N-Q 1 d666552dnq.htm OPPENHEIMER EQUITY INCOME FUND Oppenheimer Equity Income Fund

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-04797

Oppenheimer Equity Income Fund

(Exact name of registrant as specified in charter)

6803 South Tucson Way, Centennial, Colorado 80112-3924

(Address of principal executive offices) (Zip code)

Cynthia Lo Bessette

OFI Global Asset Management, Inc.

225 Liberty Street, New York, New York 10281-1008

(Name and address of agent for service)

Registrant’s telephone number, including area code: (303) 768-3200

Date of fiscal year end: October 31

Date of reporting period: 1/31/2019

Item 1. Schedule of Investments.

STATEMENT OF INVESTMENTS January 31, 2019 Unaudited

 

      Shares      Value  

Common Stocks—94.2%

                  

Consumer Discretionary—8.7%

                  

Auto Components—0.7%

                  

Lear Corp.

      141,000      $         21,704,130   
                   

Automobiles—2.9%

                  

General Motors Co.

      2,175,880        84,902,838  
                   

Hotels, Restaurants & Leisure—0.9%

                  

McDonald’s Corp.

      147,260        26,327,143  
                   

Household Durables—0.5%

                  

Newell Brands, Inc.

      758,000        16,077,180  
                   

Media—1.3%

                  

Comcast Corp., Cl. A

      1,051,460        38,451,892  
                   

Multiline Retail—1.9%

                  

Nordstrom, Inc.

      332,620        15,436,894  

Target Corp.

      558,320        40,757,360  
        56,194,254  
                   

Specialty Retail—0.5%

                  

Lowe’s Cos., Inc.

      145,000        13,943,200  
                   

Consumer Staples—7.9%

                  

Beverages—3.0%

                  

Coca-Cola Co. (The)

      1,832,610        88,203,519  
                   

Food & Staples Retailing—1.5%

                  

Walmart, Inc.

      473,320        45,358,256  
                   

Food Products—0.6%

                  

Conagra Brands, Inc.

      532,000        11,512,480  

McCormick & Co., Inc.

      51,800        6,404,552  
        17,917,032  
                   

Household Products—0.8%

                  

Procter & Gamble Co. (The)

      238,290        22,987,836  
                   

Tobacco—2.0%

                  

Philip Morris International, Inc.

      764,310        58,637,863  
                   

Energy—12.9%

                  

Energy Equipment & Services—0.3%

                  

Baker Hughes a GE Co., Cl. A

      386,600        9,112,162  
                   

Oil, Gas & Consumable Fuels—12.6%

                  

Anadarko Petroleum Corp.

      762,660        36,096,698  

BP plc, Sponsored ADR

      1,292,190        53,134,853  

 

1      OPPENHEIMER EQUITY INCOME FUND

STATEMENT OF INVESTMENTS Unaudited / Continued

 

 

      Shares      Value  

Oil, Gas & Consumable Fuels (Continued)

                  

Chevron Corp.

      481,110       $         55,159,261   

ConocoPhillips

      212,830        14,406,463  

Enbridge, Inc.

      849,730        31,117,112  

EOG Resources, Inc.

      187,380        18,588,096  

Marathon Petroleum Corp.

      451,027        29,885,049  

Royal Dutch Shell plc, Cl. A, Sponsored ADR

      957,820        59,126,229  

Ship Finance International Ltd.

      1,424,270        17,319,123  

Suncor Energy, Inc.

      1,822,030        58,888,010  
        373,720,894  
                   

Financials—23.5%

                  

Capital Markets—3.7%

                  

Apollo Global Management LLC, Cl. A1

     497,445        14,565,190  

BlackRock, Inc., Cl. A

      75,050        31,151,754  

Blackstone Group LP (The)1

     634,900        21,396,130  

Charles Schwab Corp. (The)

      275,000        12,861,750  

Goldman Sachs Group, Inc. (The)

      147,120        29,131,231  
        109,106,055  
                   

Commercial Banks—10.7%

                  

Bank of America Corp.

