485APOS

                                                  Registration No.  33-3692
                                                         File No.  811-3614

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                                   FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933           [X]

      Pre-Effective Amendment No. __                                                [   ]


      Post-Effective Amendment No. 29                                               [X]
                                   --


                                           and/or

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


      Amendment No. 34                                                     [X]
                    --


                                 Rochester Fund Municipals
                     (Exact Name of Registrant as Specified in Charter)


                   6803 South Tucson Way, Centennial, Colorado 80112-3924
                          (Address of Principal Executive Offices)

                                       (303) 768-3200
                              (Registrant's Telephone Number)


                                    Robert G. Zack, Esq.
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                                   OppenheimerFunds, Inc.
                 Two World Financial Center, 225 Liberty Street-11th Floor
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                                  New York, NY 10281-1008
                          (Name and Address of Agent for Service)

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


[   ] Immediately upon filing pursuant to paragraph (b)
[   ] On ____________ pursuant to paragraph (b)
[   ] 60 days after filing pursuant to paragraph (a)(1)
[X ]  On April 29, 2005 pursuant to paragraph (a)(1)
[   ] 75 days after filing pursuant to paragraph (a)(2)
[   ] On _______________ pursuant to paragraph (a)(2) of Rule 485


If appropriate, check the following box:

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

Rochester Fund Municipals


Prospectus dated April __, 2005




















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


















Rochester Fund Municipals is a diversified mutual fund. It seeks as high a level
of income exempt from federal income tax and New York State and New York City
personal income taxes as is consistent with its investment policies and prudent
investment management while seeking preservation of shareholders' capital.

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





















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The Right Way to Invest







37

Contents

            About the Fund
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            The Fund's Investment Objective and Principal Investment Strategies

            Main Risks of Investing in the Fund

            The Fund's Past Performance

            Fees and Expenses of the Fund

            About the Fund's Investments

            How the Fund is Managed


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

            Special Investor Services
            AccountLink
            PhoneLink
            OppenheimerFunds Internet Website

            How to Sell Shares

            By Checkwriting
            By Mail
            By Wire
            By Telephone


            How to Exchange Shares

            Shareholder Account Rules and Policies

            Dividends, Capital Gains and Taxes

            Financial Highlights








ABOUT THE FUND

The Fund's Investment Objective and Principal Investment Strategies

WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks to provide as high a
level of income exempt from federal income tax and New York State and New York
City personal income taxes as is consistent with its investment policies and
prudent investment management while seeking preservation of shareholders' capital.

WHAT DOES THE FUND MAINLY INVEST IN? To seek its investment objective:
o     As a fundamental policy, under normal market conditions, the Fund invests
      at least 80% of its net assets in tax-exempt securities, and
o     At least 75% of the Fund's investments in tax-exempt obligations must be
      investment grade. That means they must be securities rated in the four
      highest rating categories of a nationally-recognized rating organization or
      unrated securities assigned a comparable rating by the Fund's investment
      manager, OppenheimerFunds, Inc. (the "Manager").

      The Fund's tax-exempt investments can include a wide variety of debt
obligations (which are referred to as "New York municipal securities" in this
Prospectus), including securities issued by:
o     The State of New York or its political subdivisions (cities, towns and
      counties, for example),
o     Agencies, public authorities and instrumentalities (these are
      state-chartered corporations) of the State of New York, and
o     Territories, commonwealths and possessions of the United States (for
      example, Puerto Rico, Guam and the Virgin Islands) that pay interest that
      is exempt from federal income tax and New York State and New York City
      personal income taxes (in the opinion of the issuer's legal counsel when
      the security is issued).

      The Fund's investments have no maturity limitations and can include
municipal bonds (long-term obligations), municipal notes (short-term obligations)
and interests in municipal leases. At times, the Fund focuses on longer-term
securities to seek higher yields.  The Fund can buy general obligation bonds as
well as industrial development bonds and "private activity" municipal securities
that pay income subject to alternative minimum taxation. To the extent the Fund
invests in securities that may pay interest subject to alternative minimum
taxation, those securities will be counted towards the Fund's policy regarding
minimum investments in tax-exempt securities as described above. A substantial
percentage of the municipal securities the Fund buys may be "callable," allowing
the issuer of the securities to redeem them before their maturity date. The Fund
also uses certain derivative investments such as "inverse floaters" and variable
rate obligations to try to increase income.  These investments are more fully
explained in "About the Fund's Investments," below.

HOW DOES THE PORTFOLIO MANAGEMENT TEAM DECIDE WHAT SECURITIES TO BUY OR SELL? In
selecting securities for the Fund, the portfolio management team generally looks
for triple tax-exempt municipal securities using a variety of factors, which may
change over time and may vary in particular cases. Currently, the portfolio
management team focuses on:
o     Finding  primarily   investment-grade   securities  that  offer  high  income
       opportunities.
o     Buying a wide range of  securities of different  issuers  within the state of
       New York,  including  different agencies and  municipalities,  for portfolio
       diversification to help spread credit risks.
o     Looking for unrated  bonds that might  provide high income and  securities of
      smaller issuers that might be overlooked by other investors and funds.

      Investments are sold when the Manager believes better prospective
risk/return characteristics are possible from other investments.

WHO IS THE FUND DESIGNED FOR? The Fund is designed for investors who are seeking
income exempt from federal income tax and New York State and New York City
personal income taxes from a municipal bond fund focusing primarily on
investment-grade obligations.  The Fund does not seek capital appreciation.
Because it generally invests in tax-exempt securities, the Fund is not
appropriate for retirement plan accounts, nor is it designed for investors whose
main goal is capital growth. The Fund is intended to be a long-term investment
but is not a complete investment program.

Main Risks of Investing in the Fund

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

CREDIT RISK. Municipal securities are subject to credit risk.  Credit risk is the
risk that the issuer of a debt security might not make interest and principal
payments on the security as they become due. If an issuer fails to pay interest,
the Fund's income might be reduced. If an issuer fails to repay principal, the
value of that security and of the Fund's shares might be reduced. A downgrade in
an issuer's credit rating or other adverse news about an issuer can reduce the
value of that issuer's securities. To seek higher income the Fund can invest up
to 25% of its tax-exempt investments in securities rated below investment grade,
sometimes called "junk bonds." Therefore, it may have greater credit risks than
funds that buy only investment-grade bonds.

INTEREST RATE RISKS. Municipal securities are debt securities that are subject to
changes in value when prevailing interest rates change. When prevailing interest
rates fall, the values of already-issued municipal securities generally rise.
When prevailing interest rates rise, the values of already-issued municipal
securities generally fall, and the securities may sell at a discount from their
face amount. The magnitude of these price changes is generally greater for
securities having longer maturities. At times the Fund may emphasize investments
in long-term securities to seek higher income. When the average maturity of the
Fund's portfolio is longer, its share price may fluctuate more if interest rates
change.

      Additionally, the Fund can buy variable and floating rate obligations. When
interest rates fall, the yields of these securities decline. Callable bonds the
Fund buys are more likely to be called when interest rates fall, and the Fund
might then have to reinvest the proceeds of the called instrument in other
securities that have lower yields, reducing the Fund's income.

RISKS OF FOCUSING INVESTMENTS IN NEW YORK MUNICIPAL SECURITIES.  While the Fund's
fundamental policies do not allow it to concentrate its investments (that is, to
invest 25% or more of its assets in a single industry), municipal securities are
not considered an "industry" under that policy. At times the Fund can have a
relatively high portion of its portfolio holdings in particular segments of the
municipal securities market, such as general obligation bonds or hospital bonds
for example, and therefore will be vulnerable to economic or legislative events
that affect issuers in particular segments of the municipal securities market.
      Even though the Fund is "diversified" as to 75% of its assets (which means
that, as to 75% of its assets, the Fund cannot invest more than 5% of its assets
in the securities of any one issuer), the Fund invests primarily in New York
municipal securities. Therefore, the Fund's portfolio is vulnerable to changes in
economic, regulatory and political conditions in New York that can affect the
prices of those securities or the Fund's ability to sell them at an acceptable
price.

      On September 11, 2001, terrorist attacks destroyed the World Trade Center.
Those attacks resulted in substantial loss of life, damage to other buildings in
the vicinity, disruption of public transportation and business and displacement
of residents in the immediate vicinity of the World Trade Center. Destruction of
the World Trade Center continues to have a substantial impact on the city of New
York and its economy. The Statement of Additional Information contains further
information concerning special investment considerations for New York municipal
securities, including the effect of the events of September 11, 2001 on New York
City and New York State.


Tobacco Settlement Revenue Bonds. The Fund may invest a significant portion of
its assets in tobacco settlement revenue bonds.  Tobacco settlement revenue bonds
are secured by an issuing state's proportionate share in the Master Settlement
Agreement ("MSA"). The MSA is an agreement, reached out of court in November 1998
between 46 states and nearly all the U.S. tobacco manufacturers (approximately
99% of the current combined market share of tobacco manufacturers). The MSA
provides for payments annually by the manufacturers to the states and
jurisdictions in perpetuity, in exchange for releasing all claims against the
manufacturers and a pledge of no further litigation. Tobacco manufacturers pay
into a master escrow trust based on their market share, and each state receives a
fixed percentage of the payment as set forth in the MSA.

A number of states have  securitized  the future flow of those  payments by selling
bonds pursuant to indentures,  some through distinct  governmental entities created
for such  purpose.  The bonds are  backed by the future  revenue  flow that is used
for principal  and interest  payments on the bonds.  Annual  payments on the bonds,
and  thus  risk  to the  Fund,  are  highly  dependent  on the  receipt  of  future
settlement  payments to the state or its  governmental  entity,  as well as several
other  factors.  The actual amount of future  settlement  payments,  therefore,  is
dependent  on  many  factors,  including,  but  not  limited  to,  annual  domestic
cigarette   shipments,   cigarette   consumption,   inflation   and  the  financial
capability  of  participating  tobacco  companies.  As a result,  payments  made by
tobacco  manufacturers  could be  negatively  impacted  if the  decrease in tobacco
consumption is significantly  greater than the forecasted  decline.  A market share
loss by the MSA  companies to non-MSA  participating  tobacco  manufacturers  would
cause a downward  adjustment in the payment amounts.  A participating  manufacturer
filing for bankruptcy  also could cause delays or reductions in bond payments.  The
MSA itself has been subject to legal  challenges and has, to date,  withstood those
challenges.   The  Statement  of  Additional  Information  contains  more  detailed
information about the Fund's investments in tobacco settlement revenue bonds.



BORROWING FOR LEVERAGE. As a fundamental policy, the Fund can borrow from banks
in amounts up to 5% of its total assets for emergency purposes or to buy
portfolio securities. This use of "leverage" will subject the Fund to greater
costs than funds that do not borrow for leverage, and may also make the Fund's
share price more sensitive to interest rate changes.

RISKS OF DERIVATIVE INVESTMENTS.  The Fund can use derivatives to seek increased
returns. In general terms, a derivative investment is an investment contract
whose value depends on (or is derived from) the value of an underlying asset,
interest rate or index. Covered call options, "inverse floaters" and variable
rate obligations are examples of derivatives the Fund can use. The Fund typically
does not use hedging instruments, such as options, to hedge investment risks.

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

Inverse Floaters Have Special Risks. Variable rate bonds known as "inverse
      floaters" pay interest at rates that vary as the yields generally available
      on short-term tax-exempt bonds change. However, the yields on inverse
      floaters move in the opposite direction of yields on short-term bonds in
      response to market changes. As interest rates rise, inverse floaters
      produce less current income, and their market value can become volatile.
      Inverse floaters are a type of "derivative security." Some inverse floaters
      have a "cap," so that if interest rates rise above the "cap," the security
      pays additional interest income.  If rates do not rise above the "cap," the
      Fund will have paid an additional amount for a feature that proves
      worthless. The Fund's investment in inverse floaters cannot exceed 20% of
      its total assets.

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

      The value of the Fund's investments and share prices will change over time
due to a number of factors. They include changes in general bond market
movements, the change in value of particular bonds, the income they pay because
of an event affecting the issuer or changes in interest rates that can affect
bond prices overall.

      Because the Fund focuses its investments in New York municipal securities
and can buy below-investment-grade securities, it will have greater credit risks
than municipal bond funds that invest in issuers of many states or buy only
investment-grade securities. Its focus on longer-term bonds and its use of
inverse floaters as well as other derivative investments may cause greater
fluctuations in the Fund's share prices in the short term than short-term
municipal bond funds or bond funds that do not invest in derivatives.

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


The Fund's Past Performance

The bar chart and table below show one measure of the risks of investing in the
Fund, by showing changes in the Fund's performance (for its Class A shares) from
year to year for the last 10 calendar years and by showing how the average annual
total returns of the Fund's shares, both before and after taxes, compared to
those of a broad-based market index and the Consumer Price Index. The after-tax
returns for the other classes of shares will vary.

      The after-tax returns are shown for Class A shares only and are calculated
using the historical highest individual federal marginal income tax rates in
effect during the periods shown, and do not reflect the impact of state or local
taxes. In certain cases, the figure representing "Return After Taxes on
Distributions and Sale of Fund Shares" may be higher than the other return
figures for the same period. A higher after-tax return results when a capital
loss occurs upon redemption and translates into an assumed tax deduction that
benefits the shareholder. The after-tax returns are calculated based on certain
assumptions mandated by regulation and your actual after-tax returns may differ
from those shown, depending on your individual tax situation. The Fund's past
investment performance, before and after taxes, is not necessarily an indication
of how the Fund will perform in the future.

Annual Total Returns (Class A) (as of 12/31 each year)
[See appendix to prospectus for data in bar chart showing the annual total
returns]

Sales  charges  and taxes are not  included in the  calculations  of return in this
bar chart,  and if those charges and taxes were  included,  the returns may be less
than those shown.

During the period  shown in the bar chart,  the  highest  return  (not  annualized)
before taxes for a calendar  quarter was 7.74%  (1Qtr95) and the lowest return (not
annualized) before taxes for a calendar quarter was -5.67% (1Qtr94).


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Average Annual Total Returns

- ------------------------------                        5 Years          10 Years
for    the    periods    ended                      (or life of       (or life of
December 31, 2004                   1 Year        class, if less)   class, if less)

- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Class  A   Shares   (inception

5/15/86)                             ____%             ____%             ____%
  Return Before Taxes                ____%             ____%             ____%
  Return After Taxes on              ____%             ____%             ____%
  Distributions
  Return    After   Taxes   on
  Distributions  and  Sale  of
  Fund Shares

- -------------------------------------------------------------------------------------
Lehman Brothers Municipal
Bond Index (reflects no
deduction for fees, expenses

or taxes)                            ____%             ____%            ____%1

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Consumer Price Index                 ____%             ____%            ____%1

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Class  B   Shares   (inception       ____%             ____%             ____%

3/17/97)
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Class  C   Shares   (inception       ____%             ____%             ____%

3/17/97)
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------

Class  Y   Shares   (inception       ____%             ____%              N/A

4/28/00)
- -------------------------------------------------------------------------------------

1.    From 12/31/94.

The Fund's  average annual total returns  include  applicable  sales  charges:  for
Class A, the  current  maximum  initial  sales  charge of  4.75%;  for Class B, the
contingent  deferred sales charge of 5% (1-year) and 2% (5-year);  and for Class C,
the 1% contingent  deferred sales charge for the 1-year  period.  There is no sales
charge  for Class Y.  Because  Class B shares  convert  to Class A shares 72 months
after  purchase,   Class  B  "life-of-class"   performance  does  not  include  any
contingent  deferred  sales  charge  and uses  Class A  performance  for the period
after  conversion.  The returns measure the  performance of a hypothetical  account
and  assume  that  all  dividends  and  capital  gains   distributions   have  been
reinvested in additional  shares.  The  performance of the Fund's Class A shares is
compared to the Lehman  Brothers  Municipal Bond Index,  an,  unmanaged  index of a
broad  range  of  investment-grade  municipal  bonds  that  is  a  measure  of  the
performance of the general  municipal bond market.  The Fund's  performance is also
compared  to the  Consumer  Price  Index,  a  non-securities  index  that  measures
changes  in the  inflation  rate.  Performance  of the  securities  index  includes
reinvestment of income,  but does not reflect  transaction cost, fees,  expenses or
taxes and  includes  municipal  securities  from many states while the Fund invests
primarily in New York municipal securities.


