Any share certificates held by a Planholder may be
surrendered unendorsed to the Transfer Agent with the Plan application so that the shares represented by the
certificate may be held under the Plan.

For accounts subject to Automatic Withdrawal Plans, distributions of capital gains must be reinvested in
shares of the Fund, which will be done at net asset value without a sales charge. Dividends on shares held in the
account may be paid in cash or reinvested.

Shares will be redeemed to make withdrawal payments at the net asset value per share determined on the
redemption date. Checks or AccountLink payments representing the proceeds of Plan withdrawals will normally be
transmitted three business days prior to the date selected for receipt of the payment, according to the choice
specified in writing by the Planholder. Receipt of payment on the date selected cannot be guaranteed.

The amount and the interval of disbursement payments and the address to which checks are to be mailed or
AccountLink payments are to be sent may be changed at any time by the Planholder by writing to the Transfer
Agent. The Planholder should allow at least two weeks' time after mailing such notification for the requested
change to be put in effect. The Planholder may, at any time, instruct the Transfer Agent by written notice to
redeem all, or any part of, the shares held under the Plan. That notice must be in proper form in accordance with
the requirements of the then-current Prospectus of the Fund. In that case, the Transfer Agent will redeem the
number of shares requested at the net asset value per share in effect and will mail a check for the proceeds to
the Planholder.

The Planholder may terminate a Plan at any time by writing to the Transfer Agent. The Fund may also
give directions to the Transfer Agent to terminate a Plan. The Transfer Agent will also terminate a Plan upon its
receipt of evidence satisfactory to it that the Planholder has died or is legally incapacitated. Upon termination
of a Plan by the Transfer Agent or the Fund, shares that have not been redeemed will be held in uncertificated
form in the name of the Planholder. The account will continue as a dividend-reinvestment, uncertificated account
unless and until proper instructions are received from the Planholder, his or her executor or guardian, or
another authorized person.

To use shares held under the Plan as collateral for a debt, the Planholder may request issuance of a
portion of the shares in certificated form. Upon written request from the Planholder, the Transfer Agent will
determine the number of shares for which a certificate may be issued without causing the withdrawal checks to
stop. However, should such uncertificated shares become exhausted, Plan withdrawals will terminate.

If the Transfer Agent ceases to act as transfer agent for the Fund, the Planholder will be deemed to
have appointed any successor transfer agent to act as agent in administering the Plan.
How to Exchange Shares

As stated in the Prospectus, shares of a particular class of Oppenheimer funds having more than one class of
shares may be exchanged only for shares of the same class of other Oppenheimer funds. Shares of Oppenheimer funds
that have a single class without a class designation are deemed "Class A" shares for this purpose. You can obtain
a current list showing which funds offer which classes of shares by calling the Distributor.

o All of the Oppenheimer funds currently offer Class A, B, C, N and Y shares with the following
exceptions:

The following funds only offer Class A shares:
Centennial America Fund, L.P. Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust Centennial Tax Exempt Trust
Centennial Government Trust Oppenheimer Money Market Fund, Inc.
Centennial Money Market Trust
The following funds do not offer Class N shares:
Oppenheimer California Municipal Fund Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Limited Term Municipal Fund Oppenheimer Rochester National Municipals
Oppenheimer Municipal Bond Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer New Jersey Municipal Fund Limited Term New York Municipal Fund
Oppenheimer New York Municipal Fund Rochester Fund Municipals

The following funds do not offer Class Y shares:
Oppenheimer California Municipal Fund Oppenheimer Limited Term Municipal Fund
Oppenheimer Capital Income Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Cash Reserves Oppenheimer New York Municipal Fund
Oppenheimer Champion Income Fund Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Convertible Securities Fund Oppenheimer Rochester National Municipals
Oppenheimer Disciplined Allocation Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Small Cap Value Fund
Oppenheimer International Small Company Fund Limited Term New York Municipal Fund

o Class Y shares of Oppenheimer Real Asset Fund may not be exchanged for shares of any other fund.
o Class B, Class C and Class N shares of Oppenheimer Cash Reserves are generally available only by
exchange from the same class of shares of other Oppenheimer funds or through OppenheimerFunds-sponsored
401(k) plans.
o Class M shares of Oppenheimer Convertible Securities Fund may be exchanged only for Class A shares of
other Oppenheimer funds. They may not be acquired by exchange of shares of any class of any other
Oppenheimer funds except Class A shares of Oppenheimer Money Market Fund or Oppenheimer Cash Reserves
acquired by exchange of Class M shares.
o Class X shares of Limited Term New York Municipal Fund may be exchanged only for Class B shares of other
Oppenheimer funds and no exchanges may be made to Class X shares.
o Shares of Oppenheimer Capital Preservation Fund may not be exchanged for shares of Oppenheimer Money
Market Fund, Inc., Oppenheimer Cash Reserves or Oppenheimer Limited-Term Government Fund. Only
participants in certain retirement plans may purchase shares of Oppenheimer Capital Preservation Fund,
and only those participants may exchange shares of other Oppenheimer funds for shares of Oppenheimer
Capital Preservation Fund.
o Class A shares of Oppenheimer Senior Floating Rate Fund are not available by exchange of shares of
Oppenheimer Money Market Fund or Class A shares of Oppenheimer Cash Reserves.
o Shares of Oppenheimer Select Managers Mercury Advisors S&P Index Fund and Oppenheimer Select Managers QM
Active Balanced Fund are only available to retirement plans and are available only by exchange from the
same class of shares of other Oppenheimer funds held by retirement plans.
o Class A shares of Oppenheimer funds may be exchanged at net asset value for shares of any money market
fund offered by the Distributor. Shares of any money market fund purchased without a sales charge may be
exchanged for shares of Oppenheimer funds offered with a sales charge upon payment of the sales charge.
They may also be used to purchase shares of Oppenheimer funds subject to an early withdrawal charge or
contingent deferred sales charge.
o Shares of Oppenheimer Money Market Fund, Inc. purchased with the redemption proceeds of shares of other
mutual funds (other than funds managed by the Manager or its subsidiaries) redeemed within the 30 days
prior to that purchase may subsequently be exchanged for shares of other Oppenheimer funds without being
subject to an initial sales charge or contingent deferred sales charge. To qualify for that privilege,
the investor or the investor's dealer must notify the Distributor of eligibility for this privilege at
the time the shares of Oppenheimer Money Market Fund, Inc. are purchased. If requested, they must supply
proof of entitlement to this privilege.
o Shares of the Fund acquired by reinvestment of dividends or distributions from any of the other
Oppenheimer funds or from any unit investment trust for which reinvestment arrangements have been made
with the Distributor may be exchanged at net asset value for shares of any of the Oppenheimer funds.

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

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

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

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

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

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

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

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

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

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

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

|X| Limits on Multiple Exchange Orders. The Fund reserves the right to reject telephone or written
exchange requests submitted in bulk by anyone on behalf of more than one account. The Fund may accept requests
for exchanges of up to 50 accounts per day from representatives of authorized dealers that qualify for this
privilege.

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

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

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

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

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

Dividends, Capital Gains and Taxes

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

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

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

The tax discussion in the Prospectus and this Statement of Additional Information is based on tax law in
effect on the date of the Prospectus and this Statement of Additional Information. Those laws and regulations may
be changed by legislative, judicial, or administrative action, sometimes with retroactive effect. State and local
tax treatment of ordinary income dividends and capital gain dividends from regulated investment companies may
differ from the treatment under the Internal Revenue Code described below. Potential purchasers of shares of the
Fund are urged to consult their tax advisers with specific reference to their own tax circumstances as well as
the consequences of federal, state and local tax rules affecting an investment in the Fund.

|X| Qualification as a Regulated Investment Company. The Fund has elected to be taxed as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986, as amended. As a regulated
investment company, the Fund is not subject to federal income tax on the portion of its net investment income
(that is, taxable interest, dividends, and other taxable ordinary income, net of expenses) and capital gain net
income (that is, the excess of net long-term capital gains over net short-term capital losses) that it
distributes to shareholders. That qualification enables the Fund to "pass through" its income and realized
capital gains to shareholders without having to pay tax on them. This avoids a "double tax" on that income and
capital gains, since shareholders normally will be taxed on the dividends and capital gains they receive from the
Fund (unless their Fund shares are held in a retirement account or the shareholder is otherwise exempt from tax).

The Internal Revenue Code contains a number of complex tests relating to qualification that the Fund
might not meet in a particular year. If it did not qualify as a regulated investment company, the Fund would be
treated for tax purposes as an ordinary corporation and would receive no tax deduction for payments made to
shareholders.

To qualify as a regulated investment company, the Fund must distribute at least 90% of its investment
company taxable income (in brief, net investment income and the excess of net short-term capital gain over net
long-term capital loss) for the taxable year. The Fund must also satisfy certain other requirements of the
Internal Revenue Code, some of which are described below. Distributions by the Fund made during the taxable year
or, under specified circumstances, within 12 months after the close of the taxable year, will be considered
distributions of income and gains for the taxable year and will therefore count toward satisfaction of the
above-mentioned requirement.

To qualify as a regulated investment company, the Fund must derive at least 90% of its gross income from
dividends, interest, certain payments with respect to securities loans, gains from the sale or other disposition
of stock or securities or foreign currencies (to the extent such currency gains are directly related to the
regulated investment company's principal business of investing in stock or securities) and certain other income.

In addition to satisfying the requirements described above, the Fund must satisfy an asset
diversification test in order to qualify as a regulated investment company. Under that test, at the close of
each quarter of the Fund's taxable year, at least 50% of the value of the Fund's assets must consist of cash and
cash items (including receivables), U.S. government securities, securities of other regulated investment
companies, and securities of other issuers. As to each of those issuers, the Fund must not have invested more
than 5% of the value of the Fund's total assets in securities of each such issuer and the Fund must not hold more
than 10% of the outstanding voting securities of each such issuer. No more than 25% of the value of its total
assets may be invested in the securities of any one issuer (other than U.S. government securities and securities
of other regulated investment companies), or in two or more issuers which the Fund controls and which are engaged
in the same or similar trades or businesses. For purposes of this test, obligations issued or guaranteed by
certain agencies or instrumentalities of the U.S. government are treated as U.S. government securities.

|X| Excise Tax on Regulated Investment Companies. Under the Internal Revenue Code, by December 31 each year,
the Fund must distribute 98% of its taxable investment income earned from January 1 through December 31 of that
year and 98% of its capital gains realized in the period from November 1 of the prior year through October 31 of
the current year. If it does not, the Fund must pay an excise tax on the amounts not distributed. It is presently
anticipated that the Fund will meet those requirements. To meet this requirement, in certain circumstances |X|
the Fund might be required to liquidate portfolio investments to make sufficient distributions to avoid excise
tax liability. However, the Board of Directors and the Manager might determine in a particular year that it would
be in the best interests of shareholders for the Fund not to make such distributions at the required levels and
to pay the excise tax on the undistributed amounts. That would reduce the amount of income or capital gains
available for distribution to shareholders.

|X| Taxation of Fund Distributions. The Fund anticipates distributing substantially all of its investment
company taxable income for each taxable year. Those distributions will be taxable to shareholders as ordinary
income and treated as dividends for federal income tax purposes.

Special provisions of the Internal Revenue Code govern the eligibility of the Fund's dividends for the
dividends-received deduction for corporate shareholders. Long-term capital gains distributions are not eligible
for the deduction. The amount of dividends paid by the Fund that may qualify for the deduction is limited to the
aggregate amount of qualifying dividends that the Fund derives from portfolio investments that the Fund has held
for a minimum period, usually 46 days. A corporate shareholder will not be eligible for the deduction on
dividends paid on Fund shares held for 45 days or less. To the extent the Fund's dividends are derived from
gross income from option premiums, interest income or short-term gains from the sale of securities or dividends
from foreign corporations, those dividends will not qualify for the deduction.

The Fund may either retain or distribute to shareholders its net capital gain for each taxable year.
The Fund currently intends to distribute any such amounts. If net long term capital gains are distributed and
designated as a capital gain distribution, it will be taxable to shareholders as a long-term capital gain and
will be properly identified in reports sent to shareholders in January of each year. Such treatment will apply no
matter how long the shareholder has held his or her shares or whether that gain was recognized by the Fund before
the shareholder acquired his or her shares.

If the Fund elects to retain its net capital gain, the Fund will be subject to tax on it at the 35%
corporate tax rate. If the Fund elects to retain its net capital gain, the Fund will provide to shareholders of
record on the last day of its taxable year information regarding their pro rata share of the gain and tax paid.
As a result, each shareholder will be required to report his or her pro rata share of such gain on their tax
return as long-term capital gain, will receive a refundable tax credit for his/her pro rata share of tax paid by
the Fund on the gain, and will increase the tax basis for his/her shares by an amount equal to the deemed
distribution less the tax credit.

Investment income that may be received by the Fund from sources within foreign countries may be subject
to foreign taxes withheld at the source. The United States has entered into tax treaties with many foreign
countries which entitle the Fund to a reduced rate of, or exemption from, taxes on such income.

Distributions by the Fund that do not constitute ordinary income dividends or capital gain distributions
will be treated as a return of capital to the extent of the shareholder's tax basis in their shares. Any excess
will be treated as gain from the sale of those shares, as discussed below. Shareholders will be advised annually
as to the U.S. federal income tax consequences of distributions made (or deemed made) during the year. If prior
distributions made by the Fund must be re-characterized as a non-taxable return of capital at the end of the
fiscal year as a result of the effect of the Fund's investment policies, they will be identified as such in
notices sent to shareholders.

Distributions by the Fund will be treated in the manner described above regardless of whether the
distributions are paid in cash or reinvested in additional shares of the Fund (or of another fund). Shareholders
receiving a distribution in the form of additional shares will be treated as receiving a distribution in an
amount equal to the fair market value of the shares received, determined as of the reinvestment date.

The Fund will be required in certain cases to withhold 30% (29% for payments after December 31, 2003) of
ordinary income dividends, capital gains distributions and the proceeds of the redemption of shares, paid to any
shareholder (1) who has failed to provide a correct taxpayer identification number or to properly certify that
-------
number when required, (2) who is subject to backup withholding for failure to report the receipt of interest or
dividend income properly, or (3) who has failed to certify to the Fund that the shareholder is not subject to
backup withholding or is an "exempt recipient" (such as a corporation). All income and any tax withheld by the
Fund is remitted by the Fund to the U.S. Treasury and is identified in reports mailed to shareholders in January
of each year.