      3,444,360        98,060,929  

BB&T Corp.

      649,550        31,698,040  

Citigroup, Inc.

      2,045,410        131,847,129  

JPMorgan Chase & Co.

      256,360        26,533,260  

KeyCorp

      601,590        9,908,187  

Zions Bancorp NA

      389,290        18,526,311  
        316,573,856  
                   

Consumer Finance—1.0%

                  

Navient Corp.

      2,469,290        28,149,906  
                   

Insurance—2.3%

                  

Prudential Financial, Inc.

      746,680        68,799,095  
                   

Real Estate Investment Trusts (REITs)—5.8%

                  

Crown Castle International Corp.

      179,850        21,053,241  

Equity Residential

      773,940        56,157,087  

Park Hotels & Resorts, Inc.

      1,209,970        36,383,798  

Prologis, Inc.

      245,690        16,991,920  

Starwood Property Trust, Inc.

      1,259,350        27,806,448  

Uniti Group, Inc.

      752,490        14,982,076  
        173,374,570  
                   

Health Care—17.8%

                  

Biotechnology—1.0%

                  

Gilead Sciences, Inc.

      424,570        29,724,146  

 

2      OPPENHEIMER EQUITY INCOME FUND

 

 

      Shares      Value  

Health Care Equipment & Supplies—2.2%

                  

Abbott Laboratories

      905,230      $         66,063,685   
                   

Health Care Providers & Services—5.9%

                  

Anthem, Inc.

      392,590        118,954,770  

UnitedHealth Group, Inc.

      204,450        55,242,390  
        174,197,160  
                

Pharmaceuticals—8.7%

                  

AstraZeneca plc, Sponsored ADR

      593,740        21,719,009  

GlaxoSmithKline plc, Sponsored ADR

      491,890        19,282,088  

Merck & Co., Inc.

      1,290,000        96,014,700  

Novartis AG, Sponsored ADR

      301,440        26,382,029  

Pfizer, Inc.

      2,229,280        94,632,936  
        258,030,762  
                

Industrials—5.2%

                  

Aerospace & Defense—0.9%

                  

Lockheed Martin Corp.

      90,940        26,344,409  
                   

Airlines—0.6%

                  

Delta Air Lines, Inc.

      381,630        18,863,971  
                   

Electrical Equipment—1.8%

                  

Eaton Corp. plc

      696,460        53,105,075  
                   

Machinery—1.3%

                  

Caterpillar, Inc.

      291,490        38,814,808  
                   

Road & Rail—0.6%

                  

Union Pacific Corp.

      108,350        17,235,234  
                   

Information Technology—8.4%

                  

Communications Equipment—3.3%

                  

Cisco Systems, Inc.

      2,061,270        97,477,458  
                   

IT Services—1.2%

                  

International Business Machines Corp.

      130,470        17,537,778  

Mastercard, Inc., Cl. A

      87,000        18,368,310  
        35,906,088  
                   

Semiconductors & Semiconductor Equipment—0.9%

                  

Texas Instruments, Inc.

      258,940        26,070,079  
                   

Software—2.3%

                  

Microsoft Corp.

      643,660        67,217,414  
                   

Technology Hardware, Storage & Peripherals—0.7%

                  

HP, Inc.

      788,400        17,368,452  

 

3      OPPENHEIMER EQUITY INCOME FUND

STATEMENT OF INVESTMENTS Unaudited / Continued

 

 

      Shares     Value 

Technology Hardware, Storage & Peripherals (Continued)

             

Western Digital Corp.

      100,000    

$        4,499,000 

     21,867,452 
              

Materials—1.5%

             

Chemicals—0.4%

             

Eastman Chemical Co.

      156,200     12,592,844 
    

Containers & Packaging—0.5%

             

International Paper Co.

      316,903     15,030,709 
    

Metals & Mining—0.6%

             

Freeport-McMoRan, Inc.