Fees and Expenses of the Fund


The following tables are meant to help you understand the fees and expenses you
may pay if you buy and hold shares of the Fund. The Fund pays a variety of
expenses directly for management of its assets, administration, distribution of
its shares and other services. Those expenses are subtracted from the Fund's
assets to calculate the Fund's net asset values per share. All shareholders
therefore pay those expenses indirectly. Shareholders pay other expenses
directly, such as sales charges and account transaction charges. The numbers
below are based on the Fund's expenses during its fiscal year ended December 31,
2004.


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Shareholder Fees (charges paid directly from your investment):
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                           Class A      Class B      Class C       Class Y
                            Shares       Shares       Shares       Shares
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Maximum Sales Charge        4.75%         None         None         None
(Load) on purchases
(as % of offering price)
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Maximum Deferred Sales
Charge (Load) (as % of
the lower of the            None1         5%2          1%3          None
original offering price
or redemption proceeds)
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Annual Fund Operating Expenses (deducted from Fund assets):
(% of average daily net assets)
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- -----------------------------------------------------------------------
                           Class A    Class B      Class C
                                                             Class Y
                             Shares     Shares     Shares    Shares
- -----------------------------------------------------------------------
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Management Fees              ____%      ____%       ____%      ____%

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Distribution and/or          0.15%      1.00%       1.00%      None
Service (12b-1) Fees
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Other Expenses               0.10%      0.12%       0.12%      0.15%
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------

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

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


Expenses may vary in future years. "Other Expenses" include transfer agent fees,
custodial fees, accounting, administrative and legal expenses the Fund pays. The
"Other Expenses" in the table are based on among other things, the fees the Fund
would have paid if the transfer agent had not waived a portion of its fees under
a voluntary undertaking to the Fund to limit those fees to 0.35% of average daily
net assets per fiscal year for all classes. That undertaking may be amended or
withdrawn at any time. For the Fund's fiscal year ended December 31, 2004, the
transfer agent fees did not exceed the expense limitation described above.


1.    A contingent  deferred  sales charge may apply to  redemptions of investments
   of $1 million or more of Class A shares. See "How to Buy Shares" for details.

2.    Applies  to  redemptions  in  first  year  after  purchase.   The  contingent
   deferred  sales  charge  gradually  declines  from 5% to 1% in years one through
   six and is eliminated after that.

3.    Applies to shares redeemed within 12 months of purchase.


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

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







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

Class A Shares                   $____         $____         $____        $____

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

Class B Shares                   $____         $____         $____       $____1

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

Class C Shares                   $____         $____         $____        $____

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

Class Y Shares                   $____         $____         $____        $____

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

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

Class A Shares                   $____         $____         $____        $____

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

Class B Shares                   $____         $____         $____       $____1

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

Class C Shares                   $____         $____         $____        $____

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

Class Y Shares                   $____         $____         $____        $____

- --------------------------------------------------------------------------------
In the first  example,  expenses  include the initial  sales charge for Class A and
the  applicable  Class B or  Class C  contingent  deferred  sales  charges.  In the
second  example,  the Class A expenses  include the sales  charge,  but Class B and
Class C expenses do not include  contingent  deferred  sales  charges.  There is no
sales charge on Class Y shares.
1.    Class B expenses  for years 7 through 10 are based on Class A expenses  since
   Class  B  shares  automatically  convert  to  Class A  shares  72  months  after
   purchase.

About the Fund's Investments

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

      The Manager tries to reduce risks by diversifying investments and by
carefully researching securities before they are purchased.  However, changes in
the overall market prices of municipal securities and the income they pay can
occur at any time. The yields and share prices of the Fund will change daily
based on changes in market prices of securities, interest rates and market
conditions and in response to other economic events.

Municipal Securities. The Fund buys municipal bonds and notes, certificates of
      participation in municipal leases and other debt obligations. Generally,
      these are debt obligations issued by the State of New York and its
      political subdivisions (such as cities, towns and counties). To seek a
      higher yield, the Fund also can invest in municipal securities other than
      New York municipal securities. Although any interest from those securities
      generally would be exempt from federal taxation, any such interest may be
      subject to New York State and New York City personal income tax. The Fund
      does not expect to invest a significant portion of its assets in securities
      that are not New York municipal securities.

                 What  is  a  Municipal  Debt  Security?   A  municipal  debt
                 security  essentially is a loan by the buyer of the security
                 to the issuer of the  security.  The issuer  promises to pay
                 back the  principal  amount  of the loan and  normally  pays
                 interest exempt from federal personal income taxes.

      Municipal securities are issued to raise money for a variety of public or
      private purposes, including financing state or local governments, specific
      projects or public facilities. The Fund can invest in municipal securities
      that are "general obligations," which are secured by the issuer's pledge of
      its full faith, credit and taxing power for the payment of principal and
      interest. Some debt securities, such as zero-coupon securities, do not pay
      current interest. Other securities may be subject to calls by the issuer to
      redeem the debt or to prepayment prior to their stated maturity.


      The Fund also can buy "revenue obligations," whose interest is payable only
      from the revenues derived from a particular facility or class of
      facilities, or a specific excise tax or other revenue source such as, e.g.,
      tobacco revenue settlement bonds. Some of these revenue obligations are
      industrial development bonds and private activity bonds that pay interest
      that may be a tax preference item subject to alternative minimum taxation
      for investors subject to the alternative minimum tax. The Fund does not
      invest more than 5% of its total assets in industrial revenue bonds for an
      industrial user with less than three years' operating history if that user
      is responsible for interest and principal payments.


Municipal Lease Obligations.  Municipal leases are used by state and local
      governments to obtain financing to acquire land, equipment or facilities.
      The Fund may invest in certificates of participation that represent a
      proportionate interest in payments made under municipal lease obligations.
      Most municipal leases, while secured by the leased property, are not
      general obligations of the issuing municipality. They often contain
      "non-appropriation" clauses that provide that the municipal government has
      no obligation to make lease or installment payments in future years unless
      money is appropriated on a yearly basis.

      If the government stops making payments or transfers its payment
      obligations to a private entity, the obligation could lose value or become
      taxable. Some of these obligations may not have an active trading market,
      which means that the Fund might have difficulty selling its investment at
      an acceptable price when it wants to. The Fund cannot invest more than 5%
      of its net assets in unrated or illiquid municipal leases.

Floating Rate/Variable Rate Obligations.  Some municipal securities have variable
      or floating interest rates. Variable rates are adjustable at stated
      periodic intervals.  Floating rates are automatically adjusted according to
      a specified market rate for those investments, such as the percentage of
      the prime rate of a bank, or the 91-day U.S. Treasury Bill rate. These
      obligations may be secured by bank letters of credit or other credit
      support arrangements. Inverse floaters, discussed under the Main Risks
      section above, are types of variable rate obligations.

Ratings of Municipal Securities the Fund Buys.  Most of the municipal securities
      the Fund buys are "investment grade" at the time of purchase. The Fund does
      not invest more than 25% of its tax-exempt investments in municipal
      securities that at the time of purchase are below investment grade.
      Investment-grade securities include rated securities within the four
      highest rating categories of a nationally-recognized rating organization
      such as Moody's Investors Service, Standard and Poor's, a division of
      McGraw Hill Companies, Inc., Fitch, Inc., or unrated securities that are
      judged by the Manager to be comparable to securities rated as investment
      grade. Rating definitions of the principal national rating organizations
      are provided in Appendix A to the Statement of Additional Information. All
      municipal securities, including investment-grade securities, are subject to
      risks of default. A reduction in the rating of a security after the Fund
      buys it will not automatically require the Fund to dispose of that
      security.  However, the Manager will evaluate those securities to determine
      whether to keep them in the Fund's portfolio.

      The Manager relies to some extent on credit ratings by
      nationally-recognized rating agencies when evaluating the credit risk of
      securities selected for the Fund's portfolio.  It may also use its own
      research and analysis to evaluate risks.  Many factors affect an issuer's
      ability to make timely payments, and the credit risks of a particular
      security may change over time.

      The Fund can invest a significant portion of its assets in unrated
      securities. Some of these unrated securities may not have an active trading
      market, which means that the Fund might have difficulty valuing them and
      selling them promptly at an acceptable price.

Special Credit Risks of Lower-Grade Securities. Municipal securities rated below
      investment grade usually offer higher yields than investment-grade
      securities but they are subject to greater price fluctuations and risks of
      loss of income and principal than investment-grade municipal securities.
      Securities that are (or that have fallen) below investment grade have a
      greater risk that the issuers may not meet their debt repayment
      obligations. They also may be less liquid than investment-grade securities,
      making it difficult for the Fund to sell them at an acceptable price. Those
      risks can reduce the Fund's share prices and the income it earns. The Fund
      will not invest more than 5% of its net assets in the securities of an
      issuer if the securities are rated "B" or below by a nationally-recognized
      rating organization or, if unrated, assigned an equivalent rating by the
      Manager.

CAN THE FUND'S INVESTMENT OBJECTIVE AND POLICIES CHANGE?  The Fund's Board of
Trustees can change non-fundamental investment policies without shareholder
approval, although significant changes will be described in amendments to this
Prospectus. Fundamental policies cannot be changed without the approval of a
majority of the Fund's outstanding voting shares. The Fund's investment objective
is a fundamental policy. Other investment restrictions that are fundamental
policies are listed in the Statement of Additional Information. An investment
policy is not fundamental unless this Prospectus or the Statement of Additional
Information says that it is.

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

"When-Issued" and "Delayed-Delivery" Transactions.  The Fund can purchase
      municipal securities on a "when-issued" basis and can purchase or sell such
      securities on a "delayed-delivery" basis.  These terms refer to securities
      that have been created and for which a market exists, but which are not
      available for immediate delivery.  The Fund does not intend to enter into
      these transactions for speculative purposes. During the period between the
      purchase and settlement, no payment is made for the security and no
      interest accrues to the Fund from the investment until the Fund receives
      the security on settlement of the trade.  There is a risk of loss to the
      Fund if the value of the security declines prior to the settlement date. As
      a fundamental policy, securities purchased on a "when-issued" or
      "delayed-delivery" basis cannot exceed 10% of the Fund's net assets.

Illiquid and Restricted Securities.  Investments may be illiquid because they do
      not have an active trading market, making it difficult to value them or
      dispose of them promptly at an acceptable price. A restricted security may
      have a contractual restriction on its resale or cannot be sold publicly
      until it is registered under the Securities Act of 1933. The Fund will not
      invest more than 15% of its net assets in illiquid and restricted
      securities. That limit includes unrated or illiquid tax-exempt municipal
      leases that cannot be more than 5% of the Fund's net assets. Certain
      restricted securities that are eligible for resale to qualified
      institutional purchasers may not be subject to the 15% limit. The Manager
      monitors holdings of illiquid securities on an ongoing basis to determine
      whether to sell any holdings to maintain adequate liquidity.

Zero-Coupon Securities. The Fund can invest without limit in zero-coupon
      securities. These debt obligations do not pay interest prior to their
      maturity date or else they do not start to pay interest at a stated coupon
      rate until a future date. They are issued and traded at a discount from
      their face amount. The discount varies as the securities approach their
      maturity date (or the date interest payments are scheduled to begin). When
      interest rates change, zero-coupon securities are subject to greater
      fluctuations in their value than securities that pay current interest. The
      Fund accrues the discount on zero-coupon bonds as tax-free income on a
      current basis. The Fund may have to pay out the imputed income on
      zero-coupon securities without receiving actual cash payments currently.

Temporary Defensive and Interim Investments. In times of unstable or adverse
      market, economic or political conditions, the Fund can invest up to 100% of
      its assets in temporary investments that are inconsistent with the Fund's
      principal investment strategies. Generally, the Fund's defensive or interim
      investments would be U.S. government securities or highly-rated corporate
      debt securities, prime commercial paper or certificates of deposit of
      domestic banks. The Fund also might hold these types of securities pending
      the investment of proceeds from the sale of portfolio securities or to meet
      anticipated redemptions of Fund shares. The income from some of these
      investments might not be tax exempt, and therefore when making those
      investments the Fund might not achieve its objective.


PORTFOLIO HOLDINGS.  The Fund's portfolio holdings are included in semi-annual
      and annual reports that are distributed to shareholders of the Fund within
      60 days after the close of  the period for which such report is being made.
      The Fund also makes disclosures of the portfolio securities holdings in
      Statement of Investments under Form N-Q, filed with the SEC no later than
      60 days after the close of the first and third fiscal quarters. These
      additional quarterly filings are publicly available at the SEC. Therefore,
      portfolio holdings of the Fund are made publicly available no later than 60
      days after the close of the Fund's fiscal quarter.


How the Fund is Managed

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


      The Manager has been an investment advisor since 1960. The Manager and its
subsidiaries and controlled affiliates managed more than $____ billion in assets
as of March 31, 2005, including other Oppenheimer funds with more than 7 million
shareholder accounts. The Manager is located at Two World Financial Center, 225
Liberty Street, 11th Floor, New York, New York 10281-1008.


Portfolio Managers. The Fund is managed by a portfolio management team comprised
      of Ronald Fielding and other investment professionals selected from the
      Manager's Rochester Division.  This portfolio management team is primarily
      responsible for the day-to-day management of the Fund's portfolio. Mr.
      Fielding is a Senior Vice President of the Manager since January 1996 and a
      Vice President of the Fund.  Mr. Fielding serves in a similar capacity for
      other Oppenheimer funds.


Advisory Fees. Under the Investment Advisory Agreement effective January 1, 2005,
      the Fund pays the Manager an advisory fee at an annual rate, payable
      monthly, which declines on additional assets as the Fund grows: 0.54% of
      the first $100 million of average daily net assets, 0.52% on the next $150
      million, 0.47% on the next $1.75 billion, 0.46% on the next $3 billion,
      0.45% on the next $3 billion and 0.44% of average daily net assets over $8
      billion. The Fund's management fee for its last fiscal year ended December
      31, 2004, was ___% of average annual net assets for each class of shares.