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

In general, any gain or loss arising from the redemption of shares of the Fund will be considered
capital gain or loss, if the shares were held as a capital asset. It will be long-term capital gain or loss if
the shares were held for more than one year. However, any capital loss arising from the redemption of shares
held for six months or less will be treated as a long-term capital loss to the extent of the amount of capital
gain dividends received on those shares. Special holding period rules under the Internal Revenue Code apply in
this case to determine the holding period of shares and there are limits on the deductibility of capital losses
in any year.
|X| Foreign Shareholders. Under U.S. tax law, taxation of a shareholder who is a foreign person (to
include, but not limited to, a nonresident alien individual, a foreign trust, a foreign estate, a foreign
corporation, or a foreign partnership) primarily depends on whether the foreign person's income from the Fund is
effectively connected with the conduct of a U.S. trade or business. Typically, ordinary income dividends paid
from a mutual fund are not considered "effectively connected" income.

If the ordinary income dividends from the Fund are effectively connected with the conduct of a U.S.
---
trade or business, then the foreign person may claim an exemption from the U.S. tax described above provided the
Fund obtains a properly completed and signed Certificate of Foreign Status.

If the foreign person fails to provide a certification of his/her foreign status, the Fund will be
required to withhold U.S. tax at a rate of 30% (29% for payments after December 31, 2003) on ordinar7y income
dividends, capital gains distributions and the proceeds of the redemption of shares, paid to any foreign person.
All income and any tax withheld (in this situation) by the Fund is remitted by the Fund to the U.S. Treasury and
is identified in reports mailed to shareholders in January of each year.

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

Dividend Reinvestment in Another Fund. Shareholders of the Fund may elect to reinvest all dividends and/or
capital gains distributions in shares of the same class of any of the other Oppenheimer funds listed above.
Reinvestment will be made without sales charge at the net asset value per share in effect at the close of
business on the payable date of the dividend or distribution. To elect this option, the shareholder must notify
the Transfer Agent in writing and must have an existing account in the fund selected for reinvestment. Otherwise
the shareholder first must obtain a prospectus for that fund and an application from the Distributor to establish
an account. Dividends and/or distributions from shares of certain other Oppenheimer funds (other than Oppenheimer
Cash Reserves) may be invested in shares of this Fund on the same basis.

Additional Information About the Fund

The Distributor. The Fund's shares are sold through dealers, brokers and other financial institutions that have a
sales agreement with OppenheimerFunds Distributor, Inc., a subsidiary of the Manager that acts as the Fund's
Distributor. The Distributor also distributes shares of the other Oppenheimer funds and is sub-distributor for
funds managed by a subsidiary of the Manager.

The Transfer Agent. OppenheimerFunds Services, the Fund's Transfer Agent, is a division of the Manager. It is
responsible for maintaining the Fund's shareholder registry and shareholder accounting records, and for paying
dividends and distributions to shareholders. It also handles shareholder servicing and administrative functions.
It serves as the Transfer Agent for an annual per account fee. It also acts as shareholder servicing agent for
the other Oppenheimer funds. Shareholders should direct inquiries about their accounts to the Transfer Agent at
the address and toll-free numbers shown on the back cover.

The Custodian. Citibank, N.A. is the custodian of the Fund's assets. The custodian's responsibilities include
safeguarding and controlling the Fund's portfolio securities and handling the delivery of such securities to and
from the Fund. It is the practice of the Fund to deal with the custodian in a manner uninfluenced by any banking
relationship the custodian may have with the Manager and its affiliates. The Fund's cash balances with the
custodian in excess of $100,000 are not protected by federal deposit insurance. Those uninsured balances at
times may be substantial.

Independent Auditors. KPMG LLP are the independent auditors of the Fund. They audit the Fund's financial
statements and perform other related audit services. They also act as auditors for certain other funds advised by
the Manager and its affiliates.

A-1
Appendix A

RATINGS DEFINITIONS
-------------------

Below are summaries of the rating definitions used by the nationally-recognized rating agencies listed below.
Those ratings represent the opinion of the agency as to the credit quality of issues that they rate. The
summaries below are based upon publicly-available information provided by the rating organizations.

Moody's Investors Service, Inc.
- -------------------------------------------------------------------------------------------------------------------

Long-Term (Taxable) Bond Ratings

Aaa: Bonds rated "Aaa" are judged to be the best quality. They carry the smallest degree of investment risk.
Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While
the various protective elements are likely to change, the changes that can be expected are most unlikely to
impair the fundamentally strong position of such issues.

Aa: Bonds rated "Aa" are judged to be of high quality by all standards. Together with the "Aaa" group, they
comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins
of protection may not be as large as with "Aaa" securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger
than that of "Aaa" securities.

A: Bonds rated "A" possess many favorable investment attributes and are to be considered as upper-medium grade
obligations. Factors giving security to principal and interest are considered adequate but elements may be
present which suggest a susceptibility to impairment some time in the future.

Baa: Bonds rated "Baa" are considered medium-grade obligations; that is, they are neither highly protected nor
poorly secured. Interest payments and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack
outstanding investment characteristics and have speculative characteristics as well.

Ba: Bonds rated "Ba" are judged to have speculative elements. Their future cannot be considered well-assured.
Often the protection of interest and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position characterizes bonds in this class.

B: Bonds rated "B" generally lack characteristics of the desirable investment. Assurance of interest and
principal payments or of maintenance of other terms of the contract over any long period of time may be small.

Caa: Bonds rated "Caa" are of poor standing. Such issues may be in default or there may be present elements of
danger with respect to principal or interest.

Ca: Bonds rated "Ca" represent obligations which are speculative in a high degree. Such issues are often in
default or have other marked shortcomings.

C: Bonds rated "C" are the lowest class of rated bonds and can be regarded as having extremely poor prospects of
ever attaining any real investment standing.

Con. (...): Bonds for which the security depends on the completion of some act or the fulfillment of some condition
are rated conditionally. These bonds are secured by (a) earnings of projects under construction, (b) earnings of
projects unseasoned in operating experience, (c) rentals that begin when facilities are completed, or (d)
payments to which some other limiting condition attaches. The parenthetical rating denotes probable credit
stature upon completion of construction or elimination of the basis of the condition.

Moody's applies numerical modifiers 1, 2, and 3 in each generic rating classification from "Aa" through "Caa."
The modifier "1" indicates that the obligation ranks in the higher end of its generic rating category; the
modifier "2" indicates a mid-range ranking; and the modifier "3" indicates a ranking in the lower end of that
generic rating category. Advanced refunded issues that are secured by certain assets are identified with a #
symbol.

Short-Term Ratings - Taxable Debt

These ratings apply to the ability of issuers to honor senior debt obligations having an original maturity not
exceeding one year:

Prime-1: Issuer has a superior ability for repayment of senior short-term debt obligations.

Prime-2: Issuer has a strong ability for repayment of senior short-term debt obligations. Earnings trends and
coverage ratios, while sound, may be more subject to variation. Capitalization characteristics, while
appropriate, may be more affected by external conditions. Ample alternate liquidity is maintained.

Prime-3: Issuer has an acceptable ability for repayment of senior short-term obligations. The effect of industry
characteristics and market compositions may be more pronounced. Variability in earnings and profitability may
result in changes in the level of debt protection measurements and may require relatively high financial
leverage. Adequate alternate liquidity is maintained.

Not Prime: Issuer does not fall within any Prime rating category.

Standard & Poor's Rating Services
- -------------------------------------------------------------------------------------------------------------------

Long-Term Credit Ratings

AAA: Bonds rated "AAA" have the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its
financial commitment on the obligation is extremely strong.

AA: Bonds rated "AA" differ from the highest rated obligations only in small degree. The obligor's capacity to
meet its financial commitment on the obligation is very strong.

A: Bonds rated "A" are somewhat more susceptible to the adverse effects of changes in circumstances and economic
conditions than obligations in higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB: Bonds rated "BBB" exhibit adequate protection parameters. However, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on
the obligation.

BB, B, CCC, CC, and C

Bonds rated "BB", "B", "CCC", "CC" and "C" are regarded as having significant speculative characteristics. "BB"
indicates the least degree of speculation, and "C" the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to
adverse conditions.
BB: Bonds rated "BB" are less vulnerable to nonpayment than other speculative issues. However, these face major
ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the obligation.

B: Bonds rated "B" are more vulnerable to nonpayment than obligations rated "BB", but the obligor currently has
the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic
conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the
obligation.

CCC: Bonds rated "CCC" are currently vulnerable to nonpayment, and are dependent upon favorable business,
financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the
event of adverse business, financial or economic conditions, the obligor is not likely to have the capacity to
meet its financial commitment on the obligation.

CC: Bonds rated "CC" are currently highly vulnerable to nonpayment.

C: A subordinated debt or preferred stock obligation rated "C" is currently highly vulnerable to nonpayment. The
"C" rating may be used to cover a situation where a bankruptcy petition has been filed or similar action has been
taken, but payments on this obligation are being continued. A "C" also will be assigned to a preferred stock
issue in arrears on dividends or sinking fund payments, but that is currently paying.

D: Bonds rated "D" are in default. Payments on the obligation are not being made on the date due even if the
applicable grace period has not expired, unless Standard and Poor's believes that such payments will be made
during such grace period. The "D" rating will also be used upon the filing of a bankruptcy petition or the taking
of a similar action if payments on an obligation are jeopardized.

The ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or minus (-) sign to show relative
standing within the major rating categories. The "r" symbol is attached to the ratings of instruments with
significant noncredit risks.

Short-Term Issue Credit Ratings

A-1: Obligation is rated in the highest category. The obligor's capacity to meet its financial commitment on the
obligation is strong. Within this category, a plus (+) sign designation indicates the obligor's capacity to meet
its financial obligation is extremely strong.

A-2: Obligation is somewhat more susceptible to the adverse effects of changes in circumstances and economic
conditions than obligations in higher rating categories. However, the obligor's capacity to meet its financial
commitment on the obligation is satisfactory.

A-3: Obligation exhibits adequate protection parameters. However, adverse economic conditions or changing
circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on
the obligation.

B: Obligation is regarded as having significant speculative characteristics. The obligor currently has the
capacity to meet its financial commitment on the obligation. However, it faces major ongoing uncertainties which
could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation.

C: Obligation is currently vulnerable to nonpayment and is dependent upon favorable business, financial, and
economic conditions for the obligor to meet its financial commitment on the obligation.
D: Obligation is in payment default. Payments on the obligation have not been made on the due date even if the
applicable grace period has not expired, unless Standard and Poor's believes that such payments will be made
during such grace period. The "D" rating will also be used upon the filing of a bankruptcy petition or the taking
of a similar action if payments on an obligation are jeopardized.

Fitch, Inc.
- -------------------------------------------------------------------------------------------------------------------

International Long-Term Credit Ratings

Investment Grade:
AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of credit risk. They are assigned only
in the case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly
unlikely to be adversely affected by foreseeable events.

AA: Very High Credit Quality. "AA" ratings denote a very low expectation of credit risk. They indicate a very
strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to
foreseeable events.

A: High Credit Quality. "A" ratings denote a low expectation of credit risk. The capacity for timely payment of
financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to changes in
circumstances or in economic conditions than is the case for higher ratings.

BBB: Good Credit Quality. "BBB" ratings indicate that there is currently a low expectation of credit risk. The
capacity for timely payment of financial commitments is considered adequate, but adverse changes in circumstances
and in economic conditions are more likely to impair this capacity. This is the lowest investment-grade category.

Speculative Grade:

BB: Speculative. "BB" ratings indicate that there is a possibility of credit risk developing, particularly as the
result of adverse economic change over time. However, business or financial alternatives may be available to
allow financial commitments to be met. Securities rated in this category are not investment grade.

B: Highly Speculative. "B" ratings indicate that significant credit risk is present, but a limited margin of
safety remains. Financial commitments are currently being met. However, capacity for continued payment is
contingent upon a sustained, favorable business and economic environment.

CCC, CC C: High Default Risk. Default is a real possibility. Capacity for meeting financial commitments is
solely reliant upon sustained, favorable business or economic developments. A "CC" rating indicates that default
of some kind appears probable. "C" ratings signal imminent default.

DDD, DD, and D: Default. The ratings of obligations in this category are based on their prospects for achieving
partial or full recovery in a reorganization or liquidation of the obligor. While expected recovery values are
highly speculative and cannot be estimated with any precision, the following serve as general guidelines. "DDD"
obligations have the highest potential for recovery, around 90%-100% of outstanding amounts and accrued interest.
"DD" indicates potential recoveries in the range of 50%-90%, and "D" the lowest recovery potential, i.e., below
50%.

Entities rated in this category have defaulted on some or all of their obligations. Entities rated "DDD" have the
highest prospect for resumption of performance or continued operation with or without a formal reorganization
process. Entities rated "DD" and "D" are generally undergoing a formal reorganization or liquidation process;
those rated "DD" are likely to satisfy a higher portion of their outstanding obligations, while entities rated
"D" have a poor prospect for repaying all obligations.
Plus (+) and minus (-) signs may be appended to a rating symbol to denote relative status within the major rating
categories. Plus and minus signs are not added to the "AAA" category or to categories below "CCC," nor to
short-term ratings other than "F1" (see below).

International Short-Term Credit Ratings

F1: Highest credit quality. Strongest capacity for timely payment of financial commitments. May have an added
"+" to denote any exceptionally strong credit feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of
safety is not as great as in the case of higher ratings.

F3: Fair credit quality. Capacity for timely payment of financial commitments is adequate. However, near-term
adverse changes could result in a reduction to non-investment grade.

B: Speculative. Minimal capacity for timely payment of financial commitments, plus vulnerability to near-term
adverse changes in financial and economic conditions.

C: High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely
reliant upon a sustained, favorable business and economic environment.

D: Default. Denotes actual or imminent payment default.
(i)

B-1
Appendix B
Industry Classification
-----------------------

Aerospace & Defense Household Durables
Air Freight & Couriers Household Products
Airlines Industrial Conglomerates
Auto Components Insurance
Automobiles Internet & Catalog Retail
Banks Internet Software & Services
Beverages Information Technology Consulting & Services
Biotechnology Leisure Equipment & Products
Building Products Machinery
Chemicals Marine
Commercial Services & Supplies Media
Communications Equipment Metals & Mining
Computers & Peripherals Multiline Retail
Construction & Engineering Multi-Utilities
Construction Materials Office Electronics
Containers & Packaging Oil & Gas
Distributors Paper & Forest Products
Diversified Financials Personal Products
Diversified Telecommunication Services Pharmaceuticals
Electric Utilities Real Estate
Electrical Equipment Road & Rail
Electronic Equipment & Instruments Semiconductor Equipment & Products
Energy Equipment & Services Software
Food & Drug Retailing Specialty Retail
Food Products Textiles & Apparel
Gas Utilities Tobacco
Health Care Equipment & Supplies Trading Companies & Distributors
Health Care Providers & Services Transportation Infrastructure
Hotels Restaurants & Leisure Water Utilities
Wireless Telecommunication Services

C-1
Appendix C

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

In certain cases, the initial sales charge that applies to purchases of Class A shares5 of the Oppenheimer funds
or the contingent deferred sales charge that may apply to Class A, Class B or Class C shares may be waived.6
That is because of the economies of sales efforts realized by OppenheimerFunds Distributor, Inc., (referred to in
this document as the "Distributor"), or by dealers or other financial institutions that offer those shares to
certain classes of investors.

