REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 | ☒ |
PreEffective Amendment No. | □ |
PostEffective Amendment No. 72 | ☒ |
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 | ☒ |
Amendment No. 73 | ☒ |
Class A | Class T | Class C | Class R | Class Y | Class I | ||
Maximum Sales Charge (Load) imposed on purchases (as % of offering price) | 4.75% | 2.50% | None | None | None | None | |
Maximum Deferred Sales Charge (Load) (as % of the lower of original offering price or redemption proceeds) | None | None | 1% | None | None | None |
Class A | Class T | Class C | Class R | Class Y | Class I | ||
Management Fees | 0.65% | 0.65% | 0.65% | 0.65% | 0.65% | 0.65% | |
Distribution and/or Service (12b-1) Fees | 0.25% | 0.25% | 1.00% | 0.50% | None | None | |
Other Expenses1 | 0.46% | 0.46% | 0.46% | 0.46% | 0.46% | 0.27% | |
Total Annual Fund Operating Expenses | 1.36% | 1.36% | 2.11% | 1.61% | 1.11% | 0.92% | |
Fee Waiver and Expense Reimbursement2 | (0.17)% | (0.17)% | (0.17)% | (0.17)% | (0.17)% | (0.17)% | |
Total Annual Fund Operating Expenses after Fee Waiver and/or Expense Reimbursement | 1.19% | 1.19% | 1.94% | 1.44% | 0.94% | 0.75% |
1. | “Other Expenses” are based on estimates for the current fiscal year. |
2. | OFI Global has contractually agreed to waive a portion of its management fees and/or reimburse the Fund for certain of its expenses so that total annual fund operating expenses after any fee waiver and/or expense reimbursement (excluding any applicable dividend expense, taxes, interest and fees from borrowing, any subsidiary expenses, Acquired Fund Fees and Expenses, brokerage commissions, extraordinary expenses and certain other Fund expenses) will not exceed 1.19% of average annual net assets for Class A shares, 1.19% for Class T shares, 1.94% for class C shares, 1.44% for Class R shares, 0.94% for Class Y shares, and 0.75% for Class I Shares. These fee waivers and/or expense reimbursements may not be amended or withdrawn for one year from the date of the prospectus, unless approved by the Board. |
If shares are redeemed | If shares are not redeemed | ||||
1 Year | 3 Years | 1 Year | 3 Years | ||
Class A | $591 | $872 | $591 | $872 | |
Class T | $369 | $656 | $369 | $656 | |
Class C | $299 | $651 | $199 | $651 | |
Class R | $148 | $495 | $148 | $495 | |
Class Y | $96 | $338 | $96 | $338 | |
Class I | $77 | $278 | $77 | $278 |
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■ | CoCos are usually issued in the form of subordinated debt instruments to provide the appropriate regulatory capital treatment. If an issuer liquidates, dissolves or winds-up before a conversion to equity has occurred, the rights and claims of the holders of the CoCos (such as a fund) against the issuer generally rank junior to the claims of holders of unsubordinated obligations of the issuer. In addition, if the CoCos are converted into the issuer’s underlying equity securities after a conversion event (i.e., a “trigger”), each holder will be further subordinated. |
■ | A trigger event for CoCos would likely be the result of, or related to, the deterioration of the issuer’s financial condition (e.g., a decrease in the issuer’s capital ratio) and status as a going concern. In such a case, with respect to CoCos that provide for conversion into common stock upon the occurrence of the trigger event, the market price of the issuer’s common stock received by the Fund will have likely declined, perhaps substantially, and may continue to decline, which may adversely affect the Fund’s net asset value. Further, the issuer’s common stock would be subordinate to the issuer’s other classes of securities and therefore would worsen a Fund’s standing in a bankruptcy proceeding. In addition, because the common stock of the issuer may not pay a dividend, investors in these instruments could experience a reduced income rate, potentially to zero. |
■ | CoCos may be subject to an automatic write-down (i.e., the automatic write-down of the principal amount or value of the securities, potentially to zero, and the cancellation of the securities) under certain circumstances, which could result in the Fund losing a portion or all of its investment in such securities. In addition, the Fund may not have any rights with respect to repayment of the principal amount of the securities that has not become due or the payment of interest or dividends on such securities for any period from (and including) the interest or dividend payment date falling immediately prior to the occurrence of such automatic write-down. An automatic write-down could also result in a reduced income rate if the dividend or interest payment is based on the security’s par value. |
■ | CoCos may have no stated maturity and fully discretionary coupons. This means coupon (i.e., interest) payments can be canceled at the banking institution’s discretion or at the request of the relevant regulatory authority in order to help the bank absorb losses, without causing a default. |
■ | The occurrence of a conversion event is inherently unpredictable and depends on many factors, some of which will be outside the issuer’s control. Because of the uncertainty regarding whether a conversion event will occur, it may be difficult to predict when, if at all, a CoCo will be converted to equity, and the Fund may suffer losses as a result. |
■ | The value of CoCos is unpredictable and is influenced by many factors including, without limitation: the creditworthiness of the issuer and/or fluctuations in such issuer’s applicable capital ratios; supply and demand for CoCos; general market conditions and available liquidity; and economic, financial and political events that affect the issuer, its particular market or the financial markets in general. Moreover, the performance of CoCos may be correlated with one another and as a result negative information of one issuer may cause decline in the value of CoCos of many other issuers. |
■ | Common stock represents an ownership interest in a company. It ranks below preferred stock and debt securities in claims for dividends and in claims for assets of the issuer in a liquidation or bankruptcy. |
■ | Warrants are options to purchase equity securities at specific prices that are valid for a specific period of time. Their prices do not necessarily move parallel to the prices of the underlying securities, and can be more volatile than the price of the underlying securities. If the market price of the underlying security does not exceed the exercise price during the life of the warrant, the warrant will expire worthless and any amount paid for the warrant will be lost. The market for warrants may be very limited and it may be difficult to sell a warrant promptly at an acceptable price. Rights are similar to warrants, but normally have a short duration and are distributed directly by the issuer to its shareholders. Rights and warrants have no voting rights, receive no dividends and have no rights with respect to the assets of the issuer. |
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■ | Convertible securities can be converted into or exchanged for a set amount of common stock of an issuer within a particular period of time at a specified price or according to a price formula. Convertible debt securities pay interest and convertible preferred stocks pay dividends until they mature or are converted, exchanged or redeemed. Some convertible debt securities may be considered “equity equivalents” because of the feature that makes them convertible into common stock. The conversion feature of convertible securities generally causes the market value of convertible securities to increase when the value of the underlying common stock increases, and to fall when the stock price falls. The market value of a convertible security reflects both its “investment value,” which is its expected income potential, and its “conversion value,” which is its anticipated market value if it were converted. If its conversion value exceeds its investment value, the security will generally behave more like an equity security, in which case its price will tend to fluctuate with the price of the underlying common stock or other security. If its investment value exceeds its conversion value, the security will generally behave more like a debt security, in which case the security’s price will likely increase when interest rates fall and decrease when interest rates rise. Convertible securities may offer the Fund the ability to participate in stock market movements while also seeking some current income. Convertible securities may provide more income than common stock but they generally provide less income than comparable non-convertible debt securities. Most convertible securities will vary, to some extent, with changes in the price of the underlying common stock and are therefore subject to the risks of that stock. In addition, convertible securities may be subject to the risk that the issuer will not be able to pay interest or dividends when due, and their market value may change based on changes in the issuer’s credit rating or the market’s perception of the issuer’s creditworthiness. However, credit ratings of convertible securities generally have less impact on the value of the securities than they do for non-convertible debt securities. Some convertible preferred stocks have a mandatory conversion feature or a call feature that allows the issuer to redeem the stock on or prior to a mandatory conversion date. Those features could diminish the potential for capital appreciation on the investment. |
■ | Banking Industry Risk. Banks depend upon being able to obtain funds at reasonable costs and upon liquidity in the capital and credit markets to finance their lending and other operations which makes banks sensitive to changes in money market and general economic conditions. When a bank’s borrowers have financial trouble, their failure to repay the bank will adversely affect the bank’s financial situation. Banks are also highly regulated. Decisions by regulators may limit the loans banks make and the interest rates and fees they charge, and may reduce bank profitability. |
■ | Diversified Financials Industry Risk. The Fund is subject to the risks faced by companies in the diversified financials industry, including: changes in credit ratings, interest rates, loan losses, the performance of credit and financial markets and the availability and cost of capital funds, and adverse effects from governmental regulation and oversight. The diversified financials industry may also be affected by risks that affect the broader financials industry. |
■ | Insurance Industry Risk. The insurance industry is subject to extensive government regulation and can be significantly affected by changes in interest rates, general economic conditions, price and market competition, the imposition of premium rate caps or other changes in government regulation or tax law. Certain segments of the insurance industry can be significantly affected by mortality and morbidity rates, environmental clean-up costs and catastrophic events such as earthquakes, hurricanes and terrorist acts. |
■ | Interest Rate Risk. Interest rate risk is the risk that rising interest rates, or an expectation of rising interest rates in the near future, will cause the values of the Fund’s investments in debt securities to decline. The values of debt securities usually change when prevailing interest rates change. When interest rates rise, the values of outstanding debt securities generally fall, and those securities may sell at a discount from their face amount. Additionally, when interest rates rise, the decrease in values of outstanding debt securities may not be offset by higher income from new investments. When interest rates fall, the values of already-issued debt securities generally rise and the Fund’s investments in new securities may be at lower yields and may reduce the Fund’s income. The values of longer-term debt securities usually change more than the values of shorter-term debt securities when interest rates change; thus, interest rate risk is usually greater for securities with longer maturities or durations. “Zero-coupon” or “stripped” securities may be particularly sensitive to interest rate changes. Risks associated with rising interest rates are heightened given that interest rates in the U.S. are near historic lows. Interest rate changes may have different effects on the values of mortgage-related securities because of prepayment and extension risks. |
■ | Duration Risk. Duration is a measure of the price sensitivity of a debt security or portfolio to interest rate changes. Duration risk is the risk that longer-duration debt securities are more likely to decline in price, and to a greater extent, than shorter-duration debt securities, in a rising interest-rate environment. “Effective duration” attempts to measure the expected percentage change in the value of a bond or portfolio resulting from a change in prevailing interest rates. The change in the value of a bond or portfolio can be approximated by multiplying its duration by a change in interest rates. |
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For example, if a bond has an effective duration of three years, a 1% increase in general interest rates would be expected to cause the bond’s value to decline about 3% while a 1% decrease in general interest rates would be expected to cause the bond’s value to increase 3%. The duration of a debt security may be equal to or shorter than the full maturity of a debt security. |
■ | Credit Risk. Credit risk is the risk that the issuer of a security might not make interest and principal payments on the security as they become due. U.S. government securities generally have lower credit risks than securities issued by private issuers or certain foreign governments. If an issuer fails to pay interest, the Fund’s income might be reduced, and if an issuer fails to repay principal, the value of the security might fall and the Fund could lose the amount of its investment in the security. The extent of this risk varies based on the terms of the particular security and the financial condition of the issuer. A downgrade in an issuer’s credit rating or other adverse news about an issuer, for any reason, can reduce the market value of that issuer’s securities. |
■ | Credit Spread Risk. Credit spread risk is the risk that credit spreads (i.e., the difference in yield between securities that is due to differences in their credit quality) may increase when the market expects lower-grade bonds to default more frequently. Widening credit spreads may quickly reduce the market values of the Fund’s lower-rated and unrated securities. Some unrated securities may not have an active trading market or may trade less actively than rated securities, which means that the Fund might have difficulty selling them promptly at an acceptable price. |
■ | Extension Risk. Extension risk is the risk that, if interest rates rise rapidly, prepayments on certain debt securities may occur at a slower rate than expected, and the expected maturity of those securities could lengthen as a result. Securities that are subject to extension risk generally have a greater potential for loss when prevailing interest rates rise, which could cause their values to fall sharply. Extension risk is particularly prevalent for a callable security where an increase in interest rates could result in the issuer of that security choosing not to redeem the security as anticipated on the security’s call date. Such a decision by the issuer could have the effect of lengthening the debt security’s expected maturity, making it more vulnerable to interest rate risk and reducing its market value. |
■ | Reinvestment Risk. Reinvestment risk is the risk that when interest rates fall, the Fund may be required to reinvest the proceeds from a security’s sale or redemption at a lower interest rate. Callable bonds are generally subject to greater reinvestment risk than non-callable bonds. |
■ | Prepayment Risk. Certain fixed-income securities (in particular mortgage-related securities) are subject to the risk of unanticipated prepayment. Prepayment risk is the risk that, when interest rates fall, the issuer will redeem the security prior to the security’s expected maturity, or that borrowers will repay the loans that underlie these fixed-income securities more quickly than expected, thereby causing the issuer of the security to repay the principal prior to expected maturity. The Fund may need to reinvest the proceeds at a lower interest rate, reducing its income. Securities subject to prepayment risk generally offer less potential for gains when prevailing interest rates fall. If the Fund buys those securities at a premium, accelerated prepayments on those securities could cause the Fund to lose a portion of its principal investment. The impact of prepayments on the price of a security may be difficult to predict and may increase the security’s price volatility. Interest-only and principal-only securities are especially sensitive to interest rate changes, which can affect not only their prices but can also change the income flows and repayment assumptions about those investments. |
■ | Event Risk. If an issuer of debt securities is the subject of a buyout, debt restructuring, merger or recapitalization that increases its debt load, it could interfere with its ability to make timely payments of interest and principal and cause the value of its debt securities to fall. |
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■ | Prices of below-investment-grade securities may be subject to extreme price fluctuations, even under normal market conditions. Adverse changes in an issuer’s industry and general economic conditions may have a greater impact on the prices of below-investment-grade securities than on the prices of investment-grade securities. |
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■ | Below-investment-grade securities may be issued by less creditworthy issuers and may be more likely to default than investment-grade securities. Issuers of below-investment-grade securities may have more outstanding debt relative to their assets than issuers of investment-grade securities. Issuers of below-investment-grade securities may be unable to meet their interest or principal payment obligations because of an economic downturn, specific issuer developments, or the unavailability of additional financing. |
■ | In the event of an issuer’s bankruptcy, claims of other creditors may have priority over the claims of the holders of below-investment-grade securities. |
■ | Below-investment-grade securities may be less liquid than investment-grade securities, even under normal market conditions. There are fewer dealers in the below-investment-grade securities market and there may be significant differences in the prices quoted by the dealers. Because they are less liquid, judgment may play a greater role in valuing certain of the Fund’s securities than is the case with securities trading in a more liquid market. |
■ | Below-investment-grade securities typically contain redemption provisions that permit the issuer of the securities containing such provisions to redeem the securities at its discretion. If the issuer redeems below-investment-grade securities, the Fund may have to invest the proceeds in securities with lower yields and may lose income. |
■ | Below-investment-grade securities markets may be more susceptible to real or perceived adverse credit, economic, or market conditions than investment-grade securities. |
■ | Foreign Market Risk. If there are fewer investors in a particular foreign market, securities traded in that market may be less liquid and more volatile than U.S. securities and more difficult to price. Foreign markets may also be subject to delays in the settlement of transactions and difficulties in pricing securities. If the Fund is delayed in settling a purchase or sale transaction, it may not receive any return on the invested assets or it may lose money if the value of the security declines. It may also be more expensive for the Fund to buy or sell securities in certain foreign markets than in the United States, which may increase the Fund’s expense ratio. |
■ | Foreign Economy Risk. Foreign economies may be more vulnerable to political or economic changes than the U.S. economy. They may be more concentrated in particular industries or may rely on particular resources or trading partners to a greater extent. Certain foreign economies may be adversely affected by shortages of investment capital or by high rates of inflation. Changes in economic or monetary policy in the U.S. or abroad may also have a greater impact on the economies of certain foreign countries. |
■ | Foreign Governmental and Regulatory Risks. Foreign companies may not be subject to the same accounting and disclosure requirements as U.S. companies. As a result there may be less accurate information available regarding a foreign company’s operations and financial condition. Foreign companies may be subject to capital controls, nationalization, or confiscatory taxes. There may be less government regulation of foreign issuers, exchanges and brokers than in the United States. Some countries also have restrictions that limit foreign ownership and may impose penalties for increases in the value of the Fund’s investment. The value of the Fund’s foreign investments may be affected if it experiences difficulties in enforcing legal judgments in foreign courts. |
■ | Foreign Currency Risk. A change in the 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. If the U.S. dollar rises in value against a foreign currency, a security denominated in that currency will be worth less in U.S. dollars and if the U.S. dollar decreases in value against a foreign currency, a security denominated in that currency will be worth more in U.S. dollars. The dollar value of foreign investments may also be affected by exchange controls. Foreign currency exchange transactions may impose additional costs on the Fund. The Fund can also invest in derivative instruments linked to foreign currencies. 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 derivatives linked to that foreign currency. The investment adviser’s selection of foreign currency denominated investments may not perform as expected. Currency derivative investments may be particularly volatile and subject to greater risks than other types of foreign-currency denominated investments. |
■ | Foreign Custody Risk. There may be very limited regulatory oversight of certain foreign banks or securities depositories that hold foreign securities and foreign currency and the laws of certain countries may limit the ability to recover such assets if a foreign bank or depository or their agents goes bankrupt. There may also be an increased risk of loss of portfolio securities. |
■ | Time Zone Arbitrage. If the Fund invests a significant amount of its assets in foreign securities, it may be exposed to “time-zone arbitrage” attempts by investors seeking to take advantage of differences in the values of foreign securities that might result from events that occur after the close of the foreign securities market on which a security is traded and before the close of the New York Stock Exchange that day, when the Fund’s net asset value is calculated. If such time |
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zone arbitrage were successful, it might dilute the interests of other shareholders. However, the Fund’s use of “fair value pricing” under certain circumstances, to adjust the closing market prices of foreign securities to reflect what the investment adviser and the Board believe to be their fair value, may help deter those activities. |
■ | Globalization Risks. The growing inter-relationship of global economies and financial markets has increased the effect of conditions in one country or region on issuers of securities in a different country or region. In particular, the adoption or prolongation of protectionist trade policies by one or more countries, changes in economic or monetary policy in the United States or abroad, or a slowdown in the U.S. economy, could lead to a decrease in demand for products and reduced flows of capital and income to companies in other countries. |
■ | Regional Focus. At times, the Fund might increase the relative emphasis of its investments in a particular region of the world. Securities of issuers in a region might be affected by changes in economic conditions or by changes in government regulations, availability of basic resources or supplies, or other events that affect that region more than others. If the Fund has a greater emphasis on investments in a particular region, it may be subject to greater risks from adverse events that occur in that region than a fund that invests in a different region or that is more geographically diversified. Political, social or economic disruptions in the region may adversely affect the values of the Fund’s holdings. |
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■ | Less Developed Securities Markets. Developing or emerging market countries may have less well-developed securities markets and exchanges. Consequently they have lower trading volume than the securities markets of more developed countries and may be substantially less liquid than those of more developed countries. |
■ | Transaction Settlement. Settlement procedures in developing or emerging markets may differ from those of more established securities markets, and settlement delays may result in the inability to invest assets or to dispose of portfolio securities in a timely manner. As a result there could be subsequent declines in the value of the portfolio security, a decrease in the level of liquidity of the portfolio or, if there is a contract to sell the security, a possible liability to the purchaser. |
■ | Price Volatility. Securities prices in developing or emerging markets may be significantly more volatile than is the case in more developed nations of the world, which may lead to greater difficulties in pricing securities. |
■ | Less Developed Governments and Economies. The governments of developing or emerging market countries may be more unstable than the governments of more developed countries. In addition, the economies of developing or emerging market countries may be more dependent on relatively few industries or investors that may be highly vulnerable to local and global changes. Developing or emerging market countries may be subject to social, political, or economic instability. Further, the value of the currency of a developing or emerging market country may fluctuate more than the currencies of countries with more mature markets. |
■ | Government Restrictions. In certain developing or emerging market countries, government approval may be required for the repatriation of investment income, capital or the proceeds of sales of securities by foreign investors. Other government restrictions may include confiscatory taxation, expropriation or nationalization of company assets, restrictions on foreign ownership of local companies, protectionist measures, and practices such as share blocking. |
■ | Privatization Programs. The governments in some developing or emerging market countries have been engaged in programs to sell all or part of their interests in government-owned or controlled enterprises. However, in certain developing or emerging market countries, the ability of foreign entities to participate in privatization programs may be limited by local law. There can be no assurance that privatization programs will be successful. |
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■ | Traditional and Roth IRA accounts as well as Asset Builder Plan, Automatic Exchange Plan and government allotment plan accounts may be opened with a minimum initial investment of $500. |
■ | For wrap fee-based programs, salary reduction plans and other retirement plans and accounts, there is no minimum initial investment. |
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■ | Investing for the Shorter Term. While the Fund is meant to be a long-term investment, if you have a relatively short-term investment horizon, you should consider investing in Class C shares in most cases. That is because the effect of the initial sales charge on most Class A and Class T shares may be greater than the effect of the ongoing asset-based sales charge on Class C shares over the short-term. The Class C contingent deferred sales charge does not apply to redemptions of shares held for more than one year. |
■ | Investing for the Longer Term. If you have a longer-term investment horizon, Class A or Class T shares may be more appropriate in most cases. That is because the effect of the ongoing asset-based sales charge on Class C shares might be greater than the effect of the initial sales charge on Class A or Class T shares, regardless of the amount of your investment. |
■ | Amount of Your Investment. Your choice will also depend on how much you plan to invest. As your investment horizon increases and/or your eligibility for a reduced front-end sales charge applies, Class C shares might not be as advantageous as Class A shares with a sales charge. That is because the effect of the ongoing asset-based sales charge on Class C shares may be greater than the effect of the reduced front-end sales charge on Class A share purchases. Class T shares may also be advantageous over Class C shares, depending upon your investment horizon, your eligibility for a reduced front-end sales charge and other factors such as the need for exchangeability without the imposition of a sales charge and rights of accumulation. For an investor who is eligible to invest in Class I shares, that share class will be the most advantageous. For other investors who invest $1 million or more or in other arrangements that qualify for a sales charge waiver, Class A shares will be more advantageous than Class C shares in most cases, no matter how long you intend to hold your shares. |
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Amount of Purchase | Front-End Sales Charge As a Percentage of Offering Price | Front-End Sales Charge As a Percentage of Net Amount Invested | Concession As a Percentage of Offering Price | |
Less than $50,000 | 4.75% | 4.98% | 4.00% | |
$50,000 or more but less than $100,000 | 4.50% | 4.71% | 3.75% | |
$100,000 or more but less than $250,000 | 3.50% | 3.63% | 2.75% | |
$250,000 or more but less than $500,000 | 2.50% | 2.56% | 2.00% | |
$500,000 or more but less than $1 million | 2.00% | 2.04% | 1.60% |
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■ | Right of Accumulation. To qualify for the reduced Class A sales charge that would apply to a larger purchase than you are currently making, you can add the value of qualified shares that you and your spouse currently own, and other qualified share purchases that you are currently making, to the value of your Class A share purchase of the Fund. The value of the qualified shares you currently own is based on the greater of their current offering price or the amount you paid for the shares. For purposes of calculating that value, only the value of shares owned as of December 31, 2007 and any shares purchased subsequently will be taken into consideration. The value of any shares that you have redeemed will not be counted. In totaling your holdings, you may count shares held in: |
■ | your individual accounts (including IRAs, 403(b) plans and eligible college savings programs), |
■ | your joint accounts with your spouse, |
■ | accounts you or your spouse hold as trustees or custodians on behalf of children who are minors. |
■ | Letter of Intent. You may also qualify for reduced Class A sales charges by submitting a Letter of Intent to the Fund. A Letter of Intent is a written statement of your intention to purchase a specified value of qualified shares over a 13-month period. The total amount of your intended purchases in the same types of accounts identified above under “Right of Accumulation” will determine the reduced sales charge rate that will apply to your Class A share purchases during that period. You must notify your financial intermediary of any qualifying college savings program purchases or purchases through other financial intermediaries. |
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Amount of Purchase | Front-End Sales Charge As a Percentage of Offering Price | Front-End Sales Charge As a Percentage of Net Amount Invested | Concession As a Percentage of Offering Price | |
Less than $250,000 | 2.50% | 2.56% | 2.50% | |
$250,000 or more but less than $500,000 | 2.00% | 2.04% | 2.00% | |
$500,000 or more but less than $1 million | 1.50% | 1.52% | 1.50% | |
$1 million or more | 1.00% | 1.01% | 1.00% | |
■ | Wrap fee-based programs and fee-based clients of a broker, dealer, registered investment advisor or other financial intermediary; |
■ | Commissionable brokerage platforms where the financial intermediary, acting as broker on behalf of its customer, charges the customer a transaction-based commission outside of the Fund; |
■ | “Institutional investors” which may include corporations; trust companies; endowments and foundations; defined contribution, defined benefit, and other employer sponsored retirement and deferred compensation plans; retirement plan platforms; insurance companies; registered investment advisor firms; registered investment companies; bank trusts; college savings programs; and family offices; and |
■ | Eligible employees, which are present or former officers, directors, trustees and employees (and their eligible family members) of the Fund, the Manager and its affiliates, its parent company and the subsidiaries of its parent company, and retirement plans established for the benefit of such individuals. |
■ | be an “institutional investor” which may include corporations; trust companies; endowments and foundations; defined contribution, defined benefit, and other employer sponsored retirement plans and deferred compensation plans; service provider platforms; insurance companies; registered investment advisor firms; registered investment companies; bank trusts; college savings programs; and family offices; |
■ | make a minimum initial investment of $1 million or more per account (waived for service provider platforms); and |
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■ | trade through an omnibus, trust, trust networked or similar pooled account. |
■ | any increase in net asset value over the initial purchase price, |
■ | shares purchased by the reinvestment of dividends or capital gains distributions, or |
■ | shares eligible for a sales charge waiver (see “Sales Charge Waivers” below). |
■ | shares acquired by the reinvestment of dividends or capital gains distributions, |
■ | other shares that are not subject to the contingent deferred sales charge, and |
■ | shares held the longest during the holding period. |
■ | Dividend Reinvestment. Dividends or capital gains distributions may be reinvested in shares of the Fund, or any of the other Oppenheimer funds into which shares of the Fund may be exchanged, without a sales charge. |
■ | Exchanges of Shares. There is no sales charge on exchanges of shares except for exchanges of Class T shares and Class A shares of Oppenheimer Government Money Market Fund or Oppenheimer Government Cash Reserves on which you have not paid a sales charge. |
■ | Reinvestment Privilege. There is no sales charge on reinvesting the proceeds from redemptions of Class A shares that occurred within the previous three months if you paid an initial or contingent deferred sales charge on the redeemed shares, except with respect to purchases of Class T shares. This reinvestment privilege does not apply to reinvestment purchases made through automatic investment options. |
■ | Shares issued in plans of reorganization, such as mergers, asset acquisitions and exchange offers, to which the Fund is a party. |
■ | Purchases made with the reinvestment of loan repayments by a participant in a retirement plan if the participant previously paid a sales charge on those shares. |
■ | Purchases made in amounts of less than $5 for accounts held directly with the Transfer Agent. |
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■ | Purchases by the Manager or its affiliates. |
■ | Purchases by present or former officers, directors, trustees and employees (and their “immediate families”) of the Fund, the Manager and its affiliates, and retirement plans established by the Manager or its affiliate for their employees. The term “immediate family” refers to one’s spouse, children, grandchildren, grandparents, parents, parents in law, brothers and sisters, sons and daughters in law, a sibling’s spouse, a spouse’s siblings, aunts, uncles, nieces and nephews; relatives by virtue of a remarriage (step-children, step-parents, etc.) are included. |
■ | Purchases by current employees and registered representatives (and their spouses) of any financial intermediaries if permitted by the intermediary’s policies. The purchaser must certify to the Distributor at the time of purchase that the purchase is for the purchaser’s own account (or for the benefit of such employee’s spouse or minor children). |
■ | Purchases made through an advisory fee or wrap fee-based platform. |
■ | Purchases by group omnibus retirement plans under section 401(a), 401(k), 403(b) and 457 of the Internal Revenue Code. |
■ | Purchases by taxable accounts held directly with the Transfer Agent that are established with the proceeds of Required Minimum Distributions from retirement plans and accounts. |
■ | Rollover purchases in an OppenheimerFunds-sponsored IRA held directly with the Transfer Agent made with the proceeds of a retirement plan distribution that was previously invested in an Oppenheimer fund. |
■ | Purchases by former shareholders of Atlas Strategic Income Fund for any Oppenheimer fund into which shareholders of Oppenheimer Global Strategic Income Fund may exchange if permitted by the intermediary’s policies. |
■ | Purchases by former shareholders of Oppenheimer Total Return Fund Periodic Investment Plan for any Oppenheimer fund into which shareholders of Oppenheimer Main Street Fund may exchange if permitted by the intermediary’s policies. |
■ | Purchases within retirement plans that were converted to Class A shares from Class B shares on July 1, 2011, if permitted by the intermediary’s policies. |
■ | Effective December 4, 2017, purchases made where there is no broker-dealer of record. |
■ | Involuntary redemptions of small accounts (please refer to “Minimum Account Balance,” in the prospectus). |
■ | For distributions from retirement plans and accounts, deferred compensation plans or other employee benefit plans for any of the following reasons, as applicable: |
1. Following the death or disability (as defined in the Internal Revenue Code) of the participant or beneficiary. The death or disability must occur after the participant’s account was established in an Oppenheimer fund. | |
2. To return excess contributions. | |
3. To return contributions made due to a mistake of fact. | |
4. To make hardship withdrawals, except from IRAs, as defined in the plan. | |
5. To make distributions required under a Qualified Domestic Relations Order, or, in the case of an IRA, a divorce or separation agreement described in Section 71(b) of the Internal Revenue Code. | |
6. To meet the minimum distribution requirements of the Internal Revenue Code. | |