PENDING LITIGATION.  A consolidated amended complaint has been filed as
putative derivative and class actions against the Manager, Distributor and
Transfer Agent, as well as 51 of the Oppenheimer funds (collectively the
"funds") including the Fund, 31 present and former Directors or Trustees and
9 present and former officers of certain of the Funds. This complaint, filed
in the U.S. District Court for the Southern District of New York on January
10, 2005, consolidates into a single action and amends six individual
previously-filed putative derivative and class action complaints. Like those
prior complaints, the complaint alleges that the Manager charged excessive
fees for distribution and other costs, improperly used assets of the funds in
the form of directed brokerage commissions and 12b-1 fees to pay brokers to
promote sales of the funds, and failed to properly disclose the use of fund
assets to make those payments in violation of the Investment Company Act and
the Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary
duties to Fund shareholders under the Investment Company Act and at common
law.  The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.

      The Manager and the Distributor believe the claims asserted in these law
suits to be without merit, and intend to defend the suits vigorously. The Manager
and the Distributor do not believe that the pending actions are likely to have a
material adverse effect on the Fund or on their ability to perform their
respective investment advisory or distribution agreements with the Fund.


ABOUT YOUR ACCOUNT

How to Buy Shares

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

Buying Shares Through Your Dealer. You can buy shares through any dealer, broker
      or financial institution that has a sales agreement with the Distributor.
      Your dealer will place your order with the Distributor on your behalf.
Buying Shares Through the Distributor. Complete an OppenheimerFunds new account
      application and return it with a check payable to "OppenheimerFunds
      Distributor, Inc." Mail it to P.O. Box 5270, Denver, Colorado 80217. If you
      don't list a dealer on the application, the Distributor will act as your
      agent in buying the shares. However, we recommend that you discuss your
      investment with a financial advisor before you make a purchase to be sure
      that the Fund is appropriate for you.
o     Paying by Federal Funds Wire. Shares purchased through the Distributor may
      be paid for by Federal Funds wire. The minimum investment is $2,500. Before
      sending a wire, call the Distributor's Wire Department at 1.800.225.5677 to
      notify the Distributor of the wire and to receive further instructions.
o     Buying Shares Through OppenheimerFunds AccountLink. With AccountLink, you
      pay for shares by electronic funds transfers from your bank account. Shares
      are purchased for your account by a transfer of money from your bank
      account through the Automated Clearing House (ACH) system. You can provide
      those instructions automatically, under an Asset Builder Plan, described
      below, or by telephone instructions using OppenheimerFunds PhoneLink, also
      described below. Please refer to "AccountLink," below for more details.

o     Buying Shares Through Asset Builder Plans. You may purchase shares of the
      Fund automatically each month from your account at a bank or other
      financial institution under an Asset Builder Plan with AccountLink. Details
      are in the Asset Builder application and the Statement of Additional
      Information.


WHAT IS THE MINIMUM AMOUNT YOU MUST INVEST? In most cases, you can buy Fund
shares with a minimum initial investment of $1,000 and make additional
investments at any time with as little as $50. There are reduced minimums
available under the following special investment plans:
o     By using an Asset Builder Plan or Automatic Exchange Plan (details are in
      the Statement of Additional Information), or government allotment plan, you
      can make subsequent investments (after making an initial investment of
      $500) for as little as $50. For any type of account established under one
      of these plans prior to November 1, 2002, the minimum additional investment
      will remain $25.
o     The minimum investment requirement does not apply to reinvesting dividends
      from the Fund or other Oppenheimer funds (a list of them appears in the
      Statement of Additional Information, or you can ask your dealer or call the
      Transfer Agent), or reinvesting distributions from unit investment trusts
      that have made arrangements with the Distributor.

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


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

      The net asset value per share for a class of shares on a "regular business
      day" is determined by dividing the value of the Fund's net assets
      attributable to that class by the number of shares of that class
      outstanding on that day.  To determine net asset values, the Fund assets are
      valued primarily on the basis of current market quotations.  If market
      quotations are not readily available or do not accurately reflect fair
      value for a security (in the Manager's judgment) or if a security's value
      has been materially affected by events occurring after the close of the
      exchange or market on which the security is principally traded, that
      security may be valued by another method that the Board of
      Directors/Trustees believes accurately reflects the fair value.

            The Board has adopted valuation procedures for the Fund and has
      delegated the day-to-day responsibility for fair value determinations to
      the Manager's Valuation Committee.  Fair value determinations by the
      Manager are subject to review, approval and ratification by the Board at its
      next scheduled meeting after the fair valuations are determined.  In
      determining whether current market prices are readily available and
      reliable, the Manager monitors the information it receives in the ordinary
      course of its investment management responsibilities for significant events
      that it believes in good faith will affect the market prices of the
      securities of issuers held by the Fund.  Those may include events affecting
      specific issuers (for example, a halt in trading of the securities of an
      issuer on an exchange during the trading day) or events affecting
      securities markets (for example, a foreign securities market closes early
      because of a natural disaster).

            If, after the close of the principal market on which a security held
      by the Fund is traded and before the time as of which the Fund's net asset
      values are calculated that day, a significant event occurs that the Manager
      learns of and believes in the exercise of its judgment will cause a
      material change in the value of that security from the closing price of the
      security on the principal market on which it is traded, the Manager will
      use its best judgment to determine a fair value for that security.

            The Manager believes that foreign securities values may be affected
      by volatility that occurs in U.S. markets on a trading day after the close
      of foreign securities markets.  The Manager's fair valuation procedures
      therefore include a procedure whereby foreign securities prices may be
      "fair valued" to take those factors into account.

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

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

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

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


- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Class A Shares. If you buy Class A shares, you pay an initial sales charge (on
      investments up to $1 million). The amount of that sales charge will vary
      depending on the amount you invest. The sales charge rates are listed in
      "How Can You Buy Class A Shares?" below.
- -----------------------------------------------------------------------------------
Class B Shares. If you buy Class B shares, you pay no sales charge at the time of
      purchase, but you will pay an annual asset-based sales charge. If you sell
      your shares within 6 years of buying them, you will normally pay a
      contingent deferred sales charge. That contingent deferred sales charge
      varies depending on how long you own your shares, as described in "How Can
      You Buy Class B Shares?" below.
- -----------------------------------------------------------------------------------
Class C Shares. If you buy Class C shares, you pay no sales charge at the time of
      purchase, but you will pay an annual asset-based sales charge. If you sell
      your shares within 12 months of buying them, you will normally pay a
      contingent deferred sales charge of 1.0%, as described in "How Can You Buy
      Class C Shares?" below.
- -----------------------------------------------------------------------------------
Class Y Shares. Class Y shares generally are offered only to certain
      institutional investors that have special agreements with the Distributor,
      as described in "Who Can Buy Class Y Shares?" below.

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

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

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

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

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


      If you invest $1 million or more, in most cases Class A shares will be the
      most advantageous choice, no matter how long you intend to hold your
      shares. The Distributor will not accept purchase orders of $100,000 or more
      for Class B shares or $1 million or more of Class C shares from a single
      investor.  Dealers or other financial intermediaries purchasing shares for
      their customers in omnibus accounts are responsible for compliance with
      those limits.


o     Investing for the Longer Term.  If you are  investing  less than $100,000 for
      the  longer-term,  for  example  for  retirement,  and do not  expect to need
      access  to your  money  for  seven  years  or  more,  Class B  shares  may be
      appropriate.

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


      Additionally, the dividends payable to Class B and Class C shareholders
      will be reduced by the additional expenses borne by those classes that are
      not borne by Class A or Class Y shares, such as the Class B and Class C
      asset-based sales charge described below and in the Statement of Additional
      Information. Also, checkwriting is not available on accounts subject to a
      contingent deferred sales charge.


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

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

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







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

 Amount of Purchase       Front-End Sales  Front-End Sales   Concession As a
                                           Charge As a

                          Charge As a      Percentage of
                          Percentage of    Net               Percentage of
                          Offering Price   Amount Invested   Offering Price
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 Less than $50,000             4.75%             4.98%             4.00%
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $50,000 or more but           4.50%             4.71%             4.00%
 less than $100,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $100,000 or more but          3.50%             3.63%             3.00%
 less than $250,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $250,000 or more but          2.50%             2.56%             2.25%
 less than $500,000
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 $500,000 or more but          2.00%             2.04%             1.80%
 less than $1 million
 ------------------------------------------------------------------------------


Due to  rounding,  the actual  sales  charge for a  particular  transaction  may be
higher or lower than the rates listed above.

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

Can You Reduce Class A Sales Charges?  You and your spouse may be eligible to buy
Class A shares of the Fund at reduced sales charge rates set forth in the table
above under the Fund's "Right of Accumulation" or a "Letter of Intent." The Fund
reserves the right to modify or to cease offering these programs at any time
o     Right of Accumulation. To qualify for the reduced Class A sales charge that
         would apply to a larger purchase than you are currently making (as
         shown in the table above), you can add the value of any Class A,
         Class B or, effective March 18, 2005, Class C shares of the Fund or
         other Oppenheimer funds that you or your spouse currently own, or are
         currently purchasing, to the value of your Class A share purchase.
         Your Class A shares of Oppenheimer Money Market Fund, Inc. or
         Oppenheimer Cash Reserves on which you have not paid a sales charge
         will not be counted for this purpose. In totaling your holdings, you
         may count shares held in your individual accounts (including IRAs and
         403(b) plans), your joint accounts with your spouse, or accounts you
         or your spouse hold as trustees or custodians on behalf of your
         children who are minors. A fiduciary can count all shares purchased
         for a trust, estate or other fiduciary account (including employee
         benefit plans for the same employer) that has multiple accounts. To
         qualify for this Right of Accumulation, if you are buying shares
         directly from the Fund you must inform the Fund's Distributor of your
         eligibility and holdings at the time of your purchase. If you are
         buying shares through your financial intermediary you must notify
         your intermediary of your eligibility for this Right of Accumulation
         at the time of your purchase.

               To count shares of eligible Oppenheimer funds held in accounts at
         other intermediaries under this Right of Accumulation, you may be
         requested to provide the Distributor or your current intermediary
         (depending on the way you are buying your shares) a copy of each account
         statement showing your current holdings of the Fund or other eligible
         Oppenheimer funds, including statements for accounts held by you and
         your spouse or in retirement plans or trust or custodial accounts for
         minor children as described above. The Distributor or intermediary
         through which you are buying shares will combine the value of all your
         eligible Oppenheimer fund accounts based on the current offering price
         per share to determine what Class A sales charge breakpoints you may
         qualify for on your current purchase.

o     Letters of Intent. You may also qualify for reduced Class A sales charges
         by submitting a Letter of Intent to the Distributor. A Letter of
         Intent is a written statement of your intention to purchase a
         specified value of Class A, Class B or (effective March 18, 2005)
         Class C shares of the Fund or other Oppenheimer funds over a 13-month
         period. The total amount of your intended purchases of Class A, Class
         B and (effective March 18, 2005) Class C shares will determine the
         reduced sales charge rate that will apply to your Class A share
         purchases of the Fund during that period. You can choose to include
         purchases made up to 90 days before the date that you submit a
         Letter.  Your Class A shares of Oppenheimer Money Market Fund, Inc.
         or Oppenheimer Cash Reserves on which you did not pay a sales charge
         will not be counted for this purpose. Submitting a Letter of Intent
         does not obligate you to purchase the specified amount of shares. You
         can also apply the Right of Accumulation to these purchases.

            If you do not complete the Letter of Intent, the front-end
         sales charge you paid on your purchases will be recalculated to
         reflect the actual value of shares you purchased.  A certain
         portion of your shares will be held in escrow by the Fund's
         Transfer Agent for this purpose. Please refer to "How to Buy
         Shares - Letters of Intent" in the Fund's Statement of Additional
         Information for more complete information.

Other Special Sales Charge Arrangements and Waivers.  The Fund and the
Distributor offer other opportunities to purchase shares without front-end
or contingent deferred sales charges under the programs described below.
The Fund reserves the right to amend or discontinue these programs at any
time without prior notice.
o     Dividend Reinvestment.  Dividends and/or capital gains distributions
         received by a shareholder from the Fund may be reinvested in shares of
         the Fund or any of the other Oppenheimer funds without a sales charge,
         at the net asset value per share in effect on the payable date. You must
         notify the Transfer Agent in writing to elect this option and must have
         an existing account in the fund selected for reinvestment.
o     Exchanges of Shares.  Shares of the Fund may be exchanged for shares of
         certain other Oppenheimer funds at net asset value per share at the time
         of exchange, without sales charge, and shares of the Fund can be
         purchased by exchange of shares of certain other Oppenheimer funds on
         the same basis. Please refer to "How to Exchange Shares" in this
         Prospectus and in the Statement of Additional Information for more
         details, including a discussion of circumstances in which sales charges
         may apply on exchanges
o     Reinvestment Privilege.  Within six months of a redemption of certain Class
         A and Class B shares, the proceeds may be reinvested in Class A shares
         of the Fund without sales charge. This privilege applies to redemptions
         of Class A shares that were subject to an initial sales charge or Class
         A or Class B shares that were subject to a contingent deferred sales
         charge when redeemed. The investor must ask the Transfer Agent for that
         privilege at the time of reinvestment and must identify the account from
         which the redemption was made.

Other Special Reductions and Waivers. The Fund and the Distributor offer
      additional arrangements to reduce or eliminate front-end sales charges or
      to waive contingent deferred sales charges for certain types of
      transactions and for certain classes of investors (primarily retirement
      plans that purchase shares in special programs through the Distributor).
      These are described in greater detail in Appendix C to the Statement of
      Additional Information, which may be ordered by calling 800.225.5677 or
      through the OppenheimerFunds website, at www.oppenheimerfunds.com (under
                                               ------------------------
      the hyperlinks "Access Accounts and Services - Forms & Literature" - "Order
      Literature" - "Statement of Additional Information"). A description of
      these waivers and special sales charge arrangements is also available for
      viewing on the OppenheimerFunds website (under the hyperlinks "Research
      Fund - Fund Documents - View a description..."). To receive a waiver or
      special sales charge rate under these programs, the purchaser must notify
      the Distributor (or other financial intermediary through which shares are
      being purchased) at the time of purchase or notify the Transfer Agent at
      the time of redeeming shares for those waivers that apply to contingent
      deferred sales charges.


Class A Contingent Deferred Sales Charge. There is no initial sales charge on
      purchases of Class A shares of any one or more of the Oppenheimer funds
      aggregating $1 million or more. The Distributor pays dealers of record
      concessions in an amount equal to 1.0% of purchases of $1 million or more
      (other than purchases by retirement plans, which are not permitted in the
      Fund). That concession will not be paid on purchases of shares by exchange
      or that were previously subject to a front-end sales charge and dealer
      concession.

      If you redeem any of those shares within a 24 month "holding period"
      measured from the beginning of the calendar month of their purchase, a
      contingent deferred sales charge (called the "Class A contingent deferred
      sales charge") may be deducted from the redemption proceeds. That sales
      charge will be equal to 1.0% of the lesser of:
o     the aggregate net asset value of the redeemed shares at the time of
      redemption (excluding shares purchased by reinvestment of dividends or
      capital gain distributions) or
o     the original net asset value of the redeemed shares.