Not all waivers apply to all funds. For example, waivers relating to Retirement Plans do not apply to Oppenheimer
municipal funds, because shares of those funds are not available for purchase by or on behalf of retirement
plans. Other waivers apply only to shareholders of certain funds.

For the purposes of some of the waivers described below and in the Prospectus and Statement of Additional
Information of the applicable Oppenheimer funds, the term "Retirement Plan" refers to the following types of
plans:
1) plans qualified under Sections 401(a) or 401(k) of the Internal Revenue Code,
2) non-qualified deferred compensation plans,
3) employee benefit plans7
4) Group Retirement Plans8
5) 403(b)(7) custodial plan accounts
6) Individual Retirement Accounts ("IRAs"), including traditional IRAs, Roth IRAs, SEP-IRAs,
SARSEPs or SIMPLE plans

The interpretation of these provisions as to the applicability of a special arrangement or waiver in a particular
case is in the sole discretion of the Distributor or the transfer agent (referred to in this document as the
"Transfer Agent") of the particular Oppenheimer fund. These waivers and special arrangements may be amended or
terminated at any time by a particular fund, the Distributor, and/or OppenheimerFunds, Inc. (referred to in this
document as the "Manager").

Waivers that apply at the time shares are redeemed must be requested by the shareholder and/or dealer in the
redemption request.
I.

Applicability of Class A Contingent Deferred Sales Charges in Certain Cases
- -------------------------------------------------------------------------------------------------------------------

Purchases of Class A Shares of Oppenheimer Funds That Are Not Subject to Initial Sales Charge but May Be Subject
to the Class A Contingent Deferred Sales Charge (unless a waiver applies).

There is no initial sales charge on purchases of Class A shares of any of the Oppenheimer funds in the
cases listed below. However, these purchases may be subject to the Class A contingent deferred sales charge if
redeemed within 18 months (24 months in the case of Oppenheimer Rochester National Municipals and Rochester Fund
Municipals) of the beginning of the calendar month of their purchase, as described in the Prospectus (unless a
waiver described elsewhere in this Appendix applies to the redemption). Additionally, on shares purchased under
these waivers that are subject to the Class A contingent deferred sales charge, the Distributor will pay the
applicable concession described in the Prospectus under "Class A Contingent Deferred Sales Charge."9 This waiver
provision applies to:
|_| Purchases of Class A shares aggregating $1 million or more.
|_| Purchases of Class A shares by a Retirement Plan that was permitted to purchase such shares at net asset
value but subject to a contingent deferred sales charge prior to March 1, 2001. That included plans
(other than IRA or 403(b)(7) Custodial Plans) that: 1) bought shares costing $500,000 or more, 2) had at
the time of purchase 100 or more eligible employees or total plan assets of $500,000 or more, or 3)
certified to the Distributor that it projects to have annual plan purchases of $200,000 or more.
|_| Purchases by an OppenheimerFunds-sponsored Rollover IRA, if the purchases are made:
1) through a broker, dealer, bank or registered investment adviser that has made special
arrangements with the Distributor for those purchases, or
2) by a direct rollover of a distribution from a qualified Retirement Plan if the administrator of
that Plan has made special arrangements with the Distributor for those purchases.
|_| Purchases of Class A shares by Retirement Plans that have any of the following record-keeping
arrangements:
1) The record keeping is performed by Merrill Lynch Pierce Fenner & Smith, Inc. ("Merrill Lynch")
on a daily valuation basis for the Retirement Plan. On the date the plan sponsor signs the
record-keeping service agreement with Merrill Lynch, the Plan must have $3 million or more of
its assets invested in (a) mutual funds, other than those advised or managed by Merrill Lynch
Investment Management, L.P. ("MLIM"), that are made available under a Service Agreement between
Merrill Lynch and the mutual fund's principal underwriter or distributor, and (b) funds
advised or managed by MLIM (the funds described in (a) and (b) are referred to as "Applicable
Investments").
2) The record keeping for the Retirement Plan is performed on a daily valuation basis by a record
keeper whose services are provided under a contract or arrangement between the Retirement Plan
and Merrill Lynch. On the date the plan sponsor signs the record keeping service agreement with
Merrill Lynch, the Plan must have $3 million or more of its assets (excluding assets invested
in money market funds) invested in Applicable Investments.
3) The record keeping for a Retirement Plan is handled under a service agreement with Merrill
Lynch and on the date the plan sponsor signs that agreement, the Plan has 500 or more eligible
employees (as determined by the Merrill Lynch plan conversion manager).
II.

Waivers of Class A Sales Charges of Oppenheimer Funds
- -------------------------------------------------------------------------------------------------------------------

A. Waivers of Initial and Contingent Deferred Sales Charges for Certain Purchasers.

Class A shares purchased by the following investors are not subject to any Class A sales charges (and no
concessions are paid by the Distributor on such purchases):
|_| The Manager or its affiliates.
|_| Present or former officers, directors, trustees and employees (and their "immediate families") of the
Fund, the Manager and its affiliates, and retirement plans established by them for their employees. The
term "immediate family" refers to one's spouse, children, grandchildren, grandparents, parents,
parents-in-law, brothers and sisters, sons- and daughters-in-law, a sibling's spouse, a spouse's
siblings, aunts, uncles, nieces and nephews; relatives by virtue of a remarriage (step-children,
step-parents, etc.) are included.
|_| Registered management investment companies, or separate accounts of insurance companies having an
agreement with the Manager or the Distributor for that purpose.
|_| Dealers or brokers that have a sales agreement with the Distributor, if they purchase shares for their
own accounts or for retirement plans for their employees.
|_| Employees and registered representatives (and their spouses) of dealers or brokers described above or
financial institutions that have entered into sales arrangements with such dealers or brokers (and which
are identified as such to the Distributor) or with the Distributor. The purchaser must certify to the
Distributor at the time of purchase that the purchase is for the purchaser's own account (or for the
benefit of such employee's spouse or minor children).
|_| Dealers, brokers, banks or registered investment advisors that have entered into an agreement with the
Distributor providing specifically for the use of shares of the Fund in particular investment products
made available to their clients. Those clients may be charged a transaction fee by their dealer, broker,
bank or advisor for the purchase or sale of Fund shares.
|_| Investment advisors and financial planners who have entered into an agreement for this purpose with the
Distributor and who charge an advisory, consulting or other fee for their services and buy shares for
their own accounts or the accounts of their clients.
|_| "Rabbi trusts" that buy shares for their own accounts, if the purchases are made through a broker or
agent or other financial intermediary that has made special arrangements with the Distributor for those
purchases.
|_| Clients of investment advisors or financial planners (that have entered into an agreement for this
purpose with the Distributor) who buy shares for their own accounts may also purchase shares without
sales charge but only if their accounts are linked to a master account of their investment advisor or
financial planner on the books and records of the broker, agent or financial intermediary with which the
Distributor has made such special arrangements . Each of these investors may be charged a fee by the
broker, agent or financial intermediary for purchasing shares.
|_| Directors, trustees, officers or full-time employees of OpCap Advisors or its affiliates, their
relatives or any trust, pension, profit sharing or other benefit plan which beneficially owns shares for
those persons.
|_| Accounts for which Oppenheimer Capital (or its successor) is the investment advisor (the Distributor
must be advised of this arrangement) and persons who are directors or trustees of the company or trust
which is the beneficial owner of such accounts.
|_| A unit investment trust that has entered into an appropriate agreement with the Distributor.
|_| Dealers, brokers, banks, or registered investment advisers that have entered into an agreement with the
Distributor to sell shares to defined contribution employee retirement plans for which the dealer,
broker or investment adviser provides administration services.
|-|

Retirement Plans and deferred compensation plans and trusts used to fund those plans (including, for
example, plans qualified or created under sections 401(a), 401(k), 403(b) or 457 of the Internal Revenue
Code), in each case if those purchases are made through a broker, agent or other financial intermediary
that has made special arrangements with the Distributor for those purchases.
|_| A TRAC-2000 401(k) plan (sponsored by the former Quest for Value Advisors) whose Class B or Class C
shares of a Former Quest for Value Fund were exchanged for Class A shares of that Fund due to the
termination of the Class B and Class C TRAC-2000 program on November 24, 1995.
|_| A qualified Retirement Plan that had agreed with the former Quest for Value Advisors to purchase shares
of any of the Former Quest for Value Funds at net asset value, with such shares to be held through
DCXchange, a sub-transfer agency mutual fund clearinghouse, if that arrangement was consummated and
share purchases commenced by December 31, 1996.

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

Class A shares issued or purchased in the following transactions are not subject to sales charges (and no
concessions are paid by the Distributor on such purchases):
|_| Shares issued in plans of reorganization, such as mergers, asset acquisitions and exchange offers, to
which the Fund is a party.
|_| Shares purchased by the reinvestment of dividends or other distributions reinvested from the Fund or
other Oppenheimer funds (other than Oppenheimer Cash Reserves) or unit investment trusts for which
reinvestment arrangements have been made with the Distributor.
|_| Shares purchased through a broker-dealer that has entered into a special agreement with the Distributor
to allow the broker's customers to purchase and pay for shares of Oppenheimer funds using the proceeds
of shares redeemed in the prior 30 days from a mutual fund (other than a fund managed by the Manager or
any of its subsidiaries) on which an initial sales charge or contingent deferred sales charge was paid.
This waiver also applies to shares purchased by exchange of shares of Oppenheimer Money Market Fund,
Inc. that were purchased and paid for in this manner. This waiver must be requested when the purchase
order is placed for shares of the Fund, and the Distributor may require evidence of qualification for
this waiver.
|_| Shares purchased with the proceeds of maturing principal units of any Qualified Unit Investment Liquid
Trust Series.
|_| Shares purchased by the reinvestment of loan repayments by a participant in a Retirement Plan for which
the Manager or an affiliate acts as sponsor.

C. Waivers of the Class A Contingent Deferred Sales Charge for Certain Redemptions.

The Class A contingent deferred sales charge is also waived if shares that would otherwise be subject to the
contingent deferred sales charge are redeemed in the following cases:
|_| To make Automatic Withdrawal Plan payments that are limited annually to no more than 12% of the account
value adjusted annually.
|_| Involuntary redemptions of shares by operation of law or involuntary redemptions of small accounts
(please refer to "Shareholder Account Rules and Policies," in the applicable fund Prospectus).
|_| For distributions from Retirement Plans, deferred compensation plans or other employee benefit plans for
any of the following purposes:
1) Following the death or disability (as defined in the Internal Revenue Code) of the participant
or beneficiary. The death or disability must occur after the participant's account was
established.
2) To return excess contributions.
3) To return contributions made due to a mistake of fact.
4) Hardship withdrawals, as defined in the plan.10
5) Under a Qualified Domestic Relations Order, as defined in the Internal Revenue Code, or, in the
case of an IRA, a divorce or separation agreement described in Section 71(b) of the Internal
Revenue Code.
6) To meet the minimum distribution requirements of the Internal Revenue Code.
7) To make "substantially equal periodic payments" as described in Section 72(t) of the Internal
Revenue Code.
8) For loans to participants or beneficiaries.
9) Separation from service.11
10) Participant-directed redemptions to purchase shares of a mutual fund (other than a fund managed
by the Manager or a subsidiary of the Manager) if the plan has made special arrangements with
the Distributor.
11) Plan termination or "in-service distributions," if the redemption proceeds are rolled over
directly to an OppenheimerFunds-sponsored IRA.
|_| For distributions from 401(k) plans sponsored by broker-dealers that have entered into a special
agreement with the Distributor allowing this waiver.
|_| For distributions from retirement plans that have $10 million or more in plan assets and that have
entered into a special agreement with the Distributor.
|_| For distributions from retirement plans which are part of a retirement plan product or platform offered
by certain banks, broker-dealers, financial advisors, insurance companies or record keepers which have
entered into a special agreement with the Distributor.
III. Waivers of Class B, Class C and Class N Sales Charges of Oppenheimer Funds
- -------------------------------------------------------------------------------------------------------------------

The Class B, Class C and Class N contingent deferred sales charges will not be applied to shares purchased in
certain types of transactions or redeemed in certain circumstances described below.