7. To make “substantially equal periodic payments” as described in Section 72(t) of the Internal Revenue Code. | |
8. For loans to participants or beneficiaries except for loans from OppenheimerFunds-sponsored 403(b)(7) custodial plans or from Oppenheimer Single K plans. | |
9. On account of the participant’s separation from service. This provision only applies to qualified retirement plans and 403(b)(7) custodial plans after separation from service in or after the year age 55 is attained. | |
10. Participant-directed redemptions to purchase shares of a mutual fund (other than a fund managed by the Manager or a subsidiary of the Manager). | |
11. Distributions made on account of a plan termination or “in-service” distributions, if the redemption proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA held directly with the Transfer Agent, if requested prior to plan termination or the elimination of the Oppenheimer funds as an investment option under the plan. | |
12. Distributions from a participant’s account under an Automatic Withdrawal Plan after the participant reaches age 59 1⁄2, as long as the aggregate value of the distributions does not exceed 12% of the account’s value annually. |
■ | Redemptions of shares under an Automatic Withdrawal Plan for an account (other than a retirement plan) if the aggregate value of the redeemed shares does not exceed 12% of the account’s value annually. |
Oppenheimer Preferred Securities and Income Fund | 25 |
■ | Shares issued in plans of reorganization, such as mergers, asset acquisitions and exchange offers, to which the Fund is a party. |
■ | Shares of the Fund purchased by the reinvestment of dividends or other distributions reinvested from the Fund. |
■ | Shares purchased by the reinvestment of loan repayments by a participant in a retirement plan if the participant previously paid a sales charge on those shares. |
■ | Shares purchased in amounts of less than $5 for accounts held directly with the Transfer Agent. |
■ | Involuntary redemptions of small accounts (please refer to “Minimum Account Balance,” in the applicable fund prospectus). |
■ | Redemptions from accounts other than retirement plans following the death or disability of the last surviving shareholder or sole beneficiary of a Trust. The death or disability must have occurred after the account was established, and for disability you must provide evidence of a determination of disability by the Internal Revenue Code. |
■ | Redemptions of Class C shares of an Oppenheimer fund, requested in writing by a retirement plan sponsor and submitted more than 12 months after the retirement plan’s first purchase of Class C shares, if the redemption proceeds are invested to purchase Class R shares of one or more Oppenheimer funds. |
■ | Distributions from retirement plans and accounts, deferred compensation plans or other employee benefit plans for any of the following reasons, as applicable: |
1. Following the death or disability (as defined in the Internal Revenue Code) of the participant or beneficiary. The death or disability must occur after the participant’s account was established in an Oppenheimer fund. | |
2. To return excess contributions. | |
3. To return contributions made due to a mistake of fact. | |
4. To make hardship withdrawals, except from IRAs, as defined in the plan. | |
5. To make distributions required under a Qualified Domestic Relations Order or, in the case of an IRA, a divorce or separation agreement described in Section 71(b) of the Internal Revenue Code. | |
6. To meet the minimum distribution requirements of the Internal Revenue Code. | |
7. To make “substantially equal periodic payments” as described in Section 72(t) of the Internal Revenue Code. | |
8. For loans to participants or beneficiaries except for loans from OppenheimerFunds-sponsored 403(b)(7) custodial plans or from OppenheimerFunds Single K plans. | |
9. On account of the participant’s separation from service. This provision only applies to qualified retirement plans and 403(b)(7) custodial plans after separation from service in or after the year age 55 is attained. | |
10. Participant-directed redemptions to purchase shares of a mutual fund (other than a fund managed by the Manager or a subsidiary of the Manager). | |
11. Distributions made on account of a plan termination or “in-service” distributions, if the redemption proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA held directly with the Transfer Agent, if requested prior to plan termination or the elimination of the Oppenheimer funds as an investment option under the plan. | |
12. For distributions from a participant’s account under an Automatic Withdrawal Plan after the participant reaches age 59 1⁄2 , as long as the aggregate value of the distributions does not exceed 10% of the account’s value annually. |
■ | Redemptions of Class C shares under an Automatic Withdrawal Plan from an account other than a retirement plan if the aggregate value of the redeemed shares does not exceed 10% of the account’s value annually. |
■ | Redemptions of shares sold to the Manager or its affiliates. |
■ | Redemptions of shares issued in plans of reorganization to which the Fund is a party. |
■ | Effective December 4, 2017, conversions to Class A share accounts requested by current investors who no longer have a broker-dealer of record for an existing Class C share account. |
26 | Oppenheimer Preferred Securities and Income Fund |
Oppenheimer Preferred Securities and Income Fund | 27 |
28 | Oppenheimer Preferred Securities and Income Fund |
■ | Involuntary Redemptions. In some circumstances, involuntary redemptions may be made to repay any losses from the cancellation of share purchase orders. |
■ | By Check. The Fund will normally send redemption proceeds by check to the address on your account statement. |
■ | By AccountLink. If you have linked your Fund account to your bank account with AccountLink (described below), you may have redemption proceeds transferred directly into your account. Normally the transfer to your bank is initiated on the bank business day after the redemption. You will not receive dividends on the proceeds of redeemed shares while they are waiting to be transferred. |
■ | By Wire. You can arrange to have redemption proceeds sent by Federal Funds wire to an account at a bank that is a member of the Federal Reserve wire system. The redemption proceeds will normally be transmitted on the next bank business day after the shares are redeemed. You will not receive dividends on the proceeds of redeemed shares while they are waiting to be transmitted. |
Oppenheimer Preferred Securities and Income Fund | 29 |
■ | during any period in which the NYSE is closed other than customary weekend and holiday closings or during any period in which trading on the NYSE is deemed to be restricted; |
■ | during any period in which an emergency exists, as a result of which (i) it is not reasonably practicable for the Fund to dispose of securities owned by it or (ii) it is not reasonably practicable for the Fund to fairly determine the value of its net assets; or |
■ | during such other periods as the Securities and Exchange Commission may by order permit to protect Fund shareholders. |
■ | Shares of the fund selected for exchange must be available for sale in your state of residence. |
■ | The selected fund and share class must offer the exchange privilege. |
■ | You must meet the minimum purchase requirements for the relevant class of the selected fund. |
■ | Generally, exchanges may be made only between identically registered accounts, unless all account owners send written exchange instructions with a signature guarantee. |
■ | Before exchanging into a fund, you should obtain its prospectus and should read it carefully. |
30 | Oppenheimer Preferred Securities and Income Fund |
■ | Exchanges Into Money Market Funds. A shareholder will be permitted to exchange shares of the Fund for shares of an eligible money market fund any time, even if the shareholder has exchanged shares into the Fund during the prior 30 days. Exchanges from that money market fund into another fund will be monitored for excessive activity and the Fund may limit or refuse any exchange order from a money market fund in its discretion pursuant to this policy. |
■ | Dividend Reinvestments and Share Conversions. The reinvestment of dividends or distributions from one fund to purchase shares of another fund and the conversion of shares from one share class to another class within the same fund will not be considered exchanges for purposes of imposing the 30-day limit. |
■ | Asset Allocation Programs. Investment programs by Oppenheimer “funds of funds” that entail rebalancing investments in underlying Oppenheimer funds will not be subject to these limits. However, third-party asset allocation and rebalancing programs will be subject to the 30-day limit described above. Asset allocation firms that want to exchange shares held in accounts on behalf of their customers must identify themselves and execute an acknowledgement and agreement to abide by these policies with respect to their customers’ accounts. “On-demand” exchanges outside the parameters of portfolio rebalancing programs will also be subject to the 30-day limit. |
Oppenheimer Preferred Securities and Income Fund | 31 |
■ | Automatic Exchange Plans. Accounts that receive exchange proceeds through automatic or systematic exchange plans that are established through the Transfer Agent will not be subject to the 30-day exchange limit as a result of those automatic or systematic exchanges but may be blocked from exchanges, under the 30-day limit, if they receive proceeds from other exchanges. |
■ | Redemptions of Shares. These exchange policy limits do not apply to redemptions of shares. Shareholders are permitted to redeem their shares on any regular business day, subject to the terms of this prospectus. |
■ | Purchases through AccountLink that are submitted through PhoneLink or on the internet are limited to $100,000. |
■ | Purchases through AccountLink that are submitted by calling a service representative are limited to $250,000. |
■ | Redemptions that are submitted by telephone or on the internet and request the proceeds to be paid by check, are limited to $100,000, must be made 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 15 days of changing the address on an account. |
■ | Redemptions by telephone or on the internet that are sent to your bank account through AccountLink are limited to $100,000. |
■ | Exchanges submitted by telephone or on the internet may be made only between accounts that are registered with the same name(s) and address. |
■ | Shares for which share certificates have been issued may not be redeemed or exchanged by telephone or on the internet. |
■ | Shares held in an OppenheimerFunds-sponsored qualified retirement plan account may not be redeemed or exchanged by telephone or on the internet. |
32 | Oppenheimer Preferred Securities and Income Fund |
■ | The Fund’s name; |
■ | For existing accounts, the Fund account number (from your account statement); |
■ | For new accounts, a completed account application; |
■ | For purchases, a check payable to the Fund or to OppenheimerFunds Inc.; |
■ | For redemptions, any special payment instructions; |
■ | For redemptions or exchanges, the dollar amount or number of shares to be redeemed or exchanged; |
■ | For redemptions or exchanges, any share certificates that have been issued (exchanges or redemptions of shares for which certificates have been issued cannot be processed until the Transfer Agent receives the certificates); |
■ | For individuals, the names and signatures of all registered owners exactly as they appear in the account registration; |
■ | For corporations, partnerships or other businesses or as a fiduciary, the name of the entity as it appears in the account registration and the names and titles of any individuals signing on its behalf; and |
■ | Other documents requested by the Transfer Agent to assure that the person purchasing, redeeming or exchanging shares is properly identified and has proper authorization to carry out the transaction. |
■ | You wish to redeem more than $100,000; |
■ | The redemption check is not payable to all shareholders listed on the account statement; |
■ | The redemption check is not sent to the address of record on your account statement; |
■ | Shares are being transferred to a Fund account with a different owner or name; or |
■ | Shares are being redeemed by someone (such as an Executor) other than the owners. |
■ | a U.S. bank, trust company, credit union or savings association, |
■ | a foreign bank that has a U.S. correspondent bank, |
■ | a U.S. registered dealer or broker in securities, municipal securities or government securities, or |
■ | a U.S. national securities exchange, a registered securities association or a clearing agency. |
Oppenheimer Preferred Securities and Income Fund | 33 |
■ | transmit funds electronically to purchase shares by internet, by telephone or automatically through an Asset Builder Plan. The purchase payment will be debited from your bank account. |
■ | have the Transfer Agent send redemption proceeds or dividends and distributions directly to your bank account. |
■ | Individual Retirement Accounts (IRAs). These include traditional IRAs, Roth IRAs and rollover IRAs. |
■ | SIMPLE IRAs. These are Savings Incentive Match Plan for Employees IRAs for small business owners or self-employed individuals. |
■ | 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. |
■ | “Single K” Plans. These are 401(k) plans for self-employed individuals. |
■ | Qualified Plans. These plans are designed for businesses and self-employed individuals. |
34 | Oppenheimer Preferred Securities and Income Fund |
■ | Reinvest All Distributions in the Fund. You can elect to reinvest all dividends and capital gains distributions in additional shares of the Fund. |
■ | Reinvest Only Dividends or Capital Gains. You can elect to reinvest some types of distributions in the Fund while receiving the other types of distributions by check or having them sent to your bank account through AccountLink. Different treatment is available for distributions of dividends, short-term capital gains and long-term capital gains. |
■ | Receive All Distributions in Cash. You can elect to receive all dividends and capital gains distributions by check or have them sent to your bank through AccountLink. |
■ | Reinvest Your Distributions in Another Oppenheimer Fund. You can reinvest all of your dividends and capital gains distributions in another Oppenheimer fund that is available for exchanges. You must have an existing account in the same share class in the selected fund. |
Oppenheimer Preferred Securities and Income Fund | 35 |
36 | Oppenheimer Preferred Securities and Income Fund |
• | Purchases of Class A shares by retirement plans that have any of the following record-keeping arrangements: |
1. | The record keeping is performed by Merrill Lynch Pierce Fenner & Smith, Inc. (“Merrill Lynch”) on a daily valuation basis for the retirement plan. On the date the plan sponsor signs the record-keeping service agreement with Merrill Lynch, the Plan must have $3 million or more of its assets invested in (a) mutual funds, other than those advised or managed by certain Merrill Lynch investment advisers, as specified by Merrill Lynch (a “Specified Merrill Lynch Investment Adviser”), that are made available under a Service Agreement between Merrill Lynch and the mutual fund’s principal underwriter or distributor, and (b) funds advised or managed by a Specified Merrill Lynch Investment Adviser (the funds described in (a) and (b) are referred to as “Applicable Investments”). |
2. | The record keeping for the retirement plan is performed on a daily valuation basis by a record keeper whose services are provided under a contract or arrangement between the Retirement Plan and Merrill Lynch. On the date the plan sponsor signs the record keeping service agreement with Merrill Lynch, the plan must have $5 million or more of its assets (excluding assets invested in money market funds) invested in Applicable Investments. |
3. | The record keeping for a retirement plan is handled under a service agreement with Merrill Lynch and on the date of the plan sponsor signs that agreement, the plan has 500 or more eligible employees (as determined by the Merrill Lynch plan conversion manager). |
• | Employer-sponsored retirement, deferred compensation and employee benefit plans (including health savings accounts) and trusts used to fund those plans, provided that the shares are not held in a commission-based brokerage account and shares are held for the benefit of the plan |
• | Shares purchased by or through a 529 Plan |
• | Shares purchased through a Merrill Lynch affiliated investment advisory program |
• | Shares purchased by third party investment advisors on behalf of their advisory clients through Merrill Lynch’s platform |
• | Shares of funds purchased through the Merrill Edge Self-Directed platform (if applicable) |
• | Shares purchased through reinvestment of capital gains distributions and dividend reinvestment when purchasing shares of the same fund (but not any other fund within the fund family) |
• | Shares exchanged from Class C (i.e. level-load) shares of the same fund in the month of or following the 10-year anniversary of the purchase date |
• | Employees and registered representatives of Merrill Lynch or its affiliates and their family members |
• | Directors or Trustees of the Fund, and employees of the Fund’s investment adviser or any of its affiliates, as described in this prospectus |
• | Shares purchased from the proceeds of redemptions within the same fund family, provided (1) the repurchase occurs within 90 days following the redemption, (2) the redemption and purchase occur in the same account, and (3) redeemed shares were subject to a front-end or deferred sales load (known as Rights of Reinstatement) |
• | Death or disability of the shareholder |
• | Shares sold as part of a systematic withdrawal plan as described in the Fund’s prospectus |
• | Return of excess contributions from an IRA Account |
• | Shares sold as part of a required minimum distribution for IRA and retirement accounts due to the shareholder reaching age 70 1⁄2 |
• | Shares sold to pay Merrill Lynch fees but only if the transaction is initiated by Merrill Lynch |
• | Shares acquired through a right of reinstatement |
• | Shares held in retirement brokerage accounts, that are exchanged for a lower cost share class due to transfer to certain fee based accounts or platforms (applicable to A and C shares only) |
• | Breakpoints as described in this prospectus. |
• | Rights of Accumulation (ROA) which entitle shareholders to breakpoint discounts will be automatically calculated based on the aggregated holding of fund family assets held by accounts within the purchaser’s household at Merrill Lynch. Eligible fund family assets not held at Merrill Lynch may be included in the ROA calculation only if the shareholder notifies his or her financial advisor about such assets |
• | Letters of Intent (LOI) which allow for breakpoint discounts based on anticipated purchases within a fund family, through Merrill Lynch, over a 13-month period of time (if applicable) |
• | Purchases in an OppenheimerFunds-sponsored Rollover IRA held directly with the Transfer Agent by clients of Mass Mutual Retirement Services. |
• | Shares purchased by clients of LPL who are accessing the Oppenheimer funds through LPL’s Mutual Fund Only Platform. |
Annualized Returns (for periods ended December 31, 2017) | |||
1 Year | Since Inception1 | ||
Preferred Securities and Income Composite (Net) | 10.78% | 15.16% | |
Preferred Securities and Income Composite (Gross) | 11.50% | 17.10% | |
ICE BAML Fixed Rate Preferred Securities Index (reflects no deduction for fees, expenses, or taxes) | 10.58% | 17.77% | |
Custom-ICE BAML Fixed Rate Preferred Securities Index/S&P U.S. Preferred Stock Index (reflects no deduction for fees, expenses, or taxes) | 10.58% | 15.08% |
Telephone: | Call OppenheimerFunds Services toll-free: 1.800.CALL OPP (1.800.CALL OPP (1.800.225.5677)) |
Mail: | Use the following address for regular mail: OppenheimerFunds Services P.O. Box 5270 Denver, Colorado 80217-5270 |
Use the following address for courier or express mail: OppenheimerFunds Services 6803 S. Tucson Way Centennial, CO 80112-3924 | |
Internet: | You may request documents, and read or download certain documents at www.oppenheimerfunds.com |
NYSE Ticker Symbols | |
Class A OPRAX | Class R _____ |
Class T _____ | Class Y OPRYX |
Class C _____ | Class I OPRIX |
• | whether the convertible security can be exchanged for a fixed number of shares of common stock of the issuer or is subject to a “cap” or a conversion formula or other type of limit; |
• | whether the convertible security can be exchanged at a time determined by the investor rather than by the issuer; |
• | whether the issuer of the convertible securities has restated its earnings per share on a fully diluted basis (that is, as if all of the issuer’s convertible securities were converted into common stock); and |
• | the extent to which the convertible security may participate in any appreciation in the price of the issuer’s common stock. |
• | Interest Rate Risk. Interest rate risk refers to the fluctuations in value of a debt security resulting from the relationship between price and yield. An increase in general interest rates will tend to reduce the market value of already-issued debt securities and a decline in general interest rates will tend to increase their value. Debt securities with longer maturities are usually subject to greater fluctuations in value from interest rate changes than obligations having shorter maturities. Variable rate debt securities pay interest based on an interest rate benchmark. When the benchmark rate changes, the interest payments on those securities may be reset at a higher or lower rate. Except for investments in variable rate debt securities, fluctuations in general interest rates do not affect the amount of interest income received. Fluctuations in the market valuations of debt securities may, however, affect the value of Fund assets. “Zero-coupon” or “stripped” securities may be particularly sensitive to interest rate changes. Risks associated with rising interest rates are heightened given that interest rates in the U.S. are near historic lows. |
• | Duration Risk. Duration is a measure of the price sensitivity of a debt security or portfolio to interest rate changes. Duration risk is the risk that longer-duration debt securities are more volatile and thus more likely to decline in price, and to a greater extent, than shorter-duration debt securities, in a rising interest-rate environment. “Effective duration” attempts to measure the expected percentage change in the value of a bond or portfolio resulting from a change in prevailing interest rates. The change in the value of a bond or portfolio can be approximated by multiplying its duration by a change in interest rates. For example, if a bond has an effective duration of three years, a 1% increase in general interest rates would be expected to cause the bond’s value to decline about 3% while a 1% decrease in general interest rates would be expected to cause the bond’s value to increase 3%. The duration of a debt security may be equal to or shorter than the full maturity of a debt security. |
• | Credit Risk. Credit risk relates to the ability of the issuer to meet interest or principal payments or both as they become due. In general, below-investment-grade, higher-yield bonds are subject to credit risk to a greater extent than lower-yield, investment-grade bonds. In making investments in debt securities, the investment adviser may rely to some extent on the ratings of national statistical rating organizations or it may use its own research to evaluate a security’s credit-worthiness. If securities purchased are unrated, they may be assigned a rating by the investment adviser in categories similar to those of a national statistical rating organization. There are no investment policies establishing specific maturity ranges for investments, and they may be within any maturity range (short, medium or long) depending on the investment adviser’s evaluation of investment opportunities available within the debt securities markets. |
• | Credit Spread Risk. Credit spread risk is the risk that credit spreads (i.e., the difference in yield between securities that is due to differences in their credit quality) may increase when the market expects below-investment-grade bonds to default more frequently. Widening credit spreads may quickly reduce the market values of below-investment-grade and unrated securities. Some unrated securities may not have an active trading market or may trade less actively than rated securities, which means that it might be difficult to sell them promptly at an acceptable price. |
• | Extension Risk. Extension risk is the risk that, if interest rates rise rapidly, prepayments on certain debt securities may occur at a slower rate than expected, and the expected maturity of those securities could lengthen as a result. Securities that are subject to extension risk generally have a greater potential for loss when prevailing interest rates rise, which could cause their values to fall sharply. Extension risk is particularly prevalent for a callable security where an increase in interest rates could result in the issuer of that security choosing not to redeem the security as anticipated on the security’s call date. Such a decision by the issuer could have the effect of lengthening the debt security’s expected maturity, making it more vulnerable to interest rate risk and reducing its market value. |
• | Reinvestment Risk. Reinvestment risk is the risk that when interest rates fall, it may be necessary to reinvest the proceeds from a security’s sale or redemption at a lower interest rate. Callable bonds are generally subject to greater reinvestment risk than non-callable bonds. |
• | Prepayment Risk. Certain fixed-income securities (in particular mortgage-related securities) are subject to the risk of unanticipated prepayment. Prepayment risk is the risk that, when interest rates fall, the issuer will redeem the security prior to the security’s expected maturity, or that borrowers will repay the loans that underlie these fixed-income securities more quickly than expected, thereby causing the issuer of the security to repay the principal prior to expected maturity. It may be necessary to reinvest the proceeds at a lower interest rate, reducing income. Securities subject to prepayment risk generally offer less potential for gains when prevailing interest rates fall. If these securities are purchased at a premium, accelerated prepayments on those securities could cause losses on a portion of the principal investment. The impact of prepayments on the price of a security may be difficult to predict and may increase the security’s price volatility. Interest-only and principal-only securities are especially sensitive to interest rate changes, which can affect not only their prices but can also change the income flows and repayment assumptions about those investments. |
• | Event Risk. If an issuer of debt securities is the subject of a buyout, debt restructuring, merger or recapitalization that increases its debt load, it could interfere with its ability to make timely payments of interest and principal and cause the value of its debt securities to fall. |
• | Prices of below-investment-grade securities are subject to extreme price fluctuations, even under normal market conditions. Negative economic developments may have a greater impact on the prices of below-investment-grade securities than on those of investment-grade securities. In addition, the market values of below-investment-grade securities tend to reflect individual issuer developments to a greater extent than do the market values of investment-grade securities, which react primarily to fluctuations in the general level of interest rates. |
• | Below-investment-grade securities may be issued by less creditworthy issuers and may be more likely to default than investment-grade securities. The issuers of below-investment-grade securities may have more outstanding debt relative to their assets than issuers of higher-grade securities. Below-investment-grade securities are vulnerable to adverse changes in the issuer’s industry and to general economic conditions. If the issuer experiences financial stress, it may not be able to pay interest and principal payments in a timely manner. The issuer’s ability to pay its debt obligations also may be lessened by specific issuer developments or the unavailability of additional financing. In the event of a default of an issuer of a below-investment-grade security, the Fund may incur expenses to the extent necessary to seek recovery or to negotiate new terms. |
• | Below-investment-grade securities are frequently ranked junior to claims by other creditors. If the issuer cannot meet its obligations, the senior obligations are generally paid off before the junior obligations, which could limit the Fund’s ability to fully recover principal or to receive interest payments when senior securities are in default. As a result, investors in below-investment-grade securities have a lower degree of protection with respect to principal and interest payments than do investors in investment-grade securities. |
• | There may be less of a market for below-investment-grade securities and as a result they may be harder to sell at an acceptable price. Not all dealers maintain markets in all below-investment-grade securities. As a result, there is no established retail secondary market for many of these securities. The Fund anticipates that such securities could be sold only to a limited number of dealers or institutional investors. To the extent a secondary trading market does exist, it is generally not as liquid as the secondary market for investment-grade securities. The lack of a liquid secondary market may have an adverse impact on the market price of the security. The lack of a liquid secondary market for certain securities may also make it more difficult for the Fund to obtain accurate market quotations for purposes of valuing its securities. Market quotations are generally available on many below-investment-grade securities only from a limited number of dealers and may not necessarily represent firm bids of such dealers or prices for actual sales. In addition, the trading volume for below-investment-grade securities is generally lower than that for investment-grade securities and the secondary markets could contract under adverse market or economic conditions independent of any specific adverse changes in the condition of a particular issuer. Under certain economic and/or market conditions, the Fund may have difficulty disposing of certain below-investment-grade securities due to the limited number of investors in that sector of the market. When the secondary market for below-investment-grade securities becomes more illiquid, or in the absence of readily available market quotations for such securities, the relative lack of reliable objective data makes it more difficult to value the Fund’s securities and judgment plays a more important role in determining such valuations. |
• | Below-investment-grade securities frequently have redemption features that permit an issuer to repurchase the security from the Fund before it matures. During times of falling interest rates, issuers of these securities are likely to redeem or prepay the securities and finance them with securities with a lower interest rate. To the extent an issuer is able to refinance the securities, or otherwise redeem them; the Fund may have to replace the securities with lower yielding securities, which could result in a lower return for the Fund. |
• | Below-investment-grade securities markets may also react strongly to adverse news about an issuer or the economy, or to the perception or expectation of adverse news, whether or not it is based on fundamental analysis. An increase in interest rates could severely disrupt the market for below-investment-grade securities. Additionally, below-investment-grade securities may be affected by legislative and regulatory developments. These developments could adversely affect the Fund’s net asset value and investment practices, the secondary market for below-investment-grade securities, the financial condition of issuers of these securities and the value and liquidity of outstanding below-investment-grade securities, especially in a thinly traded market. |
• | a lack of public information about foreign issuers; |
• | lower trading volume and less liquidity in foreign securities markets than in U.S. markets; |
• | greater price volatility in foreign markets than in U.S. markets; |
• | less government regulation of foreign issuers, exchanges and brokers than in the U.S.; |
• | a lack of uniform accounting, auditing and financial reporting standards in foreign countries compared to those applicable to U.S. issuers; |
• | fluctuations in the value of foreign investments due to changes in currency rates; |
• | the expense of currency exchange transactions; |
• | greater difficulties in pricing securities in foreign markets; |
• | foreign government restrictions on investments by U.S. and other non-local entities; |
• | higher brokerage commission rates than in the U.S.; |
• | increased risks of delays in clearance and settlement of portfolio transactions; |
• | unfavorable differences between the U.S. economy and some foreign economies; |
• | greater difficulty in commencing and pursuing lawsuits or other legal remedies; |
• | less regulation of foreign banks and securities depositories; |
• | increased risks of loss of certificates for portfolio securities; |
• | government restrictions on the repatriation of profits or capital or other currency control regulations; |
• | the possibility in some countries of expropriation, confiscatory taxation, political, financial or social instability or adverse diplomatic developments; |
• | the reduction of income by foreign taxes; and |
• | potential for time-zone arbitrage. |
• | futures, |
• | put and call options, |
• | currency futures and options, |
• | forward contracts, or |
• | structured investments. |
• | Participants in the futures market are subject to margin deposit and maintenance requirements that may cause investors to close futures contracts through offsetting transactions, distorting the normal market relationships. |
• | The liquidity of the futures market depends on participants entering into offsetting transactions rather than making or taking delivery. To the extent participants decide to make or take delivery, liquidity in the futures market could be reduced, thus producing distortion. |
• | Speculators may consider that deposit requirements in the futures market are less onerous than margin requirements in the securities markets. Therefore, increased participation by speculators in the futures market may cause price distortions. |
1. | gains or losses attributable to fluctuations in exchange rates that occur between the time interest or other receivables denominated in a foreign currency are accrued or expenses or other liabilities denominated in a foreign currency are accrued and the time the Fund actually collects such receivables or pays such liabilities, and |
2. | gains or losses attributable to fluctuations in the value of a foreign currency between the date of acquisition of a debt security denominated in a foreign currency or foreign currency forward contracts and the date of disposition. |
• | Less Developed Securities Markets. Developing or emerging market countries may have less well-developed securities markets and exchanges. Consequently, they have lower trading volume than the securities markets of more developed countries. These markets may be unable to respond effectively to increases in trading volume. Therefore, prompt liquidation of substantial portfolio holdings may be difficult at times. As a result, these markets may be substantially less liquid than those of more developed countries, and the securities of issuers located in these markets may have limited marketability. |
• | Transaction Settlement. Settlement procedures in developing or emerging markets may differ from those of more established securities markets. Settlements may also be delayed by operational problems. Securities issued by developing countries and by issuers located in those countries may be subject to extended settlement periods. Delays in settlement could result in temporary periods during which some assets are uninvested and no return is earned on those assets. The inability to make intended purchases of securities due to settlement problems could cause missed investment opportunities. Losses could also be caused by an inability to dispose of portfolio securities due to settlement problems. As a result there could be subsequent declines in the value of the portfolio security, a decrease in the level of liquidity of the portfolio or, if there is a contract to sell the security, a possible liability to the purchaser. |
• | Price Volatility. Securities prices in developing or emerging markets may be significantly more volatile than is the case in more developed nations of the world, which may lead to greater difficulties in pricing securities. |
• | Less Developed Governments and Economies. Developing or emerging market countries may have less developed legal and accounting systems, and their governments may also be more unstable than the governments of more developed countries. For example, governments of some developing or emerging market countries have defaulted on their bonds and there is the risk of this happening in the future. These countries may also have less protection of property rights than more developed countries. Developing or emerging market countries also may be subject to |
social, political or economic instability, and have greater potential for pervasiveness of corruption and crime, armed conflict, the adverse economic impact of civil war and religious or ethnic unrest. In addition, the economies of developing or emerging market countries may be more dependent on relatively few industries or investors that may be highly vulnerable to local and global changes. Further, the value of the currency of a developing or emerging market country may fluctuate more than the currencies of countries with more mature markets. Investments in developing or emerging market countries may also be subject to greater potential difficulties in enforcing contractual obligations. | |
