PSP 485B 2002 Bond Fund

EX-99 5 psp485b28502.htm PSP - 485B BOND FUND PSP 485B 2002 Bond Fund

Oppenheimer
Bond Fund

Prospectus dated April 30, 2002

Oppenheimer Bond Fund is a mutual fund that seeks a
high level of current income. It invests primarily in
investment-grade debt securities and U.S. government
securities.
This Prospectus contains important information
about the Fund's objective, and 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.
As with all mutual funds, the Securities and Exchange
Commission has not approved or disapproved the Fund's
securities nor has it determined that this Prospectus is
accurate or complete. It is a criminal offense to
represent otherwise.

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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 Mail
By Telephone
By Checkwriting

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 a high level of current income by investing mainly in
debt instruments.

WHAT DOES THE FUND MAINLY INVEST IN? The Fund invests at least 65% of its total assets in investment-grade debt
securities, U.S. government securities and money market instruments, under normal market conditions. Those
investment-grade debt securities can include:

o domestic and foreign corporate debt obligations,
o domestic and foreign government bonds,
o mortgage-related securities (including collateralized mortgage obligations ("CMOs")) issued by private
issuers, and
o other debt obligations.

In general, these debt securities are referred to as "bonds." The Fund's investments in U.S. government
securities include securities issued or guaranteed by the U.S. government or its agencies or federally-chartered
corporate entities referred to as "instrumentalities." These include mortgage-related U.S. government securities
and CMOs.

There is no set allocation of the Fund's assets among the classes of securities the Fund buys to meet
the 65% investment-grade securities requirement, but currently the Fund focuses mainly on U.S. government
securities and investment-grade debt securities. However, if market conditions change, the Fund's portfolio
managers might change the relative allocation of the Fund's assets. Effective July 31, 2002, the Fund will
invest at least 80% of its net assets (plus borrowings) in debt securities.

The Fund has no limitations on the range of maturities of the debt securities in which it can invest and
therefore may hold bonds with short-, medium- or long-term maturities. The Fund can invest up to 35% of its total
assets in high-yield debt securities that are below investment grade (commonly referred to as "junk bonds").
These investments are more fully explained in "About the Fund's Investments," below.

HOW DO THE PORTFOLIO MANAGERS DECIDE WHAT SECURITIES TO BUY OR SELL? In selecting securities for the Fund, 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 change 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 for investors seeking high current income from a fund that
invests primarily in investment-grade debt securities but which can also hold high-yield debt securities below
investment grade to seek higher income. Those investors should be willing to assume the credit risks of a fund
that typically invests a significant amount of its assets in corporate-debt securities, and the changes in share
prices that can occur when interest rates change. The Fund is intended as a long-term investment, not a
short-term trading vehicle, and may be appropriate for a part of an investor's retirement plan portfolio. 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. They include changes in general bond market movements in the U.S. and abroad (this is
referred to as "market risk"). 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.

Credit Risk. Debt securities are subject to credit risk. Credit risk is the risk that the issuer of a debt
security might not make interest and principal payments on the security as they become due. A downgrade in an
issuer's credit rating or other adverse news about an issuer can reduce the value of that issuer's securities.
Securities directly issued by the U.S. Treasury and certain agencies that are backed by the full faith and credit
of the U.S. government have little credit risk, and securities issued by other agencies of the U.S. government
generally have low credit risks. Securities issued by private issuers have greater credit risks. If an issuer
fails to pay interest, the Fund's income may be reduced. If an issuer fails to repay principal, the value of that
security and of the Fund's shares may be reduced.

o Special Risks of Lower-Grade Securities. Because the Fund can invest up to 35% of its total assets in
securities (including convertible securities) below investment grade to seek higher income, the Fund's
credit risks are greater than those of funds that buy only investment-grade securities. 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. Those risks can reduce the Fund's share prices and the income it earns. The market for
lower-grade securities may be less liquid, especially during times of economic distress, and therefore
they may be harder to value or to sell at an acceptable price.

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 those securities may sell at a discount from their face
amount. The magnitude of these fluctuations is generally greater for securities having longer maturities than for
short-term securities. However, interest rate changes may have different effects on the values of
mortgage-related securities because of prepayment risks, discussed below.

At times, the Fund may buy longer-term debt securities to seek higher income. When the average maturity
of the Fund's portfolio is longer, its share prices may fluctuate more when interest rates change. The Fund can
buy zero-coupon or "stripped" securities, which are particularly sensitive to interest rate changes and the rate
of principal payments (and prepayments). These are derivative securities that have prices that may go up or down
more than other types of debt securities in response to interest rate changes. The Fund's share prices can go up
or down when interest rates change, because of the effect of the change on the value of the Fund's investments.
Also, if interest rates fall, the Fund's investments in new securities at lower yields will reduce the Fund's
income.

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 pay 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 short- 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 fluctuate more and to fall.

risks of Using Derivative Investments. The Fund can use derivatives to seek increased returns or to try to hedge
investment risks. 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, interest-only and
principal-only securities, structured notes, interest-rate swap agreements and mortgage-related securities are
examples of derivatives the Fund can use.

If the issuer of the derivative does not pay the amount due, the Fund can lose money on the investment.
Also, the underlying security or investment on which the derivative is based, and the derivative itself, may not
perform the way the Manager expected it to perform. If that happens, the Fund's share prices could fall and the
Fund could get less income than expected, or its hedge might be unsuccessful. Some derivatives may be illiquid,
making it difficult to value or to sell them at an acceptable price. The Fund has limits on the amount of certain
types of derivatives it can hold. However, using derivatives can cause the Fund to lose money on its investments
and/or increase the volatility of its share prices.

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 price of the Fund will change daily based on changes in interest rates, 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 objective.