A. Waivers for Redemptions in Certain Cases.

The Class B, Class C and Class N contingent deferred sales charges will be waived for redemptions of shares in
the following cases:
|_| Shares redeemed involuntarily, as described in "Shareholder Account Rules and Policies," in the
applicable Prospectus.
|_| Redemptions from accounts other than Retirement Plans following the death or disability of the last
surviving shareholder. The death or disability must have occurred after the account was established, and
for disability you must provide evidence of a determination of disability by the Social Security
Administration.
|_| The contingent deferred sales charges are generally not waived following the death or disability of a
grantor or trustee for a trust account. The contingent deferred sales charges will only be waived in the
limited case of the death of the trustee of a grantor trust or revocable living trust for which the
trustee is also the sole beneficiary. The death or disability must have occurred after the account was
established, and for disability you must provide evidence of a determination of disability by the Social
Security Administration.
|_| Distributions from accounts for which the broker-dealer of record has entered into a special agreement
with the Distributor allowing this waiver.
|_| Redemptions of Class B shares held by Retirement Plans whose records are maintained on a daily valuation
basis by Merrill Lynch or an independent record keeper under a contract with Merrill Lynch.
|_| Redemptions of Class C shares of Oppenheimer U.S. Government Trust from accounts of clients of financial
institutions that have entered into a special arrangement with the Distributor for this purpose.
|_| Redemptions requested in writing by a Retirement Plan sponsor of Class C shares of an Oppenheimer fund
in amounts of $500,000 or more and made more than 12 months after the Retirement Plan's first purchase
of Class C shares, if the redemption proceeds are invested in Class N shares of one or more Oppenheimer
funds.
|_| Distributions12 from Retirement Plans or other employee benefit plans for any of the following purposes:
1) Following the death or disability (as defined in the Internal Revenue Code) of the participant
or beneficiary. The death or disability must occur after the participant's account was
established in an Oppenheimer fund.
2) To return excess contributions made to a participant's account.
3) To return contributions made due to a mistake of fact.
4) To make hardship withdrawals, as defined in the plan.13
5) To make distributions required under a Qualified Domestic Relations Order or, in the case of an
IRA, a divorce or separation agreement described in Section 71(b) of the Internal Revenue Code.
6) To meet the minimum distribution requirements of the Internal Revenue Code.
7) To make "substantially equal periodic payments" as described in Section 72(t) of the Internal
Revenue Code.
8) For loans to participants or beneficiaries.14
9) On account of the participant's separation from service.15
10) Participant-directed redemptions to purchase shares of a mutual fund (other than a fund managed
by the Manager or a subsidiary of the Manager) offered as an investment option in a Retirement
Plan if the plan has made special arrangements with the Distributor.
11) Distributions made on account of a plan termination or "in-service" distributions, if the
redemption proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA.
12) For distributions from a participant's account under an Automatic Withdrawal Plan after the
participant reaches age 59 1/2, as long as the aggregate value of the distributions does not
exceed 10% of the account's value, adjusted annually.
13) Redemptions of Class B shares under an Automatic Withdrawal Plan for an account other than a
Retirement Plan, if the aggregate value of the redeemed shares does not exceed 10% of the
account's value, adjusted annually.
14) For distributions from 401(k) plans sponsored by broker-dealers that have entered into a
special arrangement with the Distributor allowing this waiver.
|_| Redemptions of Class B shares or Class C shares under an Automatic Withdrawal Plan from an account other
than a Retirement Plan if the aggregate value of the redeemed shares does not exceed 10% of the
account's value annually.

B. Waivers for Shares Sold or Issued in Certain Transactions.

The contingent deferred sales charge is also waived on Class B and Class C shares sold or issued in the following
cases:
|_| Shares sold to the Manager or its affiliates.
|_| Shares sold to registered management investment companies or separate accounts of insurance companies
having an agreement with the Manager or the Distributor for that purpose.
|_| Shares issued in plans of reorganization to which the Fund is a party.
|_| Shares sold to present or former officers, directors, trustees or employees (and their "immediate
families" as defined above in Section I.A.) of the Fund, the Manager and its affiliates and retirement
plans established by them for their employees.
IV. Special Sales Charge Arrangements for Shareholders of Certain Oppenheimer Funds Who Were Shareholders of
Former Quest for Value Funds
- -------------------------------------------------------------------------------------------------------------------

The initial and contingent deferred sales charge rates and waivers for Class A, Class B and Class C shares
described in the Prospectus or Statement of Additional Information of the Oppenheimer funds are modified as
described below for certain persons who were shareholders of the former Quest for Value Funds. To be eligible,
those persons must have been shareholders on November 24, 1995, when OppenheimerFunds, Inc. became the investment
advisor to those former Quest for Value Funds. Those funds include:
Oppenheimer Quest Value Fund, Inc. Oppenheimer Small Cap Value Fund
Oppenheimer Quest Balanced Value Fund Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Quest Opportunity Value Fund

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

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

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

A. Reductions or Waivers of Class A Sales Charges.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

|X|

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

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

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

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

In addition to the waivers set forth in the Prospectus and in this Appendix, above, the contingent deferred sales
charge will be waived for redemptions of Class A and Class B shares of a Fund and exchanges of Class A or Class B
shares of a Fund into Class A or Class B shares of a Former Connecticut Mutual Fund provided that the Class A or
Class B shares of the Fund to be redeemed or exchanged were (i) acquired prior to March 18, 1996 or (ii) were
acquired by exchange from an Oppenheimer fund that was a Former Connecticut Mutual Fund. Additionally, the shares
of such Former Connecticut Mutual Fund must have been purchased prior to March 18, 1996:
1) by the estate of a deceased shareholder;
2) upon the disability of a shareholder, as defined in Section 72(m)(7) of the Internal Revenue Code;
3) for retirement distributions (or loans) to participants or beneficiaries from retirement plans qualified
under Sections 401(a) or 403(b)(7)of the Code, or from IRAs, deferred compensation plans created under
Section 457 of the Code, or other employee benefit plans;
4) as tax-free returns of excess contributions to such retirement or employee benefit plans;
5) in whole or in part, in connection with shares sold to any state, county, or city, or any
instrumentality, department, authority, or agency thereof, that is prohibited by applicable investment
laws from paying a sales charge or concession in connection with the purchase of shares of any
registered investment management company;
6) in connection with the redemption of shares of the Fund due to a combination with another investment
company by virtue of a merger, acquisition or similar reorganization transaction;
7) in connection with the Fund's right to involuntarily redeem or liquidate the Fund;
8) in connection with automatic redemptions of Class A shares and Class B shares in certain retirement plan
accounts pursuant to an Automatic Withdrawal Plan but limited to no more than 12% of the original value
annually; or
9) as involuntary redemptions of shares by operation of law, or under procedures set forth in the Fund's
Articles of Incorporation, or as adopted by the Board of Directors of the Fund.
VI. Special Reduced Sales Charge for Former Shareholders of Advance America Funds, Inc.
- -------------------------------------------------------------------------------------------------------------------

Shareholders of Oppenheimer Municipal Bond Fund, Oppenheimer U.S. Government Trust, Oppenheimer Strategic Income
Fund and Oppenheimer Capital Income Fund who acquired (and still hold) shares of those funds as a result of the
reorganization of series of Advance America Funds, Inc. into those Oppenheimer funds on October 18, 1991, and who
held shares of Advance America Funds, Inc. on March 30, 1990, may purchase Class A shares of those four
Oppenheimer funds at a maximum sales charge rate of 4.50%.
VII. Sales Charge Waivers on Purchases of Class M Shares of Oppenheimer Convertible Securities Fund
- -------------------------------------------------------------------------------------------------------------------

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

Oppenheimer Disciplined Allocation Fund

Internet Website:
WWW.OPPENHEIMERFUNDS.COM
------------------------

Investment Advisor
OppenheimerFunds, Inc.
498 Seventh Avenue
New York, New York 10018

Distributor
OppenheimerFunds Distributor, Inc.
498 Seventh Avenue
New York, New York 10018

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

Custodian Bank
Citibank, N.A.
111 Wall Street
New York, New York 10005

Independent Auditors
KPMG LLP
707 Seventeenth Street
Denver, Colorado 80202

Legal Counsel
Mayer, Brown, Rowe & Maw
1675 Broadway
New York, New York 10019

1234

PX205.001.1202

- --------

1 Currently, the 1940 Act permits (a) lending of securities, (b) purchasing debt securities or similar evidences
of indebtedness, (c) repurchase agreements and (d) inter-fund lending consistent with the Fund's exemptive order.
The Fund does not currently anticipate making loans of money.
2 Currently, the 1940 Act permits a mutual fund to borrow from banks and/or affiliated investment companies up to
one-third of its total assets (including the amount borrowed). A fund may borrow up to 5% of its total assets
for temporary purposes from any person. Inter-fund borrowing must be consistent with the Fund's exemptive order.

3 Mr. Motley was elected as Trustee to the Board I Funds effective October 10, 2002.
4 In accordance with Rule 12b-1 of the Investment Company Act, the term "Independent Directors" in this Statement
of Additional Information refers to those Directors who are not "interested persons" of the Fund (or its parent
corporation) and who do not have any direct or indirect financial interest in the operation of the distribution
plan or any agreement under the plan.
5 Certain waivers also apply to Class M shares of Oppenheimer Convertible Securities Fund.
6 In the case of Oppenheimer Senior Floating Rate Fund, a continuously-offered closed-end fund, references to
contingent deferred sales charges mean the Fund's Early Withdrawal Charges and references to "redemptions" mean
"repurchases" of shares.
7 An "employee benefit plan" means any plan or arrangement, whether or not it is "qualified" under the Internal
Revenue Code, under which Class N shares of an Oppenheimer fund or funds are purchased by a fiduciary or other
administrator for the account of participants who are employees of a single employer or of affiliated employers.
These may include, for example, medical savings accounts, payroll deduction plans or similar plans. The fund
accounts must be registered in the name of the fiduciary or administrator purchasing the shares for the benefit
of participants in the plan.
8 The term "Group Retirement Plan" means any qualified or non-qualified retirement plan for employees of a
corporation or sole proprietorship, members and employees of a partnership or association or other organized
group of persons (the members of which may include other groups), if the group has made special arrangements with
the Distributor and all members of the group participating in (or who are eligible to participate in) the plan
purchase shares of an Oppenheimer fund or funds through a single investment dealer, broker or other financial
institution designated by the group. Such plans include 457 plans, SEP-IRAs, SARSEPs, SIMPLE plans and 403(b)
plans other than plans for public school employees. The term "Group Retirement Plan" also includes qualified
retirement plans and non-qualified deferred compensation plans and IRAs that purchase shares of an Oppenheimer
fund or funds through a single investment dealer, broker or other financial institution that has made special
arrangements with the Distributor.
9 However, that concession will not be paid on purchases of shares in amounts of $1 million or more (including
any right of accumulation) by a Retirement Plan that pays for the purchase with the redemption proceeds of Class
C shares of one or more Oppenheimer funds held by the Plan for more than one year.
10 This provision does not apply to IRAs.
11 This provision does not apply to 403(b)(7) custodial plans if the participant is less than age 55, nor to IRAs.
12 The distribution must be requested prior to Plan termination or the elimination of the Oppenheimer funds as an
investment option under the Plan.
13 This provision does not apply to IRAs.
14 This provision does not apply to loans from 403(b)(7) custodial plans and loans from the
OppenheimerFunds-sponsored Single K retirement plan.
15 This provision does not apply to 403(b)(7) custodial plans if the participant is less than age 55, nor to IRAs.

Oppenheimer
Value Fund
(A series of Oppenheimer Series Fund, Inc.)

6803 S. Tucson Way, Centennial, CO 80112
1.800.225.5567

Statement of Additional Information dated December 23, 2002

Contents Page

About the Fund

Additional Information about the Fund's Investment Policies and Risks..................................... 2
The Fund's Investment Policies....................................................................... 2
Other Investment Techniques and Strategies........................................................... 5
Investment Restrictions.............................................................................. 25
How the Fund is Managed................................................................................... 30
Organization and History............................................................................. 30
Board of Directors and Oversight Committees.......................................................... 31
Directors and Officers of the Fund................................................................... 31
The Manager.......................................................................................... 39
Brokerage Policies of the Fund............................................................................ 41
Distribution and Service Plans............................................................................ 42
Performance of the Fund................................................................................... 47

About Your Account

How To Buy Shares......................................................................................... 52
How To Sell Shares........................................................................................ 62
How To Exchange Shares.................................................................................... 65
Dividends, Capital Gains and Taxes........................................................................ 67
Additional Information About the Fund..................................................................... 75

Financial Information About the Fund

Independent Auditors' Report.............................................................................. 76
Financial Statements ..................................................................................... 77

Appendix A: Ratings Definitions...........................................................................A-1
Appendix B: Industry Classifications......................................................................B-1
Appendix C: OppenheimerFunds Special Sales Charge Arrangements and Waivers................................C-1

ABOUT The FUnd

Additional Information About the Fund's Investment Policies and Risks

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

|X| Value Investing. In selecting equity investments for the Fund's portfolio, the portfolio manager
currently uses a value investing style coupled with fundamental analysis of issuers. In using a value approach,
the manager looks for stocks and other equity securities that appear to be temporarily undervalued, by various
measures, such as price/earnings ratios. Value investing seeks stocks having prices that are low in relation to
their real worth or future prospects, with the expectation that the Fund will realize appreciation in the value
of its holdings when other investors realize the intrinsic value of the stock.

|X| Investments in Equity Securities. The Fund does not limit its investments in equity securities to
issuers having a market capitalization of a specified size or range, and therefore may invest in securities of
small-, mid- and large-capitalization issuers. At times, the Fund may have substantial amounts of its assets
invested in securities of issuers in one or more capitalization ranges, based upon the Manager's use of its
investment strategies and its judgment of where the best market opportunities are to seek the Fund's objective.

|X| Rights and Warrants. The Fund can invest up to 5% of its total assets in warrants or rights. That
limit does not apply to warrants and rights that the Fund has acquired as part of units of securities or that are
attached to other securities. No more than 2% of the Fund's total assets may be invested in warrants that are not
listed on either The New York Stock Exchange or The American Stock Exchange.

Warrants basically are options to purchase equity securities at specific prices valid for a specific
period of time. Their prices do not necessarily move parallel to the prices of the underlying securities. Rights
are similar to warrants, but normally have a short duration and are distributed directly by the issuer to its
shareholders. Rights and warrants have no voting rights, receive no dividends and have no rights with respect to
the assets of the issuer.

|X| Convertible Securities. While many convertible securities are a form of debt security, in some
cases their conversion feature (allowing conversion into equity securities) causes the Manager to regard them
more as "equity equivalents." In those cases, the rating assigned to the security has less impact on the
Manager's investment decision than in the case of non-convertible fixed income securities. To determine whether
convertible securities should be regarded as "equity equivalents," the Manager examines the following factors:
(1) whether, at the option of the investor, the convertible security can be exchanged for a fixed number of
shares of common stock of the issuer,
(2) whether the issuer of the convertible securities has restated its earnings per share of common stock on
a fully diluted basis (considering the effect of conversion of the convertible securities), and
(3) the extent to which the convertible security may be a defensive "equity substitute," providing the
ability to participate in any appreciation in the price of the issuer's common stock.

|X| Preferred Stocks. Preferred stocks are equity securities but have certain attributes of debt
securities. Preferred stock, unlike common stock, has a stated dividend rate payable from the corporation's
earnings. Preferred stock dividends may be cumulative or non-cumulative, participating, or auction rate.
"Cumulative" dividend provisions require all or a portion of prior unpaid dividends to be paid before the issuer
can pay dividends on common shares.