• | Government Restrictions. In certain developing or emerging market countries, government approval may be required for the repatriation of investment income, capital or the proceeds of sales of securities by foreign investors. Also, a government might impose temporary restrictions on remitting capital abroad if the country’s balance of payments deteriorates, or it might do so for other reasons. If government approval were delayed or refused, income or capital gains may not be able to be transmitted to the United States. Other government restrictions may include confiscatory taxation, expropriation or nationalization of company assets, restrictions on foreign ownership of local companies, managed adjustments in relative currency values and other protectionist measures, and practices such as share blocking. Share blocking is the practice in certain foreign markets where voting rights related to an issuer’s securities are predicated on those securities being blocked from trading at the custodian or sub-custodian level for a period of time around a shareholder meeting. Such restrictions have the effect of prohibiting the purchase and sale of certain voting securities within a specified number of days before, and in certain instances, after a shareholder meeting. The share blocking period can last up to several weeks, typically terminating on a date established at the discretion of the issuer. Share blocking may prevent the Fund from buying or selling securities for a period of time. When shares are blocked, trades in such securities will not settle. Having a blocking restriction lifted can be difficult and onerous, with the particular requirements varying widely by country. In some countries, the block cannot be removed for the duration of time it is effective. Additionally, the imposition of restrictions on investments by foreign entities might result in less attractive investment opportunities or require the sale of existing investments. Investments in developing or emerging market countries may also be subject to greater risks relating to the withdrawal or non-renewal of any license enabling the Fund to trade in securities of a particular country. |
• | Privatization Programs. The governments in some developing or emerging market countries have been engaged in programs to sell all or part of their interests in government-owned or controlled enterprises. Privatization programs may offer opportunities for significant capital appreciation, in the appropriate circumstances. However, in certain developing countries, the ability of foreign entities to participate in privatization programs may be limited by local law. Additionally, the terms on which a foreign entity might be permitted to participate may be less advantageous than those afforded local investors. There can be no assurance that privatization programs will be successful. |
• | obligations issued or guaranteed by the U.S. Government or its instrumentalities or its agencies, |
• | commercial paper (short-term, unsecured, promissory notes) rated in the top two rating categories of a nationally recognized statistical rating organization, |
• | debt obligations of domestic or foreign corporate issuers, rated “Baa” or higher by Moody’s or at least BBB or higher by Standard & Poor’s, or a comparable rating by another rating organization), or unrated securities judged by the Sub-Adviser to be of a quality comparable to rated securities in those categories, |
• | certificates of deposit and bankers’ acceptances of domestic and foreign banks and savings and loan associations, and |
• | repurchase agreements. |
• | 67% or more of the shares present or represented by proxy at a shareholder meeting, if the holders of more than 50% of the outstanding shares are present or represented by proxy; or |
• | more than 50% of the outstanding shares. |
• | The Fund may not borrow money, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules, regulations or exemptions may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. |
• | The Fund may not make any investment if, as a result, the Fund’s investments will be concentrated in any one industry, except that the Fund will invest at least 25% of the value of its total assets in securities of companies engaged in the financials sector and except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules, regulations or exemption may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. For purposes of this concentration limitation, the Fund’s investment adviser may analyze the characteristics of a particular issuer and instrument and may assign an industry or sector classification consistent with those characteristics in the event that any third party classification provider that may be used by the investment adviser does not assign a classification. |
• | The Fund cannot make loans, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules, regulations or exemption may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. |
• | The Fund cannot invest in real estate or commodities, except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules, regulations or exemption may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. |
• | The Fund cannot issue “senior securities,” except to the extent permitted under the Investment Company Act, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statute, rules, regulations or exemption may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. |
• | The Fund cannot underwrite securities of other issuers, except to the extent permitted under the Investment Company Act or the Securities Act of 1933, the rules or regulations thereunder or any exemption therefrom that is applicable to the Fund, as such statutes, rules, regulations or exemption may be amended or interpreted from time to time by the Securities and Exchange Commission, its staff, or other authority with appropriate jurisdiction. |
• | The Fund cannot invest in the securities of other registered investment companies or registered unit investment trusts in reliance on sub-paragraph (F) or (G) of Section 12(d)(1) of the Investment Company Act. |
• | Public Disclosure. The Fund’s portfolio holdings are made publicly available no later than 60 days after the close of each of the Fund’s fiscal quarters in its annual and semi-annual reports to shareholders and in its Schedule of Investments on Form N-Q. Those documents are publicly available at the Securities and Exchange Commission. In addition, the Fund’s portfolio holdings information, as of the end of each calendar month, may be posted and available on the Fund’s website (at www.oppenheimerfunds.com) no sooner than 30 calendar days after the end of the calendar month to which the information relates. Partial holdings, listed by security or by issuer, may be posted on the Fund’s website no sooner than 5 business days following the month to which the information relates. The Fund may delay posting its holdings or may not post any holdings, if the Manager/Sub-Adviser believes that would be in the best interests of the Fund and its shareholders. Other general information about the Fund’s portfolio investments, such as portfolio composition by asset class, industry, country, currency, credit rating or maturity, may also be publicly disclosed 5 business days after the end of the calendar month to which the information relates. |
• | Employees of the Fund’s service providers who need to have access to such information; |
• | The Fund’s independent registered public accounting firm; |
• | Members of the Fund’s Board and the independent legal counsel to the Board’s independent trustees; |
• | The Fund’s custodian bank; |
• | The Fund’s financial printers; |
• | A proxy voting service designated by the Fund and its Board; |
• | Rating/ranking organizations (such as Lipper and Morningstar); |
• | Portfolio pricing services retained by the Manager/Sub-Adviser to provide portfolio security prices; |
• | Brokers and dealers for purposes of providing portfolio analytic services, in connection with portfolio transactions (purchases and sales), and to obtain bids or bid and asked prices (if securities held by the Fund are not priced by the Fund’s regular pricing services, or to obtain prices for inter-fund trades or similar transactions); and |
• | Other service providers to the Fund, the Manager, the Sub-Adviser, the Distributor, and the Transfer Agent, including providers of index services and personal trading compliance services. |
• | The third-party recipient must first submit a request for release of Fund portfolio holdings, explaining the business reason for the request; |
• | Senior officers in the Manager’s/Sub-Adviser’s Investment Operations and Legal departments must approve the completed request for release of Fund portfolio holdings; and |
• | Before receiving the data, the third-party recipient must sign a portfolio holdings non-disclosure agreement, agreeing to keep confidential the information that is not publicly available regarding the Fund’s holdings and agreeing not to use such information in any way that is detrimental to the Fund. |
• | Response to legal process in litigation matters, such as responses to subpoenas or in class action matters where the Fund may be part of the plaintiff class (and seeks recovery for losses on a security) or a defendant; and |
• | Response to regulatory requests for information (from the Securities and Exchange Commission, the Financial Industry Regulatory Authority (“FINRA”), state securities regulators, and/or foreign securities authorities, including without limitation requests for information in inspections or for position reporting purposes). |
• | create new series and classes of shares; |
• | reclassify unissued shares into additional series and classes; and |
• | divide or combine the shares of a class into a greater or lesser number of shares without changing the proportionate beneficial interest of a shareholder in the Fund. |
• | has its own dividends and distributions; |
• | pays certain expenses which may be different for the different classes; |
• | will generally have a different net asset value; |
• | will generally have separate voting rights on matters in which interests of one class are different from interests of another class; and |
• | votes as a class on matters that affect that class alone. |
• | represents an interest in the Fund proportionately equal to the interest of each other share of the same class; |
• | is freely transferable; |
• | has one vote at shareholder meetings, with fractional shares voting proportionally; |
• | may be voted in person or by proxy at shareholder meetings; and |
• | does not have cumulative voting rights, preemptive rights or subscription rights. |
• | Wrap fee-based programs and fee-based clients of a broker, dealer, registered investment adviser or other financial intermediary; |
• | Commissionable brokerage platforms where the financial intermediary, acting as broker on behalf of its customer, charges the customer a transaction-based commission outside of the Fund; |
• | “Institutional investors” which may include corporations; trust companies; endowments and foundations; defined contribution, defined benefit, and other employer sponsored retirement and deferred compensation plans; retirement plan platforms; insurance companies; registered investment adviser firms; registered investment companies; bank trusts; college savings programs; and family offices; and |
• | Eligible employees, which are present or former officers, directors, trustees and employees (and their eligible family members) of the Fund, the Manager and its affiliates, its parent company and the subsidiaries of its parent company, and retirement plans established for the benefit of such individuals. |
• | be an “institutional investor” which may include corporations; trust companies; endowments and foundations; defined contribution, defined benefit, and other employer sponsored retirement plans and deferred compensation plans; retirement plan or health savings account service provider platforms (jointly, “service provider platforms”); insurance companies; registered investment advisor firms; registered investment companies; bank trusts; college savings programs; and family offices; |
• | make a minimum initial investment of $1 million or more per account (waived for retirement and health savings account plan service provider platforms (collectively, “service provider platforms”)); and |
• | trade through an omnibus, trust, trust networked or similar pooled account. |
Independent Trustees | Position(s) | Length of Service |
Robert J. Malone | Board Chairman & Trustee | Since 2018 |
Andrew Donohue | Trustee | Since 2018 |
Jon S. Fossel | Trustee | Since 2018 |
Richard F. Grabish | Trustee | Since 2018 |
Beverly L. Hamilton | Trustee | Since 2018 |
Victoria J. Herget | Trustee | Since 2018 |
F. William Marshall, Jr. | Trustee | Since 2018 |
Karen L. Stuckey | Trustee | Since 2018 |
James D. Vaughn | Trustee | Since 2018 |
Interested Trustee | ||
Arthur P. Steinmetz | Trustee | Since 2018 |
Independent Trustees | ||
Name, Year of Birth, Position(s) | Principal Occupations(s) During the Past 5 Years; Other Trusteeship Held | Portfolios Overseen in Fund Complex |
Robert J. Malone (1944) Chairman of the Board of Trustees | Chairman - Colorado Market of MidFirst Bank (since January 2015); Chairman of the Board (2012-2016) and Director (August 2005-January 2016) of Jones International University (educational organization); Trustee of the Gallagher Family Foundation (non-profit organization) (2000-2016); Chairman, Chief Executive Officer and Director of Steele Street Bank Trust (commercial banking) (August 2003-January 2015); Director of Opera Colorado Foundation (non-profit organization) (2008-2012); Director of Colorado UpLIFT (charitable organization) (1986-2010); Director of Jones Knowledge, Inc. (2006-2010); Former Chairman of U.S. Bank-Colorado (subsidiary of U.S. Bancorp and formerly Colorado National Bank) (July 1996-April 1999); Director of Commercial Assets, Inc. (real estate investment trust) (1993-2000); Director of U.S. Exploration, Inc. (oil and gas exploration) (1997-February 2004); Chairman of the Board (1991-1994) and Trustee (1985-1994) of Regis University; and Chairman of the Board (1990-1991) and Member (1984-1999) of Young Presidents Organization. Mr. Malone has served on the Boards of certain Oppenheimer funds since 2002, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Andrew J. Donohue (1950) Trustee | Of Counsel, Shearman & Sterling LLP (since September 2017); Chief of Staff of the U.S. Securities and Exchange Commission (regulator) (June 2015-February 2017); Managing Director and Investment Company General Counsel of Goldman Sachs (investment bank) (November 2012-May 2015); Partner at Morgan Lewis & Bockius, LLP (law firm) (March 2011-October 2012); Director of the Division of Investment Management of U.S. Securities and Exchange Commission (regulator) (May 2006-November 2010); Global General Counsel of Merrill Lynch Investment Managers (investment firm) (May 2003-May 2006); General Counsel (October 1991-November 2001) and Executive Vice President (January 1993-November 2001) of OppenheimerFunds, Inc. (investment firm) (June 1991-November 2001). Mr. Donohue has served on the Boards of certain Oppenheimer funds since 2017, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Independent Trustees | ||
Name, Year of Birth, Position(s) | Principal Occupations(s) During the Past 5 Years; Other Trusteeship Held | Portfolios Overseen in Fund Complex |
Jon S. Fossel (1942) Trustee | Chairman of the Board of Jack Creek Preserve Foundation (non-profit organization) (2005-2015); Director of Jack Creek Preserve Foundation (non-profit organization) (since March 2005); Chairman of the Board (2006-December 2011) and Director (June 2002-December 2011) of UNUMProvident (insurance company); Director of Northwestern Energy Corp. (public utility corporation) (November 2004-December 2009); Director of P.R. Pharmaceuticals (October 1999-October 2003); Director of Rocky Mountain Elk Foundation (non-profit organization) (February 1998-February 2003 and February 2005-February 2007); Chairman and Director (until October 1996) and President and Chief Executive Officer (until October 1995) of the Sub-Adviser; President, Chief Executive Officer and Director of the following: Oppenheimer Acquisition Corp. (“OAC”) (parent holding company of the Sub-Adviser), Shareholders Services, Inc. and Shareholder Financial Services, Inc. (until October 1995). Mr. Fossel has served on the Boards of certain Oppenheimer funds since 1990, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Richard F. Grabish (1948) Trustee | Formerly Senior Vice President and Assistant Director of Sales and Marketing (March 1997-December 2007), Director (March 1987-December 2007) and Manager of Private Client Services (June 1985-June 2005) of A.G. Edwards & Sons, Inc. (broker/dealer and investment firm); Chairman and Chief Executive Officer of A.G. Edwards Trust Company, FSB (March 2001-December 2007); President and Vice Chairman of A.G. Edwards Trust Company, FSB (investment adviser) (April 1987-March 2001); President of A.G. Edwards Trust Company, FSB (investment adviser) (June 2005-December 2007). Mr. Grabish has served on the Boards of certain Oppenheimer funds since 2001, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Beverly L. Hamilton (1946) Trustee | Trustee of Monterey Institute for International Studies (educational organization) (2000-2014); Board Member of Middlebury College (educational organization) (December 2005-June 2011); Director (1991-2016), Vice Chairman of the Board (2006-2009) and Chairman of the Board (2010-2013) of American Funds’ Emerging Markets Growth Fund, Inc. (mutual fund); Director of The California Endowment (philanthropic organization) (April 2002-April 2008); Director (February 2002-2005) and Chairman of Trustees (2006-2007) of the Community Hospital of Monterey Peninsula; President of ARCO Investment Management Company (February 1991-April 2000); Member of the investment committees of The Rockefeller Foundation (2001-2006) and The University of Michigan (since 2000); Advisor at Credit Suisse First Boston’s Sprout venture capital unit (venture capital fund) (1994-January 2005); Trustee of MassMutual Institutional Funds (investment company) (1996-June 2004); Trustee of MML Series Investment Fund (investment company) (April 1989-June 2004); Member of the investment committee of Hartford Hospital (2000-2003); and Advisor to Unilever (Holland) pension fund (2000-2003). Ms. Hamilton has served on the Boards of certain Oppenheimer funds since 2002, during which time she has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Independent Trustees | ||
Name, Year of Birth, Position(s) | Principal Occupations(s) During the Past 5 Years; Other Trusteeship Held | Portfolios Overseen in Fund Complex |
Victoria J. Herget (1951) Trustee | Board Chair (2008-2015) and Director (2004-Present), United Educators (insurance company); Trustee (since 2000) and Chair (since 2010), Newberry Library (independent research library); Trustee, Mather LifeWays (senior living organization) (since 2001); Independent Director of the First American Funds (mutual fund family) (2003-2011); former Managing Director (1993-2001), Principal (1985-1993), Vice President (1978-1985) and Assistant Vice President (1973-1978) of Zurich Scudder Investments (investment adviser) (and its predecessor firms); Trustee (1992-2007), Chair of the Board of Trustees (1999-2007), Investment Committee Chair (1994-1999) and Investment Committee member (2007-2010) of Wellesley College; Trustee, BoardSource (non-profit organization) (2006-2009) and Chicago City Day School (K-8 School) (1994-2005). Ms. Herget has served on the Boards of certain Oppenheimer funds since 2012, during which time she has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
F. William Marshall, Jr. (1942) Trustee | Trustee Emeritus of Worcester Polytech Institute (WPI) (private university) (since 2009); Trustee of MassMutual Select Funds (formerly MassMutual Institutional Funds) (investment company) (1996-2015), MML Series Investment Fund (investment company) (1996-2015) and Mass Mutual Premier Funds (investment company) (January 2012-December 2015); President and Treasurer of the SIS Charitable Fund (private charitable fund) (January 1999-March 2011); Former Trustee of WPI (1985-2008); Former Chairman of the Board (2004-2006) and Former Chairman of the Investment Committee of WPI (1994-2008); Chairman of SIS Family Bank, F.S.B. (formerly SIS Bank) (commercial bank) (January 1999-July 1999); Executive Vice President of Peoples Heritage Financial Group, Inc. (commercial bank) (January 1999-July 1999); and Former President and Chief Executive Officer of SIS Bancorp. (1993-1999). Mr. Marshall has served on the Boards of certain Oppenheimer funds since 2000, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Karen L. Stuckey (1953) Trustee | Member (since May 2015) of Desert Mountain Community Foundation Advisory Board (non-profit organization); Partner (1990-2012) of PricewaterhouseCoopers LLP (professional services firm) (held various positions 1975-1990); Trustee (1992-2006); member of Executive, Nominating and Audit Committees and Chair of Finance Committee (1992-2006), and Emeritus Trustee (since 2006) of Lehigh University; and member, Women’s Investment Management Forum (professional organization) since inception. Ms. Stuckey has served on the Boards of certain Oppenheimer funds since 2012, during which time she has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
James D. Vaughn (1945) Trustee | Retired; former managing partner (1994-2001) of Denver office of Deloitte & Touche LLP, (held various positions 1969-1993); Trustee and Chairman of the Audit Committee of Schroder Funds (2003-2012); Board member and Chairman of Audit Committee of AMG National Trust Bank (since 2005); Trustee and Investment Committee member, University of South Dakota Foundation (since 1996); Board member, Audit Committee Member and past Board Chair, Junior Achievement (since 1993); former Board member, Mile High United Way, Boys and Girls Clubs, Boy Scouts, Colorado Business Committee for the Arts, Economic Club of Colorado and Metro Denver Network. Mr. Vaughn has served on the Boards of certain Oppenheimer funds since 2012, during which time he has become familiar with the Fund’s (and other Oppenheimer funds') financial, accounting, regulatory and investment matters and has contributed to the Board’s deliberations. | 55 |
Interested Trustee and Officer | ||
Name, Year of Birth, Position(s) | Principal Occupation(s) During the Past 5 Years; Other Trusteeships/Directorships Held | Portfolios Overseen in Fund Complex |
Arthur P. Steinmetz (1958) Trustee, President and Principal Executive Officer | Chairman of the Sub-Adviser (since January 2015); CEO and Chairman of the Manager (since July 2014), President of the Manager (since May 2013), a Director of the Manager (since January 2013), Director of the Sub-Adviser (since July 2014), President, Management Director and CEO of Oppenheimer Acquisition Corp. (the Sub-Adviser’s parent holding company) (since July 2014), and President and Director of OFI SteelPath, Inc. (since January 2013). Chief Investment Officer of the OppenheimerFunds advisory entities from (January 2013-December 2013); Executive Vice President of the Manager (January 2013-May 2013); Chief Investment Officer of the Sub-Adviser (October 2010-December 2012); Chief Investment Officer, Fixed-Income, of the Sub-Adviser (April 2009-October 2010); Executive Vice President of the Sub-Adviser (October 2009-December 2012); Director of Fixed Income of the Sub-Adviser (January 2009-April 2009); and a Senior Vice President of the Sub-Adviser (March 1993-September 2009). | 112 |
Position(s) | Length of Service | |
Helena Lee | Vice President | Since 2018 |
Arthur P. Steinmetz | President and Principal Executive Officer | Since 2018 |
Mary Ann Picciotto | Chief Compliance Officer and Chief Anti-Money Laundering Officer | Since 2018 |
Jennifer Foxson | Vice President and Chief Business Officer | Since 2018 |
Brian Petersen | Treasurer and Principal Financial & Accounting Officer | Since 2018 |
Stephanie Bullington | Assistant Treasurer | Since 2018 |
Julie Burley | Assistant Treasurer | Since 2018 |
James A. Kennedy | Assistant Treasurer | Since 2018 |
Jan Miller | Assistant Treasurer | Since 2018 |
Cynthia Lo Bessette | Secretary and Chief Legal Officer | Since 2018 |
Michael Sternhell | Assistant Secretary | Since 2018 |
Taylor V. Edwards | Assistant Secretary | Since 2018 |
Randy G. Legg | Assistant Secretary | Since 2018 |
John Yoder | Assistant Secretary | Since 2018 |
Gloria J. LaFond | Blue Sky Officer | Since 2018 |
Other Officers of the Fund | |||
Name, Year of Birth, Position(s) | Principal Occupation(s) During the Past 5 Years | Portfolios Overseen in Fund Complex | |
Helena Lee (1971) Vice President and Portfolio Manager | Vice President of the Sub-Adviser (since February 2018) and Portfolio Manager of the Sub-Adviser (since February 2018). | 1 |
Other Information about the Officers of the Fund | |||
Name, Year of Birth, Position(s) | Principal Occupation(s) During the Past 5 Years | Portfolios Overseen in Fund Complex | |
Mary Ann Picciotto (1973) Chief Compliance Officer and Chief Anti-Money Laundering Officer | Senior Vice President and Chief Compliance Officer of OFI Global Asset Management, Inc. (since March 2014); Chief Compliance Officer of OppenheimerFunds, Inc., OFI SteelPath, Inc., OFI Global Institutional, Inc., Oppenheimer Real Asset Management, Inc., OFI Private Investments Inc., Harborview Asset Management Corporation, Trinity Investment Management Corporation, and Shareholder Services, Inc. (since March 2014); Managing Director of Morgan Stanley Investment Management Inc. and certain of its various affiliated entities; Chief Compliance Officer of various Morgan Stanley Funds (May 2010-January 2014); Chief Compliance Officer of Morgan Stanley Investment Management Inc. (April 2007-January 2014). | 112 | |
Jennifer Foxson (1969) Vice President and Chief Business Officer | Senior Vice President of OppenheimerFunds Distributor, Inc. (since June 2014); Vice President of OppenheimerFunds Distributor, Inc. (April 2006-June 2014); Vice President of OppenheimerFunds, Inc. (January 1998-March 2006); Assistant Vice President of OppenheimerFunds, Inc. (October 1991-December 1998). | 112 | |
Brian S. Petersen (1970) Treasurer and Principal Financial and Accounting Officer | Senior Vice President of OFI Global Asset Management, Inc. (since January 2017); Vice President of OFI Global Asset Management, Inc. (January 2013-January 2017); Vice President of OppenheimerFunds, Inc. (February 2007-December 2012); Assistant Vice President of OppenheimerFunds, Inc. (August 2002-2007). | 112 | |
Stephanie Bullington (1977) Assistant Treasurer | Vice President of OFI Global Asset Management, Inc. (since February 2014); Vice President of OFI Global Asset Management, Inc. (January 2013-September 2013); Vice President of OppenheimerFunds, Inc. (January 2010-December 2012); Assistant Vice President of OppenheimerFunds, Inc. (October 2005-January 2010). | 112 | |
Julie Burley (1981) Assistant Treasurer | Vice President of OFI Global Asset Management, Inc. (since October 2013); OppenheimerFunds, Inc. Previously held the following positions at Deloitte & Touche: Senior Manager (September 2010-October 2013), Manager (September 2008-August 2010), and Audit Senior (September 2005-August 2008). | 112 | |
James A. Kennedy (1958) Assistant Treasurer | Senior Vice President of OFI Global Asset Management, Inc. (since January 2013); Senior Vice President of OppenheimerFunds, Inc. (September 2006-December 2012). | 112 | |
Jan Miller (1963) Assistant Treasurer | Vice President of OFI Global Asset Management, Inc. (since January 2014); Assistant Vice President of OFI Global Asset Management, Inc. (January 2013-January 2014); Assistant Vice President of OppenheimerFunds, Inc. (2005-December 2012); Assistant Vice President in OppenheimerFunds, Inc.’s Fund Accounting department (November 2004 to March 2006). | 112 | |
Cynthia Lo Bessette (1969) Secretary and Chief Legal Officer | Executive Vice President, General Counsel and Secretary of OFI Global Asset Management, Inc. (since February 2016); Senior Vice President and Deputy General Counsel of OFI Global Asset Management, Inc. (March 2015-February 2016); Chief Legal Officer of OppenheimerFunds, Inc. and OppenheimerFunds Distributor, Inc. (since February 2016); Vice President, General Counsel and Secretary of Oppenheimer Acquisition Corp. (since February 2016); General Counsel of OFI SteelPath, Inc., OFI Advisors, LLC and Index Management Solutions, LLC (since February 2016); Chief Legal Officer of OFI Global Institutional, Inc., HarbourView Asset Management Corporation, OFI Global Trust Company, Oppenheimer Real Asset Management, Inc., OFI Private Investments Inc., Shareholder Services, Inc. and Trinity Investment Management Corporation (since February 2016); Corporate Counsel (February 2012-March 2015) and Deputy Chief Legal Officer (April 2013-March 2015) of Jennison Associates LLC; Assistant General Counsel (April 2008-September 2009) and Deputy General Counsel (October 2009-February 2012) of Lord Abbett & Co. LLC. | 112 |
Other Information about the Officers of the Fund | |||
Name, Year of Birth, Position(s) | Principal Occupation(s) During the Past 5 Years | Portfolios Overseen in Fund Complex | |
Taylor V. Edwards (1967) Assistant Secretary | Senior Vice President and Managing Counsel of OFI Global Asset Management, Inc. (since January 2017); Vice President and Senior Counsel of OFI Global Asset Management, Inc. (January 2013-January 2017); Vice President (February 2007-December 2012) and Senior Counsel (February 2012-December 2012) of OppenheimerFunds, Inc.; Associate Counsel (May 2009-January 2012); Assistant Vice President (January 2006-January 2007) and Assistant Counsel (January 2006-April 2009) of OppenheimerFunds, Inc. | 112 | |
Randy Legg (1965) Assistant Secretary | Vice President and Senior Associate General Counsel of OFI Global Asset Management, Inc. (since January 2013); Vice President (June 2005-December 2012) and Senior Counsel (March 2011-December 2012) of OppenheimerFunds, Inc.; Associate Counsel (January 2007-March 2011) of OppenheimerFunds, Inc. | 112 | |
John Yoder (1975) Assistant Secretary | Vice President and Associate General Counsel of OFI Global Asset Management, Inc. (since January 2013); Vice President and Assistant Counsel (July 2011-December 2012) of OppenheimerFunds, Inc. | 112 | |
Gloria J. LaFond (1945) Blue Sky Officer | Assistant Vice President of OFI Global Asset Management, Inc. (since January 2013); Assistant Vice President (January 2006-December 2012) of OppenheimerFunds, Inc. | 112 |
As of December 31, 2017 | ||
Dollar Range of Shares Beneficially Owned in the Fund1 | Aggregate Dollar Range Of Shares Beneficially Owned in Supervised Funds | |
Independent Trustees | ||
Robert J. Malone | None | Over $100,000 |
Andrew Donohue2 | None | Over $100,000 |
Jon S. Fossel | None | Over $100,000 |
Richard F. Grabish | None | Over $100,000 |
Beverly L. Hamilton | None | Over $100,000 |
Victoria J. Herget | None | Over $100,000 |
F. William Marshall, Jr. | None | Over $100,000 |
Karen L. Stuckey | None | Over $100,000 |
James D. Vaughn | None | Over $100,000 |
Interested Trustee | ||
Arthur P. Steinmetz | None | Over $100,000 |
Estimated Aggregate Compensation From the Fund1 | Total Compensation From the Fund and Fund Complex2 | |
Name and Other Fund Position(s) (as applicable) | Year Ending December 31, 2018 | Year Ended December 31, 2017 |
Robert J. Malone3 Chairman of the Board | $1,402 | $381,000 |
Andrew J. Donohue4 Audit Committee Member | $899 | $147,934 |
Jon S. Fossel Review Committee Member and Governance Committee Member | $899 | $254,000 |
Richard F. Grabish Governance Committee Chair and Review Committee Member | $1,050 | $292,100 |
Beverly L. Hamilton Governance Committee Member and Review Committee Member | $8993 | $254,000 |
Victoria J. Herget Review Committee Chair | $1,050 | $292,100 |
F. William Marshall, Jr. Audit Committee Member | $899 | $254,000 |
Karen L. Stuckey Audit Committee Chair and Governance Committee Member | $1,100 | $304,800 |
James D. Vaughn Audit Committee Member and Governance Committee Member | $899 | $254,000 |
• | If such proposal is not specifically addressed in the Proxy Voting Guidelines, or if the Proxy Voting Guidelines provide discretion to the Manager on how to vote (i.e., on a case-by-case basis), the Manager will vote in accordance with the third-party proxy voting agent’s general recommended guidelines on the proposal provided that the Manager has reasonably determined that there is no conflict of interest on the part of the proxy voting agent. |
• | With respect to such proposal where a portfolio manager has requested that the Manager vote (i) in a manner inconsistent with the Proxy Voting Guidelines, or (ii) if such proposal is not specifically addressed in the Proxy Voting Guidelines, in a manner inconsistent with the third-party proxy voting agent’s general recommended guidelines, the Proxy Voting Committee may determine that such a request is in the best interests of the Fund (and, if applicable, its shareholders) and does not pose an actual material conflict of interest. In making its determination, the Proxy Voting Committee may consider, among other things, whether the portfolio manager is aware of the business relationship with the company, and/or is sufficiently independent from the business relationship, and to the Proxy Voting Committee’s knowledge, whether the Manager has been contacted or influenced by the company in connection with the proposal. |
• | The Fund evaluates director nominees on a case-by-case basis, examining the following factors, among others: composition of the board and key board committees, experience and qualifications, attendance at board meetings, corporate governance provisions and takeover activity, long-term company performance, the nominee’s investment in the company, and whether the company or nominee is targeted in connection with public “vote no” campaigns. |
• | The Fund generally supports proposals requiring the position of chairman to be filled by an independent director unless there are compelling reasons to recommend against the proposal such as a counterbalancing governance structure. |
• | The Fund generally supports proposals asking that a majority of directors be independent. The Fund generally supports proposals asking that a board audit, compensation, and/or nominating committee be composed exclusively of independent directors. |
• | The Fund generally votes against shareholder proposals to require a company to nominate more candidates than the number of open board seats. |
• | The Fund generally supports shareholder proposals to reduce a super-majority vote requirement, and opposes management proposals to add a super-majority vote requirement. |
• | The Fund generally supports proposals to allow shareholders the ability to call special meetings. |
• | The Fund generally votes for proposals that remove restrictions on or provide the right of shareholders to act by written consent independently of management taking into account the company’s specific governance provisions including right to call special meetings, poison pills, vote standards, etc. on a case-by-case basis. |
• | The Fund generally votes against proposals to create a new class of stock with superior voting rights. |
• | The Fund generally votes against proposals to classify a board. |
• | The Fund generally supports proposals to eliminate cumulative voting. |
• | The Fund generally votes against proposals to establish a new board committee. |
• | The Fund generally votes on management proposals seeking approval to exchange/reprice options on a case-by-case basis. |
• | The Fund votes on qualified employee stock purchase plans on a case-by-case basis. The Fund generally supports non-qualified employee stock purchase plans that feature broad-based participation, limits on employee contribution, company matching up to 25%, and no discount on the stock price on the date of purchase. |
• | The Fund generally supports transfer stock option (“TSO”) programs, if executive officers and non-employee directors are excluded from participating, if stock options are purchased from third-party financial institutions at a discount to their fair value using option pricing models, and if there is a two-year minimum holding period for sale proceeds. The Fund generally votes against equity plan proposals if the details of ongoing TSO programs are not provided to shareholders. |
• | The Fund generally supports proposals to require majority voting for the election of directors. |
• | The Fund generally supports proposals seeking additional disclosure of executive and director pay information. |
• | The Fund generally supports proposals seeking disclosure regarding the company’s, board’s or committee’s use of compensation consultants. |
• | The Fund generally supports “pay-for-performance” and “pay-for-superior-performance standard” proposals that align a significant portion of total compensation of senior executives to company performance, and generally supports an annual frequency for advisory votes on executive compensation. |
• | The Fund generally supports having shareholder votes on poison pills. |
• | The Fund generally supports proposals calling for companies to adopt a policy of not providing tax gross-up payments. |
• | The Fund votes case-by-case on bonus banking/bonus banking “plus” proposals. |
• | The Fund generally supports proposals calling for companies to adopt a policy of obtaining shareholder approval for golden coffins/executive death benefits. This would not apply to any benefit programs or equity plan proposals for which the broad-based employee population is eligible. |
• | The Fund generally supports proposals to eliminate accelerated vesting of unvested equity awards to senior executives in the event of change in control (except for pro rata vesting considering the time elapsed and attainment of any related performance goals between the award date and the change in control). |
• | In the case of social, political and environmental responsibility issues, the Fund will generally abstain where there could be a detrimental impact on share value or where the perceived value if the proposal was adopted is unclear or unsubstantiated. |
• | The Fund generally supports proposals that would clearly have a discernible positive impact on short- or long-term share value, or that would have a presently indiscernible impact on short- or long-term share value but promotes general long-term interests of the company and its shareholders. |
• | Other Accounts Managed. In addition to managing the Fund’s investment portfolio, the Portfolio Manager also manages other investment portfolios and other accounts on behalf of the Sub-Adviser or its affiliates. The following table provides information regarding those other portfolios and accounts as of December 31, 2017. No portfolio or account has an advisory fee based on performance. |
Portfolio Manager | Registered Investment Companies Managed | Total Assets in Registered Investment Companies Managed1 | Other Pooled Investment Vehicles Managed | Total Assets in Other Pooled Investment Vehicles Managed1 | Other Accounts Managed | Total Assets in Other Accounts Managed2 |
Helena Lee | 9 | $8.10 | 0 | $0 | 0 | $0 |
1. | In billions. |
2. | In millions. |
3. | Does not include personal accounts of the portfolio manager and her family, which are subject to the Code of Ethics. |
• | pays sales concessions to authorized brokers and dealers at the time of sale or as an ongoing concession, |
• | pays the service fees in advance or periodically, as described below, |
• | may finance payment of sales concessions or the advance of the service fee payments to recipients under the Plans, or may provide such financing from its own resources or from the resources of an affiliate, |