Debt securities are subject to market, credit and interest rate risks that can affect their values and
the share prices of the Fund. Prepayment risks of mortgage-backed securities can cause the Fund to reinvest
proceeds of its investments in lower-yielding securities. In the OppenheimerFunds spectrum, the Fund generally
has more risks than bond funds that focus primarily on U. S. government securities, but the Fund's emphasis on
investment-grade securities may make its share prices less volatile than high-yield bond funds or funds that
focus on foreign bonds.

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

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. 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]

For the period from 1/1/2002 through 3/31/2002, the cumulative return (not annualized) of Class A shares
was -0.42%.
Sales charges and taxes are not included in the calculations of return in this bar chart, and if those charges
were included, the returns would be less than those shown.
During the period shown in the bar chart, the highest return (not annualized) for a calendar quarter was 6.24%
(2Qtr '95) and the lowest return (not annualized) for a calendar quarter was -3.16% (1Qtr '94).

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1 Year
(or life of 5 Years 10 Years
Average Annual Total Returns class, if (or life of (or life of class,
for the periods ended December 31, 2001 less) class, if less) if less)

Class A Shares (inception 4/15/88)
Return Before Taxes
Return After Taxes on Distributions 1.96% 4.29% 5.53%
Return After Taxes on Distributions and Sale of -0.92% 1.43% 2.76%
Fund Shares 1.16% 1.98% 3.03%

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

Lehman Brothers Corporate Bond Index 10.40% 7.22% 7.68%1
(reflects no deduction for fees, expenses
or taxes)

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

Class B Shares (inception 5/3/93) 1.17% 4.21% 4.94%

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

Class C Shares (inception 7/11/95) 5.15% 4.52% 4.70%

Class N Shares (inception 3/1/01) 2.21%2 N/A N/A

Class Y Shares (inception 4/27/98) 7.30% 4.69% N/A

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

1. From 12/31/91.
2. Total returns for Class N shares are cumulative and are not annualized.
The Fund's average annual total returns include the applicable sales charge: for Class A, the current maximum
initial sales charge of 4.75%; for Class B, the contingent deferred sales charge of 5% (1-year) and 2% (5 years);
and for Class C and Class N, the 1% contingent deferred sales charge for the 1-year period for Class C shares and
life-of-class period for Class N shares. 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 Lehman Brothers Corporate Bond Index, which measures the performance of non-convertible investment-grade
domestic corporate debt securities. The index performance includes 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

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 expenses
directly, such as sales charges and account transaction charges. 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 numbers below are based
on the Fund's expenses during its fiscal year ended December 31, 2001, as restated to reflect the reduction in
Management Fees and the change in Distribution and/or Service (12b-1) Fees for Class N.

Shareholder Fees (charges paid directly from your investment):

--------------------------------------------- -------------- ------------ ------------ ------------- --------------
Class A Class B Class C Class N Class Y
Shares Shares Shares Shares Shares
--------------------------------------------- -------------- ------------ ------------ ------------- --------------
--------------------------------------------- -------------- ------------ ------------ ------------- --------------
Maximum Sales Charge (Load) on 4.75% None None None None
Purchases (as % of offering price)
--------------------------------------------- -------------- ------------ ------------ ------------- --------------
--------------------------------------------- -------------- ------------ ------------ ------------- --------------

Maximum Deferred Sales Charge
(Load) (as % of the lower of the None1 5%2 1%3 1%4 None
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 twelve (12) months of purchase.
4. Applies to shares redeemed within eighteen (18) months of retirement plan's first purchase.
Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)

Management Fees 0.58% 0.58% 0.58% 0.58% 0.58%

Distribution and/or Service (12b-1) Fees 0.25% 1.00% 1.00% 0.50% None

Other Expenses 0.25% 0.26% 0.25% 0.27% 0.21%

Total Annual Operating Expenses 1.08% 1.84% 1.83% 1.35% 0.79%

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

Effective January 1, 2002, the Management Fee rate has been reduced as described in "How the Fund is Managed -
The Manager - Advisory Fees." Prior to such change, Management Fees were 0.73% of average annual net assets for
each Class. Accordingly, the Management Fees and Total Annual Operating Expenses set forth above have been
restated to reflect the reduced fees. Effective November 1, 2001, the Distribution and/or Service (12b-1) Fees
for Class N shares increased from 0.25% to 0.50%. For the period from March 1, 2001 when Class N shares were
first offered until the Fund's fiscal year-end of December 31, 2001, the Class N shares "Distribution and/or
Service (12b-1) Fees" and "Total Annual Operating Expenses" were 0.37% and 1.37%, respectively.

"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% per annum for Class Y shares and 0.35% per annum for all other classes. After the waiver, the actual
"Other Expenses" and "Total Annual Operating Expenses" as percentages of average daily net assets were 0.19% and
0.77%, respectively, for Class Y shares. Expenses may vary in future years.

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:

---------------------------------- --------------------- -------------------- ------------------- -------------------
If shares are redeemed: 1 Year 3 Years 5 Years 10 Years1
---------------------------------- --------------------- -------------------- ------------------- -------------------
---------------------------------- --------------------- -------------------- ------------------- -------------------

Class A Shares $580 $802 $1,042 $1,730

Class B Shares $687 $879 $1,196 $1,777

Class C Shares $286 $576 $990 $2,148

Class N Shares $237 $428 $739 $1,624

Class Y Shares $81 $252 $439 $978

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

---------------------------------- --------------------- -------------------- ------------------- -------------------
If shares are not redeemed: 1 Year 3 Years 5 Years 10 Years1
---------------------------------- --------------------- -------------------- ------------------- -------------------
---------------------------------- --------------------- -------------------- ------------------- -------------------

Class A Shares $580 $802 $1,042 $1,730

Class B Shares $187 $579 $996 $1,777

Class C Shares $186 $576 $990 $2,148

Class N Shares $137 $428 $739 $1,624

Class Y Shares $81 $252 $439 $978

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

In the first example, expenses include the initial sales charge for Class A and the applicable Class B, Class C
or Class N contingent deferred sales charges. In the second example, the Class A expenses include the sales
charge, but Class B, Class C and Class N expenses do not include contingent deferred sales charges. There are no
sales charges 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. 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. 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 investments 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 share price and yield of the Fund will change daily based on changes in market prices of securities and
market conditions, and in response to other economic events.