Foreign Securities. The Fund can purchase up to 25% of its total assets in|X| foreign securities.
"Foreign securities" include equity and debt securities of companies organized under the laws of countries other
than the United States and debt securities of foreign governments and their agencies and instrumentalities. Those
securities may be traded on foreign securities exchanges or in the foreign over-the-counter markets.

possibilities in some countries of expropriation, nationalization, confiscatory taxation,
political, financial or social instability or adverse diplomatic developments; and
o unfavorable differences between the U.S. economy and foreign economies.

|X| Portfolio Turnover. "Portfolio turnover" describes the rate at which the Fund traded its portfolio
securities during its last fiscal year. For example, if a fund sold all of its securities during the year, its
portfolio turnover rate would have been 100%. The Fund's portfolio turnover rate will fluctuate from year to
year, depending on market conditions. Increased portfolio turnover creates higher brokerage and transaction costs
for the Fund, which may reduce its overall performance. Additionally, the realization of capital gains from
selling portfolio securities may result in distributions of taxable long-term capital gains to shareholders,
since the Fund will normally distribute all of its capital gains realized each year, to avoid excise taxes under
the Internal Revenue Code.

|X| Investments in Bonds and Other Debt Securities. The Fund can invest in bonds, debentures and other
debt securities under normal market conditions. Because the Fund currently emphasizes investments in equity
securities, such as stocks, it is not anticipated that significant amounts of the Fund's assets will be invested
in debt securities. However, if market conditions suggest that debt securities may offer better growth
opportunities than stocks, or if the Manager determines to seek a higher income for liquidity purposes, the
Manager might shift up to 10% of the Fund's net assets into debt securities.

|X| Special Risks of Lower-Grade Securities. It is not anticipated that the Fund will invest a
substantial portion of its assets in lower-grade debt securities. Because lower-grade securities tend to offer
higher yields than investment-grade securities, the Fund may invest in lower grade securities if the Manager is
trying to achieve greater income (and, in some cases, the appreciation possibilities of lower-grade securities
might be a reason they are selected for the Fund's portfolio). High-yield convertible debt securities might be
selected as "equity substitutes," as described above but are subject to the Fund's limitation on its investment
in debt securities as stated in the Prospectus.

"Lower-grade" debt securities are those rated below "investment grade," which means they have a rating
lower than "Baa" by Moody's or lower than "BBB" by S&P or Fitch or similar ratings by other nationally recognized
rating organizations. If they are unrated, and are determined by the Manager to be of comparable quality to debt
securities rated below investment grade, they are included in the limitation on the percentage of the Fund's
assets that can be invested in lower-grade securities. The Fund can invest in securities rated as low as "B" at
the time the Fund buys them.

o Interest Rate Risk. Interest rate risk refers to the fluctuations in value of fixed-income securities
resulting from the inverse relationship between price and yield. For example, an increase in general interest
rates will tend to reduce the market value of already-issued fixed-income investments, and a decline in general
interest rates will tend to increase their value. In addition, debt securities with longer maturities, which tend
to have higher yields, are subject to potentially greater fluctuations in value from changes in interest rates
than obligations with shorter maturities.
Fluctuations in the market value of fixed-income securities after the Fund buys them will not affect the
interest income payable on those securities (unless the security pays interest at a variable rate pegged to
interest rate changes). However, those price fluctuations will be reflected in the valuations of the securities,
and therefore the Fund's net asset values will be affected by those fluctuations.

|X| Floating Rate and Variable Rate Obligations. Some securities the Fund can purchase have variable
or floating interest rates. Variable rates are adjusted at stated periodic intervals. Variable rate obligations
can have a demand feature that allows the Fund to tender the obligation to the issuer or a third party prior to
its maturity. The tender may be at par value plus accrued interest, according to the terms of the obligations.

The interest rate on a floating rate demand note is adjusted automatically according to a stated
prevailing market rate, such as a bank's prime rate, the 91-day U.S. Treasury Bill rate, or some other standard.
The instrument's rate is adjusted automatically each time the base rate is adjusted. The interest rate on a
variable rate note is also based on a stated prevailing market rate but is adjusted automatically at specified
intervals of not less than one year. Generally, the changes in the interest rate on such securities reduce the
fluctuation in their market value. As interest rates decrease or increase, the potential for capital
appreciation or depreciation is less than that for fixed-rate obligations of the same maturity. The Manager may
determine that an unrated floating rate or variable rate demand obligation meets the Fund's quality standards by
reason of being backed by a letter of credit or guarantee issued by a bank that meets those quality standards.

During periods of rapidly rising interest rates, prepayments of mortgage-related securities may occur at
slower than expected rates. Slower prepayments effectively may lengthen a mortgage-related security's expected
maturity. Generally, that would cause the value of the security to fluctuate more widely in responses to changes
in interest rates. If the prepayments on the Fund's mortgage-related securities were to decrease broadly, the
Fund's effective duration, and therefore its sensitivity to interest rate changes, would increase.

|X| U.S. Government Securities. These are securities issued or guaranteed by the U.S. Treasury or
other government agencies or federally-chartered corporate entities referred to as "instrumentalities." The
obligations of U.S. government agencies or instrumentalities in which the Fund may invest may or may not be
guaranteed or supported by the "full faith and credit" of the United States. "Full faith and credit" means
generally that the taxing power of the U.S. government is pledged to the payment of interest and repayment of
principal on a security. If a security is not backed by the full faith and credit of the United States, the owner
of the security must look principally to the agency issuing the obligation for repayment. The owner might not be
able to assert a claim against the United States if the issuing agency or instrumentality does not meet its
commitment. The Fund will invest in securities of U.S. government agencies and instrumentalities only if the
Manager is satisfied that the credit risk with respect to the agency or instrumentality is minimal.

o U.S. Treasury Obligations. These include Treasury bills (maturities of one year or less when issued),
Treasury notes (maturities of one to 10 years), and Treasury bonds (maturities of more than 10 years). Treasury
securities are backed by the full faith and credit of the United States as to timely payments of interest and
repayments of principal. They also can include U. S. Treasury securities that have been "stripped" by a Federal
Reserve Bank, zero-coupon U.S. Treasury securities described below, and Treasury Inflation-Protection Securities
("TIPS").

o Treasury Inflation-Protection Securities. The Fund can buy these TIPS, which are designed to provide an
investment vehicle that is not vulnerable to inflation. The interest rate paid by TIPS is fixed. The principal
value rises or falls semi-annually based on changes in the published Consumer Price Index. If inflation occurs,
the principal and interest payments on TIPS are adjusted to protect investors from inflationary loss. If
deflation occurs, the principal and interest payments will be adjusted downward, although the principal will not
fall below its face amount at maturity.

o Obligations Issued or Guaranteed by U.S. Government Agencies or Instrumentalities. These include direct
obligations and mortgage-related securities that have different levels of credit support from the government.
Some are supported by the full faith and credit of the U.S. government, such as Government National Mortgage
Association ("GNMA") pass-through mortgage certificates (called "Ginnie Maes"). Some are supported by the right
of the issuer to borrow from the U.S. Treasury under certain circumstances, such as Federal National Mortgage
Association bonds ("Fannie Maes"). Others are supported only by the credit of the entity that issued them, such
as Federal Home Loan Mortgage Corporation obligations ("Freddie Macs").

Monthly payments of principal will be made, and additional prepayments of principal may be made, to the
Fund with respect to the mortgages underlying the Ginnie Maes owned by the Fund. All of the mortgages in the
pools relating to the Ginnie Maes in the Fund are subject to prepayment without any significant premium or
penalty, at the option of the mortgagors. While the mortgages on one-to-four family dwellings underlying certain
Ginnie Maes have a stated maturity of up to 30 years, it has been the experience of the mortgage industry that
the average life of comparable mortgages, as a result of prepayments, refinancing and payments from foreclosures,
is considerably less.

o U.S. Government Securities. These include obligations issued or guaranteed by the U.S. government or any
of its agencies or instrumentalities.

o Bank Obligations. The Fund can buy time deposits, certificates of deposit and bankers' acceptances. They
must be :
o obligations issued or guaranteed by a domestic or foreign bank (including a foreign branch of a domestic
bank) having total assets of at least $1 billion,
o banker's acceptances (which may or may not be supported by letters of credit) only if guaranteed by a
U.S. commercial bank with total assets of at least U.S. $1 billion.

o Variable Amount Master Demand Notes. Master demand notes are corporate obligations that permit the
investment of fluctuating amounts by the Fund at varying rates of interest under direct arrangements between the
Fund, as lender, and the borrower. They permit daily changes in the amounts borrowed. The Fund has the right to
increase the amount under the note at any time up to the full amount provided by the note agreement, or to
decrease
the amount. The borrower may prepay up to the full amount of the note without penalty. These notes may or may not
be backed by bank letters of credit.

The Fund has no limitations on the type of issuer from whom these notes will be purchased. However, in
connection with such purchases and on an ongoing basis, the Manager will consider the earning power, cash flow
and other liquidity ratios of the issuer, and its ability to pay principal and interest on demand, including a
situation in which all holders of such notes made demand simultaneously. Investments in master demand notes are
subject to the limitation on investments by the Fund in illiquid securities, described below. Currently, the Fund
does not intend that its investments in variable amount master demand notes will exceed 5% of its total assets.

When such transactions are negotiated, the price (which is generally expressed in yield terms) is fixed
at the time the commitment is made. Delivery and payment for the securities take place at a later date. The
securities are subject to change in value from market fluctuations during the period until settlement. The value
at delivery may be less than the purchase price. For example, changes in interest rates in a direction other
than that expected by the Manager before settlement will affect the value of such securities and may cause a loss
to the Fund. During the period between purchase and settlement, the Fund makes no payment to the issuer and no
interest accrues to the Fund from the investment until it receives the security at settlement. There is a risk of
loss to the Fund if the value of the security changes prior to the settlement date, and there is the risk that
the other party may not perform.

Pursuant to an Exemptive Order issued by the Securities and Exchange Commission, the Fund, along
with other affiliated entities managed by the Manager, may transfer uninvested cash balances into one or more
joint repurchase accounts. These balances are invested in one or more repurchase agreements, secured by U.S.
government securities. Securities that are pledged as collateral for repurchase agreements are held by a
custodian bank until the agreements mature. Each joint repurchase arrangement requires that the market value of
the collateral be sufficient to
cover payments of interest and principal; however, in the event of default by the other party to the agreement,
retention or sale of the collateral may be subject to legal proceedings.

Illiquid securities include repurchase agreements maturing in more than seven days and participation
interests that do not have puts exercisable within seven days.

o Inter-Fund Borrowing. The Fund will not borrow from affiliated funds unless the terms of the borrowing
arrangement are at least as favorable as the terms the Fund could otherwise negotiate with a third party.
To assure that the Fund will not be disadvantaged by borrowing from an affiliated fund, certain safeguards
may be implemented. Examples of these safeguards include the following:
o the Fund will not borrow money from affiliated funds unless the interest rate is more favorable than
available bank loan rates;
o the Fund's borrowing from affiliated funds must be consistent with its investment objective and
investment policies;
o the loan rates will be determined by a pre-established formula based on quotations from independent
banks;
o if the Fund has outstanding borrowings from all sources greater than 10% of its total assets, then the
Fund must secure each additional outstanding inter-fund loan by segregating liquid
assets of the Fund as collateral;
o the Fund cannot borrow from an affiliated fund in excess of 125% of its total redemptions for the
preceding seven days;
o each inter-fund loan may be repaid on any day by the Fund; and
o the Trustees will be provided with a report of all inter-fund loans and the Trustees will monitor all
such borrowings to ensure that the Fund's participation is appropriate.

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

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

The Fund may buy a call or put only if, after the purchase, the value of all call and put options held by the
Fund will not exceed 5% of the Fund's total assets.

o Buying and Selling Call and Put Options on Foreign Currencies. The Fund can buy and sell calls and puts
on foreign currencies. They include puts and calls that trade on a securities or commodities exchange or o
in the over-the-counter markets or are quoted by major recognized dealers in such options. The Fund could use
these calls and puts to try to protect against declines in the dollar value of foreign securities and increases
in the dollar cost of foreign securities the Fund wants to acquire

o The Fund can use hedging instruments to establish a position in the securities markets as a temporary
substitute for the purchase of individual securities (long hedging) by buying futures and/or calls on such
futures, broadly-based indices or on securities. It is possible that when the Fund does so the market might
decline. If the Fund then concludes not to invest in securities because of concerns that the market might
decline further or for other reasons, the Fund will realize a loss on the hedging instruments that is not offset
by a reduction in the price of the securities purchased.

The projection of short-term currency market movements is extremely difficult, and the successful
execution of a short-term hedging strategy is highly uncertain. Forward contracts
involve the risk that anticipated currency movements will not be accurately predicted, causing the Fund
to sustain losses on these contracts and to pay additional transactions costs. The use of forward contracts in
this manner might reduce the Fund's performance if there are unanticipated changes in currency prices to a
greater degree than if the Fund had not entered into such contracts.

o Regulatory Aspects of Hedging Instruments. When using futures and options on futures, the Fund is
required to operate within certain guidelines and restrictions with respect to the use of futures as established
by the Commodities Futures Trading Commission (the "CFTC"). In particular, the Fund is exempted from
registration with the CFTC as a "commodity pool operator" if the Fund complies with the requirements of Rule 4.5
adopted by the CFTC. The Rule does not limit the percentage of the Fund's assets that may be used for futures
margin and related options premiums for a bona fide hedging position. However, under the Rule, the Fund must
limit its aggregate initial futures margin and related options premiums to not more than 5% of the Fund's net
assets for hedging strategies that are not considered bona fide hedging strategies under the Rule. Under the
Rule, the Fund must also use short futures and options on futures solely for bona fide hedging purposes within
the meaning and intent of the applicable provisions of the Commodity Exchange Act.

Under the Internal Revenue Code, the following gains or losses are treated as ordinary income or loss:
(1) gains or losses attributable to fluctuations in exchange rates that occur between the time the Fund
accrues interest or other receivables or accrues expenses or other liabilities denominated in a
foreign currency and the time the Fund actually collects such receivables or pays such
liabilities, and
(2) gains or losses attributable to fluctuations in the value of a foreign currency between the date of
acquisition of a debt security denominated in a foreign currency or foreign currency forward
contracts and the date of disposition.

Other Investment Restrictions

|X| What Are "Fundamental Policies?" Fundamental policies are those policies that the Fund has adopted
to govern its investments that can be changed only by the vote of a "majority" of the Fund's outstanding voting
securities. Under the Investment Company Act, a "majority" vote is defined as the vote of the holders of the
lesser of:
o 67% or more of the shares present or represented by proxy at a shareholder meeting, if the holders of
more than 50% of the outstanding shares are present or
represented by proxy, or
o more than 50% of the outstanding shares.