• | employs personnel to support distribution of Class B, Class C and Class R shares, |
• | bears the costs of sales literature, advertising and prospectuses (other than those furnished to current shareholders) and certain other distribution expenses, |
• | may not be able to adequately compensate dealers that sell Class B, Class C and Class R shares without receiving payment under the Plans and therefore may not be able to offer such Classes for sale absent the Plans, |
• | receives payments under the Plans consistent with the service and distribution fees paid by other non-proprietary funds that charge 12b-1 fees, |
• | may use the payments under the Plan to include the Fund in various third-party distribution programs that might increase sales of Fund shares, |
• | may experience increased difficulty selling the Fund’s shares if Plan payments were discontinued, because most competitor funds have plans that pay dealers as much or more for distribution services than the amounts currently being paid by the Fund, and |
• | may not be able to continue providing the same quality of distribution efforts and services, or to obtain such services from brokers and dealers, if Plan payments were discontinued. |
1. | Payments made by the Fund, or by an investor buying or selling shares of the Fund, including: |
• | an initial front-end sales charge, all or a portion of which is payable by the Distributor to financial intermediaries (see the “More About Your Account” section in the Fund’s prospectus); and |
• | ongoing asset-based distribution and/or service fees (described in the section “Distribution and Service Arrangements - Distribution and Service (12b-1) Plans” above). |
2. | Payments made by the Transfer Agent or Sub-Transfer Agent to financial intermediaries, to compensate or reimburse them for services provided, such as sub-transfer agency services for shareholders or retirement plan participants, omnibus accounting or sub-accounting, participation in networking arrangements, operational and recordkeeping and other administrative services. These payments are made out of the Transfer Agent’s or Sub-Transfer Agent’s own resources and/or assets, including from the revenues or profits derived from the transfer agency fees the Transfer Agent receives from the Fund. |
3. | In addition, the Sub-Adviser or Distributor may, at their discretion, make the following types of payments from their own resources and/or assets, including from the revenues or profits derived from the advisory fees the Sub-Adviser receives from the Manager for sub-advisory services on behalf of the Fund. Payments are made based on the guidelines established by the Sub-Adviser and Distributor, subject to applicable law. These payments are often referred to as “revenue sharing” payments, and may include, but are not limited to: |
• | compensation for marketing or promotional support, support provided in offering shares in the Fund or other Oppenheimer funds through certain trading platforms and programs, and other promotional or marketing services; and |
• | other compensation, to the extent the payment is not prohibited by law or by any self-regulatory agency, such as FINRA. |
4. | The Distributor may also provide, accept and/or cover the cost of certain non-cash compensation items, subject to internal policies and applicable FINRA regulations. |
• | charges for setting up access for the Fund or other Oppenheimer funds on particular trading systems; |
• | marketing, promotional support and program support, such as expenses related to including the Oppenheimer funds in retirement plans, college savings plans, fee-based advisory or wrap fee-based programs, fund “supermarkets,” bank or trust company products or insurance companies’ variable annuity or variable life insurance products; |
• | placement on the dealer’s list of offered funds; |
• | providing representatives of the Distributor with access to a financial intermediary’s sales meetings, sales representatives and management representatives; or |
• | firm support, which may include, but is not limited to, business planning assistance, “due diligence” or training meetings, advertising, or educating a financial intermediary’s sales personnel about the Oppenheimer funds. |
• | Equity securities (both U.S. and foreign) traded on a securities exchange are valued based on the official closing price on the principal exchange on which the security is traded, prior to when the Fund’s assets are valued. If the official closing price is unavailable, the security is valued at the last sale price on the principal exchange on which it is traded. If neither the official closing price nor the last sales price is available, the security is valued based on prices derived from bid and/or asked quotes from the exchange or broker-dealers or at fair value. |
• | Fixed Income securities (both U.S. and foreign and including corporate, government and municipal or tax-exempt securities), event-linked bonds, loans, mortgage-backed securities, collateralized mortgage obligations, and asset-backed securities are valued at the mean between the “bid” and “asked” prices as determined by a pricing service or by utilizing evaluated prices provided by third party pricing services who may use matrix pricing methods to determine the evaluated prices. Standard inputs generally considered by third-party pricing vendors include, but are not limited to, reported trade data, broker-dealer price quotations, benchmark yields, issuer spreads on comparable securities, the credit quality, yield, maturity, as well as other factors. Pricing services generally price fixed income securities assuming orderly transactions of an institutional “round lot” size, but some Fund trades may occur in smaller, “odd lot” sizes, sometimes at lower prices than institutional round lot trades. If a security cannot be valued in the manner stated above, the security is valued based on information derived from bid and/or asked prices for round lots from broker-dealers. If a fixed income security with a remaining maturity of 60 days or less cannot be valued in the manner stated above, the security is valued at cost adjusted by the amortization of discount or premium to maturity. |
• | Exchange-traded derivatives (other than futures and futures options) are valued at the last sale price on their principal exchange. If the exchange-traded derivative cannot be valued at the last sale price, it is valued at the mean between the closing bid and asked prices on the exchange. Futures and futures options traded on an exchange are generally valued at the official settlement price on their principal exchange. Over-the-counter (OTC) derivatives (other than a forward currency exchange contract) are valued by a pricing service or if a value from the pricing service is not available, by one or more prices from dealers, which may be or include the counterparty to the derivative transaction. |
• | Shares of an investment company or a fund’s wholly-owned subsidiary (if applicable) that are not traded on an exchange and shares of OFI Global China Fund LLC are valued at their NAV per share. |
1. | state the reason for the distribution; |
2. | if the distribution is premature, state the owner’s awareness of tax penalties; and |
3. | conform to the requirements of the plan and the Fund’s other redemption requirements. |
• | An initial sales charge was paid on the redeemed Class A shares or a Class A CDSC was paid when the shares were redeemed. |
• | income from certain taxable investments (such as certificates of deposit, repurchase agreements, commercial paper and obligations of the U.S. government, or its agencies and instrumentalities) or from bonds or other debt obligations; |
• | income from loans of portfolio securities; |
• | income or gains from certain options or futures; |
• | any net short-term capital gain; |
• | any market discount accrual on tax-exempt bonds; and |
• | certain foreign currency gains. |
• | Likelihood of payment-capacity and willingness of the obligor to meet its financial commitment on an obligation in accordance with the terms of the obligation; |
• | Nature of and provisions of the obligation and the promise we impute; |
• | Protection afforded by, and relative position of, the obligation in the event of bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditors’ rights. |
• | Amortization schedule-the larger the final maturity relative to other maturities, the more likely it will be treated as a note; and |
• | Source of payment-the more dependent the issue is on the market for its refinancing, the more likely it will be treated as a note. |
1. | For certain structured finance, preferred stock and hybrid securities in which payment default events are either not defined or do not match investors’ expectations for timely payment, the ratings reflect the likelihood of impairment and the expected financial loss in the event of impairment. |
2. | For certain structured finance, preferred stock and hybrid securities in which payment default events are either not defined or do not match investors’ expectations for timely payment, the ratings reflect the likelihood of impairment. |
(a) | (i) | Agreement and Declaration of Trust dated 8/15/12: Previously filed with Registrant’s Post-Effective Amendment No. 57, (8/21/12), and incorporated herein by reference. |
(ii) | Schedule A to the Agreement and Declaration of Trust, as amended 11/8/17: Filed herewith. | |
(b) | By-Laws dated 8/15/12: Previously filed with Registrant’s Post-Effective Amendment No. 57, (8/21/12), and incorporated herein by reference. | |
(c) | (i) | Article V of the Agreement and Declaration of Trust: Previously filed with Registrant’s Post-Effective Amendment No. 57, (8/21/12), and incorporated herein by reference. |
(ii) | Article II of the By-Laws: Previously filed with Registrant’s Post-Effective Amendment No. 57, (8/21/12), and incorporated herein by reference. | |
(d) | (i) | Investment Advisory Agreement dated 11/8/17: Filed herewith. |
(ii) | Investment Sub-Advisory Agreement dated 11/8/17: Filed herewith. | |
(e) | (i) | General Distributor's Agreement dated 11/8/17: Filed herewith. |
(ii) | Form of Dealer Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference. | |
(iii) | Form of Broker Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference. | |
(iv) | Form of Agency Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference. | |
(v) | Form of Trust Company Fund/SERV Purchase Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 45 to the Registration Statement of Oppenheimer High Yield Fund (Reg. No. 2-62076), (10/26/01), and incorporated herein by reference. | |
(vi) | Form of Trust Company Agency Agreement of OppenheimerFunds Distributor, Inc.: Previously filed with Post-Effective Amendment No. 34 to the Registration Statement of Oppenheimer Main Street Funds, Inc. (Reg. No. 33-17850), (10/23/06), and incorporated herein by reference. | |
(f) | Form of Oppenheimer Funds Compensation Deferral Plan, As Amended and Restated Effective 1/1/08: Previously filed with Post-Effective Amendment No. 2 to the Registration Statement of Oppenheimer Portfolio Series Fixed Income Active Allocation Fund (Reg. No. 333-146105), (5/29/09), and incorporated herein by reference. | |
(g) | (i) | Global Custody Agreement dated 8/16/02, as amended: Previously filed with Post-Effective Amendment No. 51 to the Registration Statement of Oppenheimer Capital Appreciation Fund (Reg. No. 2-69719), (10/23/06), and incorporated herein by reference. |
(ii) | Form of Amendment to the Global Custody Agreement: Filed herewith. | |
(h) | Not Applicable. | |
(i) | (i) Opinion and Consent of Counsel: Filed herewith. | |
(ii) Opinion of Delaware Counsel: Filed herewith. |
(j) | Independent Registered Public Accounting Firm’s Consent: Filed herewith. | |
(k) | Not applicable. | |
(l) | Not applicable. | |
(m) | (i) | Service Plan and Agreement for Class A shares: Filed herewith. |
(ii) | Service Plan and Agreement for Class T shares: Filed herewith. | |
(iii) | Distribution and Service Plan and Agreement for Class C shares: Filed herewith. | |
(iv) | Distribution and Service Plan and Agreement for Class R shares: Filed herewith. | |
(n) | Oppenheimer Funds Multiple Class Plan Pursuant to Rule 18f-3: Previously filed with Post-Effective Amendment No. 1 to the Registration Statement of Oppenheimer Global High Yield Fund (Reg. No. 333-176889), (9/25/14), and incorporated herein by reference. | |
(o) | Power of Attorney dated 8/22/17 for all Trustees and Officers: Previously filed with Post-Effective Amendment No. 7 to the Registration Statement of Oppenheimer Main Street Small Cap Fund (Reg. No. 333-186810), (8/25/17), and incorporated herein by reference. | |
(p) | Code of Ethics of the Oppenheimer Funds, OFI Global Asset Management, Inc., OFI SteelPath, Inc., OppenheimerFunds, Inc. (including certain other affiliates and subsidiaries) and OppenheimerFunds Distributor, Inc., effective as of 5/26/16, under Rule 17j-1 of the Investment Company Act of 1940: Previously filed with Post-Effective Amendment No. 18 to the Registration Statement of Oppenheimer Portfolio Series (Reg. No. 333-121449), (5/25/16), and incorporated herein by reference. |
(a) | OFI Global Asset Management, Inc. (the “Manager”) is the manager of the Registrant. The information required by this Item 31 about officers and directors of the Manager, together with information as to any other business, profession, vocation or employment of a substantial nature engaged in by such officers and directors during the past two years, is incorporated by reference to Form ADV, filed by the Manager pursuant to the Investment Advisers Act of 1940 (SEC File No. 801-76771). |
(b) | OppenheimerFunds, Inc. (the “Sub-Adviser”) provides advisory services to the Registrant. The information required by this Item 31 about officers and directors of the Sub-Adviser, together with information as to any other business, profession, vocation or employment of a substantial nature engaged in by such officers and directors during the past two years, is incorporated by reference to Form ADV, filed by the Sub-Adviser pursuant to the Investment Advisers Act of 1940 (SEC File No. 801-8253). |
(a) | OppenheimerFunds Distributor, Inc. is the Distributor of the Registrant’s shares. It is also the Distributor of each of the registered open-end investment companies listed below and for MassMutual Institutional Funds. |
(b) | The directors and officers of the Registrant’s principal underwriter are: |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Ryan Adam(2) | Vice President | None |
Rina M. Aligaen(2) | Assistant Vice President | None |
Anthony P. Allocco(2) | Assistant Vice President | None |
Joseph M. Allyn(1) | Vice President | None |
Nicole Andersen(2) | Assistant Vice President | None |
Charles F. Anderson(1) | Vice President | None |
Matthew J. Auer(2) | Vice President | None |
Kevin K. Babikian(2) | Assistant Secretary | None |
Anthony E. Bamonte(2) | Vice President | None |
James P. Barker(2) | Vice President | None |
Todd M. Barney(1) | Vice President | None |
Marina O. Barskaya(2) | Assistant Vice President | None |
Blake M. Bass(1) | Vice President | None |
Leslie A. Bednar(2) | Assistant Vice President | None |
Kathleen M. Beichert(1) | Senior Vice President | None |
Kimberly A. Belsole(2) | Vice President | None |
Rocco Benedetto(2) | Senior Vice President | None |
Emanuele S. Bergagnini(2) | Vice President | None |
Christopher E. Bergeron(2) | Vice President | None |
Rhea M. Berglund(1) | Vice President | None |
Rick D. Bettridge(2) | Vice President | None |
Kamal Bhatia(2) | Senior Vice President | None |
Adam L. Bilmes(2) | Vice President | None |
Paul G. Blease(2) | Senior Vice President | None |
Carolyn Boccaccio(2) | Vice President | None |
Maria T. Boingeanu(2) | Assistant Vice President | None |
Nancy S. Bong(2) | Vice President | None |
Christina G. Boris(2) | Vice President | None |
David A. Borrelli(2) | Senior Vice President | None |
Jeffrey R. Botwinick(2) | Vice President | None |
Sarah M. Bourgraf(1) | Vice President | None |
Matthew Brady(2) | Assistant Vice President | None |
Reginald J. Breaux(1) | Vice President | None |
Joshua H. Broad(2) | Vice President | None |
Kenneth S. Brodsky(2) | Senior Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Garrett Brookes(1) | Assistant Vice President | None |
Gregory L. Brown(2) | Vice President | None |
Matthew G. Brown(1) | Vice President | None |
Paul T. Brunswick(2) | Vice President | None |
Ryan M. Buckley(2) | Vice President | None |
Megan R. Byrne(2) | Assistant Vice President | None |
Jason A. Campisi(2) | Vice President | None |
Tara Carbonneau(1) | Vice President | None |
Sean T. Carey(2) | Vice President | None |
Robert M. Caruso(2) | Vice President | None |
Rick A. Casagrande(2) | Assistant Vice President | None |
Thomas M. Caulfield(1) | Vice President | None |
Stephane C. Chevrier(2) | Vice President | None |
Michael G. Chewning(1) | Vice President | None |
Donelle L. Chisolm(2) | Vice President | None |
Andrew S. Chonofsky(2) | Senior Vice President | None |
Angelanto L. Ciaglia(2) | Vice President | None |
Steven F. Cinquino(2) | Assistant Vice President | None |
Nicholas A. Cirbo(1) | Vice President | None |
John S. Clark(2) | Senior Vice President | None |
Adam M. Cohen(2) | Assistant Vice President | None |
Ryan J. Coleman(1) | Vice President | None |
Ellen L. Comisar(2) | Vice President | None |
Serina Copanas(2) | Vice President | None |
John H. Corcoran(2) | Vice President | None |
Cameron T. Cowden(2) | Vice President | None |
Neev Crane(2) | Vice President | None |
Michael Daley(2) | Vice President | None |
Edward Dane(2) | Senior Vice President | None |
Jeffrey N. Davis(3) | Vice President | None |
Stephen D. Degnan(2) | Vice President | None |
Ivan A. DelRio(2) | Vice President | None |
Richard E. DeMarco(2) | Assistant Vice President | None |
Michael R. Dennehy(2) | Vice President | None |
Michelle D. DeWitt(2) | Assistant Vice President | None |
Stephen P. Donovan(1) | Vice President | None |
Robert U. Duffey(2) | Vice President | None |
Cameron F. Dunford(1) | Vice President | None |
Robert B. Dunphy(2) | Vice President | None |
Peter G. Egginton(2) | Vice President | None |
Wendy Hetson Ehrlich(2) | Vice President | None |
Paul F. Eisenhardt(2) | Senior Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Kyle C. Elliott(2) | Vice President | None |
Rickey C. Ernzen(3) | Vice President | None |
Michael J. Eustic(2) | Vice President | None |
Gregg A. Everett(2) | Vice President | None |
George R. Fahey(1) | Senior Vice President | None |
Jason E. Farrell(2) | Vice President | None |
Kristie M. Feinberg(2) | Assistant Treasurer | None |
Jessica M. Fernandez(2) | Vice President | None |
Josean Y. Fernandez(2) | Vice President | None |
Michael A. Ferrer(2) | Vice President | None |
Jonathan Ferris(2) | Assistant Vice President | None |
Nicole Filingeri(2) | Vice President | None |
Tristan A. Fischer(2) | Vice President | None |
John Fortuna(2) | Senior Vice President | None |
Mark D. Foster(1) | Vice President | None |
Valeri L. Fox(2) | Vice President | None |
Jennifer L. Foxson(2) | Senior Vice President and Secretary | Vice President and Chief Business Officer |
George P. Fraser(1) | Vice President | None |
Victoria K. Frey(1) | Assistant Vice President | None |
Alice K. Fricke(2) | Vice President | None |
William L. Friebel(2) | Vice President | None |
Joseph T. Friedman(1) | Vice President | None |
Kellen G. Frye(2) | Vice President | None |
Dominique Z. Gabriel(2) | Assistant Vice President | None |
Kathryn T. Gallo(2) | Vice President | None |
Charlotte A. Gardner(1) | Vice President | None |
Christopher R. Gaudio(2) | Vice President | None |
Jay Gentry(1) | Senior Vice President | None |
Dina Ghanbarzadeh(2) | Assistant Vice President | None |
Nancy J. Girondo(2) | Vice President | None |
Jill E. Glazerman(2) | Senior Vice President | None |
Justin A. Goldstein(2) | Vice President | None |
Michael H. Gottesman(2) | Senior Vice President | None |
Raquel Granahan(2) | Senior Vice President | None |
Justin P. Grant(2) | Assistant Vice President | None |
Anthony Greco(2) | Assistant Vice President | None |
Moshe Greenberg(2) | Assistant Vice President | None |
Samuel J. Groban(2) | Vice President | None |
Vincent E. Grogan(2) | Senior Vice President | None |
Eric M. Grossjung(2) | Vice President | None |
Seth E. Guenther(1) | Assistant Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Michael D. Guman(2) | Vice President | None |
Joseph B. Gunderson(2) | Assistant Vice President | None |
Mahrukh Hameed(2) | Assistant Vice President | None |
LeaAnna M. Hartman(1) | Vice President | None |
Stacia E. Hatfield(2) | Vice President | None |
Alexander D. Hayes(2) | Vice President | None |
Petter A. Hellstrom-Bialek(1) | Vice President | None |
Richard N. Henn(2) | Senior Vice President | None |
Nicholas M. Henry(2) | Vice President | None |
Nicole M. Pretzel Holahan(2) | Vice President | None |
Heather L. Holliday-Smith(1) | Assistant Vice President | None |
Eric D. Holquist(2) | Vice President | None |
Timothy B. Horsburgh(2) | Assistant Vice President | None |
Brian F. Husch(2) | Vice President | None |
Keith P. Hylind(2) | Vice President | None |
Vincent R. Iacono(2) | Vice President | None |
Jason F. Israel(2) | Assistant Vice President | None |
Christopher Ivezic(2) | Vice President | None |
Michael C. Jamison(1) | Vice President | None |
Nickie J. Jacobs(1) | Assistant Vice President | None |
Shonda R. Jaquez(2) | Vice President | None |
Allyson M. Jarecky-Freitag(2) | Vice President | None |
Daniel C. Jarema(1) | Vice President | None |
Robert T. Jason(1) | Assistant Vice President | None |
Ryan O. Johann(2) | Assistant Vice President | None |
Eric K. Johnson(1) | Senior Vice President | None |
Sarah J. Joyce(2) | Assistant Vice President | None |
Wylie D. Kain(2) | Vice President | None |
Sachin Kambli(2) | Assistant Vice President | None |
Masakuni Kamiyama(2) | Assistant Vice President | None |
Annie V. Kang(2) | Vice President | None |
Assaf Kedem (2) | Assistant Vice President | None |
Geoffrey M. Keller(1) | Vice President | None |
Scott R. Kelley(1) | Vice President | None |
Gregory Kelly(2) | Vice President | None |
Brian P. Kiley(2) | Senior Vice President | None |
Susan Kim(2) | Assistant Vice President | None |
Matthew J. Kissane(2) | Assistant Vice President | None |
Jeffrey Klebanoff(2) | Vice President | None |
Kevin J. Koppel(2) | Assistant Vice President | None |
Melissa M. Kretschmer(2) | Assistant Vice President | None |
Eric J. Kristenson(2) | Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Stanford L. Kutler(2) | Senior Vice President | None |
David T. Kuzia(1) | Vice President | None |
Michael S. La Tona(2) | Vice President | None |
Daniel La Rochelle(2) | Assistant Vice President | None |
Lisa Lamentino(2) | Vice President | None |
Thomas M. Landhauser(2) | Vice President | None |
Brian Landy(2) | Assistant Vice President | None |
Laura L. Lawson(2) | Vice President | None |
Daniel J. Lee(2) | Vice President | None |
Eric Lee(2) | Assistant Vice President | None |
Talley D. Leger(2) | Vice President | None |
John P. Leonard(2) | Vice President | None |
Brian S. Levitt(2) | Senior Vice President | None |
Jesse E. Levitt(2) | Vice President | None |
Craig M. Lieb(2) | Vice President | None |
Lorna A. Lindquist(2) | Vice President | None |
Malissa B. Lischin(2) | Vice President | None |
Susan List(2) | Assistant Vice President | None |
Terrie P. Liu(1) | Assistant Vice President | None |
Cynthia Lo Bessette(2) | Chief Legal Officer | Secretary and Chief Legal Officer |
Gordon C. Loetz(2) | Vice President | None |
Christina J. Loftus(2) | Senior Vice President | None |
David P. Lolli(2) | Assistant Vice President | None |
Thomas Loncar(2) | Vice President | None |
Inna London-Ikhilov(2) | Assistant Vice President | None |
David A. Long(1) | Assistant Vice President | None |
John Luiz(2) | Vice President | None |
Brian Lynch(2) | Assistant Vice President | None |
Joseph M. Macaluso(2) | Assistant Vice President | None |
John W. Mackey(2) | Vice President | None |
Peter K. Maddox(2) | Vice President | None |
Salvatore Maia(2) | Assistant Vice President | None |
Michael J. Malik(2) | Vice President | None |
Joseph C. Marich(2) | Vice President | None |
Natalie Marin(2) | Vice President | None |
Michael A. Marino(2) | Assistant Vice President | None |
Todd A. Marion(2) | Vice President | None |
Sheila M. Masley(1) | Assistant Vice President | None |
Katarina Maxianova(2) | Vice President | None |
Clare C. Mazur(2) | Vice President | None |
Peter J. McCarthy(1) | Vice President | None |
Robert D. McClure(2) | Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Ryan T. McCormack(2) | Assistant Vice President | None |
John C. McDonough(2) | Chairman, Chief Executive Officer, President & Director | None |
Matthew S. McGee(1) | Vice President | None |
Kent C. McGowan(2) | Vice President | None |
Simon A. McKay(2) | Vice President | None |
Philip J. McKeon(2) | Assistant Vice President | None |
William J. McNamara(2) | Vice President | None |
Christopher S. Mechem(2) | Vice President | None |
Brian F. Medina(1) | Vice President | None |
Gregory E. Mehok(2) | Vice President | None |
Daniel P. Melehan(2) | Vice President | None |
Izaak Mendelson(2) | Assistant Vice President | None |
Ariella Menegon(2) | Assistant Vice President | None |
Debbie S. Michaelson(1) | Vice President | None |
David B. Miller(2) | Assistant Vice President | None |
Peter L. Mintzberg(2) | Executive Vice President | None |
Clint T. Modler(1) | Senior Vice President | None |
Thomas J. Montefinise(2) | Assistant Vice President | None |
Brandon D. Moore(1) | Vice President | None |
Rian Morrissey(1) | Vice President | None |
Jeffrey W. Mortimer(2) | Vice President | None |
James F. Mugno(2) | Vice President | None |
Matthew D. Mulcahy(2) | Vice President | None |
Wendy J. Murray(2) | Vice President | None |
Keith D. Myers(1) | Assistant Vice President | None |
Kyle Najarian(1) | Vice President | None |
Christina M. Nasta(2) | Senior Vice President | None |
Kevin R. Neznek(2) | Senior Vice President | None |
Nichola L. Noriega(2) | Vice President | None |
Peter J. Novak(2) | Senior Vice President | None |
Ryan P. O’Carroll(2) | Vice President | None |
James B. O’Connell(2) | Vice President | None |
Timothy J. O’Connell(2) | Vice President | None |
Patricia O’Connor(2) | Vice President | None |
Tony D. Oh(1) | Treasurer | None |
Ronald M. Ongaro(2) | Assistant Vice President | None |
Leonard J. Oremland(2) | Senior Vice President | None |
Leonar G. Palao(2) | Assistant Vice President | None |
Bruce Palm(2) | Vice President | None |
Alan I. Panzer(2) | Vice President | None |
Andrew Y. Park(1) | Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Maria Paster(2) | Vice President | None |
Ashley B. Patten(1) | Vice President | None |
Lori L. Penna (2) | Vice President | None |
Andrew J. Petersen(1) | Vice President | None |
Daniel J. Petter(2) | Vice President | None |
David M. Pfeffer(2) | Director & Chief Financial Officer | None |
Patrick A. Phalon(2) | Vice President | None |
Andrew W. Phillips(1) | Vice President | None |
Piers A. Platt(2) | Vice President | None |
Scott A. Porter(2) | Assistant Vice President | None |
Yunchang Qiu(2) | Senior Vice President | None |
Michael E. Quinn(2) | Vice President | None |
Michael D. Rabin(2) | Vice President | None |
Michael A. Radon(2) | Assistant Vice President | None |
Richard E. Rath(2) | Vice President | None |
William J. Raynor(2) | Vice President | None |
Brenna D. Rhone(2) | Assistant Vice President | None |
James T. Robinson(1) | Vice President | None |
Ian M. Roche(2) | Vice President | None |
Jason D. Roche(2) | Vice President | None |
Adam T. Rochlin(2) | Senior Vice President | None |
Michael A. Rock(2) | Vice President | None |
Rachel S. Rodgers(2) | Assistant Vice President | None |
Philip Rolleri(2) | Assistant Vice President | None |
Michael J. Roman(2) | Assistant Vice President | None |
Megan P. Rosenblum(2) | Vice President | None |
Francis W. Ross(1) | Vice President | None |
Jonathan J. Ross(2) | Vice President | None |
Kristen M. Ross(2) | Assistant Vice President | None |
Adrienne M. Ruffle(2) | Vice President | None |
Thomas F. Sabow(2) | Vice President | None |
Gary Salerno(2) | Assistant Vice President | None |
Gary J. Sanchez(1) | Vice President | None |
John C. Saunders(2) | Senior Vice President | None |
Kurt R. Savallo(2) | Assistant Vice President | None |
Alex C. Schardt(2) | Vice President | None |
Thomas J. Schmitt(2) | Vice President | None |
Erik M. Schneberger (2) | Senior Vice President | None |
William A. Schories(2) | Vice President | None |
Patrick L. Scorzelli(2) | Vice President | None |
Jeffrey D. Sharon(2) | Vice President | None |
Rahul N. Shah(2) | Assistant Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Faiza Sikander(2) | Assistant Vice President | None |
Jessica A. Skolnick(2) | Assistant Vice President | None |
Bryant B. Smith(2) | Vice President | None |
Timothy F. Smith(2) | Assistant Vice President | None |
Mark C. Sokoloff(2) | Assistant Vice President | None |
Haley M. Sorenson(1) | Vice President | None |
John A. Spensley(2) | Vice President | None |
Timothy J. Spitz(2) | Vice President | None |
Alfred O. St. John(2) | Vice President | None |
Jesse T. Stackland-Winterer(2) | Vice President | None |
Michael N. Staples(2) | Vice President | None |
Keith S. Stecker(2) | Assistant Vice President | None |
Bryan D. Stein(2) | Vice President | None |
Joseph D. Stellato(2) | Vice President | None |
Benjamin A. Stewart(2) | Senior Vice President | None |
Wayne C. Strauss(2) | Vice President | None |
Matthew C. Straut(2) | Senior Vice President | None |
Ryan P. Sullivan(2) | Assistant Vice President | None |
Brian C. Summe(2) | Vice President | None |
Michael E. Sussman(2) | Vice President | None |
George T. Sweeney(2) | Senior Vice President | None |
Adam L. Tabor(2) | Vice President | None |
Leo P. Tallon(2) | Vice President | None |
Laura B. Taylor (1) | Senior Vice President | None |
Paul E. Temple(2) | Senior Vice President | None |
Jay S. Therrien(2) | Vice President | None |
David G. Thomas(2) | Vice President | None |
John B. Thorpe(1) | Vice President | None |
Luz V. Touma(2) | Vice President | None |
Matthew R. Trimble(2) | Assistant Vice President | None |
Catherine L. Tulley(1) | Assistant Vice President | None |
David C. Van Hellemont(2) | Vice President | None |
Wesley R. Vance(2) | Vice President | None |
Daniel T. Veith(2) | Assistant Vice President | None |
Vincent C. Vermette(2) | Vice President | None |
Alyse S. Vishnick(2) | Vice President | None |
Rohit Vohra(2) | Vice President | None |
Richard Walsh(2) | Vice President | None |
Teresa M. Ward(2) | Vice President | None |
Keith R. Watts(1) | Vice President | None |
Taylor Watts(1) | Vice President | None |
Michael J. Weigner(2) | Vice President | None |
Name & Principal Business Address | Position & Office with Underwriter | Position and Office with Registrant |
Kimberly W. Weinrick(2) | Vice President | None |
Christopher G. Werner(2) | Vice President | None |
Donna M. White (2) | Chief Compliance Officer | None |
Ryan C. Wilde(1) | Vice President | None |
Timothy A. Wilkinson(1) | Vice President | None |
Thomas Winnick(2) | Vice President | None |
Patrick J. Wisneski(1) | Vice President | None |
Kevin P. Woodson(1) | Assistant Vice President | None |
Ryan J. Woolhiser(1) | Vice President | None |
Theodore J. Young(1) | Assistant Vice President | None |
David T. Zicchinella(2) | Vice President | None |
Steven L. Zito(1) | Vice President | None |
Zhanyi Zhu(2) | Assistant Vice President | None |
(c) | Not applicable. |
Oppenheimer Integrity Funds on behalf of Oppenheimer Preferred Securities and Income Fund | |
By: | Arthur P. Steinmetz* |
Arthur P. Steinmetz Trustee, President and Principal Executive Officer |
Signatures | Title | Date | ||
Robert J. Malone* Robert J. Malone | Chairman of the Board of Trustees | February 2, 2018 | ||
Arthur P. Steinmetz* Arthur P. Steinmetz | Trustee, President and Principal Executive Officer | February 2, 2018 | ||
Brian S. Petersen* Brian S. Petersen | Treasurer, Principal Financial & Accounting Officer | February 2, 2018 | ||
Andrew J. Donohue* Andrew J. Donohue | Trustee | February 2, 2018 | ||
Jon S. Fossel* Jon S. Fossel | Trustee | February 2, 2018 | ||
Richard F. Grabish* Richard F. Grabish | Trustee | February 2, 2018 | ||
Beverly L. Hamilton* Beverly L. Hamilton | Trustee | February 2, 2018 | ||
Victoria J. Herget* Victoria J. Herget | Trustee | February 2, 2018 | ||
F. William Marshall, Jr.* F. William Marshall, Jr. | Trustee | February 2, 2018 | ||
Karen L. Stuckey* Karen L. Stuckey | Trustee | February 2, 2018 | ||
James D. Vaughn* James D. Vaughn | Trustee | February 2, 2018 | ||
*By: /s/ Taylor V. Edwards Taylor V. Edwards, Attorney-in-Fact |
Exhibit No. | Description | |
28(a)(ii) | Schedule A to the Agreement and Declaration of Trust, as amended 11/8/17 | |
28(d)(i) | Investment Advisory Agreement dated 11/8/17 | |
28(d)(ii) | Investment Sub-Advisory Agreement dated 11/8/17 | |
28(e)(i) | General Distributor’s Agreement dated 11/8/17 | |
28(g)(ii) | Form of Amendment to the Global Custody Agreement | |
28(i)(i) | Opinion and Consent of Counsel | |
28(i)(ii) | Opinion of Delaware Counsel | |
28(j) | Independent Registered Public Accounting Firm’s Consent | |
28(m)(i) | Service Plan and Agreement for Class A shares dated 11/8/17 | |
28(m)(ii) | Service Plan and Agreement for Class T shares dated 11/8/17 | |
28(m)(iii) | Distribution and Service Plan and Agreement for Class C shares dated 11/8/17 | |
28(m)(iv) | Distribution and Service Plan and Agreement for Class R shares dated 11/8/17 |
Schedule A
(as of November 8, 2017)
Oppenheimer Integrity Funds
Oppenheimer Total Return Bond Fund[1]
Classes of Shares
Class A
Class T
Class B
Class C
Class R
Class Y
Class I
Oppenheimer Global Unconstrained Bond Fund[2]
Classes of Shares
Class A
Class T
Class C
Class R
Class Y
Class I
Oppenheimer Preferred Securities and Income Fund[3]
Classes of Shares
Class A
Class T
Class C
Class R
Class Y
Class I
1 Amended June 1, 2017 to reflect the name change of
Oppenheimer Core Bond Fund to
Oppenheimer Total Return Bond Fund, the name change of Class N to Class R, and the addition of Class T.
[2] Amended August 23, 2017 to reflect the addition of Oppenheimer Global Unconstrained Bond Fund.
[3] Amended November 8, 2017 to reflect the addition of Oppenheimer Preferred Securities and Income Fund.
|
INVESTMENT ADVISORY AGREEMENT
AGREEMENT made November 8, 2017, by and between OPPENHEIMER INTEGRITY FUNDS (the “Trust”), on behalf of its series OPPENHEIMER PREFERRED SECURITIES AND INCOME FUND (the “Fund”), and OFI GLOBAL ASSET MANAGEMENT, INC. (hereinafter referred to as “OFI GLOBAL”).
WHEREAS, the Trust is an open-end, diversified series management investment company registered as such with the Securities and Exchange Commission (the “Commission”) pursuant to the Investment Company Act of 1940, as amended (the “Investment Company Act”), and OFI GLOBAL is an investment adviser registered as such with the Commission under the Investment Advisers Act of 1940, as amended;
WHEREAS, the Trust, on behalf of the Fund, desires that OFI GLOBAL shall act as its investment adviser pursuant to this Agreement; and
WHEREAS, the Fund is a series of the Trust having a separate portfolio, investment policies and investment restrictions;
NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set forth, it is agreed by and between the parties, as follows:
1. General Provision.
(a) The Trust hereby employs OFI GLOBAL and OFI GLOBAL hereby undertakes to act as the investment adviser of the Fund and to perform for the Fund such other duties and functions as are hereinafter set forth. OFI GLOBAL shall, in all matters, give to the Fund and the Trust’s Board of Trustees the benefit of its best judgment, effort, advice and recommendations and shall, at all times conform to, and use its best efforts to enable the Fund to conform to (i) the provisions of the Investment Company Act and any rules or regulations thereunder; (ii) any other applicable provisions of state or federal law; (iii) the provisions of the Declaration of Trust and By-Laws of the Trust as amended from time to time; (iv) policies and determinations of the Board of Trustees of the Trust; (v) the fundamental policies and investment restrictions of the Fund as reflected in the Trust’s registration statement under the Investment Company Act or as such policies may, from time to time, be amended by the Fund’s shareholders; and (vi) the Prospectus and Statement of Additional Information of the Fund in effect from time to time. The appropriate officers and employees of OFI GLOBAL shall be available upon reasonable notice for consultation with any of the Trustees and officers of the Trust with respect to any matters dealing with the business and affairs of the Trust including the valuation of portfolio securities of the Fund which are either not registered for public sale or not traded on any securities market.
(b) At its option, OFI GLOBAL may appoint a sub-adviser (which may be affiliated with OFI GLOBAL) to perform all or such responsibilities of OFI GLOBAL under this Agreement as shall be delegated by OFI GLOBAL to such subadviser provided, however, that the appointment
of any subadviser and the assumption by such subadviser of any responsibilities of OFI GLOBAL shall be subject to the approval of the Board of Trustees of the Trust, including the vote of the majority of the Trustees of the Trust who are not parties to this Agreement or “interested persons” (as defined in the Investment Company Act) of any such person, cast in person at a meeting called for the purpose of voting on such approval, and, to the extent necessary, the shareholders of the Fund. OFI GLOBAL agrees to give the Trust prompt written notice of the termination of, or any notice to terminate, any subadviser agreement.
2. Investment Management.
(a) OFI GLOBAL shall, subject to the direction and control by the Trust’s Board of Trustees, (i) supervise and monitor continuously the investment program of the Fund and the composition of its portfolio and determine what securities shall be purchased or sold by the Fund; (ii) subject to subsection (i) hereof, regularly provide investment advice and recommendations to the Fund with respect to its investments, investment policies and the purchase and sale of securities; and (iii) arrange, subject to the provisions of paragraph 7 hereof, for the purchase of securities and other investments for the Fund and the sale of securities and other investments held in the Fund’s portfolio.
(b) Provided that the Trust shall not be required to pay any compensation other than as provided by the terms of this Agreement and subject to the provisions of paragraph 7 hereof, OFI GLOBAL may obtain investment information, research or assistance from any other person, firm or corporation to supplement, update or otherwise improve its investment management services.
(c) Provided that nothing herein shall be deemed to protect OFI GLOBAL from willful misfeasance, bad faith or gross negligence in the performance of its duties, or reckless disregard of its obligations and duties under this Agreement, OFI GLOBAL shall not be liable for any loss sustained by reason of good faith errors or omissions in connection with any matters to which this Agreement relates.