In selecting debt securities and evaluating their yield potential and credit risk, the Manager does not
rely solely on ratings by rating organizations but evaluates business and economic factors affecting an issuer as
well. The debt securities the Fund buys may be rated by nationally recognized rating organizations such as
Moody's Investors Service or Standard & Poor's Rating Services, or they may be unrated securities assigned an
equivalent rating by the Manager. "Investment-grade" rated securities are those in the four highest rating
categories of national ratings organizations. A description of those ratings definitions is included in Appendix
A to the Statement of Additional Information.

U.S. Government Securities. Not all of the U.S. government securities the Fund buys are backed by the full faith
and credit of the U.S. government as to payment of interest and repayment of principal. Some are backed
by the right of the entity to borrow from the U.S. Treasury. Others are backed only by the credit of the
instrumentality. All of these different types of securities described below are generally 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 can buy U. S. Treasury securities that have been "stripped" of their coupons and
zero-coupon securities described below.
o Obligations Issued or Guaranteed by U.S. Government Agencies or Instrumentalities. These include direct
obligations and mortgage-related securities that have different levels of credit support from the U.S.
government. Some are supported by the full faith and credit of the U.S. government, such as Government
National Mortgage Association ("Ginnie Mae") pass-through mortgage certificates. 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 ("Fannie Mae") bonds. Others are supported only by the credit of the
entity that issued them, such as Federal Home Loan Mortgage Corporation ("Freddie Mac") obligations.
o Mortgage-Related U.S. Government Securities. These include interests in pools of residential or
commercial mortgages, in the form of CMOs 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 with 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. These prepayment risks can make the prices of CMOs very
volatile when interest rates change. That volatility will affect the Fund's share prices.
Other Debt Securities. While the Fund invests primarily in investment-grade debt securities, it is not required
to dispose of debt securities that fall below investment grade after the Fund buys them. However, the
portfolio managers will monitor those holdings to determine whether the Fund should sell them. While
securities rated "Baa" by Moody's or "BBB" by S&P are considered "investment grade," they have some
speculative characteristics.
While investment-grade securities are subject to risks of non-payment of interest and principal, in
general, higher-yielding lower-grade bonds, whether rated or unrated, have greater risks than
investment-grade securities. There may be less of a market for them and therefore they may be harder to
value and sell at an acceptable price. These risks can reduce the Fund's share prices and the income it
earns.
o Private-Issuer Securities. The Fund can invest in securities issued by private issuers that do not offer
the credit backing of the U.S. government. These include multi-class debt or pass-through certificates
secured by mortgage loans. They may be issued by banks, savings and loans, mortgage bankers or special
trusts. The Fund can buy other types of asset-backed securities collateralized by loans or other assets
or receivables. Private-issuer mortgage-backed securities are subject to the credit risks of the issuers
(as well as the interest rate risks and prepayment risks discussed above). There is the risk that
private issuers may not make timely payment of interest or repay principal when due, although in some
cases those payment obligations may be supported by insurance or guarantees.
Foreign Securities. The Fund typically invests a portion of its assets in foreign debt securities, and it has no
limit on the amount of its assets that can be invested in foreign securities that are investment grade.
The Fund can buy debt securities issued by foreign governments or companies. The Fund can buy securities
of governments and companies in both developed markets and emerging markets. Debt securities issued or
guaranteed by a foreign government or its agencies might not be backed by the "full faith and credit" of
the government.
The Fund's foreign debt investments can be denominated in U.S. dollars or in foreign currencies. The
Fund will buy foreign currency only in connection with the purchase and sale of foreign securities and
not for speculation.
o Risks of Foreign Investing. While foreign securities offer special investment opportunities, there are
also special risks that can reduce the Fund's share prices and returns. The change in value of a foreign
currency against the U.S. dollar will result in a change in the U.S. dollar value of securities
denominated in that foreign currency. Currency rate changes can also affect the distributions the Fund
makes from the income it receives from foreign securities as foreign currency values change against the
U.S. dollar. Foreign investing can result in higher transaction and operating costs for the Fund.
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, currency devaluation,
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.

Portfolio Turnover. The Fund can engage in short-term trading to try to achieve its objective, and will likely
have a high portfolio turnover rate. Portfolio turnover increases the Fund's brokerage and transaction
costs (and reduces the Fund's performance). However, most of the Fund's portfolio transactions are
principal trades that do not entail brokerage fees. If the Fund realizes capital gains when it sells its
portfolio investments, it must generally pay those gains out to shareholders, increasing their taxable
distributions. The Financial Highlights table at the end of this Prospectus shows the Fund's portfolio
turnover rates during recent fiscal years.

CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE? The Fund's Board of Trustees can change non-fundamental
investment policies without shareholder approval, although significant changes will be described in amendments to
this Prospectus. Fundamental policies cannot be changed without the approval of a majority of the Fund's
outstanding voting shares. The Fund's investment objective is a fundamental policy. Investment restrictions that
are fundamental policies are listed in the Statement of Additional Information. An investment policy is not
fundamental unless this Prospectus or the Statement of Additional Information says that it is. The Fund's policy
to invest at least 80% of its net assets (plus borrowings) in debt securities is not a fundamental policy;
however, it cannot be changed without 60 days prior notice to shareholders.