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

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

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

- --------------------------------------------------------------------------------
Years Since Beginning of Month in       Contingent Deferred Sales Charge on
Which Purchase Order was Accepted       Redemptions in That Year
                                        (As % of Amount Subject to Charge)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
0 - 1                                   5.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1 - 2                                   4.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2 - 3                                   3.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
3 - 4                                   3.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4 - 5                                   2.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
5 - 6                                   1.0%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
More than 6                             None
- --------------------------------------------------------------------------------
In the table, a "year" is a 12-month  period.  In applying the contingent  deferred
sales charge,  all purchases are  considered to have been made on the first regular
business day of the month in which the purchase was made.


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

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


WHO CAN BUY CLASS Y SHARES?  Class Y shares are sold at net asset value per share
without a sales charge directly to institutional investors that have special
agreements with the Distributor for this purpose. They may include insurance
companies, registered investment companies, employee benefit plans and Section
529 plans, among others.


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

DISTRIBUTION AND SERVICE (12b-1) PLANS.


Service Plan for Class A Shares. The Fund has adopted a Service Plan for Class A
      shares. It reimburses the Distributor for a portion of its costs incurred
      for services provided to accounts that hold Class A shares. Reimbursement
      is made quarterly at an annual rate of up to 0.15% of the average annual
      net assets of Class A shares of the Fund. The Board of Trustees can
      increase that fee to 0.25% of average annual net assets without shareholder
      approval. Shareholders will be notified of any such change. The Distributor
      currently uses all of those fees to pay dealers, brokers, banks and other
      financial institutions quarterly for providing personal service and
      maintenance of accounts of their customers that hold Class A shares.


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

      The asset-based sales charge and service fees increase Class B and Class C
      expenses by 1.00% of the net assets per year of the respective class.
      Because these fees are paid out of the Fund's assets on an ongoing basis,
      over time these fees will increase the cost of your investment and may cost
      you more than other types of sales charges.

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

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


      The Distributor currently pays a sales concession of 0.75% of the purchase
      price of Class C shares to dealers from its own resources at the time of
      sale. Including the advance of the service fee, the total amount paid by
      the Distributor to the dealer at the time of sale of Class C shares is
      therefore 1.00% of the purchase price. The Distributor pays the asset-based
      sales charge as an ongoing concession to the dealer on Class C shares that
      have been outstanding for a year or more. The Distributor normally retains
      the Class C asset-based sales charge during the first year after Class C
      shares are purchased. See the Statement of Additional Information for
      exceptions.

      Under certain circumstances, the Distributor will pay the full Class B or
      Class C asset-based sales charge and the service fee to the dealer
      beginning in the first year after purchase of such shares in lieu of paying
      the dealer the sales concession and the advance of the first year's service
      fee at the time of purchase, if there is a special agreement between the
      dealer and the Distributor.  In those circumstances, the sales concession
      will not be paid to the dealer.

      In addition, the Manager and the Distributor may make substantial payments
      to dealers or other financial intermediaries and service providers for
      distribution and/or shareholder servicing activities, out of their own
      resources, including the profits from the advisory fees the Manager
      receives from the Fund.  Some of these distribution-related payments may be
      made to dealers or financial intermediaries for marketing, promotional or
      related expenses; these payments are often referred to as "revenue
      sharing."  In some circumstances, those types of payments may create an
      incentive for a dealer or financial intermediary or its representatives to
      recommend or offer shares of the Fund or other Oppenheimer funds to its
      customers.  You should ask your dealer or financial intermediary for more
      details about any such payments it receives.


Special Investor Services

ACCOUNTLINK. You can use our AccountLink feature to link your Fund account with
an account at a U.S. bank or other financial institution. It must be an Automated
Clearing House (ACH) member. AccountLink lets you:
    o transmit funds electronically to purchase shares by telephone (through a
      service representative or by PhoneLink) or automatically under Asset
      Builder Plans, or
    o have the Transfer Agent send redemption proceeds or transmit dividends and
      distributions directly to your bank account. Please call the Transfer Agent
      for more information.
      You may purchase shares by telephone only after your account has been
established. To purchase shares in amounts up to $250,000 through a telephone
representative, call the Distributor at 1.800.225.5677. The purchase payment will
be debited from your bank account.


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


PHONELINK. PhoneLink is the OppenheimerFunds automated telephone system that
enables shareholders to perform a number of account transactions automatically
using a touch-tone phone. PhoneLink may be used on already-established Fund
accounts after you obtain a Personal Identification Number (PIN), by calling the
PhoneLink number, 1.800.225.5677.
Purchasing Shares. You may purchase shares in amounts up to $100,000 by phone, by
      calling 1.800.225.5677. You must have established AccountLink privileges to
      link your bank account with the Fund to pay for these purchases.
Exchanging Shares. With the OppenheimerFunds Exchange Privilege, described below,
      you can exchange shares automatically by phone from your Fund account to
      another OppenheimerFunds account you have already established by calling
      the special PhoneLink number.
Selling Shares. You can redeem shares by telephone automatically by calling the
      PhoneLink number and the Fund will send the proceeds directly to your
      AccountLink bank account. Please refer to "How to Sell Shares," below for
      details.

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

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

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


How to Sell Shares

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

Certain Requests Require a Signature Guarantee. To protect you and the Fund from
      fraud, the following redemption requests must be in writing and must
      include a signature guarantee (although there may be other situations that
      also require a signature guarantee):

   o  You wish to redeem more than $100,000 and receive a check.
   o  The redemption check is not payable to all shareholders listed on the
      account statement.
   o  The redemption check is not sent to the address of record on your account
      statement.
   o  Shares are being transferred to a Fund account with a different owner or
      name.

   o  Shares are being redeemed by someone (such as an Executor) other than the
      owners.

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

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

CHECKWRITING. To write checks against your Fund account, request that privilege
on your account application, or contact the Transfer Agent for signature cards.
They must be signed (with a signature guarantee) by all owners of the account and
returned to the Transfer Agent so that checks can be sent to you to use.
Shareholders with joint accounts can elect in writing to have checks paid over
the signature of one owner. If you previously signed a signature card to
establish checkwriting in another Oppenheimer fund, simply call 1.800.225.5677 to
request checkwriting for an account in this Fund with the same registration as
the other account.

o     Checks can be written to the order of whomever you wish, but may not be
      cashed at the bank the checks are payable through or the Fund's custodian
      bank.
o     Checkwriting privileges are not available for accounts holding shares that
      are subject to a contingent deferred sales charge.
o     Checks must be written for at least $500. Checks written below the stated
      amount on the check will not be accepted. However, if you have existing
      checks indicating a $100 minimum, you may still use them for amounts of
      $100 or more.
o     Checks cannot be paid if they are written for more than your account value.
      Remember, your shares fluctuate in value and you should not write a check
      close to the total account value.
o     You may not write a check that would require the Fund to redeem shares that
      were purchased by check or Asset Builder Plan payments within the prior 10
      days.
o     Don't use your checks if you changed your Fund account number, until you
      receive new checks.


HOW DO YOU SELL SHARES BY MAIL? Write a letter of instruction that includes:
   o  Your name,
   o  The Fund's name,
   o  Your Fund account number (from your account statement),
   o  The dollar amount or number of shares to be redeemed,
   o  Any special payment instructions,
   o  Any share certificates for the shares you are selling,
   o  The signatures of all registered owners exactly as the account is

      registered, and
   o  Any special documents requested by the Transfer Agent to assure proper
      authorization of the person asking to sell the shares.

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

HOW DO YOU SELL SHARES BY TELEPHONE? You and your dealer representative of record
may also sell your shares by telephone. To receive the redemption price
calculated on a particular regular business day, your call must be received by
the Transfer Agent by the close of the Exchange that day, which is normally 4:00
P.M., but may be earlier on some days. You may not redeem shares under a share
certificate by telephone.
   o  To redeem shares through a service representative or automatically on
      PhoneLink, call 1.800.225.5677.

      Whichever method you use, you may have a check sent to the address on the
account statement, or, if you have linked your Fund account to your bank account
on AccountLink, you may have the proceeds sent to that bank account.

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

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

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

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

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

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

      To determine whether a contingent deferred sales charge applies to a
redemption, the Fund redeems shares in the following order:
   1. shares acquired by reinvestment of dividends and capital gains
      distributions,
   2. shares held for the holding period that applies to the class, and
   3. shares held the longest during the holding period.

Contingent deferred sales charges are not charged when you exchange shares of the
Fund for shares of other Oppenheimer funds. However, if you acquire Class B or
Class C shares of this Fund by exchanging shares of another Oppenheimer fund that
are still subject to a contingent deferred sales charge holding period, that
holding period will carry over to this Fund. If you exchange Class A shares
subject to a contingent deferred sales charge of another Oppenheimer fund for
Class A shares of this Fund, the 24 month contingent deferred sales charge
holding period applicable to Class A shares of this Fund will apply. If you
exchange Class A shares subject to a contingent deferred sales charge holding
period of this Fund for Class A shares of another Oppenheimer fund, the holding
period of the other Oppenheimer fund will normally apply.

How to Exchange Shares


If you want to change all or part of your investment from one Oppenheimer fund to
another, you can exchange your shares for shares of the same class of another
Oppenheimer fund that offers the exchange privilege. For example, you can
exchange Class A shares of the Fund only for Class A shares of another fund. To
exchange shares, you must meet several conditions:


   o  Shares of the fund selected for exchange must be available for sale in your
      state of residence.

   o  The prospectus of  the selected fund must offer the exchange privilege.
   o  When you establish an account, you must hold the shares you buy for at
      least seven days before you can exchange them. After your account is open
      for seven days, you can exchange shares on any regular business day,
      subject to the limitations described below.
   o  You must meet the minimum purchase requirements for the selected fund.
      o     Generally,  exchanges may be made only between  identically  registered
accounts,  unless all account  owners send  written  exchange  instructions  with a
signature guarantee.
   o  Before exchanging into a fund, you must obtain its prospectus and should
      read it.

      For tax purposes, an exchange of shares of the Fund is considered a sale of
those shares and a purchase of the shares of the fund to which you are
exchanging. An exchange may result in a capital gain or loss.

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

In some cases, sales charges may be imposed on exchange  transactions.  In general,
a contingent  deferred  sales  charge  (CDSC) is not imposed on exchanges of shares
that are subject to a CDSC.  However,  if you exchange shares that are subject to a
CDSC,  the CDSC holding  period will be carried over to the  acquired  shares,  and
the CDSC may be imposed if those  shares  are  redeemed  before the end of the CDSC
holding period.

There  are a number of other  special  conditions  and  limitations  that  apply to
certain types of exchanges.  These  conditions and  circumstances  are described in
detail in the "How to  Exchange  Shares"  section in the  Statement  of  Additional
Information.

HOW DO YOU SUBMIT EXCHANGE REQUESTS? Exchanges may be requested in writing, by
telephone or internet, or by establishing an Automatic Exchange Plan.

Written Exchange Requests. Send an OppenheimerFunds Exchange Request form, signed
      by all owners of the account, to the Transfer Agent at the address on the
      back cover. Exchanges of shares for which share certificates have been
      issued cannot be processed unless the Transfer Agent receives the
      certificates with the request.

Telephone and Internet Exchange Requests. Telephone exchange requests may be made
      either by calling a service representative or by using PhoneLink by calling
      1.800.225.5677. You may submit internet exchange requests on the
      OppenheimerFunds internet website, at www.oppenheimerfunds.com. You must
                                            ------------------------
      have obtained a user I.D. and password to make transactions on that
      website. Telephone and/or internet exchanges 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 exchanged by telephone
      or the internet.

Automatic Exchange Plan. Shareholders can authorize the Transfer Agent to
      exchange a pre-determined amount of shares automatically on a monthly,
      quarterly, semi-annual or annual basis.


Please refer to "How to Exchange Shares" in the Statement of Additional
Information for more details.

ARE THERE LIMITATIONS ON FREQUENT PURCHASES, REDEMPTIONS AND EXCHANGES?

Risks from Excessive Purchase, Redemption and Short-Term Exchange Activity. The
OppenheimerFunds exchange privilege affords investors the ability to switch their
investments among Oppenheimer funds if their investment needs change. However,
there are limits on that privilege. Frequent purchases, redemptions and exchanges
of fund shares may interfere with the Manager's ability to manage the fund's
investments efficiently, increase the fund's transaction and administrative costs
and/or affect the fund's performance, depending on various factors, such as the
size of the fund, the nature of its investments, the amount of fund assets the
portfolio manager maintains in cash or cash equivalents, the aggregate dollar
amount and the number and frequency of trades. If large dollar amounts are
involved in exchange and/or redemption transactions, the Fund might be required
to sell portfolio securities at unfavorable times to meet redemption or exchange
requests, and the Fund's brokerage or administrative expenses might be increased.

Therefore, the Manager and the Fund's Board of Trustees have adopted the
following policies and procedures to detect and prevent frequent and/or excessive
exchanges, and/or purchase and redemption activity, while balancing the needs of
investors who seek liquidity from their investment and the ability to exchange
shares as investment needs change. There is no guarantee that the policies and
procedures described below will be sufficient to identify and deter excessive
short-term trading.

o     Timing of Exchanges.  Exchanged shares are normally redeemed from one fund
      and the proceeds are reinvested in the fund selected for exchange on the
      same regular business day on which the Transfer Agent or its agent (such as
      a financial intermediary holding the investor's shares in an "omnibus" or
      "street name" account) receives an exchange request that conforms to these
      policies. The request must be received by the close of The New York Stock
      Exchange that day, which is normally 4:00 p.m. Eastern time, but may be
      earlier on some days. However, the Transfer Agent may delay the
      reinvestment of proceeds from an exchange for up to five business days if
      it determines, in its discretion, that an earlier transmittal of the
      redemption proceeds to the receiving fund would be detrimental to either
      the fund from which the exchange is made or the fund to which the exchange
      is made.

o     Limits on Disruptive Activity. The Transfer Agent may, in its discretion,
      limit or terminate trading activity by any person, group or account  that
      it believes would be disruptive, even if the activity has not exceeded the
      policy outlined in this Prospectus. The Transfer Agent may review and
      consider the history of frequent trading activity in all accounts in the
      Oppenheimer funds known to be under common ownership or control as part of
      the Transfer Agent's procedures to detect and deter excessive trading
      activity.

o     Exchanges of Client Accounts by Financial Advisers.  The Fund and the
      Transfer Agent permit dealers and financial intermediaries to submit
      exchange requests on behalf of their customers (unless the customer has
      revoked that authority). The Distributor and/or the Transfer Agent have
      agreements with a number of financial intermediaries that permit them to
      submit exchange orders in bulk on behalf of their clients. Those
      intermediaries are required to follow the exchange policies stated in this
      Prospectus and to comply with additional, more stringent restrictions.
      Those additional restrictions include limitations on the funds available
      for exchanges, the requirement to give advance notice of exchanges to the
      Transfer Agent, and limits on the amount of client assets that may be
      invested in a particular fund. A fund or the Transfer Agent may limit or
      refuse bulk exchange requests submitted by such financial intermediaries
      if, in the Transfer Agent's judgment, exercised in its discretion, the
      exchanges would be disruptive to any of the funds involved in the
      transaction.

o     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.

o     Right to Refuse Exchange and Purchase Orders.  The Distributor and/or the
      Transfer Agent may refuse any purchase or exchange order in their
      discretion and are not obligated to provide notice before rejecting an
      order. The Fund may amend, suspend or terminate the exchange privilege at
      any time. You will receive 60 days' notice of any material change in the
      exchange privilege unless applicable law allows otherwise.

o     Right to Terminate or Suspend Account Privileges.  The Transfer Agent may
      send a written warning to direct shareholders who the Transfer Agent
      believes may be engaging in excessive purchases, redemptions and/or
      exchange activity and reserves the right to suspend or terminate the
      ability to purchase shares and/or exchange privileges for any account that
      the Transfer Agent determines, in carrying out these policies and in the
      exercise of its discretion, has engaged in disruptive or excessive trading
      activity, with or without such warning.

o     Omnibus Accounts.  If you hold your shares of the Fund through a financial
      intermediary such as a broker-dealer, a bank, an insurance company separate
      account, an investment adviser, an administrator or trustee of a retirement
      plan or 529 plan, that holds your shares in an account under its name
      (these are sometimes referred to as "omnibus" or "street name" accounts),
      that financial intermediary may impose its own restrictions or limitations
      to discourage short-term or excessive trading. You should consult your
      financial intermediary to find out what trading restrictions, including
      limitations on exchanges, they may apply.