(d) Nothing in this Agreement shall prevent OFI GLOBAL or any officer thereof from acting as investment adviser for any other person, firm or corporation and shall not in any way limit or restrict OFI GLOBAL or any of its directors, officers, stockholders or employees from buying, selling or trading any securities for its or their own account or for the account of others for whom it or they may be acting, provided that such activities will not adversely affect or otherwise impair the performance by OFI GLOBAL of its duties and obligations under this Agreement.
3. Other Duties of OFI GLOBAL.
OFI GLOBAL shall, at its own expense, provide and supervise the activities of all administrative and clerical personnel as shall be required to provide effective corporate administration for the Fund, including the compilation and maintenance of such records with respect to its operations as may reasonably be required; the preparation and filing of such reports with respect thereto as shall be required by the Commission; composition of periodic reports with respect to operations of the Fund for its shareholders; composition of proxy materials for meetings of the Fund’s shareholders; and the composition of such registration statements as may be required by federal and state securities laws
for continuous public sale of shares of the Fund. OFI GLOBAL shall, at its own cost and expense, also provide the Trust with adequate office space, facilities and equipment. OFI GLOBAL shall, at its own expense, provide such officers for the Trust as the Trust’s Board may request.
4. Allocation of Expenses.
All other costs and expenses of the Fund not expressly assumed by OFI GLOBAL under this Agreement, by a sub-adviser under any Sub-Advisory Agreement or to be paid by the Distributor of the shares of the Fund, shall be paid by the Trust, including, but not limited to: (i) interest and taxes; (ii) brokerage commissions; (iii) insurance premiums for fidelity and other coverage requisite to its operations; (iv) compensation and expenses of the Trust’s trustees other than those affiliated with OFI GLOBAL; (v) legal and audit expenses; (vi) custodian and transfer agent fees and expenses; (vii)expenses incidental to the redemption of its shares; (viii) expenses incidental to the issuance of its shares against payment therefor by or on behalf of the subscribers thereto; (ix) fees and expenses, other than as hereinabove provided, incidental to the registration under federal and state “blue sky” securities laws of shares of the Fund for public sale; (x) expenses of printing and mailing reports, notices and proxy materials to shareholders of the Fund; (xi) except as noted above, all other expenses incidental to holding meetings of the Fund’s shareholders; and (xii) such extraordinary non-recurring expenses as may arise, including litigation, affecting the Fund and any legal obligation which the Trust may have (on behalf of the Fund) to indemnify its officers and trustees with respect thereto. Any officers or employees of OFI GLOBAL or any entity controlling, controlled by or under common control with OFI GLOBAL who may also serve as officers, trustees or employees of the Fund shall not receive any compensation from the Fund for their services. The expenses with respect to any two or more series of the Trust shall be allocated in proportion to the net assets of the respective series except where allocations of direct expenses can be made.
5. Compensation of OFI GLOBAL.
The Trust agrees to pay OFI GLOBAL and OFI GLOBAL agrees to accept as full compensation for the performance of all functions and duties to be performed pursuant to the provisions hereof, a fee computed on the aggregate net asset value of the Fund as of the close of each business day and payable monthly at the following annual rate:
0.65% of the first $500 million of average annual net assets;
0.60% of the next $500 million to $1 billion;
0.55% of the next $1 billion to $5 billion;
0.53% of average annual net assets in excess of $5 billion.
6. Use of Name “Oppenheimer.”
OFI GLOBAL hereby grants to the Trust a royalty-free, non-exclusive license to use the name “Oppenheimer” in the name of the Trust and the Fund for the duration of this Agreement and any extensions or renewals thereof to the extent necessary to protect OFI GLOBAL’s rights to the name “Oppenheimer” under applicable law, such license shall allow OFI GLOBAL to inspect and, subject to control by the Trust’s Board, control the nature and quality of services offered by the Fund under such name. Such license may, upon termination of this Agreement, be terminated by OFI
GLOBAL, in which event the Trust shall promptly take whatever action may be necessary to change its name and the name of the Fund and discontinue any further use of the name “Oppenheimer” in the name of the Trust and the Fund or otherwise. The name “Oppenheimer” may be used by OFI GLOBAL in connection with any of its activities, or licensed by OFI GLOBAL to any other party.
7. Portfolio Transactions and Brokerage.
(a) OFI GLOBAL is authorized, in arranging the purchase and sale of the Fund’s portfolio securities, to employ or deal with such members of securities or commodities exchanges, brokers or dealers (hereinafter “broker-dealers”), including “affiliated” broker-dealers (as that term is defined in the Investment Company Act), as may, in its best judgment, implement the policy of the Fund to obtain, at reasonable expense, the “best execution” (prompt and reliable execution at the most favorable security price obtainable) of the Fund’s portfolio transactions as well as to obtain, consistent with the provisions of subparagraph (c) of this paragraph 7, the benefit of such investment information or research as will be of significant assistance to the performance by OFI GLOBAL of its investment management functions.
(b) OFI GLOBAL shall select broker-dealers to effect the Fund’s portfolio transactions on the basis of its estimate of their ability to obtain best execution of particular and related portfolio transactions. The abilities of a broker-dealer to obtain best execution of particular portfolio transaction(s) will be judged by OFI GLOBAL on the basis of all relevant factors and considerations including, insofar as feasible, the execution capabilities required by the transaction or transactions; the ability and willingness of the broker-dealer to facilitate the Fund’s portfolio transactions by participating therein for its own account; the importance to the Fund of speed, efficiency or confidentiality; the broker-dealer’s apparent familiarity with sources from or to whom particular securities might be purchased or sold; as well as any other matters relevant to the selection of a broker-dealer for particular and related transactions of the Fund.
(c) OFI GLOBAL shall have discretion, in the interests of the Fund, to allocate brokerage on the Fund’s portfolio transactions to broker-dealers, other than affiliated broker-dealers, qualified to obtain best execution of such transactions who provide brokerage and/or research services (as such services are defined in Section 28(e)(3) of the Securities Exchange Act of 1934) for the Fund and/or other accounts for which OFI GLOBAL or its affiliates exercise “investment discretion” (as that term is defined in Section 3(a)(35) of the Securities Exchange Act of 1934) and to cause the Fund to pay such broker-dealers a commission for effecting a portfolio transaction for the Fund that is in excess of the amount of commission another broker-dealer adequately qualified to effect such transaction would have charged for effecting that transaction, if OFI GLOBAL determines, in good faith, that such commission is reasonable in relation to the value of the brokerage and/or research services provided by such broker-dealer, viewed in terms of either that particular transaction or the overall responsibilities of OFI GLOBAL or its affiliates with respect to the accounts as to which they exercise investment discretion. In reaching such determination, OFI GLOBAL will not be required to place or attempt to place a specific dollar value on the brokerage and/or research services provided or being provided by such broker-dealer. In demonstrating that
such determinations were made in good faith, OFI GLOBAL shall be prepared to show that all commissions were allocated for purposes contemplated by this Agreement and that the total commissions paid by the Fund over a representative period selected by the Trustees were reasonable in relation to the benefits to the Fund.
(d) OFI GLOBAL shall have no duty or obligation to seek advance competitive bidding for the most favorable commission rate applicable to any particular portfolio transactions or to select any broker-dealer on the basis of its purported or “posted” commission rate but will, to the best of its ability, endeavor to be aware of the current level of the charges of eligible broker-dealers and to minimize the expense incurred by the Fund for effecting its portfolio transactions to the extent consistent with the interests and policies of the Fund as established by the determinations of the Board of Trustees and the provisions of this paragraph 7.
(e) The Trust recognizes that an affiliated broker-dealer: (i) may act as one of the Fund’s regular brokers for the Fund so long as it is lawful for it so to act; (ii) may be a major recipient of brokerage commissions paid by the brokerage commissions paid by the Fund; and (iii) may effect portfolio transactions for the Fund only if the commissions, fees or other remuneration received or to be received by it are determined in accordance with procedures contemplated by any rule, regulation or order adopted under the Investment Company Act for determining the permissible level of such commissions.
8. Duration.
This Agreement will take effect on the date first set forth above. Unless earlier terminated pursuant to paragraph 9 hereof, this Agreement shall remain in effect until two years from the date of execution hereof, and thereafter will continue in effect from year to year, so long as such continuance shall be approved at least annually by the Trust’s Board of Trustees, including the vote of the majority of the Trustees of the Trust who are not parties to this Agreement or “interested persons” (as defined in the Investment Company Act) of any such party, cast in person at a meeting called for the purpose of voting on such approval, or by the holders of a “majority” (as defined in the Investment Company Act) of the outstanding voting securities of the Fund and by such a vote of the Trust’s Board of Trustees.
9. Termination.
This Agreement may be terminated (i) by OFI GLOBAL at any time without penalty upon sixty days’ written notice to the Trust (which notice may be waived by the Trust); or (ii) by the Trust at any time without penalty upon sixty days’ written notice to OFI GLOBAL (which notice may be waived by OFI GLOBAL) provided that such termination by the Trust shall be directed or approved by the vote of a majority of all of the Trustees of the Trust then in office or by the vote of the holders of a “majority” of the outstanding voting securities of the Fund (as defined in the Investment Company Act).
10. Assignment or Amendment.
This Agreement may not be amended or the rights of OFI GLOBAL hereunder sold, transferred, pledged or otherwise in any manner encumbered without the affirmative vote or written consent of the holders of the “majority” of the outstanding voting securities of the Fund. This Agreement shall automatically and immediately terminate in the event of its “assignment” (as defined in the Investment Company Act).
11. Disclaimer of Shareholder or Trustee Liability.
OFI GLOBAL understands and agrees that the obligations of the Trust or the Fund under this Agreement are not binding upon any trustee or shareholder of the Trust or the Fund personally, but bind only the Trust and the Trust’s property. OFI GLOBAL represents that it has notice of the provisions of the Declaration of Trust of the Trust disclaiming shareholder or trustee liability for acts or obligations of the Trust.
12. Definitions.
The terms and provisions of the Agreement shall be interpreted and defined in a manner consistent with the provisions and definitions contained in the Investment Company Act.
Oppenheimer Integrity Funds,
on behalf of its series
Oppenheimer Preferred Securities and Income Fund
By: /s/ Brian Petersen
Brian Petersen
Treasurer and Principal Financial & Accounting Officer
OFI Global Asset Management, Inc.
By: /s/ Cynthia Lo Bessette
Cynthia Lo Bessette
Executive Vice President, General Counsel & Secretary
INVESTMENT SUBADVISORY AGREEMENT
THIS AGREEMENT is made and entered into as of November 8, 2017, between OFI Global Asset Management, Inc., a Delaware corporation (the “Adviser”), and OppenheimerFunds, Inc., a Colorado corporation (the “SubAdviser”)
W I T N E S S E T H:
WHEREAS, OPPENHEIMER PREFERRED SECURITIES AND INCOME FUND, a series of OPPENHEIMER INTEGRITY FUNDS (the “Fund”) is registered with the Securities and Exchange Commission (the “SEC”) as an open-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”);
WHEREAS, the Adviser is registered with the U.S. Securities and Exchange Commission (“SEC”) as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”) and is engaged in the business of rendering investment advice;
WHEREAS, the Adviser has, pursuant to an Investment Advisory Agreement with the Fund dated as of November 8, 2017, (the “Advisory Agreement”) been retained to act as investment adviser for the Fund;
WHEREAS, pursuant to the Advisory Agreement and subject to the supervision of the Board of Trustees, the Adviser shall administer the Fund’s business affairs and, in connection therewith, shall furnish the Fund with office facilities and with clerical, bookkeeping and recordkeeping services at such office facilities, as needed. The Adviser shall supervise continuously the investment program of the Fund;
WHEREAS, the Adviser (or a SubAdviser under the Adviser’s supervision) shall manage the investment operations of the Fund and the composition of the Fund’s portfolio, including the purchase, retention and disposition thereof, in accordance with the Fund’s investment objectives, policies and restrictions as stated in the Fund’s registration statement;
WHEREAS, the Advisory Agreement permits the Adviser to delegate certain of its duties under the Advisory Agreement subject to the requirements of the 1940 Act;
WHEREAS, the SubAdviser is registered with the SEC as an investment adviser under the Advisers Act and is engaged in the business of rendering investment advice; and
WHEREAS, the Adviser desires to retain SubAdviser to assist it in the provision of a continuous investment program for the Fund’s assets, and SubAdviser is willing to render such services subject to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, the parties do mutually agree and promise as follows:
1. Appointment as SubAdviser. The Adviser hereby retains the SubAdviser to act as SubAdviser of the Fund to provide investment advice to the Fund as hereinafter set forth, subject to the supervision of the Adviser and the Board of Trustees of the Fund and subject to the terms of this Agreement; and the SubAdviser hereby accepts such employment.
2. Duties of SubAdviser.
(a) Investments. The SubAdviser is hereby authorized and directed and hereby agrees, subject to the stated investment policies and restrictions of the Fund as set forth in the Fund’s prospectus, summary prospectus and/or statement of additional information, in each case as currently in effect and as supplemented or amended from time to time (collectively referred to hereinafter as the “Prospectus”) and subject to the directions and continuous oversight of the Adviser and the Fund’s Board of Trustees, to (i) regularly provide investment advice and recommendations to the Fund with respect to the Fund’s investments, investment policies and the purchase and sale of securities and other investments; (ii) supervise continuously the investment program of the Fund and the composition of its portfolio and determine what securities and other investments shall be purchased or sold by the Fund; (iii) monitor the performance of and supervise any sub-advisers and brokers and dealers to the extent deemed to be necessary or desirable, and (iv) arrange, subject to the provisions of paragraphs (c) and (d) below, for the purchase of securities, and other investments for the Fund and the sale of securities and other investments held in the portfolio of the Fund. The Adviser agrees to provide the SubAdviser with such assistance as may be reasonably requested by the SubAdviser in connection with its activities under this Agreement, including, without limitation, information concerning the Fund, its assets available, or to become available, for investment and generally as to the conditions of the Fund or the Fund’s affairs.
Provided that the Fund shall not be required to pay any compensation for services under this Agreement other than as provided by the terms of the Agreement and subject to the provisions of part (c) of paragraph 2 hereof, the SubAdviser may obtain investment information, research or assistance from any other person, firm or corporation to supplement, update or otherwise improve its investment management services including entering into sub-advisory agreements with other affiliated or unaffiliated registered investment advisors to perform investment advisory services with respect to the Fund, and to terminate any such sub-advisory agreements at any time to the extent permitted by law.
(b) Compliance with Applicable Laws and Governing Documents. In the performance of its duties and obligations under this Agreement or otherwise, the SubAdviser shall act in conformity with the Fund’s Declaration of Trust, By-Laws, procedures and policies adopted by the Board of the Fund and/or by the Adviser and the Prospectus and with the instructions and directions received in writing from the Adviser or the Board of Trustees of the Fund and will conform to and comply with the requirements of the 1940 Act, the Internal Revenue Code of 1986, as amended (the “Code”), and all other applicable federal and state laws and regulations necessary to allow the Fund to qualify as a “regulated investment company” as defined in Subchapter M of the Code. Notwithstanding the foregoing, the Adviser shall, subject to the SubAdviser’s compliance with its obligations, remain responsible for the Fund’s overall compliance with the 1940 Act, the Code and all other applicable federal and state laws and regulations.
(c) Brokerage.
(i) The Adviser and the SubAdviser are authorized, in arranging the Fund’s portfolio transactions, to employ or deal with such members of securities or commodities exchanges, brokers or dealers, including “affiliated” broker dealers (as that term is defined in the Investment Company Act) (hereinafter “broker-dealers”), as may, in their best judgment, implement the policy of the Fund to obtain, at reasonable expense, the “best execution” (prompt and reliable execution at the most favorable security price obtainable) of the Fund’s portfolio transactions as well as to obtain, consistent with the provisions of part (c) (iii) of section 2 of this Agreement, the benefit of such investment information or
research as may be of significant assistance to the performance by the SubAdviser of its investment management functions.
(ii) The SubAdviser shall select broker-dealers to effect the Fund’s portfolio transactions on the basis of its estimate of their ability to obtain best execution of particular and related portfolio transactions. The abilities of a broker-dealer to obtain best execution of particular portfolio transaction(s) will be judged by the SubAdviser on the basis of all relevant factors and considerations including, insofar as feasible, the execution capabilities required by the transaction or transactions; the ability and willingness of the broker-dealer to facilitate the Fund’s portfolio transactions by participating therein for its own account; the importance to the Fund of speed, efficiency or confidentiality; the broker-dealer’s apparent familiarity with sources from or to whom particular securities might be purchased or sold; as well as any other matters relevant to the selection of a broker-dealer for particular and related transactions of the Fund.
(iii) The SubAdviser shall have discretion, in the interests of the Fund, to allocate brokerage on the Fund’s portfolio transactions to broker-dealers other than affiliated broker-dealers, qualified to obtain best execution of such transactions who provide brokerage and/or research services (as such services are defined in Section 28(e) of the Securities Exchange Act of 1934) for the Fund and/or other accounts for which the SubAdviser and its affiliates exercise “investment discretion” (as that term is defined in the Securities Exchange Act of 1934) and to cause the Fund to pay such broker-dealers a commission for effecting a portfolio transaction for the Fund that is in excess of the amount of commission another broker-dealer adequately qualified to effect such transaction would have charged for effecting that transaction, if the SubAdviser determines, in good faith, that such commission is reasonable in relation to the value of the brokerage and/or research services provided by such broker-dealer, viewed in terms of either that particular transaction or the overall responsibilities of the SubAdviser and its investment advisory affiliates with respect to the accounts as to which they exercise investment discretion. In reaching such determination, the SubAdviser will not be required to place or attempt to place a specific dollar value on the brokerage and/or research services provided or being provided by such broker-dealer. In demonstrating that such determinations were made in good faith, the SubAdviser shall be prepared to show that all commissions were allocated for the purposes contemplated by this Agreement and that the total commissions paid by the Fund over a representative period selected by the Fund’s Board of Trustees were reasonable in relation to the benefits to the Fund.
(iv) The SubAdviser shall have no duty or obligation to seek advance competitive bidding for the most favorable commission rate applicable to any particular portfolio transactions or to select any broker-dealer on the basis of its purported or “posted” commission rate but will, to the best of its ability, endeavor to be aware of the current level of the charges of eligible broker-dealers and to minimize the expense incurred by the Fund for effecting its portfolio transactions to the extent consistent with the interests and policies of the Fund as established by the determinations of its Board of Trustees and the provisions of section 2 (c) of this Agreement.
(d) Books and Records. The SubAdviser shall maintain separate detailed records of all matters pertaining to the Fund (the “Fund’s Records”), including, without limitation, brokerage and other records of all securities transactions. The SubAdviser acknowledges that the Fund’s Records are property of the Fund. The Fund’s Records shall be available to the Fund, the Adviser, the SubAdviser and their respective agents at any time upon reasonable request during normal business hours and shall be available for telecopying without delay to the Adviser during any day that the Fund is open for business.
(e) Information Concerning the Fund and SubAdviser. From time to time as the Adviser or the Fund may request, the SubAdviser will furnish the requesting party information and reports on portfolio transactions and reports on Fund assets held in the portfolio, all in such detail, form and frequency as the Adviser or the Fund may reasonably request.
The SubAdviser will also provide the Adviser with notice and analysis of events that may affect or relate to the valuation of the Fund’s portfolio.
(f) Custody Arrangements. The SubAdviser shall on each business day provide the Adviser, the Fund and the Fund’s custodian(s) with such information as the Adviser, the Fund and the Fund’s custodian(s) may reasonably request relating to all transactions and portfolio holdings of the Fund.
3. Expenses. During the term of this Agreement, the SubAdviser will pay all expenses incurred by it in connection with its activities under this Agreement other than the cost of securities and other investments (including brokerage commissions and other transaction charges, if any) purchased or sold for the Fund. Provided that the Fund shall not be required to pay any compensation other than as provided by the terms of the Advisory Agreement, the SubAdviser may obtain investment information, research or assistance from any other person, firm or corporation to supplement, update or otherwise improve its investment management services. Except as otherwise provided in this Agreement or by law, the SubAdviser shall not be responsible for the Fund’s or Adviser’s expenses, which shall include, but not be limited to, organizational and offering expenses (which include out-of-pocket expenses, but not overhead or employee costs of the SubAdviser); expenses for legal, accounting and auditing services; taxes and governmental fees; dues and expenses incurred in connection with membership in investment company organizations; costs of printing and distributing shareholder reports, proxy materials, Prospectuses, stock certificates and distribution of dividends; charges of the Fund’s custodians and sub-custodians, administrators and sub-administrators, registrars, transfer agents, dividend disbursing agents and dividend reinvestment plan agents; payment for portfolio pricing services to a pricing agent, if any; registration and filing fees of the SEC; expenses of registering or qualifying securities of the Fund for sale in the various states; freight and other charges in connection with the shipment of the Fund’s portfolio securities; fees and expenses of non-interested Trustees; salaries of shareholder relations personnel; costs of shareholders meetings; insurance; interest; brokerage costs; and litigation and other extraordinary or non-recurring expenses.
4. Compensation. For the services provided and the expenses assumed with respect to the Fund pursuant to this Agreement, the SubAdviser will be entitled to the fee set forth for the Fund on Exhibit A (“SubAdvisory Fee”). The SubAdvisory Fee will be calculated as described in Exhibit A.
5. Representations and Warranties of SubAdviser. The SubAdviser represents and warrants to the Adviser and the Fund as follows:
(a) The SubAdviser is registered with the SEC as an investment adviser under the Advisers Act;
(b) The SubAdviser is or will be registered as a Commodity Trading Advisor (“CTA”) and a Commodity Pool Operator (“CPO”) under the Commodity Exchange Act (the “CEA”) with the Commodity Futures Trading Commission (the “CFTC”) and the National Futures Association (“NFA”), or is not required to register pursuant to an applicable exemption;
(c) The SubAdviser is a corporation duly organized and properly registered and operating under the laws of the State of Colorado with the power to own and possess its assets, perform its obligations under this Agreement, and to carry on its business as it is now being, and to be, conducted;
(d) The execution, delivery and performance by the SubAdviser of this Agreement are within the SubAdviser’s powers and have been duly authorized by all necessary action and no action by or in respect of, or filing with, any governmental body, agency or official is required on the part of the SubAdviser for the execution, delivery and performance by the SubAdviser of this Agreement, and the execution, delivery and performance by the SubAdviser of this Agreement do not contravene or constitute a default under (i) any provision of applicable law, rule or regulation, (ii) the SubAdviser’s governing instruments, or (iii) any agreement, judgment, injunction, order, decree or other instrument binding upon the SubAdviser;
(e) The Form ADV of the SubAdviser previously provided to the Adviser and all amendments to the SubAdviser’s Form ADV to be provided to Adviser is or will be a true and complete copy of the form as currently filed or as then filed with the SEC and the information contained therein is accurate and complete in all material respects and does not omit to state any material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.
6. Representations and Warranties of Adviser. The Adviser represents and warrants to the SubAdviser as follows:
(a) The Adviser is registered with the SEC as an investment adviser under the Advisers Act;
(b) The Adviser is or will be registered as a CTA and a CPO under the CEA with the CFTC and the NFA or is not required to register pursuant to an applicable exemption;
(c) The Adviser is a corporation duly organized and validly existing under the laws of the State of Delaware with the power to own and possess its assets, perform its obligations under this Agreement, and to carry on its business as it is now being, and to be, conducted;
(d) The execution, delivery and performance by the Adviser of this Agreement are within the Adviser’s powers and have been duly authorized by all necessary action, and no action by or in respect of, or filing with, any governmental body, agency or official is required on the part of the Adviser for the execution, delivery and performance by the Adviser of this Agreement, and the execution, delivery and performance by the Adviser of this Agreement do not contravene or constitute a default under (i) any provision of applicable law, rule or regulation, (ii) the Adviser’s governing instruments, or (iii) any agreement, judgment, injunction, order, decree or other instrument binding upon the Adviser;
(e) The Adviser acknowledges that it received a copy of the SubAdviser’s Form ADV prior to the execution of this Agreement;
(f) The Adviser and the Fund have duly entered into the Advisory Agreement pursuant to which the Fund authorized the Adviser to enter into this Agreement; and
(g) The Adviser will take such steps as are necessary to ensure that the Fund’s shares are duly authorized and registered for sale to the extent that such shares are offered for sale.
7. Survival of Representations and Warranties; Duty to Update Information. All representations and warranties made by the SubAdviser and the Adviser pursuant to Sections 5 and 6, respectively, shall survive the termination of this Agreement. The parties hereto shall promptly notify each other in writing upon becoming aware that any of the foregoing representations and warranties are no longer true and the SubAdviser shall promptly update all information and documents which the SubAdviser is required to provide to the Adviser hereunder.
8. Liability. The SubAdviser shall exercise its best judgment in rendering the services in accordance with the terms of this Agreement. Provided that nothing herein shall be deemed to protect the SubAdviser from willful misfeasance, bad faith or gross negligence in the performance of its duties, or reckless disregard of its obligations and duties under this Agreement, the SubAdviser shall not be liable for any loss sustained by reason of good faith errors or omissions in connection with any matters to which this Agreement relates.
9. Duration and Termination.
(a) Duration. This Agreement will take effect on the date first set forth above. Unless sooner terminated, this Agreement shall remain in effect until two years from the date first set forth above, and thereafter shall continue automatically for successive annual periods, provided such continuance is specifically approved at least annually by the Fund’s Board of Trustees or by vote of a majority of the outstanding voting securities of the Fund (as defined in the 1940 Act); provided that in either event its continuance also is approved by a majority of the Fund’s Board of Trustees who are not “interested persons” (as defined in the 1940 Act) of any party to this Agreement, by vote cast in person at a meeting called for the purpose of voting on such approval.
(b) Termination. Notwithstanding whatever may be provided herein to the contrary, this Agreement may be terminated at any time, without payment of any penalty:
(i) By vote of a majority of the Fund’s Board of Trustees, or by vote of a majority of the outstanding voting securities of the Fund, or by the Adviser, in each case, upon at least 60 days’ written notice to the SubAdviser;
(ii) By the non-defaulting party immediately upon receipt of written notice from the non-defaulting party to the defaulting party in the event of a breach of any provision of this Agreement by the defaulting party; or
(iii) By the SubAdviser upon at least 60 days’ written notice to the Adviser and the Fund.
The notice provided for in (i) and (iii) above may be waived by the party required to be notified.
This Agreement shall not be assigned (as such term is defined in the 1940 Act) and shall terminate automatically in the event of its assignment or upon the termination of the Advisory Agreement.
(c) Transactions in Progress Upon Termination. The Adviser and SubAdviser will cooperate with each other to ensure that portfolio securities or other transactions in progress at the date of termination of this Agreement shall be completed by the SubAdviser in accordance with the terms of
such transactions, and to this end the SubAdviser shall provide the Adviser with all necessary information and documentation to secure the implementation thereof.
10. Duties of the Adviser. The Adviser shall continue to have responsibility for all services to be provided to the Fund pursuant to the Advisory Agreement and shall oversee and review the SubAdviser’s performance of its duties under this Agreement.
11. Amendment. This Agreement may be amended only by mutual consent of the parties, provided that the terms of any material amendment shall be approved by: a) the Fund’s Board of Trustees or by a vote of a majority of the outstanding voting securities of the Fund (as required by the 1940 Act), and b) the vote of a majority of the Fund’s Board of Trustees who are not “interested persons” of any party to this Agreement cast in person at a meeting called for the purpose of voting on such approval, if such approval is required by applicable law.
12. Confidentiality. Subject to the duties of the SubAdviser to comply with applicable law, including any demand of any regulatory or taxing authority having jurisdiction, the SubAdviser shall treat as confidential all information pertaining to the Fund and the actions of the SubAdviser, the Adviser and the Fund in respect thereof.
13. Notice. Any notice that is required to be given by the parties to each other under the terms of this Agreement shall be in writing, delivered, or mailed postpaid to the other parties, or transmitted by facsimile with acknowledgment of receipt, to the parties at the following addresses or facsimile numbers, which may from time to time be changed by the parties by notice to the other party:
(a) | If to the SubAdviser: |
OppenheimerFunds, Inc.
225 Liberty Street
New York, NY 10281-1008
Attn: Chief Legal Officer
Facsimile: (212) 323-4070
(b) If to the Adviser:
OFI Global Asset Management, Inc.
225 Liberty Street
New York, NY 10281-1008
Attn: Executive Vice President, General Counsel & Secretary
Facsimile: (212) 323-4070
Such notice shall be deemed effective when provided in accordance with this section 13.
14. Jurisdiction. This Agreement shall be governed by and construed consistent with the Advisory Agreement and in accordance with substantive laws of the State of New York without reference to choice of law principles thereof and in accordance with the 1940 Act. In the case of any conflict, the 1940 Act shall control.
15. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, all of which shall together constitute one and the same instrument.
16. Certain Definitions. The terms and provisions of this Agreement shall be interpreted and defined in a manner consistent with the provisions and definitions of the 1940 Act.
17. Captions. The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof.
18. Severability. If any provision of this Agreement shall be held or made invalid by a court decision or applicable law, the remainder of the Agreement shall not be affected adversely and shall remain in full force and effect.
19. Survival. The provisions of Sections 2(d), 7, 8, 9(e), 10(c), 12, and 13 will survive termination of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first written above.
ADVISER:
OFI GLOBAL ASSET MANAGEMENT, INC.
By: /s/ Taylor V. Edwards
Name: Taylor V. Edwards
Title: Senior Vice President
SUBADVISER:
OPPENHEIMERFUNDS, INC.
By: /s/ Cynthia Lo Bessette
Name: Cynthia Lo Bessette
Title: Chief Legal Officer
EXHIBIT A
TO SUBADVISORY AGREEMENT
SubAdvisory Fee
The Adviser will pay the SubAdviser a SubAdvisory Fee calculated in the same manner as the investment management fee paid by the Fund to the Adviser under the Advisory Agreement, which SubAdvisory Fee shall not exceed 90% of the investment management fee collected by the Adviser from the Fund, and which shall be calculated after any investment management fee waivers (i) required by the Fund’s Board of Trustees or (ii) voluntarily agreed to by both the Adviser and the SubAdviser.
GENERAL DISTRIBUTOR’S AGREEMENT
BETWEEN
OPPENHEIMER PREFERRED SECURITIES AND INCOME FUND,
A SERIES OF OPPENHEIMER INTEGRITY FUNDS
AND
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
Date: November 8, 2017
OPPENHEIMERFUNDS DISTRIBUTOR, INC.
225 Liberty Street
New York, New York 10281-1008
To Whom It May Concern:
OPPENHEIMER PREFERRED SECURITIES AND INCOME FUND, A SERIES OF OPPENHEIMER INTEGRITY FUNDS, a Delaware statutory trust (the “Fund”), is registered as an investment company under the Investment Company Act of 1940 (the “1940 Act”), consisting of one or more series (“Series”) and an indefinite number of one or more classes of its shares of beneficial interest for each Series (“Shares”) have been registered under the Securities Act of 1933 (the “1933 Act”) to be offered for sale to the public in a continuous public offering in accordance with the terms and conditions set forth in the Prospectus and Statement of Additional Information (“SAI”) included in the Fund’s Registration Statement as it may be amended from time to time (the “current Prospectus and/or SAI”).
In this connection, the Fund desires that your firm (the “General Distributor”) act in a principal capacity as General Distributor for the sale and distribution of Shares which have been registered as described above and of any additional Shares which may become registered during the term of this Agreement. You have advised the Fund that you are willing to act as such General Distributor, and it is accordingly agreed by and between us as follows:
1. Appointment of the Distributor. The Fund hereby appoints you as the sole General Distributor, pursuant to the aforesaid continuous public offering of its Shares, and the Fund further agrees from and after the date of this Agreement, that it will not, without your consent, sell or agree to sell any Shares otherwise than through you, except (a) the Fund may itself sell shares without sales charge as an investment to the officers, trustees or directors and bona fide present and former full-time employees of the Fund, the Fund’s Investment Adviser and affiliates thereof, and to other investors who are identified in the current Prospectus and/or SAI as having the privilege to buy Shares at net asset value; (b) the Fund may issue shares in connection with a merger, consolidation or acquisition of assets on such basis as may be authorized or permitted under the 1940 Act; (c) the Fund may issue shares for the reinvestment of dividends and other
distributions of the Fund or of any other Fund if permitted by the current Prospectus and/or SAI; and (d) the Fund may issue shares as underlying securities of a unit investment trust if such unit investment trust has elected to use Shares as an underlying investment; provided that in no event as to any of the foregoing exceptions shall Shares be issued and sold at less than the then-existing net asset value.
2. Sale of Shares. You hereby accept such appointment and agree to use your best efforts to sell Shares, provided, however, that when requested by the Fund at any time because of market or other economic considerations or abnormal circumstances of any kind, or when agreed to by mutual consent of the Fund and the General Distributor, you will suspend such efforts. The Fund may also withdraw the offering of Shares at any time when required by the provisions of any statute, order, rule or regulation of any governmental body having jurisdiction. It is understood that you do not undertake to sell all or any specific number of Shares.