      1,515,620     17,641,817 
    

Telecommunication Services—5.0%

             

Diversified Telecommunication Services—5.0%

             

AT&T, Inc.

      3,426,230     102,992,474 

CenturyLink, Inc.

      1,040,020     15,933,106 

Verizon Communications, Inc.

      545,080    

30,012,105 

     148,937,685 
    

Utilities—3.3%

             

Electric Utilities—3.3%

             

American Electric Power Co., Inc.

      231,760     18,336,851 

Avangrid, Inc.

      323,500     16,132,945 

Entergy Corp.

      217,820     19,427,366 

Exelon Corp.

      518,130     24,745,889 

NextEra Energy, Inc.

      114,540    

20,500,369 

    

99,143,420 

Total Common Stocks (Cost $2,439,773,941)

      2,793,805,897 
    
    

Preferred Stock—1.4%

             

Becton Dickinson & Co., 6.125% Cv., Series A, Non-Vtg. (Cost $41,093,979)

      688,589     42,348,224 
     Principal Amount      

Non-Convertible Corporate Bond and Note—0.0%

             

Reynolds American, Inc., 7.00% Sr. Unsec. Nts., 8/4/41 (Cost $358,810)2

   $                 354,000     366,978 
     Shares      

Structured Securities—0.3%

             

Credit Suisse AG (London), WeatherFord International PLC Equity Linked Nts., 3/18/19

      9,396,455     6,281,577 

Credit Suisse AG (London), WeatherFord International PLC Equity Linked Nts., 3/19/19

      4,678,000    

3,122,565 

Total Structured Securities (Cost $33,703,267)

      9,404,142 

 

4      OPPENHEIMER EQUITY INCOME FUND

 

 

      Shares     Value   

Investment Company—4.1%

             

Oppenheimer Institutional Government Money Market Fund, Cl. E, 2.35%3,4

    

(Cost $120,914,853)

      120,914,853     $        120,914,853  

Total Investments, at Value (Cost $2,635,844,850)

      100.0%       2,966,840,094  

Net Other Assets (Liabilities)

      0.0          (964,836) 
  

 

 

Net Assets

                  100.0%       $     2,965,875,258  
  

 

 

Footnotes to Statement of Investments

1. Security is a Master Limited Partnership.

2. Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $366,978 or 0.01% of the Fund’s net assets at period end.

3. Rate shown is the 7-day yield at period end.

4. Is or was an affiliate, as defined in the Investment Company Act of 1940, as amended, at or during the reporting period, by virtue of the Fund owning at least 5% of the voting securities of the issuer or as a result of the Fund and the issuer having the same investment adviser. Transactions during the reporting period in which the issuer was an affiliate are as follows:

 

     Shares
October 31, 2018		    

Gross

Additions

     Gross
Reductions		     Shares
January 31, 2019		  

Investment Company

        
Oppenheimer Institutional Government Money Market Fund, Cl. E     79,346,367         301,429,077         259,860,591         120,914,853    
     Value     Income     Realized Gain
(Loss)		    

Change in
Unrealized

Gain (Loss)

  

Investment Company

        
Oppenheimer Institutional Government Money Market Fund, Cl. E   $ 120,914,853       $ 459,064       $ —       $ —    

 

5      OPPENHEIMER EQUITY INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS January 31, 2019 Unaudited

 

 

1. Organization

Oppenheimer Equity Income Fund (the “Fund”) is a diversified open-end management investment company registered under the Investment Company Act of 1940 (“1940 Act”), as amended. The Fund’s investment objective is to seek total return. The Fund’s investment adviser is OFI Global Asset Management, Inc. (“OFI Global” or the “Manager”), a wholly-owned subsidiary of OppenheimerFunds, Inc. (“OFI” or the “Sub-Adviser”). The Manager has entered into a sub-advisory agreement with OFI.