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

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.

Zero-Coupon and "Stripped" Securities. Some of the debt securities the Fund buys are zero-coupon bonds that pay
no interest. They are issued at a substantial discount from their face value. They may be securities
issued by the U.S. government or private issuers. "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 typical debt securities that pay interest on a regular basis. The Fund may have to pay out
the imputed income on zero-coupon securities without receiving the cash currently. Stripped securities
are particularly sensitive to changes in interest rates.

The values of interest-only and principal-only mortgage-related securities are very sensitive to changes
in interest rates and prepayments of underlying mortgages. The market for these securities may be
limited, making it difficult for the Fund to value or to sell its holdings at an acceptable price.

Preferred Stock. Unlike common stock, preferred stock typically has a stated dividend rate. Preferred stock
dividends may be cumulative (they remain a liability of the company until they are paid) or
non-cumulative. When interest rates rise, the value of preferred stock having a fixed dividend rate
tends to fall. The right to payment of dividends on preferred stock is generally subordinate to the
rights of a corporation's debt 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 typically 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 prepayment risks and the risk of default by the issuer as well
as by the borrowers of the underlying loans in the pool.
Illiquid and Restricted Securities. Investments may be illiquid because they do not have an active trading
market, making it difficult to value them or sell them at an acceptable price. A restricted security is
one that has a contractual restriction on its resale or which cannot be sold publicly until it is
registered under the Securities Act of 1933. The Fund will not invest more than 10% of its net assets in
illiquid or restricted securities (the Fund's Board of Trustees can increase that limit to 15%). Certain
restricted securities that are eligible for resale to qualified institutional purchasers may not be
subject to that limit. The Manager monitors holdings of illiquid securities on an ongoing basis to
determine whether to sell any holdings to maintain adequate liquidity.
"Structured" Notes. The Fund can buy "structured" notes, which are specially-designed derivative debt investments
whose payments of principal or interest payments 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. Their 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.
Hedging. The Fund can buy and sell certain kinds of futures contracts, put and call options, interest rate swaps
and forward contracts to hedge investment risks. The Fund is not required to use hedging instruments to
seek its objective and does not currently use them to a significant degree.
There are special risks in particular hedging strategies. 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.
Short-Term Debt Securities. The Fund can buy high-quality, short-term money market instruments, including
obligations of the U.S. Government and its agencies, short-term corporate debt obligations, bank
certificates of deposit and bankers' acceptances, and commercial paper, which are short-term, negotiable
promissory notes of companies. Because these instruments tend to offer lower yields than other debt
securities, the Fund ordinarily does not invest in them to seek high current income, and uses them more
for liquidity and cash management purposes or for defensive purposes when market conditions are unstable.

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 Trustees, under an investment advisory
agreement that states the Manager's responsibilities. The agreement sets the fees the Fund pays to the Manager
and describes the expenses that the Fund is responsible to pay to conduct its business.

The Manager has been an investment advisor since January 1960. The Manager and its subsidiaries and
affiliates managed more than $130 billion in assets as of March 31, 2002, including other Oppenheimer funds, with
more than 6.3 million shareholder accounts. The Manager is located at 498 Seventh Avenue, 10th Floor, New York,
New York 10018.

Portfolio Managers. Since April 23, 2002, the Fund has been managed by a portfolio management team comprised of
Angelo Manioudakis and other investment professionals selected from the Manager's high-grade team in its
fixed-income department. This portfolio management team is primarily responsible for the day-to-day
management of the Fund's portfolio. Mr. Manioudakis is a Vice President of the Fund and Senior Vice
President of the Manager. He is also an officer and portfolio manager of other Oppenheimer funds.
Certain members of the Fund's portfolio management team have portfolio management responsibilities for
other Oppenheimer funds. Prior to joining the Manager in April 2002, Mr. Manioudakis was a portfolio
manager at Morgan Stanley Investment Management (since August 1993).

Advisory Fees. Under the Investment Advisory Agreement, effective January 1, 2002, the Fund pays the Manager an
advisory fee at an annual rate that declines on additional assets as the Fund grows: 0.60% of the first
$200 million of average annual net assets of the Fund, 0.57% of the next $200 million, 0.54% of the next
$200 million, 0.51% of the next $200 million, 0.45% of the next $200 million and 0.35% of average annual
net assets in excess of $1 billion. Prior to January 1, 2002 the annual advisory fee was: 0.75% of the
first $200 million of average annual net assets of the Fund, 0.72% of the next $200 million, 0.69% of
the next $200 million, 0.66% of the next $200 million, 0.60% of the next $200 million and 0.50% of
average annual net assets in excess of $1 billion. The Fund's management fee for its last fiscal year
ended December 31, 2001 was 0.73% of average annual net assets for each class of shares.

A B O U T Y O U R A C C O U N T

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.
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
1.800.525.7048 to notify the Distributor of the wire and to receive further instructions.
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.
Buying Shares Through Asset Builder Plans. You may purchase shares of the Fund (and up to four other
Oppenheimer funds) 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 $25. There are reduced minimum investments under special investment
plans.