3. Sales Charge. Shares shall be sold by you at net asset value plus a front-end sales charge not in excess of 8.5% of the offering price, but which front-end sales charge shall be proportionately reduced or eliminated for larger sales and under other circumstances, in each case on the basis set forth in the current Prospectus and/or SAI. The redemption proceeds of shares offered and sold at net asset value with or without a front-end sales charge may be subject to a contingent deferred sales charge (“CDSC”) under the circumstances described in the current Prospectus and\or SAI. You may reallow such portion of the front-end sales charge to dealers or cause payment (which may exceed the front-end sales charge, if any) of commissions to brokers through which sales are made, as you may determine, and you may pay such amounts to dealers and brokers on sales of shares from your own resources (such dealers and brokers shall collectively include all domestic or foreign institutions eligible to offer and sell the Shares), and in the event the Fund has more than one Series or class of Shares outstanding, then you may impose a front-end sales charge and/or a CDSC on Shares of one Series or one class that is different from the charges imposed on Shares of the Fund’s other Series or class(es), in each case as set forth in the current Prospectus and/or SAI, provided the front-end sales charge and CDSC to the ultimate purchaser do not exceed the respective levels set forth for such category of purchaser in the current Prospectus and/or SAI.
4. Purchase of Shares.
(a) | As General Distributor, you shall have the right to accept or reject orders for the purchase of Shares at your discretion. Any consideration which you may receive in connection with a rejected purchase order will be returned promptly. |
(b) | You agree promptly to issue or to cause the duly appointed transfer or shareholder servicing agent of the Fund to issue as your agent confirmations of all accepted purchase orders and to transmit a copy of such confirmations to the Fund. The net asset value of all Shares which are the subject of such confirmations, computed in accordance with the applicable rules under the 1940 Act, shall be a liability of the General Distributor to the Fund to be paid promptly after receipt of payment from the originating dealer or broker (or investor, in the case of direct purchases) and not later than eleven business days after such confirmation even if you have not actually |
received payment from the originating dealer or broker, or investor. In no event shall the General Distributor make payment to the Fund later than permitted by applicable rules of the National Association of Securities Dealers, Inc.
(c) | If the originating dealer or broker shall fail to make timely settlement of its purchase order in accordance with applicable rules of the Financial Industry Regulatory Authority (FINRA) or if a direct purchaser shall fail to make good payment for shares in a timely manner, you shall have the right to cancel such purchase order and, at your account and risk, to hold responsible the originating dealer or broker, or investor. You agree promptly to reimburse the Fund for losses suffered by it that are attributable to any such cancellation, or to errors on your part in relation to the effective date of accepted purchase orders, limited to the amount that such losses exceed contemporaneous gains realized by the Fund for either of such reasons with respect to other purchase orders. |
(d) | In the case of a canceled purchase for the account of a directly purchasing shareholder, the Fund agrees that if such investor fails to make you whole for any loss you pay to the Fund on such canceled purchase order, the Fund will reimburse you for such loss to the extent of the aggregate redemption proceeds of any other shares of the Fund owned by such investor, on your demand that the Fund exercise its right to claim such redemption proceeds. The Fund shall register or cause to be registered all Shares sold to you pursuant to the provisions hereof in such names and amounts as you may request from time to time and the Fund shall issue or cause to be issued certificates evidencing such Shares for delivery to you or pursuant to your direction if and to the extent that the shareholder account in question contemplates the issuance of such certificates. All Shares, when so issued and paid for, shall be fully paid and non-assessable by the Fund (which shall not prevent the imposition of any CDSC that may apply) to the extent set forth in the current Prospectus and/or SAI. |
5. Repurchase of Shares.
(a) | In connection with the repurchase of Shares, you are appointed and shall act as Agent of the Fund. You are authorized, for so long as you act as General Distributor of the Fund, to repurchase, from authorized dealers, certificated or uncertificated shares of the Fund (“Shares”) on the basis of orders received from each dealer (“authorized dealer”) with which you have a dealer agreement for the sale of Shares and permitting resales of Shares to you, provided that such authorized dealer, at the time of placing such resale order, shall represent (i) if such Shares are represented by certificate(s), that certificate(s) for the Shares to be repurchased have been delivered to it by the registered owner with a request for the redemption of such Shares executed in the manner and with the signature guarantee required by the then-currently effective prospectus of the Fund, or (ii) if such Shares are uncertificated, that the registered owner(s) has delivered to the dealer a request for the redemption of such Shares executed in the manner and with the signature guarantee required by the then-currently effective prospectus of the Fund. |
(b) | You shall (a) have the right in your discretion to accept or reject orders for the repurchase of Shares; (b) promptly transmit confirmations of all accepted repurchase orders; and (c) transmit a copy of such confirmation to the Fund, or, if so directed, to any duly appointed transfer or shareholder servicing agent of the Fund. In your discretion, you may accept repurchase requests made by a financially responsible dealer which provides you with indemnification in form satisfactory to you in consideration of your acceptance of such dealer’s request in lieu of the written redemption request of the owner of the account; you agree that the Fund shall be a third party beneficiary of such indemnification. |
(c) | Upon receipt by the Fund or its duly appointed transfer or shareholder servicing agent of any certificate(s) (if any has been issued) for repurchased Shares and a written redemption request of the registered owner(s) of such Shares executed in the manner and bearing the signature guarantee required by the then-currently effective Prospectus or SAI of the Fund, the Fund will pay or cause its duly appointed transfer or shareholder servicing agent promptly to pay to the originating authorized dealer the redemption price of the repurchased Shares (other than repurchased Shares subject to the provisions of part (d) of Section 5 of this Agreement) next determined after your receipt of the dealer’s repurchase order. |
(d) | Notwithstanding the provisions of part (c) of Section 5 of this Agreement, repurchase orders received from an authorized dealer after the determination of the Fund’s redemption price on a regular business day will receive that day’s redemption price if the request to the dealer by its customer to arrange such repurchase prior to the determination of the Fund’s redemption price that day complies with the requirements governing such requests as stated in the current Prospectus and/or SAI. |
(e) | You will make every reasonable effort and take all reasonably available measures to assure the accurate performance of all services to be performed by you hereunder within the requirements of any statute, rule or regulation pertaining to the redemption of shares of a regulated investment company and any requirements set forth in the then-current Prospectus and/or SAI of the Fund. You shall correct any error or omission made by you in the performance of your duties hereunder of which you shall have received notice in writing and any necessary substantiating data; and you shall hold the Fund harmless from the effect of any errors or omissions which might cause an over- or under-redemption of the Fund’s Shares and/or an excess or non-payment of dividends, capital gains distributions, or other distributions. |
(f) | In the event an authorized dealer initiating a repurchase order shall fail to make delivery or otherwise settle such order in accordance with the rules of the Financial Industry Regulatory Authority (FINRA) you shall have the right to cancel such repurchase order and, at your account and risk, to hold responsible the originating dealer. In the event that any cancellation of a Share repurchase order or any error in the timing of the acceptance of a Share repurchase order shall result in a gain or loss |
to the Fund, you agree promptly to reimburse the Fund for any amount by which any losses shall exceed then-existing gains so arising.
6. 1933 Act Registration. The Fund has delivered to you a copy of its current Prospectus and SAI. The Fund agrees that it will use its best efforts to continue the effectiveness of the Registration Statement under the 1933 Act. The Fund further agrees to prepare and file any amendments to its Registration Statement as may be necessary and any supplemental data in order to comply with the 1933 Act. The Fund will furnish you at your expense with a reasonable number of copies of the Prospectus and SAI and any amendments thereto for use in connection with the sale of Shares.
7. 1940 Act Registration. The Fund has already registered under the 1940 Act as an investment company, and it will use its best efforts to maintain such registration and to comply with the requirements of the 1940 Act.
8. State Blue Sky Qualification. At your request, the Fund will take such steps as may be necessary and feasible to qualify Shares for sale in states, territories or dependencies of the United States, the District of Columbia, the Commonwealth of Puerto Rico and in foreign countries, in accordance with the laws thereof, and to renew or extend any such qualification; provided, however, that the Fund shall not be required to qualify shares or to maintain the qualification of shares in any jurisdiction where it shall deem such qualification disadvantageous to the Fund.
9. Duties of Distributor. You agree that:
(a) | Neither you nor any of your officers will take any long or short position in the Shares, but this provision shall not prevent you or your officers from acquiring Shares for investment purposes only; |
(b) | You shall furnish to the Fund any pertinent information required to be inserted with respect to you as General Distributor within the purview of the Securities Act of 1933 in any reports or registration required to be filed with any governmental authority; and |
(c) | You will not make any representations inconsistent with the information contained in the current Prospectus and/or SAI. |
(d) | You shall maintain such records as may be reasonably required for the Fund or its transfer or shareholder servicing agent to respond to shareholder requests or complaints, and to permit the Fund to maintain proper accounting records, and you shall make such records available to the Fund and its transfer agent or shareholder servicing agent upon request. |
(e) | In performing under this Agreement, you shall comply with all requirements of the Fund’s current Prospectus and/or SAI and all applicable laws, rules and regulations with respect to the purchase, sale and distribution of Shares. |
10. Allocation of Costs. The Fund shall pay the cost of composition and printing of sufficient copies of its Prospectus and SAI as shall be required for periodic distribution to its shareholders and the expense of registering Shares for sale under federal securities laws, state blue sky laws, and the laws of the District of Columbia, any territory, commonwealth, or possession of the United States, and any foreign country. You shall pay the expenses normally attributable to the sale of Shares, other than as paid under the Fund’s Distribution Plan under Rule 12b-1 of the 1940 Act, including the cost of printing and mailing of the Prospectus (other than those furnished to existing shareholders) and any sales literature used by you in the public sale of the Shares.
11. Duration. This Agreement shall take effect on the date first written above, and shall supersede any and all prior General Distributor’s Agreements by and among the Fund and you. Unless earlier terminated pursuant to paragraph 12 hereof, this Agreement shall remain in effect until two years from the date of execution hereof, and hereinafter will continue in effect from year to year, provided that such continuance shall be specifically approved at least annually: (a) by the Fund’s Board of Trustees or by vote of a majority of the voting securities of the Fund; and (b) by the vote of a majority of the Trustees, who are not parties to this Agreement or “interested persons” (as defined in the 1940 Act) of any such person, cast in person at a meeting called for the purpose of voting on such approval.
12. Termination. This Agreement may be terminated (a) by the General Distributor at any time without penalty by giving sixty days’ written notice (which notice may be waived by the Fund); (b) by the Fund at any time without penalty upon sixty days’ written notice to the General Distributor (which notice may be waived by the General Distributor); or (c) by mutual consent of the Fund and the General Distributor, provided that such termination by the Fund shall be directed or approved by the Board of Trustees of the Fund or by the vote of the holders of a majority of the outstanding voting securities of the Fund. In the event this Agreement is terminated by the Fund, the General Distributor shall be entitled to be paid the CDSC under paragraph 3 hereof on the redemption proceeds of Shares sold prior to the effective date of such termination.
13. Assignment. This Agreement may not be amended or changed except in writing and shall be binding upon and shall enure to the benefit of the parties hereto and their respective successors; however, this Agreement shall not be assigned by either party and shall automatically terminate upon assignment.
14. Disclaimer of Shareholder Liability. The General Distributor understands and agrees that the obligations of the Fund under this Agreement are not binding upon any Trustee or shareholder of the Fund personally, but bind only the Fund and the Fund’s property; the General Distributor represents that it has notice of the provisions of the Declaration of Trust, as may be amended or restated from time to time, of the Fund disclaiming trustee and shareholder liability for acts or obligations of the Fund.
15. Section Headings. The headings of each section is for descriptive purposes only, and such headings are not to be construed or interpreted as part of this Agreement.
If the foregoing is in accordance with your understanding, so indicate by signing in the space provided below.
Oppenheimer Preferred Securities and Income Fund, a Series of Oppenheimer Integrity Funds
By: /s/ Cynthia Lo Bessette
Cynthia Lo Bessette
Secretary and Chief Legal Officer
Accepted:
OppenheimerFunds Distributor, Inc.
By: /s/ John McDonough
John McDonough
Chairman, Chief Executive Officer,
President and Director
FORM OF
AMENDMENT
TO
GLOBAL CUSTODY AGREEMENT
This amendment (“Amendment”), dated ____________, 2018, amends the Global Custody Agreement (“the Agreement”) dated August 16, 2002 between OppenheimerFunds, Inc. (“OFI”), on behalf of each investment company identified as Customer in Exhibit A attached thereto individually and severally, and not jointly and severally, and JPMorgan Chase Bank, N.A. (“Bank”). Capitalized terms used and not defined herein shall such meanings ascribed to them in the Agreement.
WHEREAS, the parties desire to update Exhibits A and A-1 to the Agreement in order to update the list of Customers for which OFI is the investment adviser; and
ACCORDINGLY, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties, intending to be legally bound, agree as follows:
1. | As of the Effective Date, Exhibit A to the Agreement is hereby deleted and replaced in its entirety with Exhibit A attached hereto. |
2. | As of the Effective Date, Exhibit A-1 to the Agreement is hereby deleted and replaced in its entirety with Exhibit A-1 attached hereto. |
3. | Exhibits A and A-1 to the Agreement may be amended from time to time to add, remove or change the name of any Customer; |
4. | OppenheimerFunds, Inc. represents and warrants it has the authority to act on behalf of each Customer listed on Exhibit A and to deposit and control the Financial Assets and Cash in the Accounts of such Customer and to engage Bank on behalf of such Customer as custodian in accordance with the terms of the Agreement. |
5. | OFI SteelPath Inc. represents and warrants it has the authority to act on behalf of each Customer listed on Exhibit A-1 and to deposit and control the Financial Assets and Cash in the Accounts of such Customer and to engage Bank on behalf of such Customer as custodian in accordance with the terms of the Agreement. |
6. | This Amendment may be executed in counterparts and in electronic form, each of which shall be deemed to be an original, and all of which taken together shall constitute one and the same instrument. |
[Remainder intentionally left blank]
IN WITNESS WHEREOF, the parties have executed this Amendment on the respective dates specified below with effect from the date first specified on the first page of this Amendment.
JPMORGAN CHASE BANK, N.A.
By:
Name: AnnaMaria Calla Minniti
Title: Vice President
JPMorgan Chase Bank, N.A.
OPPENHEIMERFUNDS, INC.,
on behalf of each Customer listed on Exhibit A, individually and severally, and not jointly and severally, for which it acts as investment adviser
By:
Name: Kathleen Schmitz
Title: Assistant Vice President OppenheimerFunds, Inc.
EXHIBIT A
List of Customers for which OppenheimerFunds, Inc. is the investment adviser
Account # | Fund Name |
P84570 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Global Strategic Income Fund/VA |
P84573 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Main Street Small Cap Fund/VA |
P84575 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Global Fund/VA |
P56973 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Capital Appreciation Fund/VA |
P84576 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer International Growth Fund/VA |
P56975 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Discovery Mid Cap Growth Fund/VA |
P84577 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Total Return Bond Fund/VA |
P56976 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Government Money Fund/VA |
P84580 | Oppenheimer Variable Account Funds For The Account Of Oppenheimer Conservative Balanced Fund/VA |
P84568 | Oppenheimer Global Strategic Income Fund |
P84572 | Oppenheimer Total Return Bond Fund |
P56970 | Oppenheimer Capital Appreciation Fund |
P84574 | Oppenheimer Global Fund |
P84579 | Oppenheimer Main Street Fund/VA |
P65192 | Oppenheimer Global Value Fund |
P84582 | Oppenheimer Developing Markets Fund |
P84583 | Oppenheimer International Small-Mid Company Fund |
P84584 | Oppenheimer International Growth Fund |
P84585 | Oppenheimer Main Street Mid Cap Fund |
P84586 | Oppenheimer International Bond Fund |
P87705 | Oppenheimer Global Multi Strategies Fund |
P73542 | Oppenheimer Master Event-Linked Bond Fund, LLC |
P05192 | Oppenheimer Corporate Bond Fund |
P09085 | Oppenheimer Emerging Markets Local Debt Fund |
P30222 | Oppenheimer Global High Yield Fund |
P40189 | Oppenheimer Main Street Small Cap Fund |
P26729 | Oppenheimer Global Multi-Alternatives Fund/VA |
P90403 | Oppenheimer Emerging Markets Innovators Fund |
P97265 | Oppenheimer Global Multi-Asset Income Fund |
P29613 | Oppenheimer Global Multi-Asset Growth Fund |
P35195 | Oppenheimer Small Cap Value Fund |
P59605 | Oppenheimer Macquarie Global Infrastructure Fund |
P68993 | Oppenheimer International Growth and Income Fund |
P91712 | Oppenheimer Capital Income Fund |
P91713 | Oppenheimer Fundamental Alternatives Fund |
P91714 | Oppenheimer Global Multi-Alternatives Fund |
P91715 | Oppenheimer Global Allocation Fund |
P91716 | Oppenheimer Gold & Special Minerals Fund |
P44438 | Oppenheimer Global Unconstrained Bond Fund |
P46132 | Oppenheimer Preferred Securities and Income Fund |
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first above written with effect from the Effective Date.
JPMORGAN CHASE BANK, N.A.
By:
Name: AnnaMaria Calla Minniti
Title: Vice President
JPMorgan Chase Bank, N.A.
OPPENHEIMERFUNDS, INC.
on behalf of each Customer listed on Exhibit A, individually and severally, and not jointly and severally, for which it acts as investment adviser
By:
Name: Kathleen Schmitz
Title: Assistant Vice President
OFI STEELPATH, INC.
on behalf of each Customer listed on Exhibit A-1, individually and severally, and not jointly and severally, for which it acts as investment adviser
By:
Title: Assistant Vice President
EXHIBIT A-1
List of Customers for which OFI Steelpath, Inc. is the investment adviser
P33617 | Oppenheimer SteelPath Panoramic Fund |
P42784 | Oppenheimer SteelPath MLP & Energy Infrastructure Fund |
February 2, 2018
Oppenheimer Preferred Securities and Income Fund
6803 S. Tucson Way
Centennial, CO 80112
Ladies and Gentlemen:
We have acted as counsel to Oppenheimer Preferred Securities and Income Fund (the “Fund”), a series of Oppenheimer Integrity Funds, a Delaware statutory trust (the “Trust”), in connection with Post-Effective Amendment No. 72 (the “Post-Effective Amendment”) to the Trust’s registration statement on Form N-1A (File Nos. 002-76547; 811-03420) (the “Registration Statement”), to be filed with the U.S. Securities and Exchange Commission (the “Commission”) on or about February 2, 2018, registering an indefinite number of shares of beneficial interest (the “Shares”) of the Fund under the Securities Act of 1933, as amended (the “Securities Act”).
This opinion letter is being delivered at your request in accordance with the requirements of paragraph 29 of Schedule A of the Securities Act and Item 28(i) of Form N-1A under the Securities Act and the Investment Company Act of 1940, as amended (the “Investment Company Act”).
For purposes of rendering this opinion, we have examined the prospectus and statement of additional information for the Fund (collectively, the “Prospectus”) to be filed as part of the Post-Effective Amendment; the Certificate of Trust for the Trust as filed in the Office of the Secretary of State of the State of Delaware on August 15, 2012 (the “Certificate”); the Agreement and Declaration of Trust for the Trust dated as of August 15, 2012, and schedule A to the Agreement and Declaration of Trust, as amended on November 8, 2017 (the “Governing Instrument”); the By-laws of the Trust dated as of August 15, 2012 (the “By-laws”); the resolutions adopted by the Trust’s Board of Trustees (“Board”) at a meeting of the Board duly called and held on November 7, 2017 (at which a quorum was present and acting throughout and provided for the establishment of the Fund and issuance of the Shares) (the “Resolutions” and, collectively with the Governing Instrument and the By-laws, the “Governing Documents”). We have made such other investigation as we have deemed appropriate. We have examined and relied upon certificates of public officials and, as to certain matters of fact that are material to our opinions, we have also relied on a certificate of an officer of the Trust. For purposes of this opinion letter, we have assumed the accuracy and completeness of each document submitted to us, the genuineness of all signatures on original documents, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as facsimile, electronic,
certified, conformed, or photostatic copies thereof, and the due execution and delivery of all documents where due execution and delivery are prerequisites to the effectiveness thereof. We have further assumed the legal capacity of natural persons, that persons identified to us as officers of the Trust are actually serving in such capacity, and that the representations of officers of the Trust are correct as to matters of fact. We have not independently verified any of these assumptions. Insofar as the opinion relates to matters that are governed by the laws of the State of Delaware, we have relied, with your consent, solely on the opinion of Morris, Nichols, Arsht & Tunnell LLP, a copy of which is being provided concurrently to you. In rendering our opinion, we also have made the assumptions that are customary in opinion letters of this kind. We have not verified any of those assumptions.
Our opinion, as set forth herein, is based on the facts in existence and the laws in effect on the date hereof and is limited to the federal laws of the United States of America and the laws of the State of Delaware that, in our experience, generally are applicable to the issuance of shares by entities such as the Fund. We express no opinion with respect to any other laws.
Based upon and subject to the foregoing, we are of the opinion that:
1. | The Shares to be issued pursuant to the Registration Statement have been duly authorized for issuance by the Fund; and |
2. | When issued and paid for upon the terms provided in the Registration Statement, the Shares to be issued pursuant to the Registration Statement will be validly issued, fully paid and non-assessable. |
This opinion is rendered solely in connection with the filing of the Registration Statement. We hereby consent to the filing of this opinion with the SEC in connection with the Registration Statement and to the reference to this firm in the Registration Statement. In giving our consent, we do not thereby admit that we are experts with respect to any part of the Registration Statement or Prospectus within the meaning of the term “expert” as used in Section 11 of the Securities Act or the rules and regulations promulgated thereunder by the Commission, nor do we admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/Ropes & Gray LLP
Ropes & Gray LLP
[Morris, Nichols, Arsht & Tunnell LLP Letterhead]
February 2, 2018
Oppenheimer Integrity Funds
6803 South Tucson Way
Centennial, CO 80112-3924
Re: Oppenheimer Integrity Funds
Ladies and Gentlemen:
We have acted as special Delaware counsel to Oppenheimer Integrity Funds, a Delaware statutory trust (the “Trust”), in connection with certain matters of Delaware law relating to the issuance of Shares of Class A, Class T, Class C, Class R, Class Y and Class I (the “New Classes”), each a Class of Oppenheimer Preferred Securities and Income Fund (the “Fund”), a Series of the Trust (the “Registered Shares”). Capitalized terms used herein and not otherwise herein defined are used as defined in the Agreement and Declaration of Trust of the Trust dated as of August 15, 2012 (the “Governing Instrument”).
In rendering this opinion, we have examined and relied on copies of the following documents, each in the form provided to us: Post-Effective Amendment No. 72 to the Registration Statement of the Trust under the Securities Act of 1933 on Form N-1A (File Nos. 002-76547; 811-03420) filed with the Securities and Exchange Commission on or about February 2, 2018 (the “Registration Statement”); the Certificate of Trust of the Trust (the “Certificate”) as filed in the Office of the Secretary of State of the State of Delaware (the “State Office”) on August 15, 2012; the Governing Instrument; Schedule A to the Governing Instrument as of November 8, 2017 (“Schedule A as of November 8, 2017”); the By-Laws of the Trust effective as of August 15, 2012 (the “By-Laws”); resolutions of the Board of Trustees of the Trust (the “Board”) adopted at a meeting of the Trustees held on November 7, 2017 (the “Resolutions” and together with the Governing Instrument, the By-Laws and the Registration Statement, the “Governing Documents”); and a certification of good standing of the Trust obtained as of a recent date from the State Office. In such examinations, we have assumed the genuineness of all signatures, the conformity to original documents of all documents submitted to us as copies or drafts of documents to be executed, and the legal capacity of natural persons to complete the execution of documents. We have further assumed for purposes of this opinion: (i) the due formation or organization, valid existence and good standing of each entity that is a signatory to any of the documents reviewed by us under the laws of the jurisdiction of its respective formation or organization; (ii) the due adoption, authorization, execution and delivery
by, or on behalf of, each of the parties thereto of the above-referenced agreements, instruments, certificates and other documents (including, without limitation, the due adoption by the Board of Trustees of the Resolutions) and of all documents contemplated by the Governing Documents to be executed by investors desiring to become Shareholders; (iii) the payment of consideration for the Shares, and the application of such consideration, as provided in the Governing Documents, and compliance with all other terms, conditions and restrictions set forth in the Governing Documents in connection with the issuance of the Shares; (iv) that no event has occurred subsequent to the filing of the Certificate, or will occur prior to the issuance of the Shares, that would cause a termination or dissolution of the Trust or any Series or Class thereof; (v) that the Trust became, prior to or within 180 days following the first issuance of beneficial interests therein, a registered investment company under the Investment Company Act of 1940, as amended; (vi) that the activities of the Trust have been and will be conducted in accordance with the terms of the Governing Instrument and the Delaware Statutory Trust Act, 12 Del. C. §§ 3801 et seq. (the “Delaware Act”); (vii) the taking of all appropriate action by the Trustees to establish and designate the Series, including the Fund, and Classes thereof, including the New Classes, as contemplated by the Governing Instrument; (viii) that appropriate notation of the names and addresses of, the number of Shares held by, and the consideration paid by, Shareholders will be maintained in the appropriate registers and other books and records of the Trust in connection with the issuance or transfer of Shares; (ix) that Schedule A as of November 8, 2017 is in the form presented to the Board in connection with the Board’s adoption of the Resolutions; (x) that the Registered Shares constitute the Shares covered by the Registration Statement; and (xi) that each of the documents examined by us is in full force and effect, expresses the entire understanding of the parties thereto with respect to the subject matter thereof and has not been amended, supplemented or otherwise modified, except as herein referenced. We have not reviewed any documents other than those identified above in connection with this opinion, and we have assumed that there are no documents, facts or circumstances that are contrary to, or inconsistent with the opinions expressed herein. No opinion is expressed herein with respect to the requirements of, or compliance with, federal or state securities or blue sky laws. Further, we express no opinion on the sufficiency or accuracy of any registration or offering documentation relating to the Trust or the Shares. As to any facts material to our opinion, other than those assumed, we have relied without independent investigation on the above-referenced documents and on the accuracy, as of the date hereof, of the matters therein contained.
Based on and subject to the foregoing, and limited in all respects to matters of Delaware law, it is our opinion that the Registered Shares, when issued to Shareholders and paid for in accordance with the terms, conditions, requirements and procedures set forth in the Registration Statement, will constitute validly issued, fully paid and non-assessable Shares.
We hereby consent to the filing of a copy of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement. In giving this consent, we do not hereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder. This opinion speaks only as of the date hereof and is based on our understandings and assumptions as to present facts, and on the application of
Delaware law as the same exist on the date hereof, and we undertake no obligation to update or supplement this opinion after the date hereof for the benefit of any person or entity (including any Shareholder) with respect to any facts or circumstances that may hereafter come to our attention or any changes in facts or law that may hereafter occur or take effect. We understand that the firm of Ropes & Gray LLP wishes to rely as to matters of Delaware law on the opinion hereinabove expressed in connection with the rendering of its opinion to you dated on or about the date hereof concerning the transactions contemplated hereby, and we hereby consent to such reliance. Except as provided in the foregoing sentence, this opinion is intended solely for the benefit of the Trust and the Shareholders in connection with the matters contemplated hereby and may not be relied upon by any other person or entity, or for any other purpose, without our prior written consent.
Sincerely,
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
/s/ Louis G. Hering
Louis G. Hering
11611378.3
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Trustees of
Oppenheimer Integrity Funds:
We consent to the reference to our firm under the heading “Independent Registered Public Accounting Firm” in the Statement of Additional Information of Oppenheimer Preferred Securities and Income Fund, a series of Oppenheimer Integrity Funds.
KPMG LLP
Denver, Colorado
February 2, 2018
Service Plan and Agreement
With
OppenheimerFunds Distributor, Inc.
For Class A Shares of
Oppenheimer Preferred Securities and Income Fund,
a series of Oppenheimer Integrity Funds
This Service Plan and Agreement (the “Plan”) is dated as of November 8, 2017, by and between Oppenheimer Preferred Securities and Income Fund (the “Fund”), a series of Oppenheimer Integrity Funds (the “Trust”) and OppenheimerFunds Distributor, Inc. (the “Distributor”).
1. The Plan. This Plan is the Fund's written service plan for Class A shares of the Fund (the “Shares”), designed to comply with the provisions of Rule 12b-1, as it may be amended from time to time (the “Rule”), under the Investment Company Act of 1940 (the “1940 Act”). Pursuant to this Plan, the Fund will compensate the Distributor for its services in connection with the personal service and maintenance of shareholder accounts that hold Shares (“Accounts”). The Fund may be deemed to be acting as distributor of securities of which it is the issuer, pursuant to the Rule, according to the terms of this Plan. The terms and provisions of this Plan shall be interpreted and defined in a manner consistent with the provisions and definitions contained in (i) the 1940 Act, (ii) the Rule, and (iii) Rule 2341 of the Financial Industry Regulatory Authority, or any amendment or successor to such rule (the “FINRA Rules”).
2. Definitions. As used in this Plan, the following terms shall have the following meanings:
(a) “Recipient” shall mean any broker, dealer, bank or other person or entity which: (i) has provided administrative support services with respect to Shares held by Customers (defined below) of the Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such information as the Distributor shall reasonably request to answer such questions as may arise concerning the sale of Shares; and (iii) has been selected by the Distributor to receive payments under the Plan.
(b) “Independent Trustees” shall mean the members of the Fund’s Board of Trustees who are not “interested persons” (as defined in the 1940 Act) of the Fund and who have no direct or indirect financial interest in the operation of this Plan or in any agreement relating to this Plan.
(c) “Customers” shall mean such brokerage or other customers or investment advisory or other clients of a Recipient, and/or accounts as to which such Recipient provides administrative support services or is a custodian or other fiduciary.
(d) “Qualified Holdings” shall mean, as to any Recipient, all Shares owned beneficially or of record by: (i) such Recipient, or (ii) such Recipient’s Customers, but in no event shall any such Shares be deemed owned by more than one Recipient for purposes of this Plan. In the event that more than one person or entity would otherwise qualify as Recipients as to the same Shares,
the Recipient that is the dealer of record on the Fund’s books, as determined by the Distributor, shall be deemed the Recipient as to such Shares for purposes of this Plan.
3. Payments for Administrative Support Services.
(a) Payments to the Distributor. In consideration of the payments made by the Fund to the Distributor under this Plan, the Distributor shall provide administrative support services to the Fund. Such services include administrative support services rendered in connection with Shares (1) sold in purchase transactions, (2) issued in exchange for shares of another investment company for which the Distributor serves as distributor or sub-distributor, or (3) issued pursuant to a plan of reorganization to which the Fund is a party. If the Board believes that the Distributor may not be rendering appropriate administrative support services in connection with the sale of Shares, then the Distributor, at the request of the Board, shall provide the Board with a written report or other information to verify that the Distributor is providing appropriate services in this regard. For such services, the Fund will make the following payments to the Distributor:
Administrative Support Services Fees. Within forty-five (45) days of the end of each calendar quarter or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.25% on an annual basis of the average during the period of the aggregate net asset value of the Shares computed as of the close of each business day (the “Service Fee”). Such Service Fee payments received from the Fund will compensate the Distributor for providing administrative support services with respect to Accounts. The administrative support services in connection with Accounts may include, but shall not be limited to, the administrative support services that a Recipient may render as described in Section 3(b) below.
(b) Payments to Recipients. The Distributor is authorized under the Plan to pay to a Recipient a service fee (“Recipient Service Fee”) for rendering administrative support services with respect to Accounts. However, no such payments shall be made to any Recipient for any period in which its Qualified Holdings do not equal or exceed, at the end of such period, the minimum amount (“Minimum Qualified Holdings”), if any, that may be set from time to time by a majority of the Independent Trustees. All fee payments made by the Distributor hereunder are subject to reduction or chargeback so that the aggregate Service Fee payments and Advance Recipient Service Fee Payments (as defined below) do not exceed the limits on payments to Recipients that are, or may be, imposed by the FINRA Rules. The Distributor may make Recipient Service Fee payments to any “affiliated person” (as defined in the 1940 Act) of the Distributor if such affiliated person qualifies as a Recipient or retain such payments if the Distributor qualifies as a Recipient.
Recipient Service Fee. In consideration of the administrative support services provided by a Recipient, the Distributor shall make Recipient Service Fee payments to that Recipient quarterly or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days of the end of each calendar quarter or other period at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than the minimum period (the “Minimum Holding Period”), if any, that may be set from time to time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make the following Recipient Service Fee payments to any Recipient, within forty-five (45) days of the end of each calendar quarter or at such other interval as deemed appropriate by the Distributor: (i) “Advance Recipient Service Fee Payments” at a rate not to exceed 0.25% of the aggregate net asset value of Shares, computed as of the close of business on the day such Shares are sold, constituting Qualified Holdings, sold by the Recipient during that period and owned beneficially or of record by the Recipient or by its Customers, plus (ii) Recipient Service Fee payments at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than one (1) year. In the event Shares are redeemed less than one (1) year after the date such Shares were sold, the Recipient is obligated to and will repay the Distributor on demand a pro rata portion of such Advance Recipient Service Fee Payments, based on the ratio of the time such Shares were held to one (1) year.