While the Fund, the Distributor, the Manager and the Transfer Agent encourage
financial intermediaries to apply the Fund's policies to their customers who
invest indirectly in the Fund, the Transfer Agent may not be able to detect
excessive short term trading activity facilitated by, or in accounts maintained
in, the "omnibus" or "street name" accounts of a financial intermediary.
Therefore the Transfer Agent might not be able to apply this policy to accounts
such as (a) accounts held in omnibus form in the name of a broker-dealer or other
financial institution, or (b) omnibus accounts held in the name of a retirement
plan or 529 plan trustee or administrator, or (c) accounts held in the name of an
insurance company for its separate account(s), or (d) other accounts having
multiple underlying owners but registered in a manner such that the underlying
beneficial owners are not identified to the Transfer Agent.

However, the Transfer Agent will attempt to monitor overall purchase and
redemption activity in those accounts to seek to identify patterns that may
suggest excessive trading by the underlying owners. If evidence of possible
excessive trading activity is observed by the Transfer Agent, the financial
intermediary that is the registered owner will be asked to review account
activity, and to confirm to the Transfer Agent and the fund that appropriate
action has been taken to curtail any excessive trading activity. However, the
Transfer Agent's ability to monitor and deter excessive short-term trading in
omnibus or street name accounts ultimately depends on the capability and
cooperation of the financial intermediaries controlling those accounts.



Additional Policies and Procedures. The Fund's Board has adopted additional
policies and procedures to detect and prevent frequent and/or excessive exchanges
and purchase and redemption activity. Those additional policies and procedures
will take effect on June 20, 2005:

o     30-Day Limit.  A direct shareholder may exchange some or all of the shares
      of the Fund held in his or her account to another eligible Oppenheimer fund
      once in a 30 calendar-day period. When shares are exchanged into a fund
      account, that account will be "blocked" from further exchanges into another
      fund for a period of 30 calendar days from the date of the exchange. The
      block will apply to the full account balance and not just to the amount
      exchanged into the account. For example, if a shareholder exchanged $1,000
      from one fund into another fund in which the shareholder already owned
      shares worth $10,000, then, following the exchange, the full account
      balance ($11,000 in this example) would be blocked from further exchanges
      into another fund for a period of 30 calendar days. A "direct shareholder"
      is one whose account is registered on the Fund's books showing the name,
      address and tax ID number of the beneficial owner.

o     Exchanges Into Money Market Funds.  A direct shareholder will be permitted
      to exchange shares of a stock or bond fund for shares of a money market
      fund at any time, even if the shareholder has exchanged shares into the
      stock or bond fund during the prior 30 days. However, all of the shares
      held in that money market fund would then be blocked from further exchanges
      into another fund for 30 calendar days.

o     Dividend Reinvestments/B Share Conversions.  Reinvestment of dividends or
      distributions from one fund to purchase shares of another fund and the
      conversion of Class B shares into Class A shares will not be considered
      exchanges for purposes of imposing the 30-day limit.

o     Asset Allocation.  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 to the Transfer Agent 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 be subject to the 30-day limit.
      However, investment programs by other Oppenheimer "funds-of-funds" that
      entail rebalancing of investments in underlying Oppenheimer funds will not
      be subject to these limits.

   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 block 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).


Shareholder Account Rules and Policies


More information about the Fund's policies and procedures for buying, selling and
exchanging shares is contained in the Statement of Additional Information.
A $12 annual "Minimum Balance Fee" is assessed on each Fund account with a value
      of less than $500. The fee is automatically deducted from each applicable
      Fund account annually on or about the second to last "regular business day"
      of September.  See the Statement of Additional Information to learn how you
      can avoid this fee and for circumstances under which this fee will not be
      assessed.

The offering of shares may be suspended during any period in which the
      determination of net asset value is suspended, and the offering may be
      suspended by the Board of Trustees at any time the Board believes it is in
      the Fund's best interest to do so.
Telephone transaction privileges for purchases, redemptions or exchanges may be
      modified, suspended or terminated by the Fund at any time. The Fund will
      provide you notice whenever it is required to do so by applicable law. If
      an account has more than one owner, the Fund and the Transfer Agent may
      rely on the instructions of any one owner. Telephone privileges apply to
      each owner of the account and the dealer representative of record for the
      account unless the Transfer Agent receives cancellation instructions from
      an owner of the account.
The Transfer Agent will record any telephone calls to verify data concerning
      transactions and has adopted other procedures to confirm that telephone
      instructions are genuine, by requiring callers to provide tax
      identification numbers and other account data or by using PINs, and by
      confirming such transactions in writing. The Transfer Agent and the Fund
      will not be liable for losses or expenses arising out of telephone
      instructions reasonably believed to be genuine.
Redemption or transfer requests will not be honored until the Transfer Agent
      receives all required documents in proper form. From time to time, the
      Transfer Agent in its discretion may waive certain of the requirements for
      redemptions stated in this Prospectus.
Dealers that perform account transactions for their clients by participating in
      NETWORKING through the National Securities Clearing Corporation are
      responsible for obtaining their clients' permission to perform those
      transactions, and are responsible to their clients who are shareholders of
      the Fund if the dealer performs any transaction erroneously or improperly.
The redemption price for shares will vary from day to day because the value of
      the securities in the Fund's portfolio fluctuates. The redemption price,
      which is the net asset value per share, will normally differ for each class
      of shares. The redemption value of your shares may be more or less than
      their original cost.
Payment for redeemed shares ordinarily is made in cash. It is forwarded by check,
      or through AccountLink or by Federal Funds wire (as elected by the
      shareholder) within seven days after the Transfer Agent receives redemption
      instructions in proper form. However, under unusual circumstances
      determined by the Securities and Exchange Commission, payment may be
      delayed or suspended. For accounts registered in the name of a
      broker-dealer, payment will normally be forwarded within three business
      days after redemption.
The Transfer Agent may delay processing any type of redemption payment as
      described under "How to Sell Shares" for recently purchased shares, but
      only until the purchase payment has cleared. That delay may be as much as
      10 days from the date the shares were purchased. That delay may be avoided
      if you purchase shares by Federal Funds wire or certified check, or arrange
      with your bank to provide telephone or written assurance to the Transfer
      Agent that your purchase payment has cleared.
Involuntary redemptions of small accounts may be made by the Fund if the account
      value has fallen below $200 for reasons other than the fact that the market
      value of shares has dropped. In some cases, involuntary redemptions may be
      made to repay the Distributor for losses from the cancellation of share
      purchase orders.
Shares may be "redeemed in kind" under unusual circumstances (such as a lack of
      liquidity in the Fund's portfolio to meet redemptions). This means that the
      redemption proceeds will be paid with liquid securities from the Fund's
      portfolio. If the Fund redeems your shares in kind, you may bear
      transaction costs and will bear market risks until such time as such
      securities are converted into cash.
Federal regulations may require the Fund to obtain your name, your date of birth
      (for a natural person), your residential street address or principal place
      of business and your Social Security Number, Employer Identification Number
      or other government issued identification when you open an account.
      Additional information may be required in certain circumstances or to open
      corporate accounts.  The Fund or the Transfer Agent may use this
      information to attempt to verify your identity.  The Fund may not be able
      to establish an account if the necessary information is not received.  The
      Fund may also place limits on account transactions while it is in the
      process of attempting to verify your identity.  Additionally, if the Fund
      is unable to verify your identity after your account is established, the
      Fund may be required to redeem your shares and close your account.
"Backup withholding" of federal income tax may be applied against taxable
      dividends, distributions and redemption proceeds (including exchanges) if
      you fail to furnish the Fund your correct, certified Social Security or
      Employer Identification Number when you sign your application, or if you
      under-report your income to the Internal Revenue Service.
To avoid sending duplicate copies of materials to households, the Fund will mail
      only one copy of each prospectus, annual and semi-annual report and annual
      notice of the Fund's privacy policy to shareholders having the same last
      name and address on the Fund's records. The consolidation of these
      mailings, called householding, benefits the Fund through reduced mailing
      expense.

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

Dividends, Capital Gains and Taxes

DIVIDENDS. The Fund intends to declare dividends separately for each class of
shares from net tax-exempt income and/or net taxable investment income each
regular business day and to pay those dividends to shareholders monthly on a date
selected by the Board of Trustees. Daily dividends will not be declared or paid
on newly-purchased shares until Federal Funds are available to the Fund from the
purchase payment for such shares.


       The Fund attempts to pay dividends on Class A shares at a constant level.
There is no assurance that it will be able to do so. The Board of Trustees may
change the targeted dividend level at any time, without prior notice to
shareholders. The amount of those dividends and any other distributions paid on
other classes of shares may vary over time, depending on market conditions, the
composition of the Fund's portfolio, and expenses borne by the particular class
of shares. Dividends and other distributions paid on Class A and Class Y shares
will generally be higher than dividends for Class B and Class C shares, which
normally have higher expenses than Class A and Class Y. The Fund cannot guarantee
that it will pay any dividends or other distributions.


CAPITAL GAINS. Although the Fund does not seek capital gains, it may realize
capital gains on the sale of portfolio securities. If it does, it may make
distributions out of any net short-term or long-term capital gains in December of
each year. The Fund may make supplemental distributions of dividends and capital
gains following the end of its fiscal year. There can be no assurance that the
Fund will pay any capital gains distributions in a particular year. Long-term
capital gains will be separately identified in the tax information the Fund sends
you after the end of the calendar year.

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

TAXES. Dividends paid from net investment income earned by the Fund on municipal
securities will be excludable from gross income for federal income tax purposes.
All or a portion of the dividends paid by the Fund that are derived from interest
paid on certain "private activity bonds" may be an item of tax preference if you
are subject to the federal alternative minimum tax.

      Dividends and capital gains distributions may be subject to federal, state
or local taxes. Any short-term capital gain distributions are taxable to you as
ordinary income. Any long-term capital gain distributions are taxable to you as
long-term capital gains, no matter how long you have owned shares in the Fund.
The Fund may derive gains in part from municipal obligations the Fund purchased
below their principal or face values. All, or a portion of these gains may be
taxable to you as ordinary income rather than capital gains. Whether you reinvest
your distributions in additional shares or take them in cash, the tax treatment
is the same.


      Exempt-interest dividends earned by residents of New York should not be
subject to federal, state, or local income taxes. The portion of the Fund's
dividends that are attributable to income earned on other obligations (not New
York municipal securities) will normally be subject to New York State and City
personal income tax.


     Every year the Fund will send you and the IRS a statement showing the amount
of any taxable distribution you received in the previous year. The Fund will also
send you a separate statement summarizing the total distributions paid by the
Fund.


     The Fund intends each year to qualify as a "regulated investment company"
under the Internal Revenue Code, but reserves the right not to qualify. It
qualified during its last fiscal year. The Fund, as a regulated investment
company, will not be subject to Federal income taxes on any of its income,
provided that it satisfies certain income, diversification and distribution
requirements.


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

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

Financial Highlights


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







INFORMATION AND SERVICES

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

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

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

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

- ------------------------------------------------------------------------------
By Telephone:                 Call OppenheimerFunds Services toll-free:
                              1.800.CALL OPP (225.5677)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
By Mail:                      Write to:
                              OppenheimerFunds Services
                              P.O. Box 5270
                              Denver, Colorado 80217-5270
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------

On the Internet:              You can send us a request these documents by
                              e-mail or through the OppenheimerFunds
                              website. You may also read or download certain
                              documents on the OppenheimerFunds website at:
                              www.oppenheimerfunds.com
                              ------------------------

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

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


The Fund's shares are distributed by:                [logo]        OppenheimerFunds
Distributor, Inc.
The Fund's SEC File No.: 811-3614

PR0365.001.0405
Printed on recycled paper








                             Appendix to Prospectus of
                             ROCHESTER FUND MUNICIPALS


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

      A bar chart will be included in the Prospectus of Rochester  Fund  Municipals
(the "Fund")  depicting  the annual total returns of a  hypothetical  investment in
Class A  shares  of the  Fund  for  each of the  last 10  calendar  years,  without
deducting  sales  charges or taxes.  Set forth below are the  relevant  data points
that will appear in the bar chart:

      Calendar       Annual
      Year           Total
      Ended:         Returns


      12/31/95       18.61%
      12/31/96       5.37%
      12/31/97       10.20%
      12/31/98       6.52%
      12/31/99       -5.51%
      12/31/00       11.93%
      12/31/01       5.14%
      12/31/02       5.46%
      12/31/03       8.12%
      12/31/04       ____%

Rochester Fund Municipals
6803 S. Tucson Way, Centennial, CO 80112
1.800.225.5677


Statement of Additional Information dated April __, 2005

This Statement of Additional Information is not a Prospectus. This document contains
additional information about the Fund and supplements information in the Prospectus dated
April __, 2005, as further supplemented thereafter. It should be read together with the
Prospectus, which may be obtained by writing to the Fund's Transfer Agent, OppenheimerFunds
Services, at P.O. Box 5270, Denver, Colorado 80217 or by calling the Transfer Agent at the
toll-free number shown above or by downloading it from the OppenheimerFunds Internet
website at www.oppenheimerfunds.com.


Contents                                                                Page

About the Fund

Additional Information About the Fund's Investment Policies and Risks...
     The Fund's Investment Policies.....................................
     Municipal Securities...............................................
     Other Investment Techniques and Strategies.........................
     Other Investment Restrictions......................................
     Disclosure of Portfolio Holdings

How the Fund is Managed.................................................
     Organization and History...........................................
     Board of Trustees and Oversight Committees.........................
     Trustees and Officers of the Fund..................................
     The Manager........................................................
Brokerage Policies of the Fund..........................................
Distribution and Service Plans..........................................
Performance of the Fund.................................................

About Your Account
How To Buy Shares.......................................................
How To Sell Shares......................................................
How to Exchange Shares..................................................
Dividends, Capital Gains and Taxes......................................
Additional Information About the Fund...................................

Financial Information About the Fund
Independent Auditors' Report............................................
Financial Statements ...................................................

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






                                             85
ABOUT THE FUND

Additional Information About the Fund's Investment Policies and Risks

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

The Fund's Investment Policies. The composition of the Fund's portfolio and the techniques
and strategies that the Manager uses will vary over time. The Fund is not required to use
all of the investment techniques and strategies described below in seeking its goal. The
Fund does not make investments with the objective of seeking capital growth. However, the
values of the securities held by the Fund may be affected by changes in general interest
rates and other factors prior to their maturity. Because the current value of debt
securities varies inversely with changes in prevailing interest rates, if interest rates
increase after a security is purchased, that security will normally fall in value.
Conversely, should interest rates decrease after a security is purchased, normally its
value will rise.