With Asset Builder Plans, 403(b) plans, Automatic Exchange Plans and military allotment plans, you can make
initial and subsequent investments for as little as $25. You can make additional purchases of at least
$25 through AccountLink.
Under retirement plans, such as IRAs, pension and profit-sharing plans and 401(k) plans, you can start your
account with as little as $250. If your IRA is started as an Asset Builder Plan, the $25 minimum
applies. Additional purchases may be for as little as $25.
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 and sends it to
the Distributor.
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., New York time, but may close earlier
on some days. All references to time in this Prospectus mean "New York time."
The net asset value per share is determined by dividing the value of the Fund's net assets attributable
to a class by the number of shares of that class that are outstanding. To determine net asset value, the
Fund's Board of Trustees has established procedures to value the Fund's securities, in general, based on
market value. The Board has adopted special procedures for valuing illiquid and restricted securities
and obligations for which market values cannot be readily obtained. Because some foreign securities
trade in markets and on exchanges that operate on weekends and U.S. holidays, the values of some of the
Fund's foreign investments may change on days when investors cannot buy or redeem Fund shares.
If, after the close of the principal market on which a security held by the Fund is traded, and before
the time the Fund's securities are priced that day, an event occurs that the Manager deems likely to
cause a material change in the value of such security, the Fund's Board of Trustees has authorized the
Manager, subject to the Board's review, to ascertain a fair value for such security.
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. Otherwise, the order will receive the next offering price that is determined.

-------------------------------------------------------------------------------------------------------------------
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 A Shares. If you buy Class A shares, you pay an initial sales charge (on investments up to $1 million). 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.
-------------------------------------------------------------------------------------------------------------------

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

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.

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.
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 on 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 $50,000 4.75% 4.98% 4.00%
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$50,000 or more but less than 4.50% 4.71% 3.75%
$100,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$100,000 or more but less than 3.50% 3.63% 2.75%
$250,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$250,000 or more but less than 2.50% 2.56% 2.00%
$500,000
------------------------------------ ------------------------ ------------------------- -------------------------
------------------------------------ ------------------------ ------------------------- -------------------------
$500,000 or more but less than $1 2.00% 2.04% 1.60%
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 1.0% of the first $2.5
million, plus 0.50% of the next $2.5 million, plus 0.25% of purchases over $5 million, calculated on a
calendar year basis. 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 Contingent Deferred Sales Charge on Redemptions in That Year
Order was Accepted (As % of Amount Subject to Charge)

---------------------------------------------------- ---------------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
0 - 1 5.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
1 - 2 4.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
2 - 3 3.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
3 - 4 3.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
4 - 5 2.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
5 - 6 1.0%
----------------------------------------------------------- --------------------------------------------------------
----------------------------------------------------------- --------------------------------------------------------
6 and following 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 only through 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 through group
retirement plans (which do not include IRAs and 403(b) plans) that have assets of $500,000 or more or 100 or more
eligible participants. See "Availability of Class N shares" in the Statement of Additional Information for other
circumstances where Class N shares are available for purchase.

A contingent deferred sales charge of 1.0% will be imposed upon the redemption of Class N shares, if:
o The group retirement plan is terminated or Class N shares of all Oppenheimer funds are terminated as an

investment option of the plan and Class N shares are redeemed within 18 months after the plan's first
purchase of Class N shares of any Oppenheimer fund, or

o With respect to an IRA or 403(b) plan, Class N shares are redeemed within 18 months of the plan's first
purchase of Class N shares of any Oppenheimer fund.
Retirement plans that offer Class N shares may impose charges on plan participant accounts. The
procedures for buying, selling, exchanging and transferring the Fund's other classes of shares (other than the
time those orders must be received by the Distributor or Transfer Agent in Colorado) and the special account
features applicable to purchasers of those other classes of shares described elsewhere in this prospectus do not
apply to Class N shares offered through a group retirement plan. Instructions for buying, selling, exchanging or
transferring Class N shares offered through a group retirement plan must be submitted by the plan, not by plan
participants for whose benefit the shares are held.

Who Can Buy Class Y Shares? Class Y shares are sold at net asset value per share without a sales charge directly
to institutional investors that have special agreements with the Distributor for this purpose. They may include
insurance companies, registered investment companies and employee benefit plans. For example, Massachusetts
Mutual Life Insurance Company ("MassMutual"), an affiliate of the Manager, may purchase Class Y shares of the
Fund and other Oppenheimer funds (as well as Class Y shares of funds advised by MassMutual) for asset allocation
programs, investment companies or separate investment accounts it sponsors and offers to its customers.
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.

Service Plan for Class A Shares. The Fund has adopted a Service Plan for Class A shares. It reimburses the
Distributor for a portion of its costs incurred for services provided to accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate of up to 0.25% of the average annual net
assets of Class A shares of the Fund. The Distributor currently uses all of those fees to pay dealers,
brokers, banks and other financial institutions quarterly for providing personal service and maintenance
of accounts of their customers that hold Class A shares.

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

The asset-based sales charge and service fees increase Class B and Class C expenses by 1.0% and increase
Class N expenses by 0.50% of the net assets per year of the respective class. Because these fees are
paid out of the Fund's assets on an on-going basis, over time these fees will increase the cost of your
investment and may cost you more than other types of sales charges.
The Distributor uses the service fees to compensate dealers for providing personal services for accounts
that hold Class B, Class C or Class N shares. The Distributor pays the 0.25% service fees to dealers in
advance for the first year after the shares are sold by the dealer. After the shares have been held for
a year, the Distributor pays the service fees to dealers on a quarterly basis. The Distributor retains
the service fees for accounts for which it renders the required personal services.

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

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

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

Special Investor Services

ACCOUNTLINK. You can use our AccountLink feature to link your Fund account with an account at a U.S. bank or
other financial institution. It must be an Automated Clearing House (ACH) member. AccountLink lets you:
o transmit funds electronically to purchase shares by telephone (through a service representative or by
PhoneLink) or automatically under Asset Builder Plans, or
o have the Transfer Agent send redemption proceeds or transmit dividends and distributions directly to
your bank account. Please call the Transfer Agent for more information.
You may purchase shares by telephone only after your account has been established. To purchase shares in
amounts up to $250,000 through a telephone representative, call the Distributor at 1.800.852.8457. 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 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 special
PhoneLink number, 1.800.533.3310.
Purchasing Shares. You may purchase shares in amounts up to $100,000 by phone, by calling 1.800.533.3310. 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 1.800.525.7048 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 1.800.525.7048. At times, the website may be
inaccessible or its transaction features may be unavailable.