The administrative support services to be rendered by Recipients in connection with the Accounts may include, but shall not be limited to, the following: answering routine inquiries concerning the Fund, providing such customer with information on their investment in shares, assisting in the establishment and maintenance of accounts or sub-accounts in the Fund and processing Share redemption transactions, making the Fund’s investment plans and dividend payment options available, and providing such other information and customer liaison services in connection with the rendering of personal services and/or the maintenance of Accounts, as the Distributor or the Fund may reasonably request.
(c) A majority of the Independent Trustees may at any time or from time to time increase or decrease the rate of the Service Fee or any Recipient Service Fee, so long as any adjustment does not exceed the rates set forth above, and/or direct the Distributor to set, eliminate or modify, any Minimum Holding Period and/or any Minimum Qualified Holdings and/or to split requirements so that different time periods apply to shares that are afforded different shareholder privileges and features. The Distributor shall notify all Recipients of any Minimum Qualified Holdings and Minimum Holding Period that are established and the rate of payments hereunder applicable to Recipients, and shall provide each Recipient with written notice within thirty (30) days after any change in these provisions. Inclusion of such provisions or a change in such provisions in a revised current prospectus, Statement of Additional Information or supplement to either document shall constitute sufficient notice but shall not represent the only permissible means of providing notice to the Recipient.
(d) The Service Fee and Recipient Service Fee on Shares are subject to reduction or elimination under the limits that apply to such fees and charges under the FINRA Rules relating to sales of shares of open-end funds.
(e) Under the Plan, payments may also be made to Recipients: (i) by OppenheimerFunds, Inc. (“OFI”) from its own resources (which may include profits derived from the advisory fee it receives from the Fund), or (ii) by the Distributor (a subsidiary of OFI), from its own resources or from the proceeds of its borrowings, in either case, in the discretion of OFI or the Distributor, respectively.
(f) Recipients are intended to have certain rights as third-party beneficiaries under this Plan, subject to the limitations set forth below. It may be presumed that a Recipient has provided administrative support services qualifying for payment under the Plan if it has Qualified Holdings of Shares that entitle it to payments under the Plan. In the event that either the Distributor or the Board should have reason to believe that, notwithstanding the level of Qualified Holdings, a Recipient may not be rendering appropriate administrative support services for Accounts, then the Distributor shall require the Recipient to provide a written report or other information to verify that said Recipient is providing appropriate services in this regard. If the Distributor or the Board of Trustees still is not satisfied after the receipt of such report, either may take appropriate steps to terminate the Recipient’s status as such under the Plan, whereupon such Recipient’s rights as a third-party beneficiary hereunder shall terminate. Additionally, in their discretion, a majority of the Fund’s Independent Trustees at any time may remove any broker, dealer, bank or other person or entity as a Recipient, where upon such person’s or entity’s rights as a third-party beneficiary hereof shall terminate. Notwithstanding any other provision of this Plan, this Plan does not obligate or in any way make the Fund liable to make any payment whatsoever to any person or entity other than directly to the Distributor. The Distributor has no obligation to pay any Recipient Service Fees to any Recipient if the Distributor has not received payment of Service Fees from the Fund.
4. Selection and Nomination of Trustees. While this Plan is in effect, the selection and nomination of persons to be Independent Trustees of the Fund shall be committed to the discretion of the incumbent Independent Trustees. Nothing herein shall prevent the incumbent Independent Trustees from soliciting the views or the involvement of others in such selection or nominations as long as the final decision on any such selection and nomination is approved by a majority of the incumbent Independent Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Fund shall provide written reports to the Fund’s Board for its review, detailing the amount of all payments made under this Plan and the purpose for which the payments were made. The reports shall be provided quarterly, and shall state whether all provisions of Section 3 of this Plan have been complied with.
6. Related Agreements. Any agreement related to this Plan shall be in writing and shall provide that: (i) such agreement may be terminated at any time, without payment of any penalty, by a vote of a majority of the Independent Trustees or by a vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class A voting shares; (ii) such termination shall be on not more than sixty (60) days’ written notice to any other party to the agreement; (iii) such agreement shall automatically terminate in the event of its “assignment” (as defined in the 1940 Act); (iv) such agreement shall go into effect when approved by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such agreement; and (v) such agreement shall, unless terminated as herein provided, continue in effect from year to year only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
7. Effectiveness, Continuation, Termination and Amendment. This Plan has been approved by a vote of the Board and its Independent Trustees cast in person at a meeting called on November 8, 2017, for the purpose of voting on this Plan. Unless terminated as hereinafter provided, it shall continue in effect until renewed by the Board in accordance with the Rule and
thereafter from year to year or as the Board may otherwise determine but only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
This Plan may not be amended to increase materially the amount of payments to be made under this Plan, without approval of the Class A Shareholders at a meeting called for that purpose, and all material amendments must be approved by a vote of the Board and of the Independent Trustees.
This Plan may be terminated at any time by vote of a majority of the Independent Trustees or by the vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class A voting shares. In the event of such termination, the Board and its Independent Trustees shall determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the Service Fee in respect of Shares sold prior to the effective date of such termination.
Oppenheimer Integrity Funds | |||
on behalf of its series, | |||
Oppenheimer Preferred Securities and Income Fund | |||
/s/ Cynthia Lo Bessette | |||
By: | Cynthia Lo Bessette | ||
Secretary and Chief Legal Officer | |||
OppenheimerFunds Distributor, Inc. | |||
By: | /s/ John McDonough | ||
John McDonough | |||
Chairman, Chief Executive Officer, | |||
President and Director | |||
Service Plan and Agreement
With
OppenheimerFunds Distributor, Inc.
For Class T Shares of
Oppenheimer Preferred Securities and Income Fund,
a series of Oppenheimer Integrity Funds
This Service Plan and Agreement (the “Plan”) is dated as of November 8, 2017, by and between Oppenheimer Preferred Securities and Income Fund (the “Fund”), a series of Oppenheimer Integrity Funds (the “Trust”) and OppenheimerFunds Distributor, Inc. (the “Distributor”).
1. The Plan. This Plan is the Fund’s written service plan for Class T shares of the Fund (the “Shares”), designed to comply with the provisions of Rule 12b-1, as it may be amended from time to time (the “Rule”), under the Investment Company Act of 1940 (the “1940 Act”). Pursuant to this Plan the Fund will compensate the Distributor for its services in connection with the personal service and maintenance of shareholder accounts that hold Shares (“Accounts”). The Fund may be deemed to be acting as distributor of securities of which it is the issuer, pursuant to the Rule, according to the terms of this Plan. The terms and provisions of this Plan shall be interpreted and defined in a manner consistent with the provisions and definitions contained in (i) the 1940 Act, (ii) the Rule, and (iii) Rule 2341 of the Financial Industry Regulatory Authority, or any amendment or successor to such rule (the “FINRA Rules”).
2. Definitions. As used in this Plan, the following terms shall have the following meanings:
(a) “Recipient” shall mean any broker, dealer, bank or other person or entity which: (i) has provided administrative support services with respect to Shares held by Customers (defined below) of the Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such information as the Distributor shall reasonably request to answer such questions as may arise concerning the sale of Shares; and (iii) has been selected by the Distributor to receive payments under the Plan.
(b) “Independent Trustees” shall mean the members of the Fund’s Board of Trustees who are not “interested persons” (as defined in the 1940 Act) of the Fund and who have no direct or indirect financial interest in the operation of this Plan or in any agreement relating to this Plan.
(c) “Customers” shall mean such brokerage or other customers or investment advisory or other clients of a Recipient, and/or accounts as to which such Recipient provides administrative support services or is a custodian or other fiduciary.
(d) “Qualified Holdings” shall mean, as to any Recipient, all Shares owned beneficially or of record by: (i) such Recipient, or (ii) such Recipient’s Customers, but in no event shall any such Shares be deemed owned by more than one Recipient for purposes of this Plan. In the event that more than one person or entity would otherwise qualify as Recipients as to the same Shares,
the Recipient that is the dealer of record on the Fund’s books, as determined by the Distributor, shall be deemed the Recipient as to such Shares for purposes of this Plan.
3. Payments for Administrative Support Services.
(a) Payments to the Distributor. In consideration of the payments made by the Fund to the Distributor under this Plan, the Distributor shall provide administrative support services to the Fund. Such services include administrative support services rendered in connection with Shares (1) sold in purchase transactions, (2) issued in exchange for shares of another investment company for which the Distributor serves as distributor or sub-distributor, or (3) issued pursuant to a plan of reorganization to which the Fund is a party. If the Board believes that the Distributor may not be rendering appropriate administrative support services in connection with the sale of Shares, then the Distributor, at the request of the Board, shall provide the Board with a written report or other information to verify that the Distributor is providing appropriate services in this regard. For such services, the Fund will make the following payments to the Distributor:
Administrative Support Services Fees. Within forty-five (45) days of the end of each calendar quarter or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.25% on an annual basis of the average during the period of the aggregate net asset value of the Shares computed as of the close of each business day (the “Service Fee”). Such Service Fee payments received from the Fund will compensate the Distributor for providing administrative support services with respect to Accounts. The administrative support services in connection with Accounts may include, but shall not be limited to, the administrative support services that a Recipient may render as described in Section 3(b) below.
(b) Payments to Recipients. The Distributor is authorized under the Plan to pay to a Recipient a service fee (“Recipient Service Fee”) for rendering administrative support services with respect to Accounts. However, no such payments shall be made to any Recipient for any period in which its Qualified Holdings do not equal or exceed, at the end of such period, the minimum amount (“Minimum Qualified Holdings”), if any, that may be set from time to time by a majority of the Independent Trustees. All fee payments made by the Distributor hereunder are subject to reduction or chargeback so that the aggregate Service Fee payments and Advance Recipient Service Fee Payments (as defined below) do not exceed the limits on payments to Recipients that are, or may be, imposed by the FINRA Rules. The Distributor may make Recipient Service Fee payments to any “affiliated person” (as defined in the 1940 Act) of the Distributor if such affiliated person qualifies as a Recipient or retain such payments if the Distributor qualifies as a Recipient.
Recipient Service Fee. In consideration of the administrative support services provided by a Recipient, the Distributor shall make Recipient Service Fee payments to that Recipient quarterly or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days of the end of each calendar quarter or other period at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than the minimum period (the “Minimum Holding Period”), if any, that may be set from time to time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make the following Recipient Service Fee payments to any Recipient, within forty-five (45) days of the end of each calendar quarter or at such other interval as deemed appropriate by the Distributor: (i) “Advance Recipient Service Fee Payments” at a rate not to exceed 0.25% of the aggregate net asset value of Shares, computed as of the close of business on the day such Shares are sold, constituting Qualified Holdings, sold by the Recipient during that period and owned beneficially or of record by the Recipient or by its Customers, plus (ii) Recipient Service Fee payments at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than one (1) year. In the event Shares are redeemed less than one (1) year after the date such Shares were sold, the Recipient is obligated to and will repay the Distributor on demand a pro rata portion of such Advance Recipient Service Fee Payments, based on the ratio of the time such Shares were held to one (1) year.
The administrative support services to be rendered by Recipients in connection with the Accounts may include, but shall not be limited to, the following: answering routine inquiries concerning the Fund, providing such customer with information on their investment in shares, assisting in the establishment and maintenance of accounts or sub-accounts in the Fund and processing Share redemption transactions, making the Fund’s investment plans and dividend payment options available, and providing such other information and customer liaison services in connection with the rendering of personal services and/or the maintenance of Accounts, as the Distributor or the Fund may reasonably request.
(c) A majority of the Independent Trustees may at any time or from time to time increase or decrease the rate of the Service Fee or any Recipient Service Fee, so long as any adjustment does not exceed the rates set forth above, and/or direct the Distributor to set, eliminate or modify, any Minimum Holding Period and/or any Minimum Qualified Holdings and/or to split requirements so that different time periods apply to shares that are afforded different shareholder privileges and features. The Distributor shall notify all Recipients of any Minimum Qualified Holdings and Minimum Holding Period that are established and the rate of payments hereunder applicable to Recipients, and shall provide each Recipient with written notice within thirty (30) days after any change in these provisions. Inclusion of such provisions or a change in such provisions in a revised current prospectus, Statement of Additional Information or supplement to either document shall constitute sufficient notice but shall not represent the only permissible means of providing notice to the Recipient.
(d) The Service Fee and Recipient Service Fee on Shares are subject to reduction or elimination under the limits that apply to such fees and charges under the FINRA Rules relating to sales of shares of open-end funds.
(e) Under the Plan, payments may also be made to Recipients: (i) by OppenheimerFunds, Inc. (“OFI”) from its own resources (which may include profits derived from the advisory fee it receives from the Fund), or (ii) by the Distributor (a subsidiary of OFI), from its own resources or from the proceeds of its borrowings, in either case, in the discretion of OFI or the Distributor, respectively.
(f) Recipients are intended to have certain rights as third-party beneficiaries under this Plan, subject to the limitations set forth below. It may be presumed that a Recipient has provided administrative support services qualifying for payment under the Plan if it has Qualified Holdings of Shares that entitle it to payments under the Plan. In the event that either the Distributor or the Board should have reason to believe that, notwithstanding the level of Qualified Holdings, a Recipient may not be rendering appropriate administrative support services for Accounts, then the Distributor shall require the Recipient to provide a written report or other information to verify that said Recipient is providing appropriate services in this regard. If the Distributor or the Board of Trustees still is not satisfied after the receipt of such report, either may take appropriate steps to terminate the Recipient’s status as such under the Plan, whereupon such Recipient’s rights as a third-party beneficiary hereunder shall terminate. Additionally, in their discretion, a majority of the Fund’s Independent Trustees at any time may remove any broker, dealer, bank or other person or entity as a Recipient, where upon such person’s or entity’s rights as a third-party beneficiary hereof shall terminate. Notwithstanding any other provision of this Plan, this Plan does not obligate or in any way make the Fund liable to make any payment whatsoever to any person or entity other than directly to the Distributor. The Distributor has no obligation to pay any Recipient Service Fees to any Recipient if the Distributor has not received payment of Service Fees from the Fund.
4. Selection and Nomination of Trustees. While this Plan is in effect, the selection and nomination of persons to be Independent Trustees of the Fund shall be committed to the discretion of the incumbent Independent Trustees. Nothing herein shall prevent the incumbent Independent Trustees from soliciting the views or the involvement of others in such selection or nominations as long as the final decision on any such selection and nomination is approved by a majority of the incumbent Independent Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Fund shall provide written reports to the Fund’s Board for its review, detailing the amount of all payments made under this Plan and the purpose for which the payments were made. The reports shall be provided quarterly, and shall state whether all provisions of Section 3 of this Plan have been complied with.
6. Related Agreements. Any agreement related to this Plan shall be in writing and shall provide that: (i) such agreement may be terminated at any time, without payment of any penalty, by a vote of a majority of the Independent Trustees or by a vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class T voting shares; (ii) such termination shall be on not more than sixty (60) days’ written notice to any other party to the agreement; (iii) such agreement shall automatically terminate in the event of its “assignment” (as defined in the 1940 Act); (iv) such agreement shall go into effect when approved by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such agreement; and (v) such agreement shall, unless terminated as herein provided, continue in effect from year to year only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
7. Effectiveness, Continuation, Termination and Amendment. This Plan has been approved by a vote of the Board and its Independent Trustees cast in person at a meeting called on November 8, 2017, for the purpose of voting on this Plan. Unless terminated as hereinafter provided, it shall continue in effect until renewed by the Board in accordance with the Rule and
thereafter from year to year or as the Board may otherwise determine but only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
This Plan may not be amended to increase materially the amount of payments to be made under this Plan, without approval of the Class T Shareholders at a meeting called for that purpose, and all material amendments must be approved by a vote of the Board and of the Independent Trustees.
This Plan may be terminated at any time by vote of a majority of the Independent Trustees or by the vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class T voting shares. In the event of such termination, the Board and its Independent Trustees shall determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the Service Fee in respect of Shares sold prior to the effective date of such termination.
Oppenheimer Integrity Funds | |||
on behalf of its series, | |||
Oppenheimer Preferred Securities and Income Fund | |||
/s/ Cynthia Lo Bessette | |||
By: | Cynthia Lo Bessette | ||
Secretary and Chief Legal Officer | |||
OppenheimerFunds Distributor, Inc. | |||
By: | /s/ John McDonough | ||
John McDonough | |||
Chairman, Chief Executive Officer, | |||
President and Director | |||
Distribution and Service Plan and Agreement
With
OppenheimerFunds Distributor, Inc.
For Class C Shares of
Oppenheimer Preferred Securities
and Income Fund,
a series of Oppenheimer Integrity Funds
This Distribution and Service Plan and Agreement (the “Plan”) is dated as of November 8, 2017, by and between Oppenheimer Preferred Securities and Income Fund (the “Fund”), a series of Oppenheimer Integrity Funds (the “Trust”) and OppenheimerFunds Distributor, Inc. (the “Distributor”).
1. The Plan. This Plan is the Fund’s written distribution and service plan for Class C shares of the Fund (the “Shares”), designed to comply with the provisions of Rule 12b-1, as it may be amended from time to time (the “Rule”), under the Investment Company Act of 1940 (the “1940 Act”). Pursuant to this Plan the Fund will compensate the Distributor for its services in connection with the distribution of Shares, and the personal service and maintenance of shareholder accounts that hold Shares (“Accounts”). The Fund may act as distributor of securities of which it is the issuer, pursuant to the Rule, according to the terms of this Plan. The terms and provisions of this Plan shall be interpreted and defined in a manner consistent with the provisions and definitions contained in (i) the 1940 Act, (ii) the Rule, (iii) Rule 2341 of the Financial Industry Regulatory Authority or any amendment or successor to such rule (the “FINRA Rules”) and (iv) any conditions pertaining either to distribution-related expenses or to a plan of distribution to which the Fund is subject under any order on which the Fund relies, issued at any time by the U.S. Securities and Exchange Commission (“SEC”).
2. Definitions. As used in this Plan, the following terms shall have the following meanings:
(a) “Recipient” shall mean any broker, dealer, bank or other person or entity which: (i) has rendered assistance (whether direct, administrative or both) in the distribution of Shares or has provided administrative support services with respect to Shares held by Customers (defined below) of the Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such information as the Distributor shall reasonably request to answer such questions as may arise concerning the sale of Shares; and (iii) has been selected by the Distributor to receive payments under the Plan.
(b) “Independent Trustees” shall mean the members of the Fund’s Board of Trustees who are not “interested persons” (as defined in the 1940 Act) of the Fund and who have no direct or indirect financial interest in the operation of this Plan or in any agreement relating to this Plan.
(c) “Customers” shall mean such brokerage or other customers or investment advisory or other clients of a Recipient, and/or accounts as to which such Recipient provides administrative
support services or is a custodian or other fiduciary.
(d) “Qualified Holdings” shall mean, as to any Recipient, all Shares owned beneficially or of record by: (i) such Recipient, or (ii) such Recipient’s Customers, but in no event shall any such Shares be deemed owned by more than one Recipient for purposes of this Plan. In the event that more than one person or entity would otherwise qualify as Recipients as to the same Shares, the Recipient that is the dealer of record on the Fund’s books as determined by the Distributor shall be deemed the Recipient as to such Shares for purposes of this Plan.
3. Payments for Distribution Assistance and Administrative Support Services.
(a) Payments to the Distributor. In consideration of the payments made by the Fund to the Distributor under this Plan, the Distributor shall provide administrative support services and distribution assistance services to the Fund. Such services include distribution assistance and administrative support services rendered in connection with Shares (1) sold in purchase transactions, (2) issued in exchange for shares of another investment company for which the Distributor serves as distributor or sub-distributor, or (3) issued pursuant to a plan of reorganization to which the Fund is a party. If the Board believes that the Distributor may not be rendering appropriate distribution assistance or administrative support services in connection with the sale of Shares, then the Distributor, at the request of the Board, shall provide the Board with a written report or other information to verify that the Distributor is providing appropriate services in this regard. For such services, the Fund will make the following payments to the Distributor:
(i) Administrative Support Services Fees. Within forty-five (45) days of the end of each calendar quarter or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.25% on an annual basis of the average during the period of the aggregate net asset value of the Shares computed as of the close of each business day (the “Service Fee”). Such Service Fee payments received from the Fund will compensate the Distributor for providing administrative support services with respect to Accounts. The administrative support services in connection with Accounts may include, but shall not be limited to, the administrative support services that a Recipient may render as described in Section 3(b)(i) below.
(ii) Distribution Assistance Fees (Asset-Based Sales Charge). Within ten (10) days of the end of each month or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.75% on an annual basis of the average during the month of the aggregate net asset value of Shares computed as of the close of each business day (the “Asset-Based Sales Charge”) outstanding until such Shares are redeemed or converted to another class of shares of the Fund, provided, however, that a majority of the Independent Trustees may, but are not obligated to, set a time period (the “Fund Maximum Holding Period”) from time to time for such payments. Such Asset-Based Sales Charge payments received from the Fund will compensate the Distributor for providing distribution assistance in connection with the sale of Shares.
The distribution assistance to be rendered by the Distributor in connection with the Shares may include, but shall not be limited to, the following: (i) paying sales commissions to any broker, dealer, bank or other person or entity that sells Shares, and/or paying such persons
“Advance Recipient Service Fee Payments” (as defined below) in advance of, and/or in amounts greater than, the amount provided for in Section 3(b) of this Agreement; (ii) paying compensation to and expenses of personnel of the Distributor who support distribution of Shares by Recipients; (iii) obtaining financing or providing such financing from its own resources, or from an affiliate, for the interest and other borrowing costs of the Distributor’s unreimbursed expenses incurred in rendering distribution assistance and administrative support services to the Fund; and (iv) paying other direct distribution costs, including without limitation the costs of sales literature, advertising and prospectuses (other than those prospectuses furnished to current holders of the Fund’s shares (“Shareholders”)) and state “blue sky” registration expenses.
(b) Payments to Recipients. The Distributor is authorized under the Plan to pay to a Recipient (1) a distribution assistance fee for rendering distribution assistance in connection with the sale of Shares and/or (2) a service fee (“Recipient Service Fee”) for rendering administrative support services with respect to Accounts. However, no such payments shall be made to any Recipient for any period in which its Qualified Holdings do not equal or exceed, at the end of such period, the minimum amount (“Minimum Qualified Holdings”), if any, that may be set from time to time by a majority of the Independent Trustees. All fee payments made by the Distributor hereunder are subject to reduction or chargeback so that the aggregate Service Fee payments and Advance Recipient Service Fee Payments (as defined below) do not exceed the limits on payments to Recipients that are, or may be, imposed by the FINRA Rules. The Distributor may make Recipient Service Fee payments to any “affiliated person” (as defined in the 1940 Act) of the Distributor if such affiliated person qualifies as a Recipient or retain such payments if the Distributor qualifies as a Recipient.
(i) Recipient Service Fee. In consideration of the administrative support services provided by a Recipient, the Distributor shall make Recipient Service Fee payments to that Recipient quarterly or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days of the end of each calendar quarter or other period, at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than the minimum period (the “Minimum Holding Period”), if any, that may be set from time to time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make the following Recipient Service Fee payments to any Recipient, within forty-five (45) days of the end of each calendar quarter or at such other interval as deemed appropriate by the Distributor: (i) “Advance Recipient Service Fee Payments” at a rate not to exceed 0.25% of the aggregate net asset value of Shares, computed as of the close of business on the day such Shares are sold, constituting Qualified Holdings, sold by the Recipient during that period and owned beneficially or of record by the Recipient or by its Customers, plus (ii) Recipient Service Fee payments at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than one (1) year. In the event Shares are redeemed less than one (1) year after the date such Shares were sold, the Recipient is obligated to and will repay the Distributor on demand a pro rata portion of such Advance Recipient Service Fee Payments, based on the ratio of the time such Shares were held to one (1) year.
The administrative support services to be rendered by Recipients in connection with the Accounts may include, but shall not be limited to, the following: answering routine inquiries concerning the Fund, assisting in the establishment and maintenance of accounts or sub-accounts in the Fund and processing Share redemption transactions, making the Fund’s investment plans and dividend payment options available, and providing such other information and services in connection with the rendering of personal services and/or the maintenance of Accounts, as the Distributor or the Fund may reasonably request.
(ii) Distribution Assistance Fees (Asset-Based Sales Charge) Payments. In its sole discretion and irrespective of whichever alternative method of making service fee payments to Recipients is selected by the Distributor, in addition the Distributor may make distribution assistance fee payments to a Recipient quarterly, or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days after the end of each calendar quarter or other period, at a rate not to exceed 0.1875% (0.75% on an annual basis) of the average during the period of the aggregate net asset value of Shares computed as of the close of each business day constituting Qualified Holdings owned beneficially or of record by the Recipient or its Customers until such Shares are redeemed or converted to another class of shares of the Fund, provided, however, that a majority of the Independent Trustees may, but are not obligated to, set a time period (the “Recipient Maximum Holding Period”) for making such payments. Distribution assistance fee payments shall be made only to Recipients that are registered with the SEC as a broker-dealer or are exempt from registration.
The distribution assistance to be rendered by the Recipients in connection with the sale of Shares may include, but shall not be limited to, the following: distributing sales literature and prospectuses other than those furnished to current Shareholders, providing compensation to and paying expenses of personnel of the Recipient who support the distribution of Shares by the Recipient, and providing such other information and services in connection with the distribution of Shares as the Distributor or the Fund may reasonably request.
(c) A majority of the Independent Trustees may at any time or from time to time increase or decrease the rate of fees to be paid to the Distributor or to any Recipient, so long as any adjustment does not exceed the rates set forth above, and/or direct the Distributor to set, eliminate or modify the Fund Maximum Holding Period, any Minimum Holding Period, the Recipient Maximum Holding Period and/or any Minimum Qualified Holdings and/or to split requirements so that different time periods apply to shares that are afforded different shareholder privileges and features. The Distributor shall notify all Recipients of any Minimum Qualified Holdings, Maximum Holding Period and Minimum Holding Period that are established and the rate of payments hereunder applicable to Recipients, and shall provide each Recipient with written notice within thirty (30) days after any change in these provisions. Inclusion of such provisions or a change in such provisions in a revised current prospectus, Statement of Additional Information or supplement to either document shall constitute sufficient notice but shall not represent the only permissible means of providing notice to the Recipient.
(d) The Service Fee, the Recipient Service Fee, and the Asset-Based Sales Charge on Shares are subject to reduction or elimination under the limits that apply to such fees and charges under the FINRA Rules relating to sales of shares of open-end funds.
(e) Under the Plan, payments may also be made to Recipients: (i) by OppenheimerFunds, Inc. (“OFI”) from its own resources (which may include profits derived from the advisory fee it receives from the Fund), or (ii) by the Distributor (a subsidiary of OFI), from its own resources, from Asset-Based Sales Charge payments or from the proceeds of its borrowings, in either case, in the discretion of OFI or the Distributor, respectively.
(f) Recipients are intended to have certain rights as third-party beneficiaries under this Plan, subject to the limitations set forth below. It may be presumed that a Recipient has provided distribution assistance or administrative support services qualifying for payment under the Plan if it has Qualified Holdings of Shares that entitle it to payments under the Plan. In the event that either the Distributor or the Board should have reason to believe that, notwithstanding the level of Qualified Holdings, a Recipient may not be rendering appropriate distribution assistance in connection with the sale of Shares or administrative support services for Accounts, then the Distributor shall require the Recipient to provide a written report or other information to verify that said Recipient is providing appropriate distribution assistance and/or services in this regard. If the Distributor or the Board of Trustees still is not satisfied after the receipt of such report, either may take appropriate steps to terminate the Recipient’s status as such under the Plan, whereupon such Recipient’s rights as a third-party beneficiary hereunder shall terminate. Additionally, in their discretion, a majority of the Fund’s Independent Trustees at any time may remove any broker, dealer, bank or other person or entity as a Recipient, where upon such person’s or entity’s rights as a third-party beneficiary hereof shall terminate. Notwithstanding any other provision of this Plan, this Plan does not obligate or in any way make the Fund liable to make any payment whatsoever to any person or entity other than directly to the Distributor. The Distributor has no obligation to pay any Recipient Service Fees or Distribution Assistance Fees to any Recipient if the Distributor has not received payment of Service Fees or Distribution Assistance Fees from the Fund.
4. Selection and Nomination of Trustees. While this Plan is in effect, the selection and nomination of persons to be Independent Trustees of the Fund shall be committed to the discretion of the incumbent Independent Trustees. Nothing herein shall prevent the incumbent Independent Trustees from soliciting the views or the involvement of others in such selection or nominations as long as the final decision on any such selection and nomination is approved by a majority of the incumbent Independent Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Fund shall provide written reports to the Fund’s Board for its review, detailing the amount of all payments made under this Plan and the purpose for which the payments were made. The reports shall be provided quarterly, and shall state whether all provisions of Section 3 of this Plan have been complied with.
6. Related Agreements. Any agreement related to this Plan shall be in writing and shall provide that: (i) such agreement may be terminated at any time, without payment of any penalty, by a vote of a majority of the Independent Trustees or by a vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class C voting shares; (ii) such termination shall be on not more than sixty (60) days’ written notice to any other party to the agreement; (iii) such agreement shall automatically terminate in the event of its “assignment” (as defined in the 1940 Act); (iv) such agreement shall go into effect when approved by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such agreement; and (v) such agreement shall, unless terminated as herein provided, continue in effect
from year to year only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
7. Effectiveness, Continuation, Termination and Amendment. This Plan has been approved by a vote of the Board and its Independent Trustees cast in person at a meeting called on November 8, 2017, for the purpose of voting on this Plan. Unless terminated as hereinafter provided, it shall continue in effect until renewed by the Board in accordance with the Rule and thereafter from year to year or as the Board may otherwise determine but only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
This Plan may not be amended to increase materially the amount of payments to be made under this Plan, without approval of the Class C Shareholders at a meeting called for that purpose, and all material amendments must be approved by a vote of the Board and of the Independent Trustees.
This Plan may be terminated at any time by vote of a majority of the Independent Trustees or by the vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class C voting shares. In the event of such termination, the Board and its Independent Trustees shall determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the Service Fee and/or the Asset-Based Sales Charge in respect of Shares sold prior to the effective date of such termination.
Oppenheimer Integrity Funds | |||
on behalf of its series, | |||
Oppenheimer Preferred Securities and Income Fund | |||
/s/ Cynthia Lo Bessette | |||
By: | Cynthia Lo Bessette | ||
Secretary and Chief Legal Officer | |||
OppenheimerFunds Distributor, Inc. | |||
By: | /s/ John McDonough | ||
John McDonough | |||
Chairman, Chief Executive Officer, | |||
President and Director | |||
Distribution and Service Plan and Agreement
With
OppenheimerFunds Distributor, Inc.
For Class R Shares of
Oppenheimer Preferred Securities
and Income Fund,
a series of Oppenheimer Integrity Funds
This Distribution and Service Plan and Agreement (the “Plan”) is dated as of November 8, 2017, by and between Oppenheimer Preferred Securities and Income Fund (the “Fund”), a series of Oppenheimer Integrity Funds (the “Trust”) and OppenheimerFunds Distributor, Inc. (the “Distributor”).
1. The Plan. This Plan is the Fund’s written distribution and service plan for Class R shares of the Fund (the “Shares”), designed to comply with the provisions of Rule 12b-1, as it may be amended from time to time (the “Rule”), under the Investment Company Act of 1940 (the “1940 Act”). Pursuant to this Plan the Fund will compensate the Distributor for its services in connection with the distribution of Shares, and the personal service and maintenance of shareholder accounts that hold Shares (“Accounts”). The Fund may act as distributor of securities of which it is the issuer, pursuant to the Rule, according to the terms of this Plan. The terms and provisions of this Plan shall be interpreted and defined in a manner consistent with the provisions and definitions contained in (i) the 1940 Act, (ii) the Rule, (iii) Rule 2341 of the Financial Industry Regulatory Authority or any amendment or successor to such rule (the “FINRA Rules”), and (iv) any conditions pertaining either to distribution-related expenses or to a plan of distribution to which the Fund is subject under any order on which the Fund relies, issued at any time by the U.S. Securities and Exchange Commission (“SEC”).
2. Definitions. As used in this Plan, the following terms shall have the following meanings:
(a) “Recipient” shall mean any broker, dealer, bank or other person or entity which: (i) has rendered assistance (whether direct, administrative or both) in the distribution of Shares or has provided administrative support services with respect to Shares held by Customers (defined below) of the Recipient; (ii) shall furnish the Distributor (on behalf of the Fund) with such information as the Distributor shall reasonably request to answer such questions as may arise concerning the sale of Shares; and (iii) has been selected by the Distributor to receive payments under the Plan.
(b) “Independent Trustees” shall mean the members of the Fund’s Board of Trustees who are not “interested persons” (as defined in the 1940 Act) of the Fund and who have no direct or indirect financial interest in the operation of this Plan or in any agreement relating to this Plan.
(c) “Customers” shall mean such brokerage or other customers or investment advisory or other clients of a Recipient, and/or accounts as to which such Recipient provides administrative
support services or is a custodian or other fiduciary.