      However, those fluctuations in value will not generally result in realized gains or
losses to the Fund unless the Fund sells the security prior to the security's maturity. A
debt security held to maturity is redeemable by its issuer at full principal value plus
accrued interest. The Fund does not usually intend to dispose of securities prior to their
maturity, but may do so for liquidity purposes, or because of other factors affecting the
issuer that cause the Manager to sell the particular security. In that case, the Fund could
realize a capital gain or loss on the sale.

      There are variations in the credit quality of municipal securities, both within a
particular rating classification and between classifications. These variations depend on
numerous factors. The yields of municipal securities depend on a number of factors,
including general conditions in the municipal securities market, the size of a particular
offering, the maturity of the obligation and rating (if any) of the issue. These factors
are discussed in greater detail below.

Municipal Securities. The types of municipal securities in which the Fund can invest are
described in the Prospectus under "About the Fund's Investments." The Fund may from time to
time invest in municipal securities other than New York municipal securities. For example,
to seek a higher yield, the Fund may invest in municipal securities issued by other states
and their respective political subdivisions. Although any interest from these securities
generally would be exempt from federal income tax, any such interest may be subject to New
York State and New York City personal income tax. Nonetheless, the Fund does not expect to
invest a significant portion of its assets in securities other than New York municipal
securities.

      Municipal securities are generally classified as general obligation bonds, revenue
bonds and notes. A discussion of the general characteristics of these principal types of
municipal securities follows below.

      The Fund is "diversified" with respect to 75% of its total assets. That means that as
to 75% of its total assets, the Fund cannot invest more than 5% of its net assets in the
securities of any one issuer (other than the U.S. government or its agencies and
instrumentalities) and the Fund cannot own more than 10% of an issuer's voting securities.
In applying its diversification policy with respect to the remaining 25% of its total
assets not covered by that diversification requirement, the Fund will not invest more than
10% of its assets in the securities of any one issuer.

      |X|   Municipal Bonds. Long-term municipal securities (which have a maturity of more
than one year when issued) are classified as "municipal bonds." The principal
classifications of long-term municipal bonds are "general obligation" and "revenue" bonds
(including "industrial development" bonds). They may have fixed, variable or floating rates
of interest, as described below, or may be "zero-coupon" bonds, as described below.

      Some bonds may be "callable," allowing the issuer to redeem them before their
maturity date. To protect bondholders, callable bonds may be issued with provisions that
prevent them from being called for a period of time. Typically, that is five to 10 years
from the issuance date. When interest rates decline, if the call protection on a bond has
expired, it is more likely that the issuer may call the bond. If that occurs, the Fund
might have to reinvest the proceeds of the called bond in bonds that pay a lower rate of
return. In turn, that could reduce the Fund's yield.

o     General Obligation Bonds. The basic security behind general obligation bonds is the
issuer's pledge of its full faith and credit and taxing, if any, power for the repayment of
principal and the payment of interest. Issuers of general obligation bonds include states,
counties, cities, towns and regional districts. The proceeds of these obligations are used
to fund a wide range of public projects, including construction or improvement of schools,
highways and roads, and water and sewer systems. The rate of taxes that can be levied for
the payment of debt service on these bonds may be limited or unlimited. Additionally, there
may be limits as to the rate or amount of special assessments that can be levied to meet
these obligations.


o     Revenue Bonds. The principal security for a revenue bond is generally the net
revenues derived from a particular facility, group of facilities, or, in some cases, the
proceeds of a special excise tax or other specific revenue source such as a state's or
local government's proportionate share of the tobacco Master Settlement Agreement. Revenue
bonds are issued to finance a wide variety of capital projects. Examples include electric,
gas, water and sewer systems; highways, bridges, and tunnels; port and airport facilities;
colleges and universities; and hospitals.


      Although the principal security for these types of bonds may vary from bond to bond,
many provide additional security in the form of a debt service reserve fund that may be
used to make principal and interest payments on the issuer's obligations. Housing finance
authorities have a wide range of security, including partially or fully insured mortgages,
rent subsidized and/or collateralized mortgages, and/or the net revenues from housing or
other public projects. Some authorities provide further security in the form of a state's
ability (without obligation) to make up deficiencies in the debt service reserve fund.

o     Industrial Development Bonds. Industrial development bonds are considered municipal
bonds if the interest paid is exempt from federal income tax. They are issued by or on
behalf of public authorities to raise money to finance various privately operated
facilities for business and manufacturing, housing, sports and pollution control. These
bonds may also be used to finance public facilities such as airports, mass transit systems,
ports and parking. The payment of the principal and interest on such bonds is dependent
solely on the ability of the facility's user to meet its financial obligations and the
pledge, if any, of real and personal property financed by the bond as security for those
payments.


      The Fund will purchase industrial revenue bonds only if the interest paid on the
bonds is tax-exempt under the Internal Revenue Code. The Internal Revenue Code limits the
types of facilities that may be financed with tax-exempt industrial revenue bonds and
private-activity bonds (discussed below) and the amounts of these bonds that each state can
issue.

      The Fund will not invest more than 5% of its total assets in industrial development
bonds for which the underlying credit is one business or one charitable entity.
Additionally, the Fund will not invest more than 5% of its total assets in securities for
which industrial users having less than three years' operating history are responsible for
the payments of interest and principal on the securities.

o     Private Activity Municipal Securities. The Tax Reform Act of 1986 (the "Tax Reform
Act") reorganized, as well as amended, the rules governing tax exemption for interest on
certain types of municipal securities. The Tax Reform Act generally did not change the tax
treatment of bonds issued in order to finance governmental operations. Thus, interest on
general obligation bonds issued by or on behalf of state or local governments, the proceeds
of which are used to finance the operations of such governments, continues to be
tax-exempt. However, the Tax Reform Act limited the use of tax-exempt bonds for
non-governmental (private) purposes. More stringent restrictions were placed on the use of
proceeds of such bonds. Interest on certain private activity bonds is taxable under the
revised rules. There is an exception for "qualified" tax-exempt private activity bonds, for
example, exempt facility bonds including certain industrial development bonds, qualified
mortgage bonds, qualified Section 501(c)(3) bonds and qualified student loan bonds.

      In addition, limitations as to the amount of private activity bonds which each state
may issue were revised downward by the Tax Reform Act, which will reduce the supply of such
bonds. The value of the Fund's portfolio could be affected if there is a reduction in the
availability of such bonds.

      Interest on certain private activity bonds issued after August 7, 1986, which
continues to be tax-exempt, will be treated as a tax preference item subject to the
alternative minimum tax (discussed below) to which certain taxpayers are subject. The Fund
may hold municipal securities the interest on which (and thus a proportionate share of the
exempt-interest dividends paid by the Fund) will be subject to the federal alternative
minimum tax on individuals and corporations.

      The federal alternative minimum tax is designed to ensure that all persons who
receive income pay some tax, even if their regular tax is zero. This is accomplished in
part by including in taxable income certain tax preference items that are used to calculate
alternative minimum taxable income. The Tax Reform Act made tax-exempt interest from
certain private activity bonds a tax preference item for purposes of the alternative
minimum tax on individuals and corporations. Any exempt-interest dividend paid by a
regulated investment company will be treated as interest on a specific private activity
bond to the extent of the proportionate relationship the interest the investment company
receives on such bonds bears to all its exempt interest dividends.

      In addition, corporate taxpayers subject to the alternative minimum tax may, under
some circumstances, have to include exempt-interest dividends in calculating their
alternative minimum taxable income. That could occur in situations where the "adjusted
current earnings" of the corporation exceeds its alternative minimum taxable income.
      To determine whether a municipal security is treated as a taxable private activity
bond, it is subject to a test for: (a) a trade or business use and security interest, or
(b) a private loan restriction. Under the trade or business use and security interest test,
an obligation is a private activity bond if: (i) more than 10% of the bond proceeds are
used for private business purposes and (ii) 10% or more of the payment of principal or
interest on the issue is directly or indirectly derived from such private use or is secured
by the privately used property or the payments related to the use of the property. For
certain types of uses, a 5% threshold is substituted for this 10% threshold.

      The term "private business use" means any direct or indirect use in a trade or
business carried on by an individual or entity other than a state or municipal governmental
unit. Under the private loan restriction, the amount of bond proceeds that may be used to
make private loans is limited to the lesser of 5% of the proceeds or $5.0 million. Thus,
certain issues of municipal securities could lose their tax-exempt status retroactively if
the issuer fails to meet certain requirements as to the expenditure of the proceeds of that
issue or the use of the bond-financed facility. The Fund makes no independent investigation
of the users of such bonds or their use of proceeds of the bonds. If the Fund should hold a
bond that loses its tax-exempt status retroactively, there might be an adjustment to the
tax-exempt income previously distributed to shareholders.

      Additionally, a private activity bond that would otherwise be a qualified tax-exempt
private activity bond will not, under Internal Revenue Code Section 147(a), be a qualified
bond for any period during which it is held by a person who is a "substantial user" of the
facilities or by a "related person" of such a substantial user. This "substantial user"
provision applies primarily to exempt facility bonds, including industrial development
bonds. The Fund may invest in industrial development bonds and other private activity
bonds. Therefore, the Fund may not be an appropriate investment for entities which are
"substantial users" (or persons related to "substantial users") of such exempt facilities.
Those entities and persons should consult their tax advisors before purchasing shares of
the Fund.

      A "substantial user" of such facilities is defined generally as a "non-exempt person
who regularly uses part of a facility" financed from the proceeds of exempt facility bonds.
Generally, an individual will not be a "related person" under the Internal Revenue Code
unless such individual or the individual's immediate family (spouse, brothers, sisters and
immediate descendants) own directly or indirectly in the aggregate more than 50% in value
of the equity of a corporation or partnership which is a "substantial user" of a facility
financed from the proceeds of exempt facility bonds.

      |X|   Municipal Notes. Municipal securities having a maturity (when the security is
issued) of less than one year are generally known as municipal notes. Municipal notes
generally are used to provide for short-term working capital needs. Some of the types of
municipal notes the Fund can invest in are described below.

o     Tax Anticipation Notes. These are issued to finance working capital needs of
municipalities. Generally, they are issued in anticipation of various seasonal tax revenue,
such as income, sales, use or other business taxes, and are payable from these specific
future taxes.

o     Revenue Anticipation Notes. These are notes issued in expectation of receipt of other
types of revenue, such as federal revenues available under federal revenue-sharing programs.
o     Bond Anticipation Notes. Bond anticipation notes are issued to provide interim
financing until long-term financing can be arranged. The long-term bonds that are issued
typically also provide the money for the repayment of the notes.

o     Construction Loan Notes. These are sold to provide project construction financing
until permanent financing can be secured. After successful completion and acceptance of the
project, it may receive permanent financing through public agencies, such as the Federal
Housing Administration.

o     Miscellaneous, Temporary and Anticipatory Instruments. These instruments may include
notes issued to obtain interim financing pending entering into alternate financial
arrangements such as receipt of anticipated federal, state or other grants or aid, passage
of increased legislative authority to issue longer term instruments or obtaining other
refinancing.

      |X|   Municipal Lease Obligations. The Fund's investments in municipal lease
obligations may be through certificates of participation that are offered to investors by
public entities. Municipal leases may take the form of a lease or an installment purchase
contract issued by a state or local government authority to obtain financing to acquire a
wide variety of equipment and facilities.

      Some municipal lease securities may be deemed to be "illiquid" securities. If they
are illiquid, their purchase by the Fund will be subject to the percentage limitations on
the Fund's investments in illiquid securities described in the Prospectus and below in
"Illiquid and Restricted Securities." The Fund may not invest more than 5% of its net
assets in unrated or illiquid municipal lease obligations. That limitation does not apply
to a municipal lease obligation that the Manager has determined to be liquid under
guidelines set by the Board of Trustees and that has received an investment grade rating
from a nationally-recognized rating organization.

      Those Board guidelines require the Manager to evaluate, among other things:
o     the frequency of trades and price quotations for the obligation;
o     the number of dealers willing to purchase or sell the securities and the number of
         potential buyers;
o     the willingness of dealers to undertake to make a market in the obligation;
o     the nature of the marketplace trades for the securities;
o     the likelihood that the marketability of the obligation will continue while the Fund
         owns it; and
o     the likelihood that the municipality will continue to appropriate funding for the
         leased property.

      Municipal leases have special risk considerations. Although lease obligations do not
constitute general obligations of the municipality for which the municipality's taxing
power is pledged, a lease obligation is ordinarily backed by the municipality's covenant to
budget for, appropriate and make the payments due under the lease obligation. However,
certain lease obligations contain "non-appropriation" clauses which provide that the
municipality has no obligation to make lease or installment purchase payments in future
years unless money is appropriated for that purpose on a yearly basis. While the obligation
might be secured by the lease, it might be difficult to dispose of that property in case of
a default.

      To reduce the risk of "non-appropriation," the Fund will not invest more than 10% of
its total assets in municipal leases that contain "non-appropriation" clauses. Also, the
Fund will invest in leases with non-appropriation clauses only if certain conditions are
met:

o     the nature of the leased equipment or property is such that its ownership or use is
         essential to a governmental function of a municipality,
o     appropriate covenants are obtained from the municipal obligor prohibiting the
         substitution or purchase of similar equipment if lease payments are not
         appropriated,
o     the lease obligor has maintained good market acceptability in the past,
o     the investment is of a size that will be attractive to institutional investors, and
o     the underlying leased equipment has elements of portability and/or use that enhance
         its marketability if foreclosure is ever required on the underlying equipment.

      Municipal leases may be subject to an "abatement" risk. The leases underlying certain
municipal lease obligations may state that lease payments are subject to partial or full
abatement. That abatement might occur, for example, if material damage or destruction of
the leased property interferes with the lessee's use of the property. In some cases that
risk might be reduced by insurance covering the leased property, or by the use of credit
enhancements such as letters of credit to back lease payments, or perhaps by the lessee's
maintenance of reserve funds for lease payments.

      Projects financed with certificates of participation generally are not subject to
state constitutional debt limitations or other statutory requirements that may apply to
other municipal securities. Payments by the public entity on the obligation underlying the
certificates are derived from available revenue sources. That revenue might be diverted to
the funding of other municipal service projects. Payments of interest and/or principal with
respect to the certificates are not guaranteed and do not constitute an obligation of a
state or any of its political subdivisions.

      In addition, municipal lease securities do not have as highly liquid a market as
conventional municipal bonds. Municipal leases, like other municipal debt obligations, are
subject to the risk of non-payment of interest or repayment of principal by the issuer. The
ability of issuers of municipal leases to make timely lease payments may be adversely
affected in general economic downturns and as relative governmental cost burdens are
reallocated among federal, state and local governmental units. A default in payment of
income would result in a reduction of income to the Fund. It could also result in a
reduction in the value of the municipal lease and that, as well as a default in repayment
of principal, could result in a decrease in the net asset value of the Fund. While the Fund
holds these securities, the Manager will evaluate their credit quality and the likelihood
of a continuing market for them.