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

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

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

as schools, hospitals and charitable organizations.
401(k) Plans. These are special retirement plans for businesses.
Pension and Profit-Sharing Plans. These plans are designed for businesses and self-employed individuals.
Please call the Distributor for OppenheimerFunds retirement plan documents, which include applications
and important plan information.

How to Sell Shares

You can sell (redeem) some or all of your shares on any regular business day. Your shares will be sold at the
next net asset value calculated after your order is received in proper form (which means that it must comply with
the procedures described below) and is accepted by the Transfer Agent. The Fund lets you sell your shares by
writing a letter, by using the Fund's checkwriting privilege, 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 1.800.525.7048, 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.

Checkwriting. To write checks against your Fund account, request that privilege on your account application, or
contact the Transfer Agent for signature cards. They must be signed (with a signature guarantee) by all owners of
the account and returned to the Transfer Agent so that checks can be sent to you to use. Shareholders with joint
accounts can elect in writing to have checks paid over the signature of one owner. If you previously signed a
signature card to establish checkwriting in another Oppenheimer fund, simply call 1.800.525.7048 to request
checkwriting for an account in this Fund with the same registration as the other account.
o Checks can be written to the order of whomever you wish, but may not be cashed at the bank the checks
are payable through or the Fund's custodian bank.
o Checkwriting privileges are not available for accounts holding shares that are subject to a contingent
deferred sales charge.
o Checks must be written for at least $100.
o Checks cannot be paid if they are written for more than your account value. Remember, your shares
fluctuate in value and you should not write a check close to the total account value.
o You may not write a check that would require the Fund to redeem shares that were purchased by check or
Asset Builder Plan payments within the prior 10 days.
Don't use your checks if you changed your Fund account number, until you receive new checks.

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, call 1.800.852.8457
o To redeem shares automatically on PhoneLink, call 1.800.533.3310
Whichever method you use, you may have a check sent to the address on the account statement, or, if you
have linked your Fund account to your bank account on AccountLink, you may have the proceeds sent to that bank
account.

Are There Limits on Amounts Redeemed by Telephone?

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

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

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:
the amount of your account value represented by an increase in net asset value over the initial purchase
price,
shares purchased by the reinvestment of dividends or capital gains distributions, or
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 1.800.525.7048. 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
at 1.800.852.8457, or by using PhoneLink for automated exchanges by calling 1.800.533.3310. 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:
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.
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.
The offering of shares may be suspended during any period in which the determination of net asset value is
suspended, and the offering may be suspended by the Board of Trustees at any time the Board believes it
is in the Fund's best interest to do so.

Telephone transaction privileges for purchases, redemptions or exchanges may be modified, suspended or terminated
by the Fund at any time. The Fund will provide you notice whenever it is required to do so by applicable
law. If an account has more than one owner, the Fund and the Transfer Agent may rely on the instructions
of any one owner. Telephone privileges apply to each owner of the account and the dealer representative
of record for the account unless the Transfer Agent receives cancellation instructions from an owner of
the account.

The Transfer Agent will record any telephone calls to verify data concerning transactions and has adopted other
procedures to confirm that telephone instructions are genuine, by requiring callers to provide tax
identification numbers and other account data or by using PINs, and by confirming such transactions in
writing. The Transfer Agent and the Fund will not be liable for losses or expenses arising out of
telephone instructions reasonably believed to be genuine.
Redemption or transfer requests will not be honored until the Transfer Agent receives all required documents in
proper form. From time to time, the Transfer Agent in its discretion may waive certain of the
requirements for redemptions stated in this Prospectus.
Dealers that perform account transactions for their clients by participating in NETWORKING through the National
Securities Clearing Corporation are responsible for obtaining their clients' permission to perform those
transactions, and are responsible to their clients who are shareholders of the Fund if the dealer
performs any transaction erroneously or improperly.
The redemption price for shares will vary from day to day because the value of the securities in the Fund's
portfolio fluctuates. The redemption price, which is the net asset value per share, will normally differ
for each class of shares. The redemption value of your shares may be more or less than their original
cost.

Payment for redeemed shares ordinarily is made in cash. It is forwarded by check, or through AccountLink (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 forwarding a check or processing a payment via AccountLink for recently purchased
shares, but only until the purchase payment has cleared. That delay may be as much as 10 days from the
date the shares were purchased. That delay may be avoided if you purchase shares by Federal Funds wire
or certified check, or arrange with your bank to provide telephone or written assurance to the Transfer
Agent that your purchase payment has cleared

Involuntary redemptions of small accounts may be made by the Fund if the account value has fallen below $1,000
for reasons other than the fact that the market value of shares has dropped. In some cases, involuntary
redemptions may be made to repay the Distributor for losses from the cancellation of share purchase
orders.

Shares may be "redeemed in kind" under unusual circumstances (such as a lack of liquidity in the Fund's portfolio
to meet redemptions). This means that the redemption proceeds will be paid with liquid securities from
the Fund's portfolio.
"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
1.800.525.7048. 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
each regular business day and pay those dividends to shareholders monthly on a date selected by the Board of
Trustees. Daily dividends will not be declared or paid on newly purchased shares until Federal Funds are
available to the Fund from the purchase payment for shares. Dividends and distributions paid to Class A and Class
Y shares will generally be higher than dividends for Class B, Class C and Class N shares, which normally have
higher expenses than Class A and Class Y shares. The Fund has no fixed dividend rate and cannot guarantee that it
will pay any dividends or distributions.