 

 

2. Significant Accounting Policies

Security Valuation. All investments in securities are recorded at their estimated fair value, as described in Note 3.

Foreign Currency Translation. The books and records of the Fund are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

(1) Value of investment securities, other assets and liabilities — at the exchange rates prevailing at Market Close as described in Note 3.

(2) Purchases and sales of investment securities, income and expenses — at the rates of exchange prevailing on the respective dates of such transactions.

 

 

3. Securities Valuation

The Fund calculates the net asset value of its shares as of 4:00 P.M. Eastern Time, on each day the New York Stock Exchange (the “Exchange” or “NYSE”) is open for trading, except in the case of a scheduled early closing of the Exchange, in which case the Fund will calculate net asset value of the shares as of the scheduled early closing time of the Exchange.

The Fund’s Board has adopted procedures for the valuation of the Fund’s securities and has delegated the day-to-day responsibility for valuation determinations under those procedures to the Manager. The Manager has established a Valuation Committee which is responsible for determining a fair valuation for any security for which market quotations are not readily available. The Valuation Committee’s fair valuation determinations are subject to review, approval and ratification by the Fund’s Board at least quarterly or more frequently, if necessary.

Valuation Methods and Inputs

Securities are valued primarily using unadjusted quoted market prices, when available, as supplied by third party pricing services or broker-dealers.

The following methodologies are used to determine the market value or the fair value of the types of securities described below:

Equity securities traded on a securities exchange (including exchange-traded derivatives other than futures and futures options) are valued based on the official closing price on the principal exchange on which the security is traded, as identified by the Manager, prior to the time 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, or if no sales

 

6      OPPENHEIMER EQUITY INCOME FUND

 

 

 

3. Securities Valuation (Continued)

occurred, the security is valued at the mean between the quoted bid and asked prices. Over-the-counter equity securities are valued at the last published sale price, or if no sales occurred, at the mean between the quoted bid and asked prices. Events occurring after the close of trading on foreign exchanges may result in adjustments to the valuation of foreign securities to more accurately reflect their fair value as of the time when the Fund’s assets are valued.

Shares of a registered investment company that are not traded on an exchange are valued at that investment company’s net asset value per share.

Corporate and government debt securities (of U.S. or foreign issuers) and municipal debt securities, short-term notes, mortgage-backed securities, collateralized mortgage obligations, and asset-backed securities are valued at the mean between the bid and asked prices utilizing evaluated prices obtained from third party pricing services or broker-dealers who may use matrix pricing methods to determine the evaluated prices. Pricing services generally price debt securities assuming orderly transactions of an institutional “round lot” size, but some trades may occur in smaller, “odd lot” sizes, sometimes at lower prices than institutional round lot trades. Standard inputs generally considered by third-party pricing vendors include reported trade data, broker-dealer price quotations, benchmark yields, issuer spreads on comparable securities, the credit quality, yield, maturity, as well as other appropriate factors.

Structured securities, swaps, swaptions, and other over-the-counter derivatives are valued utilizing evaluated prices obtained from third party pricing services or broker-dealers. Standard inputs generally considered by third-party pricing vendors include market information relevant to the underlying reference asset such as the price of financial instruments, stock market indices, foreign currencies, interest rate spreads, commodities, credit spreads, credit event probabilities, index values, individual security values, forward interest rates, variable interest rates, volatility measures, and forward currency rates, or the occurrence of other specific events.

Securities for which market quotations are not readily available, or when a significant event has occurred that would materially affect the value of the security, are fair valued either (i) by a standardized fair valuation methodology applicable to the security type or the significant event as previously approved by the Valuation Committee and the Fund’s Board or (ii) as determined in good faith by the Manager’s Valuation Committee. The Valuation Committee considers all relevant facts that are reasonably available, through either public information or information available to the Manager, when determining the fair value of a security. Those standardized fair valuation methodologies include, but are not limited to, valuing securities at the last sale price or initially at cost and subsequently adjusting the value based on: changes in company specific fundamentals, changes in an appropriate securities index, or changes in the value of similar securities which may be further adjusted for any discounts related to security-specific resale restrictions. When possible, such methodologies use observable market inputs such as unadjusted quoted prices of similar securities, observable interest rates, currency rates and yield curves. The methodologies used for valuing securities are not necessarily an indication of the risks associated with investing in those securities nor can it be assured that the Fund can obtain the fair value assigned to a security if it were to sell the security.