      Subject to the foregoing percentage limitations on investments in Illiquid
Securities, the Fund may invest in a tax-exempt lease only if the following requirements
are met:
o     the Fund must receive the opinion of issuer's legal counsel that the tax-exempt
         obligation will generate interest income that is exempt from federal and New York
         State income taxes; that legal counsel must be experienced in municipal lease
         transactions;
o     the Fund must receive an opinion that, as of the effective date of the lease or at
         the date of the Fund's purchase of the obligation (if that occurs on a date other
         than the effective date of the lease), the lease is the valid and binding
         obligation of the governmental issuer;
o     the Fund must receive an opinion of issuer's legal counsel that the obligation has
         been issued in compliance with all applicable federal and state securities laws;
o     the Manager must perform its own credit analysis in instances where a credit rating
         has not been provided for the lease obligation by a national rating agency;
o     if a particular exempt obligation is unrated and, in the opinion of the Manager, not
         of investment- grade quality, then at the time the Fund makes the investment the
         Manager must include the investment within the Fund's illiquid investments; it
         will also be subject to the Fund's overall limitation on investments in unrated
         tax-exempt leases.

      Municipal lease obligations are generally not rated by rating organizations. In those
cases the Manager must perform its own credit analysis of the obligation. In those cases,
the Manager generally will rely on current information furnished by the issuer or obtained
from other sources considered by the Manager to be reliable.

      |X|   Credit Ratings of Municipal Securities. Ratings by ratings organizations such
as Moody's Investors Service ("Moody's"), Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc. ("Standard and Poor's") and Fitch, Inc. ("Fitch"),
represent the respective rating agency's opinions of the credit quality of the municipal
securities they undertake to rate. However, their ratings are general opinions and are not
guarantees of quality. Credit ratings typically evaluate the safety of municipal and
interest payments, not market risk. Municipal securities that have the same maturity,
coupon and rating may have different yields, while other municipal securities that have the
same maturity and coupon but different ratings may have the same yield.

      After the Fund buys a municipal security, it may cease to be rated or its rating may
be reduced below the minimum required to enable the Fund to buy it. Neither event requires
the Fund to sell a security, but the Manager will consider those events in determining
whether the Fund should continue to hold that security. If ratings given by Moody's,
Standard & Poor's, or another rating organization change as a result of changes in those
rating organizations or their rating systems, the Fund will attempt to use comparable
ratings as standards for investments in accordance with the Fund's investment policies.

      The Fund may buy municipal securities that are "pre-refunded." The issuer's
obligation to repay the principal value of the security is generally collateralized with
U.S. government securities placed in an escrow account. This causes the pre-refunded
security to have essentially the same risks of default as a "AAA"-rated security.

      The rating definitions of Moody's, Standard & Poor's and Fitch municipal securities
are contained in Appendix A to this Statement of Additional Information. The Fund can
purchase securities that are unrated by nationally-recognized rating organizations. The
Manager will make its own assessment of the credit quality of unrated issues the Fund buys.
The Manager will use criteria similar to those used by the rating agencies, and assign a
rating category to a security that is comparable to what the Manager believes a rating
agency would assign to that security. However, the Manager's rating does not constitute a
guarantee of the quality of a particular issue.

      In evaluating the credit quality of a particular security, whether it is rated or
unrated, the Manager will normally take into consideration a number of factors. Among them
are the financial resources of the issuer, or the underlying source of funds for debt
service on a security, the issuer's sensitivity to economic conditions and trends, any
operating history of the facility financed by the obligation and the degree of community
support for it, the capabilities of the issuer's management and regulatory factors
affecting the issuer and the particular facility.

o     Special Risks of Lower-Grade Securities. Lower-grade securities, commonly called
"junk bonds," may offer higher yields than securities rated in investment grade rating
categories. In addition to having a greater risk of default than higher-grade securities,
there may be less of a market for these securities. As a result they may be more difficult
to value and harder to sell at an acceptable price. These additional risks mean that the
Fund might not receive the anticipated level of income from these securities, and the
Fund's net asset value could be affected by declines in the value of lower-grade
securities. However, because the added risk of lower-quality securities might not be
consistent with the portion of the Fund's objective to seek preservation of capital, the
Fund limits its investments in lower-quality securities to not more than 25% of its
tax-exempt investments (including New York municipal securities).

      While securities rated "Baa" by Moody's or "BBB" by Standard & Poor's or Fitch are
considered investment grade, they may be subject to special risks and have some speculative
characteristics. The Fund will not invest more than 5% of its net assets in the securities
of any one issuer if the securities are rated "B" or below by a national rating
organization or are given a comparable rating by the Manager.


Special Investment Considerations - New York Municipal Securities.  As explained in the
Prospectus, the Fund's investments are highly sensitive to the fiscal stability of New York
State (referred to in this section as the "State") and its subdivisions, agencies,
instrumentalities or authorities, including New York City (the "City"), which issue nearly
all of the municipal securities in which the Fund invests.  The following information on
the risk factors from concentrating in New York municipal securities is only a summary,
based on the State's Annual Information Statement dated September 19, 2004, and on
publicly-available official statements relating to offerings by issuers of New York
municipal securities on or prior to June 17, 2003 with respect to offerings of New York
State, and on or prior to November 5, 2004 with respect to offerings by the City.  No
representation is made as to the accuracy of this information.

      During the mid-1970s, the State, some of its agencies, instrumentalities and public
benefit corporations (the "Authorities"), and certain of the State's municipalities faced
serious financial difficulties. To address many of these financial problems, the State
developed various programs, many of which were successful in reducing the financial
crisis.  Any further financial problems experienced by these Authorities or municipalities
could have a direct adverse effect on the New York municipal securities in which the Fund
invests.

      |X| Factors Affecting Investments in New York State Securities.  On January 20, 2004,
the Governor presented the Executive Budget for 2004-05 to the New York State Legislature
containing the Financial Plan for 2004-05 (the "2004-05 Executive Budget" or "Executive
Budget").   On August 11, 2004, the New York Legislature completed action on the budget for
the 2004-05 fiscal year.  The New York Division of the Budget ("DOB") has prepared the
2004-05 Enacted Budget Financial Plan ("2004-05 Financial Plan" or "Financial Plan") which
reflected the actions of the Legislature and the Governor as of September 19, 2004, the
date of the Annual Information Statement that contained excerpts from the 2004-05 Financial
Plan.

      DOB has estimated that, in comparison to the Executive Budget, the Legislature has
identified $1.1 billion in new General Fund (the major operating fund of the State)
resources to fund $1.5 billion in additions and $280 million in new costs, leaving an
imbalance of roughly $600 to $700 million in 2004-05 and gaps of approximately $6 billion
in 2005-06 and $8 billion in 2006-07.

      The Governor has vetoed General Fund spending additions valued at $235 million in
2004-05, reducing the projected General Fund imbalance in the 2004-05 fiscal year to
approximately $400 million.  The vetoes are expected to generate comparable savings in
2005-06 and 2006-07.  The Governor also vetoed $1.6 billion in new bonding for capital
spending approved by the Legislature.  Under the State Constitution, the Legislature may
take action on the Governor's vetoes through December 31, 2004, or enact additional
appropriations, subject to gubernatorial veto, at any time during the 2004-05 fiscal year.

      DOB, in close cooperation with State agencies, expected to develop a Fiscal
Management Plan intended to balance the 2004-05 budget and reduce the outyear gaps.  DOB
expected that the Fiscal Management Plan would produce savings sufficient to balance the
2004-05 fiscal year reduce the outyear gaps to the range of $5-6 billion in 2005-06 and
roughly $7 billion in 2006-07.  DOB expected that with a Fiscal Management Plan, the State
would not need to borrow from the rainy day reserve of $794 million to end the fiscal year
in balance on a cash basis in the General Fund.

      DOB projected that spending in all State funds would total $101.2 billion in 2004-05,
a 4.0% increase above actual 2003-04 results.  When 2003-04 spending is adjusted to reflect
certain deferrals, adjusted 2004-05 spending in all State funds increases by $5.8 billion
or 6.1% over 2003-04 levels.

      Many complex political, social and economic forces influence the State's economy and
finances, which may in turn affect the State's Financial Plan.  These forces may affect the
state from fiscal year to fiscal year and are influenced by governments, institutions, and
events that are not subject to the State's control.  The Financial Plan is also necessarily
based upon forecasts of national and State economic activity.  Economic forecasts have
frequently failed to predict accurately the timing and magnitude of changes in the national
and State economies.  DOB believed that its estimates related to the performance of the
State and national economies were reasonable.  However, there can be no assurance that
actual results will not differ materially and adversely from the forecast.

      Based on DOB's projections, the 2004-05 Financial Plan depends in part on the
implementation of a fiscal management plan to maintain budget balance in that fiscal year.
The plan under development by DOB was expected to contain a range of actions that could be
implemented administratively, as well as proposals that might require legislative
approval.

      As of the close of 2003-04, balances in the State's principal reserves to guard
against unbudgeted risks totaled $815 million.  The reserves included $794 million in the
Tax Stabilization Reserve Fund and $21 million in the Contingency Reserve Fund for
litigation.  To permanently improve the State's reserve levels, the Governor has proposed
legislation to increase both the maximum size of the State's rainy day fund from 2 percent
to 5 percent of General Fund spending, and the maximum annual deposits from two-tenths of
one percent to five-tenths of one percent of spending.  Absent this legislation, the State
reported that the Fund will reach its statutory maximum balance of 2 percent or $840
million with the next annual deposit.

      Aside from the $21 million in the Contingency Reserve Fund, the Financial Plan did
not set aside specific reserves to cover potential costs that could materialize as a result
of adverse rulings in pending litigation, Federal disallowances, or other Federal actions
that could adversely affect the State's projections of receipts and disbursements.

      The Federal government has been auditing Medicaid claims submitted since 1993 under
the School Supportive Health Services Program.  The State reported that these audits had
not yet been finalized, and, as a result, the liability of the State and school districts
for any disallowances could not be determined.  Federal regulations include an appeals
process that could postpone repayment of any disallowances.  The Financial Plan assumed
that the Federal government would fully reimburse these costs.

      In addition, a portion of Federal Medicaid payments related to School Supportive
Health Services have been deferred by the Federal Centers for Medicare and Medicaid
Services pending finalization of audits.  Since the State has continued to reimburse local
school districts for these costs, these Federal deferrals, if not resolved, could
negatively impact the Financial Plan.  Alternatively, if the State were to suspend
reimbursement, local governments could be adversely affected.

      An ongoing risk to the Financial Plan arises from the potential impact of certain
litigation and Federal disallowances pending against the State, which could produce adverse
effects on the States projections of receipts and disbursements.  For example, the Federal
government has issued a draft disallowance for certain claims, and deferred the payment of
other claims, submitted by school districts related to school supportive health services.
The State reported that it was unclear what impact, if any, such disallowances may have on
the 2004-05 Financial Plan or in the future.  The 2004-05 Financial Plan assumed no
significant Federal disallowances or other Federal actions that could adversely affect
State finances.

      New York is the third most populous state in the nation and has a relatively high
level of personal wealth.  The State's economy is diverse, with a comparatively large share
of the nation's financial activities, information, education and health services
employment, and a very small share of the nation's farming and mining activity.  The
State's location and its air transport facilities and natural harbors have made it an
important link in international commerce.  Travel and tourism constitute an important part
of the economy.  Like the rest of the nation, New York has a declining proportion of its
workforce engaged in manufacturing, and an increasing proportion engaged in service
industries.

      Relative to the nation, the State has a smaller share of manufacturing and
construction and a larger share of service-related industries.  The State's financial
activities sector share, as measured by wages, is particularly large relative to the
nation.  The State has projected that it is likely to be less affected than the nation as a
whole during an economic recession that is concentrated in manufacturing and construction,
but likely to be more affected by any economic downturn that is concentrated in the
services sector.

      The State reported that the September 11, 2001 terrorist attach had a more
devastating impact on the New York economy than on any other state.  New York City is still
recovering from the severity of the blow.  However, there was evidence that the State
economy has emerged from recession and that the State's economic expansion, estimated to
have begun in August 2003, would be sustainable.  The State economy had added over 72,000
private sector jobs since August 2003.  Total State employment was projected to rise 0.5
percent in 2004, following a decline of 0.6 percent in 2003.  Wage income was projected to
rise 5.6 percent in 2004, following growth of only 1.4 percent in 2003.  Employment, wage,
and total personal income growth projected for 2004 were more closer to historical averages
for New York and reflected the belief that the State economy was on an expansionary path.
The unemployment rate was projected to fall from 6.3 percent in 2003 to 6.2 percent for
2004.

      In addition to the risks associated with the national economic forecast, the State
reported that there exist specific risks to the State economy.   Chief among them is a
weaker performance within the financial sector than was projected.  Higher energy prices
and a new round of global instability appeared to be having a more negative impact on
equity markets than on the economy as a whole.  A weaker than expected financial market
performance could result in lower bonus payment growth than projected, though this impact
would be largely felt during the first quarter of 2005.

      The State reported its view that although growth had slowed from the brisk pace of
the second half of 2003 and the first quarter of 2004, the national economy was continuing
to expand, due in large part to momentum generated by favorable monetary and fiscal
policies.  The economy was expected to accelerate to above trend growth during the second
half of 2004, following growth of only 2.8 percent for the second quarter.  The overall
strength of the national economy permitted the Federal Reserve Board to embark upon a
"measured" course of monetary tightening at the end of June 2004.  Nevertheless, interest
rates were expected to remain relatively accommodative.  Low interest rates and a
strengthening world economy were expected to maintain a favorable environment for both
business investment and international trade.  DOB had slightly lowered the forecast for
real U.S. Gross Domestic Product (GDP) from that presented with the Executive Budget.  Real
U.S. GDP was projected to grow 4.3 percent in 2004, followed by slightly above trend growth
of 3.3 percent for 2005.

      Corporate profits from current production grew 16.8 percent in 2003, followed by an
additional growth of 22.9 percent in the first half of 2004 compared with the first half of
2003.  However, the State expressed the view that strong profit growth had combined with
heightened uncertainty due to high energy prices national security concerns to create an
unusual degree of volatility in the labor market.  Since August 2003, the national economy
had gained almost half of the private sector jobs that were lost during the 2001 recession
and its aftermath, with over one million private sector jobs created during the first five
months of 2004.  However, labor market growth had slowed to a trickle in June and July
2004.  DOB expected moderate growth of 1.1 percent in employment for 2004, following a
decline of 0.3 percent for 2003.  The unemployment rate was projected to decline to 5.5
percent in 2004 from 6.0 percent in 2003.  Consistent with a strengthening labor market,
wages and salaries were expected to grow 5.1% for 2004, following growth of 2.6% for 2003.
Total personal income was expected to grow 5.4% for this year, following growth of 3.2% for
2003.  Projections for personal income and wages for 2004 represented upward revisions
compared to the Executive Budget forecast.  However, these revisions to the forecast were
largely due to revisions to the underlying data by the Bureau of Economic Analysis for 2003.