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

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

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

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 capital gains distribution,
you will pay the full price for the shares and then receive a portion of the price back as a taxable
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 Deloitte & Touche 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.

FINANCIAL HIGHLIGHTS



Class A      Year Ended December 31,                      2001         2000         1999         1998         1997
------------------------------------------------------------------------------------------------------------------

Per Share Operating Data

Net asset value, beginning of period                     $9.79        $9.97       $10.86       $10.97       $10.70
------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                      .73/1/       .73          .71          .71          .77
Net realized and unrealized gain (loss)                   (.05)/1/     (.18)        (.89)        (.11)         .27
                                                         ---------------------------------------------------------
Total income (loss)
from investment operations                                 .68          .55         (.18)         .60         1.04
------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.73)        (.73)        (.71)        (.71)
(.77)
                                                         ---------------------------------------------------------
Total dividends and/or distributions
to shareholders                                           (.73)        (.73)        (.71)        (.71)
(.77)
------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                           $9.74        $9.79        $9.97       $10.86       $10.97
                                                         =========================================================

------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value/2/                       7.05%        5.80%       (1.65)%       5.61%
10.13%

------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data

Net assets, end of period (in thousands)              $280,132     $202,833     $220,502     $246,668     $190,706
------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                     $237,232     $205,883     $251,190     $217,944     $187,458
------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:/3/
Net investment income   7.31%/1/ 7.48%        6.88%        6.46%        7.20%
Expenses                1.23%    1.31%        1.24%        1.22%/4/     1.27%/4/
------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 162%     255%         238%          67%          51%


1. Without the adoption of the change in amortization method as discussed in
Note 1 in the Notes to Financial Statements, these amounts would have been:

Net investment income                      $ .74
Net realized and unrealized gain (loss)    $(.06)
Net investment income ratio                 7.43%

2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period, with all dividends and distributions
reinvested in additional shares on the reinvestment date, and redemption at the
net asset value calculated on the last business day of the fiscal period. Sales
charges are not reflected in the total returns. Total returns are not annualized
for periods less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has been calculated without adjustment for the reduction to
custodian expenses.



                           | OPPENHEIMER BOND FUND


FINANCIAL HIGHLIGHTS Continued




Class B      Year Ended December 31,                      2001         2000         1999         1998         1997
------------------------------------------------------------------------------------------------------------------

Per Share Operating Data

Net asset value, beginning of period                     $9.79        $9.96       $10.86       $10.97       $10.69
------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                      .65/1/       .66          .63          .62          .69
Net realized and unrealized gain (loss)                   (.05)/1/     (.17)        (.90)        (.10)         .28
                                                         ---------------------------------------------------------
Total income (loss)
from investment operations                                 .60          .49         (.27)         .52          .97
------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.66)        (.66)        (.63)        (.63)
(.69)
                                                         ---------------------------------------------------------
Total dividends and/or distributions
to shareholders                                           (.66)        (.66)        (.63)        (.63)
(.69)
------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                           $9.73        $9.79        $9.96       $10.86       $10.97
                                                         =========================================================

------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value/2/                       6.14%        5.11%       (2.48)%       4.81%
9.41%

------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data

Net assets, end of period (in thousands)              $161,998      $83,637      $94,845      $88,061      $48,255
------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                     $118,521      $83,394      $95,285      $64,330      $41,439
------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:/3/
Net investment income                                     6.60%/1/     6.71%        6.13%        5.68%
6.42%
Expenses                                                  1.99%        2.07%        1.99%        1.97%/4/
2.02%/4/
------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                    162%         255%         238%          67%
51%


1. Without the adoption of the change in amortization method as discussed in
Note 1 in the Notes to Financial Statements, these amounts would have been:

Net investment income                      $ .66
Net realized and unrealized gain (loss)    $(.06)
Net investment income ratio                 6.72%

2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period, with all dividends and distributions
reinvested in additional shares on the reinvestment date, and redemption at the
net asset value calculated on the last business day of the fiscal period. Sales
charges are not reflected in the total returns. Total returns are not annualized
for periods less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has been calculated without adjustment for the reduction to
custodian expenses.



                           | OPPENHEIMER BOND FUND





Class C      Year Ended December 31,                      2001         2000         1999         1998         1997
------------------------------------------------------------------------------------------------------------------

Per Share Operating Data

Net asset value, beginning of period                     $9.80        $9.97       $10.87       $10.98       $10.70
------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                      .65/1/       .66          .63          .62          .69
Net realized and unrealized gain (loss)                   (.05)/1/     (.17)        (.90)        (.10)         .28
                                                         ---------------------------------------------------------
Total income (loss)
from investment operations                                 .60          .49         (.27)         .52          .97
------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.66)        (.66)        (.63)        (.63)
(.69)
                                                         ---------------------------------------------------------
Total dividends and/or distributions
to shareholders                                           (.66)        (.66)        (.63)        (.63)
(.69)
------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                           $9.74        $9.80        $9.97       $10.87       $10.98
                                                         =========================================================

------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value/2/                       6.14%        5.11%       (2.47)%       4.81%
9.39%

------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data

Net assets, end of period (in thousands)               $57,049      $24,303      $24,143      $21,796       $9,188
------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                      $36,886      $22,605      $24,218      $15,198       $6,134
------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:/3/
Net investment income                                     6.65%/1/     6.71%        6.13%        5.66%
6.36%
Expenses                                                  1.98%        2.07%        1.99%        1.96%/4/
2.02%/4/
------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                    162%         255%         238%          67%
51%


1. Without the adoption of the change in amortization method as discussed in
Note 1 in the Notes to Financial Statements, these amounts would have been:

Net investment income                      $ .66
Net realized and unrealized gain (loss)    $(.06)
Net investment income ratio                 6.77%

2. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period, with all dividends and distributions
reinvested in additional shares on the reinvestment date, and redemption at the
net asset value calculated on the last business day of the fiscal period. Sales
charges are not reflected in the total returns. Total returns are not annualized
for periods less than one full year.
3. Annualized for periods of less than one full year.
4. Expense ratio has been calculated without adjustment for the reduction to
custodian expenses.