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

o The Fund cannot issue senior securities. However, it can make payments or deposits of margin in
connection with options or futures transactions, lend its portfolio securities, enter into repurchase agreements,
borrow money and pledge its assets as permitted by its other fundamental policies. For purposes of this
restriction, the issuance of shares of common stock in multiple classes or series, the purchase or sale of
options, futures contracts and options on futures contracts, forward commitments, and repurchase agreements
entered into in accordance with the Fund's investment policies, and the pledge, mortgage or hypothecation of the
Fund's assets are not deemed to be senior securities.

o The Fund cannot underwrite securities of other issuers. A permitted exception is in case it is deemed to
be an underwriter under the Securities Act of 1933 in reselling its portfolio securities.

o The Fund cannot make loans, except to the extent permitted under the 1940 Act, the rules or regulations
thereunder or any exemption therefrom that is applicable to the Fund, as o such statute, rules or regulations
may be amended or interpreted from time to time. 1

How the Fund is Managed

Organization and History. The Fund is one of two investment portfolios, or "series," of Oppenheimer Series Fund,
Inc. That corporation is an open-end, management investment company organized as a Maryland corporation in 1981,
and was called Connecticut Mutual Investment Accounts, Inc. until March 18, 1996, when the Manager became the
Fund's investment advisor. The Fund is a diversified mutual fund. On March 18, 1996 the Fund changed its name from
Connecticut Mutual Growth Account to Oppenheimer Disciplined Value Fund and effective March 1, 2001 subsequently
changed its name to Oppenheimer Value Fund.

|X| Classes of Shares. The Directors are authorized, without shareholder approval, to create new series and
classes of shares. The Directors may reclassify unissued shares of the Fund into additional series or classes of
shares. The Directors also may divide or combine the shares of a class into a greater or lesser number of shares
without changing the proportionate beneficial interest of a shareholder in the Fund. Shares do not have
cumulative voting rights or preemptive or subscription rights. Shares may be voted in person or by proxy at
shareholder meetings.

The Fund currently has five classes of shares: Class A, Class B, Class C, Class N and Class Y. All
classes invest in the same investment portfolio. Only retirement plans may
purchase Class N shares. Only certain institutional investors may elect to purchase Class Y shares. Each class
of shares:
o has its own dividends and distributions,
o pays certain expenses which may be different for the different classes,
o may have a different net asset value,
o may have separate voting rights on matters in which interests of one class are different from interests
of another class, and
o votes as a class on matters that affect that class alone.

Board of Directors and Oversight Committees. The Fund's parent corporation is governed by a Board of Directors,
which is responsible for protecting the interests of shareholders under Maryland law. The Directors meet
periodically throughout the year to oversee the Fund's activities, review its performance, and review the actions
of the Manager. Although the Fund will not normally hold annual meetings of its shareholders, it may hold
shareholder meetings from time to time on important matters, and shareholders have the right to call a meeting to
remove a Director or to take other action described in the Fund's Articles of Incorporation.

The Fund's Directors and officers and their positions held with the Fund and length of service in such
position(s) and their principal occupations and business affiliations during the past five years are listed in
the chart below. The information for the Directors also includes the dollar range of shares of the Fund as well
as the aggregate dollar range of shares beneficially owned in any of the Oppenheimer funds overseen by the
Directors. All of the Directors are also trustees or directors of the following publicly offered Oppenheimer
funds (referred to as "Board I Funds"):
Oppenheimer California Municipal Fund Oppenheimer International Growth Fund
Oppenheimer Capital Appreciation Fund Oppenheimer International Small Company Fund
Oppenheimer Capital Preservation Fund Oppenheimer Money Market Fund, Inc.
Oppenheimer Developing Markets Fund Oppenheimer Multiple Strategies Fund
Oppenheimer Discovery Fund Oppenheimer Multi-Sector Income Trust
Oppenheimer Emerging Growth Fund Oppenheimer Multi-State Municipal Trust
Oppenheimer Emerging Technologies Fund Oppenheimer Municipal Bond Fund
Oppenheimer Enterprise Fund Oppenheimer New York Municipal Fund
Oppenheimer Europe Fund Oppenheimer Series Fund, Inc.
Oppenheimer Global Fund Oppenheimer Trinity Core Fund
Oppenheimer Global Growth & Income Fund Oppenheimer Trinity Large Cap Growth Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Trinity Value Fund
Oppenheimer Growth Fund Oppenheimer U.S. Government Trust

Messrs. Spiro, Murphy, Leavy, Molleur, Wixted and Zack and Mses. Bechtolt, Feld and Ives respectively
hold the same offices with one or more of the other Board I Funds as with the Fund. As of November __, 2002, the
Directors and officers of the Fund as a group owned of record or beneficially less than 1% of each class of
shares of the Fund. The foregoing statement does not reflect ownership of shares of the Fund held of record by an
employee benefit plan for employees of the Manager, other than the shares beneficially owned under the plan by
the officers of the Fund listed above. In addition, each Independent Director, and his family members, do not own
securities of either the Manager or Distributor of the Board I Funds or any person directly or indirectly
controlling, controlled by or under common control with the Manager or Distributor.

|X| Affiliated Transactions and Material Business Relationships. Mr. Reynolds has reported he has a
controlling interest in The Directorship Search Group, Inc. ("The Directorship Search Group"), a director
recruiting firm that provided consulting services to Massachusetts Mutual Life Insurance Company (which controls
the Manager) for fees aggregating $$110,000 from January 1, 2000 through December 31, 2001, an amount
representing less than 5% of the annual revenues of The Directorship Search Group, Inc. Mr. Reynolds estimates
that The Directorship Search Group will bill Massachusetts Mutual Life Insurance Company $150,000 for services to
be provided during the calendar year 2002.

- ---------------------------------------------------------------------------------------------------------------------------
Independent Directors
- ---------------------------------------------------------------------------------------------------------------------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Name, Address, Age, Principal Occupation(s) During Past 5 Years / Other Dollar Range Aggregate
Dollar Range
of Shares
Beneficially
Owned in any
of Shares of the
Position(s) Held with Beneficially Oppenheimer
Fund and Length of Trusteeships/Directorships Held by Director / Number of Owned in the Funds Overseen
Service Portfolios in Fund Complex Currently Overseen by Director Fund by Director
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------------------------
As of December 31, 2001
- -------------------------- --------------------------------------------------------------- --------------------------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Leon Levy, Chairman of General Partner (since 1982) of Odyssey Partners, L.P. None None
the Board of Directors (investment partnership) and Chairman of the Board (since
Director since 1985 1981) of Avatar Holdings, Inc. (real estate development).
Age: 76 Oversees 31 portfolios in the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Robert G. Galli, A trustee or director of other Oppenheimer funds. Formerly $50,001- Over $100,000
Director since 1993 Vice Chairman (October 1995-December 1997) of the Manager. $100,000
Age: 69 Oversees 41 portfolios in the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Phillip A. Griffiths, The Director (since 1991) of the Institute for Advanced None Over $100,000
Director since 1999 Study, Princeton, N.J., director (since 2001) of GSI Lumonics
Age: 63 and a member of the National Academy of Sciences (since
1979); formerly (in descending chronological order) a
director of Bankers Trust Corporation, Provost and Professor
of Mathematics at Duke University, a director of Research
Triangle Institute, Raleigh, N.C., and a Professor of
Mathematics at Harvard University. Oversees 31 portfolios in
the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Benjamin Lipstein, Professor Emeritus of Marketing, Stern Graduate School of None Over $100,000
Director since 1985 Business Administration, New York University. Oversees 31
Age: 79 portfolios in the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Joel W. Motley, Director (January 2002-present), Columbia Equity Financial $None3 None3
Director since 2002 Corp. (privately-held financial adviser); Managing Director
Age: 50 (January 2002-present), Carmona Motley, Inc. (privately-held
financial adviser); Formerly he held the following positions:
Managing Director (January 1998-December 2001), Carmona
Motley Hoffman Inc. (privately-held financial adviser);
Managing Director (January 1992-December 1997), Carmona
Motley & Co. (privately-held financial adviser). Oversees 31
portfolios in the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Elizabeth B. Moynihan, Author and architectural historian; a trustee of the Freer
Director since 1992 Gallery of Art and Arthur M. Sackler Gallery (Smithsonian
Age: 72 Institute), Trustees Council of the National Building Museum;
a member of the Trustees Council, Preservation League of New None $50,001-$100,000
York State. Oversees 31 portfolios in the OppenheimerFunds
complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Kenneth A. Randall, A director of Dominion Resources, Inc. (electric utility $1- $10,000 Over $100,000
Director since 1985 holding company) and Prime Retail, Inc. (real estate
Age: 75 investment trust); formerly a director of Dominion Energy,
Inc. (electric power and oil & gas producer), President and
Chief Executive Officer of The Conference Board, Inc.
(international economic and business research) and a director
of Lumbermens Mutual Casualty Company, American Motorists
Insurance Company and American Manufacturers Mutual Insurance
Company. Oversees 31 portfolios in the OppenheimerFunds
complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Edward V. Regan, President, Baruch College, CUNY; a director of RBAsset (real $1- $10,000 $50,001-$100,000
Director since 1993 estate manager); a director of OffitBank; formerly Trustee,
Age: 72 Financial Accounting Foundation (FASB and GASB), Senior
Fellow of Jerome Levy Economics Institute, Bard College,
Chairman of Municipal Assistance Corporation for the City of
New York, New York State Comptroller and Trustee of New York
State and Local Retirement Fund. Oversees 31 investment
companies in the OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Russell S. Reynolds, Jr., Chairman (since 1993) of The Directorship Search Group, Inc. None $10,001-$50,000
Director since 1989 (corporate governance consulting and executive recruiting); a
Age: 70 life trustee of International House (non-profit educational
organization), and a trustee (since 1996) of the Greenwich
Historical Society. Oversees 31 portfolios in the
OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Donald W. Spiro, Vice Chairman Emeritus (since January 1991) of the Manager. None Over $100,000
Chairman of the Board of
Directors, Formerly a director (January 1969-August 1999) of the
Director since 1985 Manager. Oversees 31 portfolios in the OppenheimerFunds
Age: 76 complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------
- -------------------------- --------------------------------------------------------------- --------------- ----------------
Clayton K. Yeutter, Of Counsel (since 1993), Hogan & Hartson (a law firm). Other None $50,001-$100,000
Director since 1991 directorships: Caterpillar, Inc. (since 1993) and
Age: 71 Weyerhaeuser Co. (since 1999). Oversees 31 portfolios in the
OppenheimerFunds complex.
- -------------------------- --------------------------------------------------------------- --------------- ----------------

The address of Mr. Murphy in the chart below is 498 Seventh Avenue, New York, NY 10018. Mr. Murphy
serves for an indefinite term, until his resignation, death or removal.

- ----------------------------------------------------------------------------------------------------------------------------
Interested Director and Officer
- ----------------------------------------------------------------------------------------------------------------------------
- ---------------------- ------------------------------------------------------------------ --------------- ------------------
Name, Address, Age, Principal Occupation(s) During Past 5 Years / Other Dollar Range Aggregate Dollar
Range of Shares
of Shares Beneficially
Position(s) Held Beneficially Owned in any of
with Fund and Length Trusteeships/Directorships Held by Director / Number of Owned in the the Oppenheimer
of Service Portfolios in Fund Complex Currently Overseen by Director Fund Funds
- ---------------------- ------------------------------------------------------------------ --------------- ------------------
- ---------------------- ------------------------------------------------------------------ ----------------------------------
As of December 31, 2001
- ---------------------- ------------------------------------------------------------------ ----------------------------------
- ---------------------- ------------------------------------------------------------------ ---------------- -----------------
John V. Murphy, Chairman, Chief Executive Officer and director (since June 2001)
President and and President (since September 2000) of the Manager; President None Over $100,000
Director, and a director or trustee of other Oppenheimer funds; President
Director since and a director (since July 2001) of Oppenheimer Acquisition
October 2001 Corp. (the Manager's parent holding company) and of Oppenheimer
Age: 53 Partnership Holdings, Inc. (a holding company subsidiary of the
Manager); a director (since November 2001) of OppenheimerFunds
Distributor, Inc. (a subsidiary of the Manager); Chairman and a
director (since July 2001) of Shareholder Services, Inc. and of
Shareholder Financial Services, Inc. (transfer agent
subsidiaries of the Manager); President and a director (since
July 2001) of OppenheimerFunds Legacy Program (a charitable
trust program established by the Manager); a director of the
investment advisory subsidiaries of the Manager: OFI
Institutional Asset Management, Inc. and Centennial Asset
Management Corporation (since November 2001), HarbourView Asset
Management Corporation and OFI Private Investments, Inc. (since
July 2001); President (since November 1, 2001) and a director
(since July 2001) of Oppenheimer Real Asset Management, Inc.; a
director (since November 2001) of Trinity Investment Management
Corp. and Tremont Advisers, Inc. (Investment advisory affiliates
of the Manager); Executive Vice President (since February 1997)
of Massachusetts Mutual Life Insurance Company (the Manager's
parent company); a director (since June 1995) of DBL Acquisition
Corporation; formerly, Chief Operating Officer (September
2000-June 2001) of the Manager; President and trustee (November
1999-November 2001) of MML Series Investment Fund and MassMutual
Institutional Funds (open-end investment companies); a director
(September 1999-August 2000) of C.M. Life Insurance Company;
President, Chief Executive Officer and director (September
1999-August 2000) of MML Bay State Life Insurance Company; a
director (June 1989-June 1998) of Emerald Isle Bancorp and
Hibernia Savings Bank (a wholly-owned subsidiary of Emerald Isle
Bancorp). Oversees 69 portfolios in the OppenheimerFunds complex.
- ---------------------- ------------------------------------------------------------------ ---------------- -----------------

Robert G. Zack, Senior Vice President (since May 1985) and General Counsel (since February 2002) of
Secretary (since November 1, the Manager; General Counsel and a director (since November 2001) of OppenheimerFunds
2001) Distributor, Inc.; Senior Vice President and General Counsel (since November 2001) of
Age: 54 HarbourView Asset Management Corporation; Vice President and a director (since
November 2000) of Oppenheimer Partnership Holdings, Inc.; Senior Vice President,
General Counsel and a director (since November 2001) of Shareholder Services, Inc.,
Shareholder Financial Services, Inc., OFI Private Investments, Inc., Oppenheimer Trust
Company and OFI Institutional Asset Management, Inc.; General Counsel (since November
2001) of Centennial Asset Management Corporation; a director (since November 2001) of
Oppenheimer Real Asset Management, Inc.; Assistant Secretary and a director (since
November 2001) of OppenheimerFunds International Ltd.; Vice President (since November
2001) of OppenheimerFunds Legacy Program; Secretary (since November 2001) of
Oppenheimer Acquisition Corp.; formerly Acting General Counsel (November 2001-February
2002) and Associate General Counsel (May 1981-October 2001) of the Manager; Assistant
Secretary of Shareholder Services, Inc. (May 1985-November 2001), Shareholder
Financial Services, Inc. (November 1989-November 2001); OppenheimerFunds International
Ltd. and Oppenheimer Millennium Funds plc (October 1997-November 2001). An officer of
85 portfolios in the OppenheimerFunds complex.