(d) “Qualified Holdings” shall mean, as to any Recipient, all Shares owned beneficially or of record by: (i) such Recipient, or (ii) such Recipient’s Customers, but in no event shall any such Shares be deemed owned by more than one Recipient for purposes of this Plan. In the event that more than one person or entity would otherwise qualify as Recipients as to the same Shares, the Recipient that is the dealer of record on the Fund’s books as determined by the Distributor shall be deemed the Recipient as to such Shares for purposes of this Plan.
3. Payments for Distribution Assistance and Administrative Support Services.
(a) Payments to the Distributor. In consideration of the payments made by the Fund to the Distributor under this Plan, the Distributor shall provide administrative support services and distribution assistance services to the Fund. Such services include distribution assistance and administrative support services rendered in connection with Shares (1) sold in purchase transactions, (2) issued in exchange for shares of another investment company for which the Distributor serves as distributor or sub-distributor, or (3) issued pursuant to a plan of reorganization to which the Fund is a party. If the Board believes that the Distributor may not be rendering appropriate distribution assistance or administrative support services in connection with the sale of Shares, then the Distributor, at the request of the Board, shall provide the Board with a written report or other information to verify that the Distributor is providing appropriate services in this regard. For such services, the Fund will make the following payments to the Distributor:
(i) Administrative Support Services Fees. Within forty-five (45) days of the end of each calendar quarter or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.25% on an annual basis of the average during the period of the aggregate net asset value of the Shares computed as of the close of each business day (the “Service Fee”). Such Service Fee payments received from the Fund will compensate the Distributor for providing administrative support services with respect to Accounts. The administrative support services in connection with Accounts may include, but shall not be limited to, the administrative support services that a Recipient may render as described in Section 3(b)(i) below.
(ii) Distribution Assistance Fees (Asset-Based Sales Charge). Within ten (10) days of the end of each month or at such other period as deemed appropriate by the Distributor, the Fund will make payments in the aggregate amount of up to 0.25% on an annual basis of the average during the month of the aggregate net asset value of Shares computed as of the close of each business day (the “Asset-Based Sales Charge”) outstanding until such Shares are redeemed or converted to another class of shares of the Fund, provided, however, that a majority of the Independent Trustees may, but are not obligated to, set a time period (the “Fund Maximum Holding Period”) from time to time for such payments. Such Asset-Based Sales Charge payments received from the Fund will compensate the Distributor for providing distribution assistance in connection with the sale of Shares.
The distribution assistance to be rendered by the Distributor in connection with the Shares may include, but shall not be limited to, the following: (i) paying sales commissions to any broker, dealer, bank or other person or entity that sells Shares, and/or paying such persons “Advance Recipient Service Fee Payments” (as defined below) in advance of, and/or in amounts greater than, the amount provided for in Section 3(b) of this Agreement; (ii) paying compensation to and expenses of personnel of the Distributor who support distribution of Shares by Recipients; (iii) obtaining
financing or providing such financing from its own resources, or from an affiliate, for the interest and other borrowing costs of the Distributor’s unreimbursed expenses incurred in rendering distribution assistance and administrative support services to the Fund; and (iv) paying other direct distribution costs, including without limitation the costs of sales literature, advertising and prospectuses (other than those prospectuses furnished to current holders of the Fund's shares ("Shareholders")) and state “blue sky” registration expenses.
(b) Payments to Recipients. The Distributor is authorized under the Plan to pay to a Recipient (1) a distribution assistance fee for rendering distribution assistance in connection with the sale of Shares and/or (2) a service fee (“Recipient Service Fee”) for rendering administrative support services with respect to Accounts. However, no such payments shall be made to any Recipient for any period in which its Qualified Holdings do not equal or exceed, at the end of such period, the minimum amount (“Minimum Qualified Holdings”), if any, that may be set from time to time by a majority of the Independent Trustees. All fee payments made by the Distributor hereunder are subject to reduction or chargeback so that the aggregate Service Fee payments and Advance Recipient Service Fee Payments (as defined below) do not exceed the limits on payments to Recipients that are, or may be, imposed by the FINRA Rules. The Distributor may make Recipient Service Fee payments to any “affiliated person” (as defined in the 1940 Act) of the Distributor if such affiliated person qualifies as a Recipient or retain such payments if the Distributor qualifies as a Recipient.
(i) Recipient Service Fee. In consideration of the administrative support services provided by a Recipient, the Distributor shall make Recipient Service Fee payments to that Recipient quarterly or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days of the end of each calendar quarter or other period, at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than the minimum period (the “Minimum Holding Period”), if any, that may be set from time to time by a majority of the Independent Trustees.
Alternatively, the Distributor may, at its sole option, make the following Recipient Service Fee payments to any Recipient, within forty-five (45) days of the end of each calendar quarter or at such other interval as deemed appropriate by the Distributor: (i) “Advance Recipient Service Fee Payments” at a rate not to exceed 0.25% of the aggregate net asset value of Shares, computed as of the close of business on the day such Shares are sold, constituting Qualified Holdings, sold by the Recipient during that period and owned beneficially or of record by the Recipient or by its Customers, plus (ii) Recipient Service Fee payments at a rate not to exceed 0.25% on an annual basis of the average during the period of the aggregate net asset value of Shares, computed as of the close of each business day, constituting Qualified Holdings owned beneficially or of record by the Recipient or by its Customers for a period of more than one (1) year. In the event Shares are redeemed less than one (1) year after the date such Shares were sold, the Recipient is obligated to and will repay the Distributor on demand a pro rata portion of such Advance Recipient Service Fee Payments, based on the ratio of the time such Shares were held to one (1) year.
The administrative support services to be rendered by Recipients in connection with the Accounts may include, but shall not be limited to, the following: answering routine inquiries concerning the Fund, assisting in the establishment and maintenance of accounts or sub-accounts in the Fund and processing Share redemption transactions, making the Fund’s investment plans and dividend payment options available, and providing such other information and services in connection
with the rendering of personal services and/or the maintenance of Accounts, as the Distributor or the Fund may reasonably request.
(ii) Distribution Assistance Fees (Asset-Based Sales Charge) Payments. In its sole discretion and irrespective of whichever alternative method of making service fee payments to Recipients is selected by the Distributor, in addition the Distributor may make distribution assistance fee payments to a Recipient quarterly, or at such other interval as deemed appropriate by the Distributor, within forty-five (45) days after the end of each calendar quarter or other period, at a rate not to exceed 0.0625% (0.25% on an annual basis) of the average during the period of the aggregate net asset value of Shares computed as of the close of each business day constituting Qualified Holdings owned beneficially or of record by the Recipient or its Customers until such Shares are redeemed or converted to another class of shares of the Fund, provided, however, that a majority of the Independent Trustees may, but are not obligated to, set a time period (the “Recipient Maximum Holding Period”) for making such payments. Distribution assistance fee payments shall be made only to Recipients that are registered with the SEC as a broker-dealer or are exempt from registration.
The distribution assistance to be rendered by the Recipients in connection with the sale of Shares may include, but shall not be limited to, the following: distributing sales literature and prospectuses other than those furnished to current Shareholders, providing compensation to and paying expenses of personnel of the Recipient who support the distribution of Shares by the Recipient, and providing such other information and services in connection with the distribution of Shares as the Distributor or the Fund may reasonably request.
(c) A majority of the Independent Trustees may at any time or from time to time increase or decrease the rate of fees to be paid to the Distributor or to any Recipient, so long as any adjustment does not exceed the rates set forth above, and/or direct the Distributor to set, eliminate or modify the Fund Maximum Holding Period, any Minimum Holding Period, the Recipient Maximum Holding Period and/or any Minimum Qualified Holdings and/or to split requirements so that different time periods apply to shares that are afforded different shareholder privileges and features. The Distributor shall notify all Recipients of any Minimum Qualified Holdings, Maximum Holding Period and Minimum Holding Period that are established and the rate of payments hereunder applicable to Recipients, and shall provide each Recipient with written notice within thirty (30) days after any change in these provisions. Inclusion of such provisions or a change in such provisions in a revised current prospectus, Statement of Additional Information or supplement to either document shall constitute sufficient notice but shall not represent the only permissible means of providing notice to the Recipient.
(d) The Service Fee, the Recipient Service Fee, and the Asset-Based Sales Charge on Shares are subject to reduction or elimination under the limits that apply to such fees and charges under the FINRA Rules relating to sales of shares of open-end funds.
(e) Under the Plan, payments may also be made to Recipients: (i) by OppenheimerFunds, Inc. (“OFI”) from its own resources (which may include profits derived from the advisory fee it receives from the Fund), or (ii) by the Distributor (a subsidiary of OFI), from its own resources, from Asset-Based Sales Charge payments or from the proceeds of its borrowings, in either case, in the discretion of OFI or the Distributor, respectively.
(f) Recipients are intended to have certain rights as third-party beneficiaries under this Plan,
subject to the limitations set forth below. It may be presumed that a Recipient has provided distribution assistance or administrative support services qualifying for payment under the Plan if it has Qualified Holdings of Shares that entitle it to payments under the Plan. In the event that either the Distributor or the Board should have reason to believe that, notwithstanding the level of Qualified Holdings, a Recipient may not be rendering appropriate distribution assistance in connection with the sale of Shares or administrative support services for Accounts, then the Distributor shall require the Recipient to provide a written report or other information to verify that said Recipient is providing appropriate distribution assistance and/or services in this regard. If the Distributor or the Board of Trustees still is not satisfied after the receipt of such report, either may take appropriate steps to terminate the Recipient’s status as such under the Plan, whereupon such Recipient’s rights as a third-party beneficiary hereunder shall terminate. Additionally, in their discretion, a majority of the Fund’s Independent Trustees at any time may remove any broker, dealer, bank or other person or entity as a Recipient, where upon such person’s or entity’s rights as a third-party beneficiary hereof shall terminate. Notwithstanding any other provision of this Plan, this Plan does not obligate or in any way make the Fund liable to make any payment whatsoever to any person or entity other than directly to the Distributor. The Distributor has no obligation to pay any Recipient Service Fees or Distribution Assistance Fees to any Recipient if the Distributor has not received payment of Service Fees or Distribution Assistance Fees from the Fund.
4. Selection and Nomination of Trustees. While this Plan is in effect, the selection and nomination of persons to be Independent Trustees of the Fund shall be committed to the discretion of the incumbent Independent Trustees. Nothing herein shall prevent the incumbent Independent Trustees from soliciting the views or the involvement of others in such selection or nominations as long as the final decision on any such selection and nomination is approved by a majority of the incumbent Independent Trustees.
5. Reports. While this Plan is in effect, the Treasurer of the Fund shall provide written reports to the Fund’s Board for its review, detailing the amount of all payments made under this Plan and the purpose for which the payments were made. The reports shall be provided quarterly, and shall state whether all provisions of Section 3 of this Plan have been complied with.
6. Related Agreements. Any agreement related to this Plan shall be in writing and shall provide that: (i) such agreement may be terminated at any time, without payment of any penalty, by a vote of a majority of the Independent Trustees or by a vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class R voting shares; (ii) such termination shall be on not more than sixty (60) days’ written notice to any other party to the agreement; (iii) such agreement shall automatically terminate in the event of its “assignment” (as defined in the 1940 Act); (iv) such agreement shall go into effect when approved by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such agreement; and (v) such agreement shall, unless terminated as herein provided, continue in effect from year to year only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
7. Effectiveness, Continuation, Termination and Amendment. This Plan has been approved by a vote of the Board and its Independent Trustees cast in person at a meeting called on November 8, 2017, for the purpose of voting on this Plan. Unless terminated as hereinafter provided, it shall continue in effect until renewed by the Board in accordance with the Rule and thereafter from year to
year or as the Board may otherwise determine but only so long as such continuance is specifically approved at least annually by a vote of the Board and its Independent Trustees cast in person at a meeting called for the purpose of voting on such continuance.
This Plan may not be amended to increase materially the amount of payments to be made under this Plan, without approval of the Class R Shareholders at a meeting called for that purpose, and all material amendments must be approved by a vote of the Board and of the Independent Trustees.
This Plan may be terminated at any time by vote of a majority of the Independent Trustees or by the vote of the holders of a “majority” (as defined in the 1940 Act) of the Fund’s outstanding Class R voting shares. In the event of such termination, the Board and its Independent Trustees shall determine whether the Distributor shall be entitled to payment from the Fund of all or a portion of the Service Fee and/or the Asset-Based Sales Charge in respect of Shares sold prior to the effective date of such termination.
Oppenheimer Integrity Funds | |||
on behalf of its series, | |||
Oppenheimer Preferred Securities and Income Fund | |||
/s/ Cynthia Lo Bessette | |||
By: |
Cynthia Lo Bessette Secretary and Chief Legal Officer |
||
OppenheimerFunds Distributor, Inc. | |||
By: | /s/ John McDonough | ||
John McDonough | |||
Chairman, Chief Executive Officer, | |||
President and Director | |||
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OFI Global Asset Management, Inc.
225 Liberty Street
New York, New York 10281-1008
February 2, 2018
Via Electronic Transmission
Mr. Mark Cowan
Senior Counsel
U.S. Securities and Exchange Commission
Division of Investment Management, Disclosure Review Office
100 F Street NE
Washington DC 20549
Re: Registration Statement on Form N-1A for Oppenheimer Preferred Securities and Income Fund, a series of Oppenheimer Integrity Funds (SEC File 811-03420)
Dear Mr. Cowan:
Thank you for your comments, provided by email correspondence on December 13, 2017, to the Registration Statement on Form N-1A (the “Registration Statement”) for Oppenheimer Preferred Securities and Income Fund, a series of Oppenheimer Integrity Funds (the “Registrant”), filed with the Securities and Exchange Commission (the “Commission”) on November 22, 2017 (accession number 0000728889-17-002427). For your convenience, we have included your comments in italics, followed by our response. The captions used below correspond to the captions the Registrant uses in the Registration Statement and defined terms have the meanings defined therein.
PROSPECTUS (Part A)
General
1. | Please make sure Item 12 disclosure and Appendix A are revised consistent with staff resolved comments in File No. 333-215964 (OFI Pictet Global Environmental Solutions Fund). |
The Fund confirms that the Item 12 disclosure and Appendix A have been revised to incorporate staff resolved comments in connection with OFI Pictet Global Environmental Solutions Fund.
The Prospectus - Summary
2. | All missing fees/expenses from the fee table and example must be filed in correspondence prior to effectiveness. |
The completed Annual Fund Operating Expenses table is provided below:
Annual Fund Operating Expenses
(expenses that you pay each year as a percentage of the value of your investment)
Class A | Class T | Class C | Class R | Class Y | Class I | |
Management Fees | 0.65% | 0.65% | 0.65% | 0.65% | 0.65% | 0.65% |
Distribution and/or Service (12b-1) Fees | 0.25% | 0.25% | 1.00% | 0.50% | None | None |
Other Expenses1 | 0.46% | 0.46% | 0.46% | 0.46% | 0.46% | 0.27% |
Total Annual Fund Operating Expenses | 1.36% | 1.36% | 2.11% | 1.61% | 1.11% | 0.92% |
Fee Waiver and Expense Reimbursement2 | -0.17% | -0.17% | -0.17% | -0.17% | -0.17% | -0.17% |
Total Annual Fund Operating Expenses after Fee Waiver and/or Expense Reimbursement | 1.19% | 1.19% | 1.94% | 1.44% | 0.94% | 0.75% |
1. "Other Expenses" are based on estimates for the current fiscal year.
2. OFI Global has contractually agreed to waive a portion of its management fees and/or reimburse the Fund for certain of its expenses so that total annual fund operating expenses after any fee waiver and/or expense reimbursement (excluding any applicable dividend expense, taxes, interest and fees from borrowing, any subsidiary expenses, Acquired Fund Fees and Expenses, brokerage commissions, extraordinary expenses and certain other Fund expenses) will not exceed 1.19% of average annual net assets for Class A shares, 1.19% for Class T shares, 1.94% for class C shares, 1.44% for Class R shares, 0.94% for Class Y shares, and 0.75% for Class I Shares. These fee waivers and/or expense reimbursements may not be amended or withdrawn for one year from the date of the prospectus, unless approved by the Board.
The completed Example table is provided below:
If shares are redeemed | If shares are not redeemed | ||||
1 Year | 3 Years | 1 Year | 3 Years | ||
Class A | $591 | $872 | Class A | $591 | $872 |
Class T | $369 | $656 | Class T | $369 | $656 |
Class C | $299 | $651 | Class C | $199 | $651 |
Class R | $148 | $495 | Class R | $148 | $495 |
Class Y | $96 | $338 | Class Y | $96 | $338 |
Class I | $77 | $278 | Class I | $77 | $278 |
3. | Include a footnote stating Acquired Fund Fees and Expenses in the Annual Fund Operating Expenses table are based on estimates for the current fiscal year. |
The Fund does not currently intend to incur any Acquired Fund Fees and Expenses and has revised the table to remove the reference accordingly.
4. | If applicable, please include a footnote to the Annual Fund Operating Expenses table indicating that any fee waiver or expense reimbursement is contractual and extends at least one year from the effective date and who may terminate such waiver or reimbursement. |
An appropriate footnote has been added.
Principal Investment Strategies
5. | Please note that it is the staff’s view that CoCos are not preferred securities. Accordingly, if the fund invests significantly in CoCos, the fund’s name could be misleading under Section 35(d). Please supplementally inform the staff the amount the Fund will/plans to invest in CoCos, and revise the disclosure in the sentence beginning “CoCos are preferred securities…”. |
The Fund does not believe that its name is misleading under Section 35(d). The Fund’s name “Oppenheimer Preferred Securities and Income Fund” is consistent with its 80% policy. That policy clearly discloses that, under normal circumstances, the Fund invests at least 80% of its net assets (plus borrowings for investment purposes) in preferred and other income producing securities. Contingent capital securities (“CoCos”), which are typically issued in the form of debt instruments, are income producing securities that are included in the Fund’s 80% bucket and could comprise a substantial amount of the Fund’s investments.
The disclosure has been revised to indicate that CoCos are not “preferred” securities.
6. | If applicable, consider disclosing that like debt, CoCos pay a fixed rate of interest. |
The Fund discloses that CoCos are typically issued in the form of debt instruments. As such, it does not believe this additional disclosure is necessary.
7. | Please clarify that CoCos are generally high yield or junk. |
In the section “Contingent Capital Security Risk”, the Fund discloses that CoCos are often rated below investment grade and are subject to the risks associated with such securities.
8. | Consider disclosing (possibly in Item 9) that the CoCos loss absorption mechanisms allow the bank to wipe out debt and help it improve its capital position. A conversion to equity or a write-down also could be triggered by a drop in share price or at the discretion of a regulator to avoid a bank’s insolvency. |
The Fund has included substantially similar disclosure in a new section of its Item 9 disclosure titled “Contingent Capital Securities”.
9. | Please clarify that a write-down of the security’s principal amount may be partial or full. |
In the section “Contingent Capital Security Risk”, the Fund discloses that an automatic write down, potentially to zero, is possible.
10. | Will the Fund invest in defaulted securities? |
No, the Fund does not currently intend to invest in defaulted securities.
11. | Does the Fund’s discussion related to debt ratings include CoCos? |
The Fund’s general policy regarding debt ratings applies to CoCos.
12. | In the section titled “Contingent Capital Security Risk” consider disclosing the effect on an issuer’s continued payment (or ability to pay) any dividends. Thus, there is no assurance that the holder would continue to receive any income upon conversion. Indicate also that the conversion would be triggered by the issuer, not the holder. |
The Fund has included substantially similar disclosure in a new section of its Item 9 disclosure titled “Contingent Capital Securities”.
13. | Please disclose whether there are other industries that comprise the financials sector. Also, please note that the industry classification must be reasonable and cannot be so broad that primary economic characteristics of the companies in a single class are materially different. See Guide 18. As such, please explain how the listed individual industries (banking, diversified financials, insurance and real estate) have primary economic characteristics that are not materially different. We may have additional comments depending on your response. |
The Fund has disclosed the industries that it believes comprise the financials sector and takes note of the staff’s comment. Upon further review, the Fund has revised the industries listed as follows: banks, diversified financials (which may include brokerage services, asset management, specialized financials, mortgage real estate investment trusts) and insurance. The financials sector generally includes companies that provide financial services to commercial and retail customers and typically perform best in low interest rate environments. A large portion of this sector generates revenue from mortgages and loans, which gain value as interest rates drop. The Fund also notes that both the Global Industry Classification Standards (“GICS”) and Standard Industrial Classification Standards (“SICS”) codes include these industries under the same broad category – financials.
14. | Please clarify that the Fund can invest up to 100% of its assets in below-investment grade securities in its Principal Investment Strategies section. |
While the Fund may invest in securities of any credit rating, it is not a principal investment strategy of the Fund to invest all of its assets in below-investment grade securities. As such, the Fund respectfully declines to make the suggested revision. In the Fund’s principal
investment strategies discussion, the Fund states its general policy with respect to ratings. Specifically, the Fund states that “[a]lthough not required to do so, the Fund will generally invest in issuers whose senior debt is rated at least BBB- or higher, which the Fund considers to be investment grade. Although a company’s senior debt rating may be BBB-, an underlying security issued by such company in which the Fund invests may have a lower rating than BBB-.”
15. | Please clarify that the Fund will invest in developing and emerging markets if this is a principal investment strategy. |
Upon further review the Fund has determined that investing in developing and emerging markets is not a principal investment strategy. The related disclosure has been removed from the section titled “Principal Risks” and included in the section titled “Other Investment Strategies and Risks.”
The Fund’s Past Performance
16. | Please supplementally identify the broad based securities index the Fund intends to use. |
The Fund intends to use the ICE BAML Preferred Stock Fixed Rate TR USD Index.
About the Fund’s Investments
17. | It is confusing differentiating principal strategies and principal risks. Please clearly state and confirm that what is listed under “The Fund’s Principal Investment Strategies and Risks” are principal strategies and risks. The non-principal strategies and risks should be disclosed in the section “Other Investment Strategies and Risks” below. |
The Fund discloses its principal investment strategies, i.e., those strategies it will employ to achieve that objective on page 1 of the prospectus under the heading “Principal Investment Strategies.” General Instruction C.3(a) to Form N-1A provides that “[i]nformation that is included in response to Items 2 through 8 [which covers the summary section of the prospectus] need not be repeated elsewhere in the prospectus.” The Fund believes that, to the extent the disclosure contained in the principal investment strategies requires further elaboration, the discussion under “About the Fund’s Investments - The Fund’s Principal Investment Strategies and Risks” elaborates on elements of the Fund’s principal investment strategies and risk factors. The Fund’s non-principal strategies and risks are disclosed under the heading “About the Fund’s Investments – Other Investment Strategies and Risks.”
18. | Please delete the sentence beginning “ The term “preferred securities” also includes hybrid securities…” since preferred securities may be considered a type of hybrid, but not all hybrid securities are preferred securities (eg. CoCos). Please revise your disclosure through the prospectus and SAI consistent with these comments. |
The suggested revisions have been made.
19. | Please revise the disclosure indicating that CoCos are preferred securities. This is not the staff’s view. |
The Fund has revised the disclosure accordingly.
20. | Please identify all industries that comprise the financials sector in the section “Financials Sector Concentration Risk”. |
The Fund has revised the disclosure. Please refer to our response to comment #13.
21. | Please confirm whether investments by fund of funds, investments in money market instruments, investments in other investment companies and investments in ETFs are principal strategies. We note the fee table includes a separate line item for AFFE. |
The AFFE line item was mistakenly included and has since been removed. Investing in other investment companies is not a principal strategy of the Fund.
22. | In the section “High Portfolio Turnover”, the disclosure indicates that the Fund may engage in frequent trading. If this is true, it should be disclosed as a principal investment strategy. |
The Fund does not anticipate having high portfolio turnover. The disclosure has been revised accordingly.
Appendix: Special Sales Charge Arrangements and Waivers
23. | Please make sure disclosure in this appendix conforms to prior comments from the staff issued in connection with OFI Pictet Global Environmental Solutions Fund and Item 12 of Form N-1A. |
The disclosure has been revised, consistent with changes made to the appendix for OFI Pictet Global Environmental Solutions Fund in connection with the staff’s comments on that fund, and with Item 12 of Form N-1A.
Appendix B
24. | Please note that the staff would like to review the complete information in this Appendix prior to effectiveness. |
The Fund has noted this comment and sent a copy of the completed Appendix to the staff prior to the Fund’s effectiveness.
25. | Please clarify where certain reference performance is intended to be shown. |
The Fund has revised the appendix so that it is consistent with the disclosure contained in the similar appendix for Oppenheimer Global Unconstrained Bond Fund.
26. | If the Fund intends to show “bar chart” information, it should be done in the manner required by Item 4. The use of “Gross Total Returns” and “Net Total Returns is confusing. |
The Fund has revised the appendix so that it is consistent with the disclosure contained in the similar appendix for Oppenheimer Global Unconstrained Bond Fund. In connection with that fund’s filing, disclosure has been added to more clearly differentiate gross returns from net returns.
27. | Sales charges, if any, should be deducted from “Net Total Return”. |
Sales charges have not been deducted from “Net Total Return” in the appendix, but the Fund has added additional information to clearly disclose that returns would be lower if sales charges were taken into account.
28. | The fund should represent supplementally that it has the records necessary to support the calculation of the performance as required by rule 204-2(a)(16) under the Investment Advisers Act of 1940, as amended (“Advisers Act”). |
OppenheimerFunds, Inc., as the separately managed account’s investment adviser and an investment adviser to the Fund, supplementally represents that it has the records necessary to support the calculation of the performance as required by rule 204-2(a)(16) under the Advisers Act.
Statement of Additional Information
29. | Please clarify what composes the financials sector. See prospectus comment. Any industry classifications that are materially different would also need their own fundamental concentration policy (if the Fund will invest more than 25%). |
The Fund respectfully declines to make additional changes. Please refer to our response to comment #13.
30. | Please further define “senior security” in connection with Section 18(g) of the Investment Company Act of 1940, as amended, so that the definition of senior securities is not limited to stock senior securities and includes debt securities. |
The disclosure the Staff suggests to revise is intended solely to provide context for understanding the Fund’s investment restrictions, and is identical to the disclosure reviewed by the Staff in connection with the effectiveness of OFI Pictet Global Environmental Solutions Fund and Oppenheimer SteelPath MLP & Energy Infrastructure Fund. To this end, we believe that in the context of a discussion of the restrictions and explanatory disclosure as a whole, our general definition is consistent with the definition provided in Section 18(g). However, in light of the Staff’s comment, we intend to review this disclosure and consider
revisions in connection with future annual registration statement updates for other funds in the OppenheimerFunds family of funds.
31. | Please revise the Fund’s discussion regarding concentration to refer to an industry “or group of industries.” |
The suggested revisions have been made.
32. | Please revise the column header in the Remuneration Table to indicate that Total Compensation From the Fund and Fund Complex is as of the end of Fund’s “Fiscal Year” |
With respect to the total compensation from the Fund and fund complex, we do not interpret form N-1A to mandate that the total compensation from the fund complex be based on fiscal year. We read the introductory paragraph of Item 17(c), along with Instruction 2 to the table, to require that compensation from the individual fund to be based on fiscal year. Accordingly, the remuneration paid from the Fund is based on fiscal year end; however, it is not practicable to calculate the remuneration from all of the funds in the complex as of this fund’s fiscal year end, therefore, for remuneration from the complex calendar year end is used and we respectfully decline to make this change.
33. | Disclosure required by Form N-1A Item 19(a)(3)(i) is missing. |
The Registrant notes that the third paragraph under the heading “The Investment Advisory Agreement” states that “The management fees paid by the Fund to the Manager are calculated at the rates described in the Prospectus, which are applied to the assets of the Fund as a whole.”
We respectfully disagree with the Commission staff’s position that sub-advisory fees should be considered payable by the Fund and are aware of no codified Commission guidance that supports the staff’s position to interpret the words used in Item 19(a)(3) of Form N-1A to mean anything other than their plain meaning. We note that the Commission’s Final Rule adopting Form N-1A: Registration Form Used by Open-End Management Investment Companies (Investment Company Act Release No. 23064) (March 13, 1998) (the “Final Rule”) states the following:
In the Form N-1A Proposing Release, the Commission requested comment whether information about the amount of fees paid to a sub-adviser or sub-advisers of a fund helps investors evaluate and compare the fund to other funds. The Commission also asked whether this type of disclosure obscures the aggregate investment advisory fee paid by a particular fund. Most commenters supported disclosure of the aggregate fee only, maintaining that information about individual sub-advisory
fees is not relevant to investors because it does not help them compare the fees charged by different funds. The Commission is persuaded that information about sub-advisory fees is not necessary for a typical fund investor, but may be of interest to some investors. Therefore, Form N-1A, as amended, requires prospectus disclosure of the aggregate advisory fees paid by a fund and disclosure in the SAI of the amount of sub-advisory fees paid by the fund. (Emphasis added.)
The Commission’s Final Rule, by its literal terms, requires prospectus disclosure about the aggregate advisory fees paid by a fund and SAI disclosure about the amount of sub-advisory fees paid by the fund, not by the fund and the investment adviser. There is no indication that the Final Rule contemplated that sub-advisory fees paid by the investment adviser to a sub-adviser should be separately set forth in the prospectus or in the SAI.
Moreover, the literal terms of Item 19(a)(3) requires, in relevant part, disclosure of “[t]he method of calculating the advisory fee payable by the Fund including:
(i) | The total dollar amounts that the Fund paid to the adviser (aggregated with amounts paid to affiliated advisers, if any), and any advisers who are not affiliated persons of the adviser, under the investment advisory contract for the last three fiscal years[.]” (Emphasis added.) |
We believe that the language of the Final Rule, as well as the plain and literal terms of Item 19(a)(3), indicates only that amounts paid by the Fund to the investment adviser should be included in the SAI. Moreover, we believe that it would be confusing and unhelpful to shareholders to provide additional amounts that the investment adviser pays to its sub-adviser, since such amounts are already included in the amounts that will be shown in the “total dollar amounts that the Fund paid to the adviser (aggregated with amounts paid to affiliated advisers, if any).”
We also believe that the statement that “the staff considers sub-advisory fees to be payable by the Fund” is not supported by the Final Rule and Item 19(a)(3). Although Form N-1A has been revised several times since the publication of the Final Rule 20 years ago, we are not aware of any proposal by the Commission during that time that clarified that a Fund must disclose additional, potentially confusing and unhelpful information about sub-advisory fees that the investment adviser pays directly to the sub-adviser that does not have a contract with the Fund.
For these reasons, we respectfully disagree with the staff’s position and believe the disclosure is consistent with the requirements and purpose of Form N-1A.
Please direct any questions you may have regarding the Registration Statement or this letter to the undersigned at:
Adrienne Ruffle
OFI Global Asset Management, Inc.
225 Liberty Street
New York, New York 10281-1008
212-323-5231
aruffle@ofiglobal.com
Sincerely,
/s/ Adrienne Ruffle
Adrienne Ruffle
Senior Associate General Counsel
Cc: Cynthia Lo Bessette, Esq.
Joseph Benedetti, Esq.
Taylor Edwards, Esq.
Ropes & Gray LLP
OFI Global Asset Management, Inc.
225 Liberty Street
New York, New York 10281-1008
February 2, 2018
VIA EDGAR
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: |
Oppenheimer Preferred Securities and Income Fund |
To the Securities and Exchange Commission:
An electronic (EDGAR) filing is transmitted herewith pursuant to the Securities Act of 1933, as amended (the “Securities Act”), and the Investment Company Act of 1940, as amended (the “Investment Company Act”), on behalf of Oppenheimer Preferred Securities and Income Fund (the “Fund”). This filing constitutes Post-Effective Amendment No. 72 under the Securities Act and Amendment No. 73 under the Investment Company Act (the “Amendment”) to the Fund’s Registration Statement on Form N-1A (the “Registration Statement”).
The Amendment has been tagged to indicate paragraphs that include changes from Post-Effective Amendment No. 68 to the Registration Statement. This filing is being made to include (i) expense information; (ii) a copy of a signed Independent Registered Public Accounting Firm’s consent, and (iii) other non-material changes permitted by Rule 485(b) under the Securities Act.
Pursuant to Rule 485(b)(4) under the Securities Act, the undersigned counsel, who prepared or reviewed the Amendment, hereby represents to the Securities and Exchange Commission (the “Commission”) that, to our knowledge, the Amendment does not contain disclosure which would render it ineligible to become effective pursuant to Rule 485(b). This filing is intended to become effective February 5, 2018, as indicated on the facing page. This filing also includes, under separate letter, our response addressing the comments of the Commission staff.
The Commission Staff is requested to address any comments or questions you may have on this filing to:
Adrienne M. Ruffle
Senior Associate General Counsel
OFI Global Asset Management, Inc.
225 Liberty Street
New York, New York 10281-1008
212-323-5231
aruffle@ofiglobal.com
Sincerely, | |
/s/ Adrienne M. Ruffle | |
Adrienne M. Ruffle Senior Associate General Counsel |
cc: | Paulita Pike, Esq. KPMG LLP Gloria LaFond |