                           | OPPENHEIMER BOND FUND


FINANCIAL HIGHLIGHTS Continued



                                                       Class N                                             Class Y
                                                        Period                                                Year
                                                         Ended                                               Ended
                                                      Dec. 31,                                            Dec. 31,
                                                          2001/1/      2001         2000         1999
1998/2/
------------------------------------------------------------------------------------------------------------------

Per Share Operating Data

Net asset value, beginning of period                    $10.02        $9.78        $9.95       $10.86       $10.88
------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income                                     .61/3/       .76/4/        .85          .76          .49
Net realized and unrealized gain (loss)                   (.29)/3/     (.05)/4/     (.18)        (.91)
(.02)

----------------------------------------------------------
Total income (loss) from
investment operations                                      .32          .71          .67         (.15)         .47
------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income                      (.61)        (.77)        (.84)        (.76)
(.49)

----------------------------------------------------------
Total dividends and/or distributions
to shareholders                                           (.61)        (.77)        (.84)        (.76)
(.49)
------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                          $ 9.73       $ 9.72        $9.78       $ 9.95       $10.86

==========================================================

------------------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value5                         3.18%        7.30%        7.13%       (1.37)%
4.40%

------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data

Net assets, end of period (in thousands)                $2,176       $4,067         $877         $186           $1
------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                       $  768       $2,286         $340          $31           $1
------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:6
Net investment income                                     7.87%/3/     7.85%/4/     7.92%        7.94%
6.84%
Expenses                                                  1.37%        0.94%        0.83%        0.83%
0.74%/7/
Expenses, net of reduction to custodian
expenses and/or voluntary waiver
of transfer agent fees                                     N/A         0.92%         N/A          N/A          N/A
------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                    162%         162%         255%         238%
67%


1. For the period from March 1, 2001 (inception of offering) to December 31,
2001.
2. For the period from April 27,1998 (inception of offering) to December 31,
1998.
3. Without the adoption of the change in amortization method as discussed in
Note 1 in the Notes to Financial Statements, these amounts would have been:

Net investment income                      Change less than $0.005 per share
Net realized and unrealized gain (loss)    Change less than $0.005 per share
Net investment income ratio 7.99%

4. Without the adoption of the change in amortization method as discussed in
Note 1 in the Notes to Financial Statements, these amounts would have been:

Net investment income                      $ .77
Net realized and unrealized gain (loss)    $(.06)
Net investment income ratio                 7.97%

5. Assumes a $1,000 hypothetical initial investment on the business day before
the first day of the fiscal period (or inception of offering), with all
dividends and distributions reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Sales charges are not reflected in the total returns.
Total returns are not annualized for periods of less than one full year.
6. Annualized for periods of less than one full year.
7. Expense ratio has been calculated without adjustment for the reduction to
custodian expenses.



                           | OPPENHEIMER BOND FUND

INFORMATION AND SERVICES

For More Information on Oppenheimer Bond 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:
                                            1.800.525.7048
------------------------------------------- ------------------------------------------------------------------
------------------------------------------- ------------------------------------------------------------------
By Mail:                                    Write to:
                                            OppenheimerFunds Services
                                            P.O. Box 5270
                                            Denver, Colorado 80217-5270
------------------------------------------- ------------------------------------------------------------------
------------------------------------------- ------------------------------------------------------------------

On the Internet:                            You can send us a request by e-mail or read or download
                                            documents on the OppenheimerFunds website:
                                            WWW.OPPENHEIMERFUNDS.COM
                                            ------------------------

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

Information about the Fund including the Statement of Additional Information can be reviewed and copied at
the SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference
Room may be obtained by calling the SEC at 1.202.942.8090. Reports and other information about the Fund are
available on the EDGAR database on the SEC's Internet website at www.sec.gov. Copies may be obtained after
payment of a duplicating fee by electronic request at the SEC's e-mail address: publicinfo@sec.gov, or by
writing to the SEC's Public Reference Section, Washington, D.C. 20549-0102.


No one has been authorized to provide any information about the Fund or to make any representations about
the Fund other than what is contained in this Prospectus. This Prospectus is not an offer to sell shares of
the Fund, nor a solicitation of an offer to buy shares of the Fund, to any person in any state or other
jurisdiction where it is unlawful to make such an offer.


The Fund's SEC File No.: 811-3420   The Fund's shares are distributed by:
PR0285.001.0402                                               [logo] OppenheimerFunds Distributor, Inc.
Printed on recycled paper.


                                             Appendix to Prospectus of
                                               Oppenheimer Bond Fund

         Graphic material included in the Prospectus of Oppenheimer Bond 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 last ten calendar years, without deducting
sales charges. Set forth below are the relevant data points that will appear in the bar chart:

         Calendar             Annual
         Year                 Total
         Ended                Returns


         12/31/92               6.77%
         12/31/93               10.30%
         12/31/94               -3.87%
         12/31/95               16.94%
         12/31/96               4.87%
         12/31/97               10.13%
         12/31/98               5.61%
         12/31/99               -1.65%
         12/31/00               5.80%
         12/31/01              7.05%