- ---------------------------------- ----------------------------------------------------------------------------------------
- ------------------------------------- -------------------------------------------------------------------------------------
Philip T. Masterson, Vice President and Assistant Counsel of the Manager (since July 1998); formerly, an
Assistant Secretary
(since August 15, 2002) associate with Davis, Graham, & Stubbs LLP (January 1997-June 1998). An officer of
Age: 38 72 portfolios in the OppenheimerFunds complex.
- ------------------------------------- -------------------------------------------------------------------------------------
- ------------------------------------- -------------------------------------------------------------------------------------
Denis R. Molleur, Vice President and Senior Counsel of the Manager (since July 1999); formerly a Vice
Assistant Secretary
(since November 1, 2001) President and Associate Counsel of the Manager (September 1995-July 1999). An
Age: 44 officer of 82 portfolios in the OppenheimerFunds complex.
- ------------------------------------- -------------------------------------------------------------------------------------
- ------------------------------------- -------------------------------------------------------------------------------------
Katherine P. Feld, Vice President and Senior Counsel (since July 1999) of the Manager; Vice President
Assistant Secretary (since June 1990) of OppenheimerFunds Distributor, Inc.; Director, Vice President
(since November 1, 2001) and Assistant Secretary (since June 1999) of Centennial Asset Management
Age: 44 Corporation; Vice President (since 1997) of Oppenheimer Real Asset Management,
Inc.; formerly Vice President and Associate Counsel of the Manager (June 1990-July
1999). An officer of 85 portfolios in the OppenheimerFunds complex.
- ------------------------------------- -------------------------------------------------------------------------------------
- ------------------------------------- -------------------------------------------------------------------------------------
Kathleen T. Ives, Vice President and Assistant Counsel (since June 1998) of the Manager; Vice
Assistant Secretary President (since 1999) of OppenheimerFunds Distributor, Inc.; Vice President and
(since November 1, 2001) Assistant Secretary (since 1999) of Shareholder Services, Inc.; Assistant Secretary
Age: 36 (since December 2001) of OppenheimerFunds Legacy Program and Shareholder Financial
Services, Inc.; formerly Assistant Vice President and Assistant Counsel of the
Manager (August 1997-June 1998); Assistant Counsel of the Manager (August
1994-August 1997). An officer of 85 portfolios in the OppenheimerFunds complex.
- ------------------------------------- -------------------------------------------------------------------------------------

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

Director Name and Other Fund For Fiscal Year Ended For Calendar Year
Position(s)
(as applicable) 07/31/02 Ended12/31/01

Leon Levy $ $ $ $173,700
Chairman

Robert G. Galli $ 2 $202,8863
Study Committee Member

Phillip Griffiths $ 4 $ $ $54,889

Benjamin Lipstein $ $ $ $150,152
Study Committee Chairman, Audit
Committee Member

Joel W. Motley4 $ $ $0 $0

Elizabeth B. Moynihan $ $ $ $105,760
Study Committee Member

Kenneth A. Randall $ $ $ $97,012
Audit Committee Chairman

Edward V. Regan $ $ $ $95,960
Proxy Committee Chairman, Audit
Committee Member

Russell S. Reynolds, Jr. $ $ $ $71,792
Proxy Committee Member

Donald Spiro $ $ $ $64,080

Clayton K. Yeutter $ $ $ $71,792
Proxy Committee Member

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

|X| Retirement Plan for Directors. The Fund and its parent corporation have adopted a retirement plan that
provides for payments to retired Directors. Payments are up to 80% of the average compensation paid during a
Director's five years of service in which the highest compensation was received. A Director must serve as
director or trustee for any of the Board I Oppenheimer funds for at least 15 years to be eligible for the maximum
payment. Each Director's retirement benefits will depend on the amount of the Director's future compensation and
length of service. Therefore the amount of those benefits cannot be determined at this time, nor can we estimate
the number of years of credited service that will be used to determine those benefits.

|X| Major Shareholders. As of November __, 2002, the only persons who owned of record or were known by
the Fund to own beneficially 5% or more of any class of the Fund's outstanding shares were:

RPSS TR Gussco Manufacturing Inc., 401K Plan, Attn: Robert Sharp, 5112 2nd Ave., Brooklyn, NY
11232-4309, which owned 6,673.998 Class N shares (53.78% of the Class N shares then outstanding).

RPSS TR IRA FBO George J. Ferguson, 635 Sunnyslope Rd., Elm Grove, WI 53122-2463, which owned
3,766.304 Class N shares (30.35% of the Class N shares then outstanding).

Persumma Financial Services Mass Mutual Financial Group, 1295 State St. #N328, Springfield, MA
01111-0001 which owned 45,762.571 Class Y shares (99.87% of the Class Y shares then outstanding).

The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a holding company controlled by
Massachusetts Mutual Life Insurance Company.

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

The Investment Advisory Agreement. The Manager provides investment advisory and management services to
the Fund under an investment advisory agreement between the Manager and the Fund. The Manager selects securities
for the Fund's portfolio and handles its day-to-day business. The portfolio manager of the Fund is employed by
the Manager and is the persons who are principally responsible for the day-to-day management of the Fund's
portfolio. Other members of the Manager's Equity Portfolio Department provide the portfolio manager with counsel
and support in managing the Fund's portfolio.

------------------------------------- ---------------------------------------------------------------------------
Fiscal Year ended 10/31: Management Fees Paid to OppenheimerFunds, Inc.
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2000 $2,235,663
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2001 $1,612,092
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------

2002 $

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

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

Brokerage Policies of the Fund

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

------------------------------------- ---------------------------------------------------------------------------
Fiscal Year Ended 10/31: Total Brokerage Commissions Paid by the Fund1
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2000 $1,148,957
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------
2001 $2,329,4072
------------------------------------- ---------------------------------------------------------------------------
------------------------------------- ---------------------------------------------------------------------------

2002 $

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

1. Amounts do not include spreads or commissions on principal transactions on a net trade basis.
2. In the fiscal year ended 10/31/02, the amount of transactions directed to brokers for research services
was $_________ and the amount of the commissions paid to broker-dealers for those services was $_______.

Distribution and Service Plans

- --------------- ----------------------- -----------------------
Fiscal Year Aggregate Front-End Class A Front-End
Sales Charges
Ended 10/31: Sales Charges on Retained by
Class A Shares Distributor1
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------
2000 $370,966 $174,293
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------
2001 $317,775 $140,878
- --------------- ----------------------- -----------------------
- --------------- ----------------------- -----------------------

2002 $ $

- --------------- ----------------------- -----------------------
1. Includes amounts retained by a broker-dealer that is an affiliate or a parent of the Distributor.

- -------------- ------------------------ ------------------------ ----------------------- ------------------------
Fiscal Year Concessions on Class A Concessions on Class B Concessions on Class Concessions on Class N
Ended 10/31: Shares Advanced by Shares Advanced by C Shares Advanced by Shares Advanced by
Distributor1 Distributor1 Distributor1 Distributor1
- -------------- ------------------------ ------------------------ ----------------------- ------------------------
- -----------------------------------------------------------------------------------------------------------------
2000 $54,817 $372,763 $28,351 N/A
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
2001 $46,553 $289,729 $26,187 $1182
- -----------------------------------------------------------------------------------------------------------------
- -------------- ------------------------ ------------------------ ----------------------- ------------------------

2002 $ $ $ $

- -------------- ------------------------ ------------------------ ----------------------- ------------------------
1. The Distributor advances concession payments to dealers for certain sales of Class A shares and for
sales of Class B, Class C and Class N shares from its own resources at the time of sale.
2. The inception date of Class N shares was March 1, 2001.

- -------------- ------------------------ ----------------------- ------------------------ -------------------------
Fiscal Year Class A Contingent Class B Contingent Class C Contingent Class N Contingent
Deferred Sales
Ended 10/31 Deferred Sales Charges Charges Retained by Deferred Sales Charges Deferred Sales Charges
Retained by Distributor Distributor Retained by Distributor Retained by Distributor
- -------------- ------------------------ ----------------------- ------------------------ -------------------------
- -------------- ------------------------ ----------------------- ------------------------ -------------------------

2002 $ $ $ $

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

Each plan has been approved by a vote of the Board of Directors, including a majority of the Independent
Directors4, cast in person at a meeting called for the purpose of voting on that plan.

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

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

For the fiscal year ended October 31, 2002 payments under the Class A Plan totaled $_______, all of
which was paid by the Distributor to recipients. That included $________ paid to an affiliate of the
Distributor's parent company. Any unreimbursed expenses the Distributor incurs with respect to Class A shares in
any fiscal year cannot be recovered in subsequent years. The Distributor may not use payments received under the
Class A Plan to pay any of its interest expenses, carrying charges, or other financial costs, or allocation of
overhead.

The asset-based sales charges on Class B, Class C and Class N shares allow investors to buy shares
without a front-end sales charge while allowing the Distributor to compensate dealers that sell those shares.
The Fund pays the asset-based sales charges to the Distributor for its services rendered in distributing Class B,
Class C and Class N shares. The payments are made to the Distributor in recognition that the Distributor:
o pays sales concessions to authorized brokers and dealers at the time of sale and pays service fees as
described above,
o may finance payment of sales concessions and/or the advance of the service fee payment to recipients
under the plans, or may provide such financing from its own resources or from the resources of an
affiliate,
o employs personnel to support distribution of Class B, Class C and Class N shares, and
o bears the costs of sales literature, advertising and prospectuses (other than those furnished to current
shareholders) and state "blue sky" registration fees and certain other distribution expenses.
o may not be able to adequately compensate dealers that sell Class B, Class C and Class N shares without
receiving payment under the plans and therefore may not be able to offer such Classes for sale
absent the plans,
o receives payments under the plans consistent with the service fees and asset-based sales charges paid by
other non-proprietary funds that charge 12b-1 fees,
o may use the payments under the plan to include the Fund in various third-party distribution programs
that may increase sales of Fund shares,

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

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

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

Distribution Fees Paid to the Distributor for the Year Ended 10/31/02

Class B Plan $ $ 1 $ %

Class C Plan $ $ 2 $ %

Class N Plan $ $ 2 N/A N/A

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

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

Performance of the Fund

o Total returns measure the performance of a hypothetical account in the Fund over various periods and do
not show the performance of each shareholder's account. Your account's performance will vary from the model
performance data if your dividends are received in cash, or you buy or sell shares during the period, or you
bought your shares at a different time and price than the shares used in the model.
o The Fund's performance returns do not reflect the effect of taxes on dividends and capital gains
distributions.
o An investment in the Fund is not insured by the FDIC or any other government agency.
o The principal value of the Fund's shares, and total returns are not guaranteed and normally will
fluctuate on a daily basis.
o When an investor's shares are redeemed, they may be worth more or less than their original cost.
o Total returns for any given past period represent historical performance information and are not, and
should not be considered, a prediction of future returns.

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

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

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

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

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

The Fund's Total Returns for the Periods Ended 10/31/02

Class A1

Class B

Class C

Class N

Class Y

- --------------- ----------- ----------- ------------ ------------ ------------ ------------ ------------ ------------
1. Inception of Class A: 9/16/85.
2. Inception of Class B: 10/2/95.
3. Inception of Class C: 5/1/96.
4. Inception of Class N: 3/1/01.
5. Inception of Class Y: 12/16/96.

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

Average Annual Total Returns for Class A Shares (After Sales Charge)
For the Periods Ended 10/31/02

1-Year 5-Year 10-Year
(or life of class)

After Taxes on Distributions % % %1

After Taxes on Distributions and % % %1
Redemption of Fund Shares

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

1. Inception date of Class A: 9/16/85

ABOUT your account

How to Buy Shares

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

|X| Terms of Escrow That Apply to Letters of Intent.

2. If the total minimum investment specified under the Letter is completed within the 13-month Letter
of Intent period, the escrowed shares will be promptly released to the investor.

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

5. The shares eligible for purchase under the Letter (or the holding of which may be counted toward
completion of a Letter) include:
(a) Class A shares sold with a front-end sales charge or subject to a Class A contingent deferred sales
charge,
(b) Class B shares of other Oppenheimer funds acquired subject to a contingent deferred sales charge, and
(c) Class A or Class B shares acquired by exchange of either (1) Class A shares of one of the other
Oppenheimer funds that were acquired subject to a Class A initial or contingent deferred sales
charge or (2) Class B shares of one of the other Oppenheimer funds that were acquired subject
to a contingent deferred sales charge.

Asset Builder Plans. To establish an Asset Builder Plan to buy shares directly from a bank account, you must
enclose a check (the minimum is $50) for the initial purchase with your application. The minimum investment for
new Asset Builder Plans is $50, each purchase must be at least $50 and shareholders must invest at least $500
before an Asset Builder Plan can be established. Shares purchased by Asset Builder Plan payments from bank
accounts are subject to the redemption restrictions for recent purchases described in the Prospectus. Asset
Builder Plans are available only if your bank is an ACH member. Asset Builder Plans may not be used to buy
shares for OppenheimerFunds employer-sponsored qualified retirement accounts. Asset Builder Plans also enable
shareholders of Oppenheimer Cash Reserves to use their fund account to make monthly automatic purchases of shares
of up to four other Oppenheimer funds.