 

7      OPPENHEIMER EQUITY INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS Unaudited / Continued

 

 

3. Securities Valuation (Continued)

Classifications

Each investment asset or liability of the Fund is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Various data inputs may be used in determining the value of each of the Fund’s investments as of the reporting period end. These data inputs are categorized in the following hierarchy under applicable financial accounting standards:

1) Level 1-unadjusted quoted prices in active markets for identical assets or liabilities (including securities actively traded on a securities exchange)

2) Level 2-inputs other than unadjusted quoted prices that are observable for the asset or liability (such as unadjusted quoted prices for similar assets and market corroborated inputs such as interest rates, prepayment speeds, credit risks, etc.)

3) Level 3-significant unobservable inputs (including the Manager’s own judgments about assumptions that market participants would use in pricing the asset or liability).

The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities.

The Fund classifies each of its investments in investment companies which are publicly offered as Level 1. Investment companies that are not publicly offered, if any, are classified as Level 2 in the fair value hierarchy.

The table below categorizes amounts at period end based on valuation input level:

 

     Level 1—
Unadjusted
Quoted Prices		     Level 2—
Other Significant
Observable Inputs		     Level 3—
Significant
Unobservable
Inputs		     Value    

Assets Table

        

Investments, at Value:

        

Common Stocks

        

Consumer Discretionary

   $ 257,600,637     $ —     $ —     $ 257,600,637    

Consumer Staples

     233,104,506       —       —       233,104,506    

Energy

     382,833,056       —       —       382,833,056    

Financials

     696,003,482       —       —       696,003,482    

Health Care

     528,015,753       —       —       528,015,753    

Industrials

     154,363,497       —       —       154,363,497    

Information Technology

     248,538,491       —       —       248,538,491    

Materials

     45,265,370       —       —       45,265,370    

Telecommunication Services

     148,937,685       —       —       148,937,685    

Utilities

     99,143,420       —       —       99,143,420    

Preferred Stock

     42,348,224       —       —       42,348,224    

Non-Convertible Corporate Bond and Note

     —       366,978       —       366,978    

Structured Securities

     —       9,404,142       —       9,404,142    

Investment Company

     120,914,853       —       —       120,914,853    
 

 

 

  

Total Assets

   $     2,957,068,974     $     9,771,120     $ —     $ 2,966,840,094    
 

 

 

  

Forward currency exchange contracts and futures contracts, if any, are reported at their

 

8      OPPENHEIMER EQUITY INCOME FUND

 

 

 

3. Securities Valuation (Continued)

unrealized appreciation/depreciation at measurement date, which represents the change in the contract’s value from trade date. All additional assets and liabilities included in the above table are reported at their market value at measurement date.

For the reporting period, there were no transfers between levels.

 

 

4. Investments and Risks

Investments in Affiliated Funds. The Fund is permitted to invest in other mutual funds advised by the Manager (“Affiliated Funds”). Affiliated Funds are management investment companies registered under the 1940 Act, as amended. The Manager is the investment adviser of, and the Sub-Adviser provides investment and related advisory services to, the Affiliated Funds. When applicable, the Fund’s investments in Affiliated Funds are included in the Statement of Investments. Shares of Affiliated Funds are valued at their net asset value per share. As a shareholder, the Fund is subject to its proportional share of the Affiliated Funds’ expenses, including their management fee. The Manager will waive fees and/or reimburse Fund expenses in an amount equal to the indirect management fees incurred through the Fund’s investment in the Affiliated Funds.