Before you establish Asset Builder payments, you should obtain a prospectus of the selected fund(s) from
your financial advisor (or the Distributor) and request an application from the Distributor. Complete the
application and return it. You may change the amount of your Asset Builder payment or you can terminate these
automatic investments at any time by writing to the Transfer Agent. The Transfer Agent requires a reasonable
period (approximately 10 days) after receipt of your instructions to implement them. The Fund reserves the right
to amend, suspend or discontinue offering Asset Builder plans at any time without prior notice.

|X| Availability of Class N Shares. In addition to the description of the types of retirement plans
which may purchase Class N shares contained in the prospectus, Class N shares also are offered to the following:
o to all rollover IRAs (including SEP IRAs and SIMPLE IRAs),
o to all rollover contributions made to Individual 401(k) plans, Profit-Sharing Plans and Money Purchase
Pension Plans,
o to all direct rollovers from OppenheimerFunds-sponsored Pinnacle and Ascender retirement plans,
o to all trustee-to-trustee IRA transfers,
o to all 90-24 type 403(b) transfers,
o to Group Retirement Plans (as defined in Appendix C to this Statement of Additional Information) which
have entered into a special agreement with the Distributor for that purpose,
o to Retirement Plans qualified under Sections 401(a) or 401(k) of the Internal Revenue Code, the
recordkeeper or the plan sponsor for which has entered into a special agreement with the
Distributor,
o to Retirement Plans of a plan sponsor where the aggregate assets of all such plans invested in the
Oppenheimer funds is $500,000 or more,
to OppenheimerFunds-sponsored Ascender 401(k) plans that pay for the purchase with the redemption
proceeds of Class A shares of one or more Oppenheimer funds.
o to certain customers of broker-dealers and financial advisors that are identified in a special agreement
between the broker-dealer or financial advisor and the Distributor for that purpose.
The sales concession and the advance of the service fee, as described in the Prospectus, will not be
paid to dealers of record on sales of Class N shares on:
o purchases of Class N shares in amounts of $500,000 or more by a retirement plan that pays for the
purchase with the redemption proceeds of Class A shares of one or more Oppenheimer funds (other
than rollovers from an OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan to any IRA
invested in the Oppenheimer funds),
o purchases of Class N shares in amounts of $500,000 or more by a retirement plan that pays for the
purchase with the redemption proceeds of Class C shares of one or more Oppenheimer funds held
by the plan for more than one year (other than rollovers from an OppenheimerFunds-sponsored
Pinnacle or Ascender 401(k) plan to any IRA invested in the Oppenheimer funds), and
o on purchases of Class N shares by an OppenheimerFunds-sponsored Pinnacle or Ascender 401(k) plan made
with the redemption proceeds of Class A shares of one or more Oppenheimer funds.

|X| Securities Valuation. The Fund's Board of Directors has established procedures for the valuation
of the Fund's securities. In general those procedures are as follows:
o Equity securities traded on a U.S. securities exchange or on Nasdaq(R)are valued as follows:
(1) if last sale information is regularly reported, they are valued at the last reported sale price on the
principal exchange on which they are traded or on Nasdaq, as applicable, on that day, or
(2) if last sale information is not available on a valuation date, they are valued at the last reported sale
price preceding the valuation date if it is within the spread of the closing "bid" and
"asked" prices on the valuation date or, if not, at the closing "bid" price on the
valuation date.
o Equity securities traded on a foreign securities exchange generally are valued in one of the following
ways:
(1) at the last sale price available to the pricing service approved by the Board of Directors, or
(2) at the last sale price obtained by the Manager from the report of the principal exchange on which the
security is traded at its last trading session on or immediately before the valuation date,
or
(3) at the mean between the "bid" and "asked" prices obtained from the principal exchange on which the
security is traded or, on the basis of reasonable inquiry, from two market makers in the
security.
o Long-term debt securities having a remaining maturity in excess of 60 days are valued based on the mean
between the "bid" and "asked" prices determined by a portfolio pricing service approved by the Fund's Board of
Directors or obtained by the Manager from two active market makers in the security on the basis of reasonable
inquiry.
o The following securities are valued at the mean between the "bid" and "asked" prices determined by a
pricing service approved by the Fund's Board of Directors or obtained by the Manager from two active market
makers in the security on the basis of reasonable inquiry:
(1) debt instruments that have a maturity of more than 397 days when issued,
(2) debt instruments that had a maturity of 397 days or less when issued and have a remaining maturity of
more than 60 days, and
(3) non-money market debt instruments that had a maturity of 397 days or less when issued and which have a
remaining maturity of 60 days or less.
o The following securities are valued at cost, adjusted for amortization of premiums and accretion of
discounts:
(1) money market debt securities held by a non-money market fund that had a maturity of less than 397 days
when issued that have a remaining maturity of 60 days or less, and
(2) debt instruments held by a money market fund that have a remaining maturity of 397 days or less.
o Securities (including restricted securities) not having readily-available market quotations are valued
at fair value determined under the Board's procedures. If the Manager is unable to locate two market makers
willing to give quotes, a security may be priced at the mean between the "bid" and "asked" prices provided by a
single active market maker (which in certain cases may be the "bid" price if no "asked" price is available).

In the case of U.S. government securities, mortgage-backed securities, corporate bonds and foreign
government securities, when last sale information is not generally available, the Manager may use pricing
services approved by the Board of Directors. The pricing service may use "matrix" comparisons to the prices for
comparable instruments on the basis of quality, yield and maturity. Other special factors may be involved (such
as the tax-exempt status of the interest paid by municipal securities). The Manager will monitor the accuracy of
the pricing services. That monitoring may include comparing prices used for portfolio valuation to actual sales
prices of selected securities.
The closing prices in the London foreign exchange market on a particular business day that are provided
to the Manager by a bank, dealer or pricing service that the Manager has determined to be reliable are used to
value foreign currency, including forward contracts, and to convert to U.S. dollars securities that are
denominated in foreign currency.

How to Sell Shares

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

The reinvestment may be made without sales charge only in Class A shares of the Fund or any of the other
Oppenheimer funds into which shares of the Fund are exchangeable as described in "How to Exchange Shares" below.
Reinvestment will be at the net asset value next computed after the Transfer Agent receives the reinvestment
order. The shareholder must ask the Transfer Agent for that privilege at the time of reinvestment. This
privilege does not apply to Class C, Class N or Class Y shares. The Fund may amend, suspend or cease offering
this reinvestment privilege at any time as to shares redeemed after the date of such amendment, suspension or
cessation.

Ordinarily, for accounts redeemed by a broker-dealer under this procedure, payment will be made within
three business days after the shares have been redeemed upon the Distributor's receipt of the required redemption
documents in proper form. The signature(s) of the registered owners on the redemption documents must be
guaranteed as described in the Prospectus.
Automatic Withdrawal and Exchange Plans. Investors owning shares of the Fund valued at $5,000 or more can
authorize the Transfer Agent to redeem shares (having a value of at least $50) automatically on a monthly,
quarterly, semi-annual or annual basis under an Automatic Withdrawal Plan. Shares will be redeemed three
business days prior to the date requested by the shareholder for receipt of the payment. Automatic withdrawals
of up to $1,500 per month may be requested by telephone if payments are to be made by check payable to all
shareholders of record. Payments must also be sent to the address of record for the account and the address must
not have been changed within the prior 30 days. Required minimum distributions from OppenheimerFunds-sponsored
retirement plans may not be arranged on this basis.

|X| Automatic Exchange Plans. Shareholders can authorize the Transfer Agent to exchange a pre-determined
amount of shares of the Fund for shares (of the same class) of other Oppenheimer funds automatically on a
monthly, quarterly, semi-annual or annual basis under an Automatic Exchange Plan. The minimum amount that may be
exchanged to each other fund account is $50. Instructions should be provided on the OppenheimerFunds Application
or signature-guaranteed instructions. Exchanges made under these plans are |X| subject to the restrictions that
apply to exchanges as set forth in "How to Exchange Shares" in the Prospectus and below in this Statement of
Additional Information.

If the Transfer Agent ceases to act as transfer agent for the Fund, the Planholder will be deemed to
have appointed any successor transfer agent to act as agent in administering the Plan.

How to Exchange Shares

o All of the Oppenheimer funds currently offer Class A, B, C, N and Y shares with the following
exceptions:

The following funds do not offer Class N shares:
Oppenheimer California Municipal Fund Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Limited Term Municipal Fund Oppenheimer Rochester National Municipals
Oppenheimer Municipal Bond Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer New Jersey Municipal Fund Limited Term New York Municipal Fund
Oppenheimer New York Municipal Fund Rochester Fund Municipals

o Class M shares of Oppenheimer Convertible Securities Fund may be exchanged only for Class A shares of
other Oppenheimer funds. They may not be acquired by exchange o of shares of any class of any
other Oppenheimer funds except Class A shares of Oppenheimer Money Market Fund or Oppenheimer Cash
Reserves acquired by exchange of Class M shares.

o Class X shares of Limited Term New York Municipal Fund may be exchanged only for Class B shares of other
Oppenheimer funds and no exchanges may be made to Class X shares.
o Shares of Oppenheimer Capital Preservation Fund may not be exchanged for shares of Oppenheimer Money
Market Fund, Inc., Oppenheimer Cash Reserves or Oppenheimer Limited-Term Government Fund. Only
participants in certain retirement plans may purchase shares of Oppenheimer Capital Preservation Fund,
and only those participants may exchange shares of other Oppenheimer funds for shares of Oppenheimer
Capital Preservation Fund.
o Class A shares of Oppenheimer Senior Floating Rate Fund are not available by exchange of shares of
Oppenheimer Money Market Fund or Class A shares of Oppenheimer Cash Reserves.
o Shares of Oppenheimer Select Managers Mercury Advisors S&P Index Fund and Oppenheimer Select Managers QM
Active Balanced Fund are only available to retirement plans and are available only by exchange from the
same class of shares of other Oppenheimer funds held by retirement plans.
o Class A shares of Oppenheimer funds may be exchanged at net asset value for shares of any money market
fund offered by the Distributor. Shares of any money market fund purchased without a sales charge may be
exchanged for shares of Oppenheimer funds offered with a sales charge upon payment of the sales charge.
They may also be used to purchase shares of Oppenheimer funds subject to an early withdrawal charge or
contingent deferred sales charge.
o Shares of Oppenheimer Money Market Fund, Inc. purchased with the redemption proceeds of shares of other
mutual funds (other than funds managed by the Manager or its subsidiaries) redeemed within the 30 days
prior to that purchase may subsequently be exchanged for shares of other Oppenheimer funds without being
subject to an initial sales charge or contingent deferred sales charge. To qualify for that privilege,
the investor or the investor's dealer must notify the Distributor of eligibility for this privilege at
the time the shares of Oppenheimer Money Market Fund, Inc. are purchased. If requested, they must supply
proof of entitlement to this privilege.
o Shares of the Fund acquired by reinvestment of dividends or distributions from any of the other
Oppenheimer funds or from any unit investment trust for which reinvestment arrangements have been made
with the Distributor may be exchanged at net asset value for shares of any of the Oppenheimer funds.

month of the initial purchase of the exchanged Class A shares, the Class A contingent deferred sales charge
is imposed on the redeemed shares.

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

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

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

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

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

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

Dividends, Capital Gains and Taxes

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

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

|X| Excise Tax on Regulated Investment Companies. Under the Internal Revenue Code, by December 31 each year,
the Fund must distribute 98% of its taxable investment income earned from January 1 through December 31 of that
year and 98% of its capital gains realized in the period from November 1 of the prior year through October 31 of
the current year. If it does not, the Fund must pay an excise tax on the amounts not distributed. It is presently
anticipated that the Fund will meet those requirements. To meet this requirement, in certain circumstances the
Fund might be required to liquidate portfolio investments to make sufficient distributions to avoid excise tax
liability. However, the Board of Directors and the Manager might determine in a particular year that it would be
in the best interests of shareholders for the Fund not to make such distributions at the required levels and to
pay the excise tax on the undistributed amounts. That would reduce the amount of income or capital gains
available for distribution to shareholders.

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

Ordinary income dividends that are paid by the Fund (and are deemed not "effectively connected income")
to foreign persons will be subject to a U.S. tax withheld by the Fund at a rate of 30%, provided the Fund obtains
a properly completed and signed Certificate of Foreign Status. The tax rate may be reduced if the foreign
person's country of residence has a tax treaty with the U.S. allowing for a reduced tax rate on ordinary income
dividends paid by the Fund. All income and any tax withheld by the Fund is remitted by the Fund to the U.S.
Treasury and is identified in reports mailed to shareholders in March of each year.
If the ordinary income dividends from the Fund are effectively connected with the conduct of a U.S.
---
trade or business, then the foreign person may claim an exemption from the U.S. tax described above provided the
Fund obtains a properly completed and signed Certificate of Foreign Status.

If the foreign person fails to provide a certification of his/her foreign status, the Fund will be
required to withhold U.S. tax at a rate of 30% (29% for payments after December 31, 2003) on ordinary income
dividends, capital gains distributions and the proceeds of the redemption of shares, paid to any foreign person.
All income and any tax withheld (in this situation) by the Fund is remitted by the Fund to the U.S. Treasury and
is identified in reports mailed to shareholders in January of each year.

Additional Information About the Fund

A-5
Appendix A

RATINGS DEFINITIONS
-------------------

Moody's Investors Service, Inc.
- -------------------------------------------------------------------------------------------------------------------

Long-Term (Taxable) Bond Ratings

Caa: Bonds rated "Caa" are of poor standing. Such issues may be in default or there may be present elements of
danger with respect to principal or interest.

Ca: Bonds rated "Ca" represent obligations which are speculative in a high degree. Such issues are often in
default or have other marked shortcomings.

C: Bonds rated "C" are the lowest class of rated bonds and can be regarded as having extremely poor prospects of
ever attaining any real investment standing.

Short-Term Ratings - Taxable Debt

These ratings apply to the ability of issuers to honor senior debt obligations having an original maturity not
exceeding one year:

Prime-1: Issuer has a superior ability for repayment of senior short-term debt obligations.

Not Prime: Issuer does not fall within any Prime rating category.

Standard & Poor's Rating Services
- -------------------------------------------------------------------------------------------------------------------

Long-Term Credit Ratings

AAA: Bonds rated "AAA" have the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its
financial commitment on the obligation is extremely strong.

AA: Bonds rated "AA" differ from the highest rated obligations only in small degree. The obligor's capacity to
meet its financial commitment on the obligation is very strong.

BB, B, CCC, CC, and C

CC: Bonds rated "CC" are currently highly vulnerable to nonpayment.

Short-Term Issue Credit Ratings

Fitch, Inc.
- -------------------------------------------------------------------------------------------------------------------

International Long-Term Credit Ratings

Speculative Grade:

International Short-Term Credit Ratings

F1: Highest credit quality. Strongest capacity for timely payment of financial commitments. May have an added
"+" to denote any exceptionally strong credit feature.

F2: Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of
safety is not as great as in the case of higher ratings.

F3: Fair credit quality. Capacity for timely payment of financial commitments is adequate. However, near-term
adverse changes could result in a reduction to non-investment grade.

B: Speculative. Minimal capacity for timely payment of financial commitments, plus vulnerability to near-term
adverse changes in financial and economic conditions.

C: High default risk. Default is a real possibility. Capacity for meeting financial commitments is solely
reliant upon a sustained, favorable business and economic environment.

D: Default. Denotes actual or imminent payment default.
(i)

B-1
Appendix B
Industry Classification
-----------------------

C-11
Appendix C