Each of the Affiliated Funds in which the Fund invests has its own investment risks, and those risks can affect the value of the Fund’s investments and therefore the value of the Fund’s shares. To the extent that the Fund invests more of its assets in one Affiliated Fund than in another, the Fund will have greater exposure to the risks of that Affiliated Fund.

Investments in Money Market Instruments. The Fund is permitted to invest its free cash balances in money market instruments to provide liquidity or for defensive purposes. The Fund may invest in money market instruments by investing in Class E shares of Oppenheimer Institutional Government Money Market Fund (“IGMMF”), which is an Affiliated Fund. IGMMF is regulated as a money market fund under the 1940 Act, as amended. The Fund may also invest in money market instruments directly or in other affiliated or unaffiliated money market funds.

Master Limited Partnerships (“MLPs”). MLPs issue common units that represent an equity ownership interest in a partnership and provide limited voting rights. MLP common units are registered with the Securities and Exchange Commission (“SEC”), and are freely tradable on securities exchanges such as the NYSE and the NASDAQ Stock Market (“NASDAQ”), or in the over-the-counter (“OTC”) market. An MLP consists of one or more general partners, who conduct the business, and one or more limited partners, who contribute capital. MLP common unit holders have a limited role in the partnership’s operations and management. The Fund, as a limited partner, normally would not be liable for the debts of the MLP beyond the amounts the Fund has contributed, but would not be shielded to the same extent that a shareholder of a corporation would be. In certain circumstances creditors of an MLP would have the right to seek return of capital distributed to a limited partner. This right of an MLP’s creditors would continue after the Fund sold its investment in the MLP.

 

9      OPPENHEIMER EQUITY INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS Unaudited / Continued

 

 

4. Investments and Risks (Continued)

Structured Securities. The Fund invests in structured securities whose market values, interest rates and/or redemption prices are linked to the performance of underlying foreign currencies, interest rate spreads, stock market indices, prices of individual securities, commodities or other financial instruments or the occurrence of other specific events. The structured securities are often leveraged, increasing the volatility of each note’s market value relative to the change in the underlying linked financial element or event. Fluctuations in value of these securities are recorded as unrealized gains and losses in the accompanying Statement of Operations. The Fund records a realized gain or loss when a structured security is sold or matures.

Equity Security Risk. Stocks and other equity securities fluctuate in price. The value of the Fund’s portfolio may be affected by changes in the equity markets generally. Equity markets may experience significant short-term volatility and may fall sharply at times. Different markets may behave differently from each other and U.S. equity markets may move in the opposite direction from one or more foreign stock markets. Adverse events in any part of the equity or fixed-income markets may have unexpected negative effects on other market segments.

The prices of individual equity securities generally do not all move in the same direction at the same time and a variety of factors can affect the price of a particular company’s securities. These factors may include, but are not limited to, poor earnings reports, a loss of customers, litigation against the company, general unfavorable performance of the company’s sector or industry, or changes in government regulations affecting the company or its industry.

 

 

5. Market Risk Factors

The Fund’s investments in securities and/or financial derivatives may expose the Fund to various market risk factors:

Commodity Risk. Commodity risk relates to the change in value of commodities or commodity indexes as they relate to increases or decreases in the commodities market. Commodities are physical assets that have tangible properties. Examples of these types of assets are crude oil, heating oil, metals, livestock, and agricultural products.

Credit Risk. Credit risk relates to the ability of the issuer of debt to meet interest and principal payments, or both, as they come due. In general, lower-grade, higher-yield debt securities are subject to credit risk to a greater extent than lower-yield, higher-quality securities.

Equity Risk. Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market.

Foreign Exchange Rate Risk. Foreign exchange rate risk relates to the change in the U.S. dollar value of a security held that is denominated in a foreign currency. The U.S. dollar value of a foreign currency denominated security will decrease as the dollar appreciates against the currency, while the U.S. dollar value will increase as the dollar depreciates against the currency.

Interest Rate Risk. Interest rate risk refers to the fluctuations in value of fixed-income

 

10      OPPENHEIMER EQUITY INCOME FUND

 

 

 

5. Market Risk Factors (Continued)

securities resulting from the inverse relationship between price and yield. For example, an increase in general interest rates will tend to reduce the market value of already issued fixed-income investments, and a decline in general interest rates will tend to increase their value. In addition, debt securities with longer maturities, which tend to have higher yields, are subject to potentially greater fluctuations in value from changes in interest rates than obligations with shorter maturities.

Volatility Risk. Volatility risk refers to the magnitude of the movement, but not the direction of the movement, in a financial instrument’s price over a defined time period. Large increases or decreases in a financial instrument’s price over a relative time period typically indicate greater volatility risk, while small increases or decreases in its price typically indicate lower volatility risk.

 

 

6. Pending Acquisition

On October 18, 2018, Massachusetts Mutual Life Insurance Company, an indirect corporate parent of the Sub-Adviser and the Manager, announced that it has entered into an agreement whereby Invesco Ltd. (“Invesco”), a global investment management company, will acquire the Sub-Adviser (the “Transaction”). In connection with the Transaction, on January 11, 2019, the Fund’s Board unanimously approved an Agreement and Plan of Reorganization (the “Agreement”), which provides for the transfer of the assets and liabilities of the Fund to a corresponding, newly formed fund (the “Acquiring Fund”) in the Invesco family of funds (the “Reorganization”) in exchange for shares of the corresponding Acquiring Fund of equal value to the value of the shares of the Fund as of the close of business on the closing date. Although the Acquiring Fund will be managed by Invesco Advisers, Inc., the Acquiring Fund will, as of the closing date, have the same investment objective and substantially similar principal investment strategies and risks as the Fund. After the Reorganization, Invesco Advisers, Inc. will be the investment adviser to the Acquiring Fund, and the Fund will be liquidated and dissolved under applicable law and terminate its registration under the Investment Company Act of 1940, as amended. The Reorganization is expected to be a tax-free reorganization for U.S. federal income tax purposes.

The Reorganization is subject to the approval of shareholders of the Fund. Shareholders of record of the Fund on January 14, 2019 will be entitled to vote on the Reorganization and will receive a combined prospectus and proxy statement describing the Reorganization, the shareholder meeting, and a discussion of the factors the Fund’s Board considered in approving the Agreement. The combined prospectus and proxy statement is expected to be distributed to shareholders of record on or about February 28, 2019. The anticipated date of the shareholder meeting is on or about April 12, 2019.

If shareholders approve the Agreement and certain other closing conditions are satisfied or waived, the Reorganization is expected to close during the second quarter of 2019, or as soon as practicable thereafter. This is subject to change.

 

11      OPPENHEIMER EQUITY INCOME FUND

Item 2. Controls and Procedures.

 

  (a)

Based on their evaluation of the registrant’s disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940 (17 CFR 270.30a-3(c)) as of 1/31/2019, the registrant’s principal executive officer and principal financial officer found the registrant’s disclosure controls and procedures to provide reasonable assurances that information required to be disclosed by the registrant in the reports that it files under the Securities Exchange Act of 1934 (a) is accumulated and communicated to the registrant’s management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure, and (b) is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the U.S. Securities and Exchange Commission.

 

  (b)

There have been no significant changes in the registrant’s internal controls over financial reporting that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 3. Exhibits.

Exhibits attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Oppenheimer Equity Income Fund

 

By:  

/s/ Arthur P. Steinmetz

    Arthur P. Steinmetz
    Principal Executive Officer
Date:   3/15/2019

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By:  

/s/ Arthur P. Steinmetz

  Arthur P. Steinmetz
    Principal Executive Officer
Date:   3/15/2019

 

By:  

/s/ Brian S. Petersen

  Brian S. Petersen
  Principal Financial Officer
Date:   3/15/2019