      A benchmark oil price had risen to a record new high in August 2004.  Unexpectedly
high world demand, attacks upon production facilities in the Middle East, and uncertainty
in Russia have all contributed significantly to the rise in oil prices.  These developments
resulted in an upward revision to the DOB forecast for consumer inflation, as represented
by growth in the Consumer Price Index (CPI), to 2.7% for 2004.  Nevertheless, the energy
market continued to pose a risk to the DOB forecast for inflation.  High energy prices also
presented a risk to domestic and global economic growth.  Lower global growth could result
in lower than anticipated exports.  In contrast, better than expected economic conditions
might encourage firms to invest more and hire more workers than expected, resulting in
higher wages and higher consumption spending as well.  A lower dollar could lead to higher
exports, and therefore, higher output growth than projected.

      |X| The 2004-05 Financial Plan.  The State reported that the State's total General
Fund receipts in support of the 2004-05 Financial Plan were projected to be $42.7 billion,
an increase of $328 million (0.8%) from 2003-04.  This total included $31.6 billion in
taxes, $2.4 billion in miscellaneous receipts, and $8.6 billion in transfers from other
Funds.  The increase largely reflected the combined impact of an improving economy and
net-revenue increases adopted in 2004 and with the 2003-04 budget, offset by the loss of
the one-time benefit of tobacco securitization receipts in 2003-04 ($4.2 billion).

      General Fund Personal Income Tax (PIT) receipts were projected to increase by  $2.7
billion (17.2%) from 2003-04.  This was attributed to continued economic improvement in
2004, enactment of a three-year temporary tax increase from 2003-2005, and a robust
settlement for 2003 tax returns.  This amount was slightly offset by a larger deposit into
the PIT Refund Reserve Account and a higher deposit into the Revenue Bond Tax Fund.

      General Fund user taxes and fees receipts for 2004-05 were projected to total $8.7
billion, an increase of $700 million (8.8 percent) from reported 2003-04 collections. The
projected growth in sales tax cash receipts of $777 million (10.7%) was attributed to the
enactment of a temporary increase in the overall tax rate (to 4.25%) and a change in the
clothing and footwear exemption.  Growth in the sales tax base, after adjusting for tax law
changes and other factors, was projected at 5.5%.

      General Fund business tax receipts in 2004-05 were projected to total $3.7 billion,
an increase of $301 million (8.8%) from 2003-04 collections.  This increase was attributed
to the continued economic recovery as reflected in the corporate franchise tax.  Business
tax receipts for 2004-05 were revised up by $5 million from the Executive Budget level, to
reflect the Legislature's rejection of an Executive Budget proposal to allow biotechnology
companies to transfer net operating losses.

      General Fund other taxes, which include estate and gift tax, real property gains tax,
and pari-mutuel taxes, were projected to total $764 million in 2004-05, which is $4 million
below 2003-04's amount, but $2 million above the Executive Budget estimate.  The State
reported that previously enacted legislation to repeal both the real property gains tax and
the gift tax, and to reduce the estate and pari-mutuel taxes, had significantly reduced
collection from these resources.

      General Fund miscellaneous receipts were projected to reach nearly $2.4 billion, a
decrease of $3.5 billion from 2003-04.  After adjusting for the receipt of one-time tobacco
securitization proceeds ($4.2 billion) in 2003-04, the annual increase was projected at
$721 million.  This increase was attributed to the acceleration of $225 million in housing
SONYMA balances from 2005-06 into 2004-05, and the receipt of $182 million from the Tobacco
Settlement Fund.

      Transfers from other Funds to the General Fund were expected to total $8.6 billion,
an increase of $748 million from 2003-04.  This annual increase was comprised of higher
transfers from the Revenue Bond Tax Fund ($368 million), the Local Government Assistance
Corporation Fund ($187 million), and all other funds ($354 million), offset by lower
transfers from the Clean Water/Clean Air Fund ($61 million).

      The State projected General Fund disbursements of $43.0 billion in 2004-05, an
increase of $974 million (2.3%) from 2003-04, and $1.1 billion from the Executive Budget
level.

      Local assistance spending was projected to be $29.4 billion in 2004-05, an increase
of $2.0 billion (7.2%) from the prior year.  This spending increase was attributed to
higher spending in Medicaid ($463 million), Higher Education Services Corporation ($352
million), school aid ($466 million), special education programs ($132 million), Office of
Children and Family Services ($61 million) and the community projects fund ($58 million).

      State Operations accounts for the cost of running the Executive, Legislative and
Judicial branches of government and was projected to total $7.5 billion in 2004-05, an
increase of $445 million (6.3%) from 2003-04.  Personal service costs (e.g., State employee
payroll) comprised 73 percent of State Operations spending and the remaining 27 percent
represented non-personal service costs for contracts, rent, supplies, and other operating
expenses.

      Spending for General State Charges was projected to be $3.7 billion in 2004-05, an
increase of $457 million (14.2%) over 2003-04.  This annual increase was due mostly to
rising costs of employee health benefits (an increase of $225 million to $2.1 billion),
higher costs related to employer pension contributions (an increase of $159 million to $654
million) and $49 million in fringe benefit increases relating to collective bargaining
settlements.

      Transfers to Other Funds were projected to total $2.5 billion in 2004-05, and
included General Fund transfers to support debt service ($1.7 billion), capital projects
($196 million), and other funds ($542 million).

      The State projected that the General Fund would end the 2004-05 fiscal year with a
$1.1 billion fund balance, comprising $794 million in the Tax Stabilization Reserve Fund,
$312 million in the Community Projects Fund, and $21 million in the Contingency Reserve
Fund for litigation.

      |_|   State Governmental Funds Group.  Substantially all State non-pension financial
operations are accounted for in the State's governmental funds group.  Governmental funds
include the following four fund types, the State's projections of receipts and
disbursements in which comprise the State's Financial Plan:

      o     the General Fund, which is the major operating fund of the State and receives
all receipts that are not required by law to be deposited in another fund, including most
State tax receipts and certain fees, transfers from other funds and miscellaneous receipts
from other sources;

      o     Special Revenue Funds, which account for the proceeds of specific revenue
sources (other than expendable trusts or major capital projects), such as federal grants,
that are legally restricted to specified purposes;

      o     Capital Projects Funds, which account for financial resources of the State to
be used for the acquisition or construction of major capital facilities (other than those
financed by Special Revenue Funds, Proprietary Funds and Fiduciary Funds); and

      o     Debt Service Funds, which account for the accumulation of resources (including
receipts from certain taxes, transfers from other funds and miscellaneous revenues, such as
dormitory room rental fees, which are dedicated by statute for payment of lease-purchase
rentals) for the payment of general long-term debt service and related costs and payments
under lease-purchase and contractual-obligation financing arrangements.

      |_|   Local Government Assistance Corporation.  In 1990, as part of a State fiscal
reform program, legislation was enacted creating Local Government Assistance Corporation
(LGAC), a public benefit corporation empowered to issue long-term obligations to fund
payments to local governments that had been traditionally funded through the State's annual
seasonal borrowing.  The legislation also dedicated revenues equal to one percent of the
State sales and use tax to pay debt service on these bonds.  As of June 1995, LGAC had
issued bonds and notes to provide net proceeds of $4.7 billion, completing the program.
The issuance of these long-term obligations, which are to be amortized over no more than 30
years, was expected to eliminate the need for continued short-term seasonal borrowing.

      The legislation also imposed a limitation on the annual seasonal borrowing of the
State except in cases where the Governor and the legislative leaders have certified the
need for additional seasonal borrowing, based on emergency or extraordinary factors or
factors unanticipated at the time of adoption of the budget, and provided a schedule for
eliminating it over time.  Any seasonal borrowing is required by law to be eliminated by
the fourth fiscal year after the limit was first exceeded (i.e., no tax and revenue
anticipation note (TRAN) seasonal borrowing in the fifth year).  This provision limiting
the State's seasonal borrowing practices was included as a covenant with LGAC's bondholders
in the resolution authorizing such bonds.  No restrictions were placed upon the State's
ability to issue deficit notes.

      The impact of the LGAC reforms, as well as other changes in revenue and spending
patterns, is that the State has been able to meet its cash flow needs throughout the fiscal
year without relying on short-term seasonal borrowings.

      |X|   Authorities.  The fiscal stability of the State is related to the fiscal
stability of its public Authorities.  Authorities refer to public benefit corporations,
created pursuant to State law, other than local authorities.  Authorities have various
responsibilities, including those which finance, construct and/or operate revenue-producing
public facilities.  Authorities are not subject to the constitutional restrictions on the
incurrence of debt that apply to the State itself, and may issue bonds and notes within the
amounts and restrictions set forth in their legislative authorization.  The State's access
to the public credit markets could be impaired and the market price of its outstanding debt
may be materially and adversely affected if any of its Authorities were to default on their
respective obligations, especially those involving State-supported or State-related debt.
As of December 31, 2003, there were 18 public authorities that had outstanding debt of $100
million or more, and the aggregate outstanding debt, including refunding bonds, of these
State public authorities was $114.9 billion, only a portion of which constituted
State-supported or State-related debt.

      Authorities generally pay their operating expenses and debt service costs from
revenues generated by the projects they finance or operate, such as tolls charged for the
use of highways, bridges or tunnels, charges for public power, electric and gas utility
services, rentals charged for housing units and charges for occupancy at medical care
facilities.  In addition, State legislation authorizes several financing techniques for
Authorities.  There are statutory arrangements providing for State local assistance
payments otherwise payable to localities to be made under certain circumstances to
Authorities.  Although the State has no obligation to provide additional assistance to
localities whose local assistance payments have been paid to Authorities under these
arrangements, the affected localities could seek additional State assistance if local
assistance payments are diverted.  Some Authorities also receive moneys from State
appropriations to pay for the operating costs of certain of their programs.

      |X|   Ratings of the State's Securities.  As of June 17, 2003, S&P had rated the
State's general obligation bonds "AA," Moody's had rated those bonds "A2" and Fitch had
rated those bonds "AA-".

      Ratings reflect only the views of the ratings organizations, and an explanation of
the significance of a rating must be obtained from the rating agency furnishing the
rating.  There is no assurance that a particular rating will continue for any given period
of time or that any such rating will not be revised downward or withdrawn entirely if, in
the judgment of the agency originally establishing the rating, circumstances so warrant. A
downward revision or withdrawal of a rating may have an effect on the market price of the
State and municipal securities in which the Fund invests.

      |X|   The State's General Obligation Debt.  As of March 31, 2004, the State had
approximately $3.8 billion in general obligation bonds outstanding.  Principal and interest
due on general obligation bonds were $509 million for the 2003-04 fiscal year and were
estimated to be $486 million for the State's 2004-05 fiscal year.

      |X|   Pending Litigation.  The State is a defendant in numerous legal proceedings
pertaining to matters incidental to the performance of routine governmental operations.
That litigation includes, but is not limited to, claims asserted against the State
involving State finances and programs and arising from alleged violations of civil rights,
alleged torts, alleged breaches of contracts, real property proceedings and other alleged
violations of State and Federal laws.  These proceedings could affect adversely the
financial condition of the State in the 2004-05 fiscal year or thereafter.

      The State reported its belief that the 2004-05 Financial plan included sufficient
reserves to offset the costs associated with the payment of judgments that may be required
during the 2004-05 fiscal year.  These reserves included (but were not limited to) amounts
appropriated for Court of Claims payments and projected fund balances in the General Fund.
In addition, any amounts ultimately required to be paid by the State may not be subject to
settlement or may be paid over a multi-year period.  There could be no assurance given,
however, that adverse decisions in legal proceedings against the State would not exceed the
amount of all potential 2004-05 Financial Plan resources available for the payment of
judgments, and could therefore adversely affect the ability of the State to maintain a
balanced 2004-05 Financial Plan.

      In addition, the State is party to other claims and litigation that either its legal
counsel has advised are not probable that the State will suffer adverse court decisions or
the State has determined are not material.  Although the amounts of potential losses, if
any, are not presently determinable, it was the State's opinion that its ultimate liability
in these cases is not expected to have a material adverse effect on the State's financial
position in the 2004-05 fiscal year or thereafter.

      |X|   Other Functions.  Certain localities in addition to the City have experienced
financial problems and have requested and received additional State assistance during the
last several State fiscal years. The potential impact on the State of any future requests
by localities for additional oversight or financial assistance was not included in the
projections of the State's receipts and disbursements for the State's 2004-05 fiscal year
or thereafter.

      |X|   Factors Affecting Investments in New York City Municipal Securities. The City
has a highly diversified economic base, with a substantial volume of business activity in
the service, wholesale and retail trade and manufacturing industries and is the location of
many securities, banking, law, accounting, news media and advertising firms.

      The City is a major seaport and focal point for international business.  Many of the
major corporations headquartered in the City are multinational in scope and have extensive
foreign operations.  Numerous foreign-owned companies in the United States are also
headquartered in the City.  These firms, which have increased in number substantially over
the past decade, are found in all sectors of the City's economy, but are concentrated in
trade, manufacturing sales offices, tourism and finance.  The City is the location of the
headquarters of the United Nations, and several affiliated organizations maintain their
principal offices in the City.  A large diplomatic community exists in the City to staff
the missions to the United Nations and the foreign consulates.

      Economic activity in the City has experienced periods of growth and recession and can
be expected to experience periods of growth and recession in the future. The City
experienced a recession in the early 1970s through the middle of that decade, followed by a
period of expansion in the late 1970s through the late 1980s.  The City fell into recession
again in the early 1990s which was followed by an expansion that lasted until 2001.  The
City's financial plan assumed that the economic slowdown that began in 2001 as a result of
the September 11 attack, a national economic recession, and a downturn in the securities
industry had largely ended.  The financial plan assumed continued recovery of the City's
economy in calendar years 2004 and 2005.

      The City reported that recovery, clean up and repair efforts in the wake of the
September 11, 2001 terrorist attacks on the World Trade Center have resulted in substantial
expenditures.  The City has been largely reimbursed by the federal government for all of
its direct costs for response and remediation of the World Trade Center site.  In addition,
the State authorized the Transitional Finance Authority (the "TFA") to have outstanding
$2.5 billion of bonds and notes to pay costs related to or arising from the September 11
attack, of which the TFA had outstanding approximately $2 billion.  The City believed it
was not possible to quantify with any certainty the long-term impact of the September 11
attack on the City and its economy.

      For each of the 1981 through 2004 fiscal years, the City's General Fund had an
operating surplus, before discretionary and other transfers, and achieved balanced
operating results as reported in accordance with then applicable generally accepted
accounting principles ("GAAP") after discretionary and other transfers.  The City has been
required to close substantial gaps between forecast revenues and forecast expenditures in
order to maintain balanced operating results. There can be no assurance that the City will
continue to maintain balanced operating results as required by State law without tax or
other revenue increases or reductions in City services or entitlement programs, which could
adversely affect the City's economic base.

      The Mayor is responsible for preparing the City's financial plan, including the
City's financial plan for the 2005 through 2008 fiscal years submitted to the Control Board
on June 29, 2004 (the "June Financial Plan") and modification to the June Financial Plan
submitted to the Control Board on October 21, 2004 (as so modified, the "2005-2008
Financial Plan", or "Financial Plan").  The City's projections set forth in the Financial
Plan are based on various assumptions and contingencies which are uncertain and which may
not materialize.

      Implementation of the Financial Plan is dependent upon the City's ability to market
its securities successfully.  Implementation of the Financial Plan is also dependent upon
the ability to market the securities of other financing entities, including the New York
City Municipal Water Finance Authority ("Water Authority"), which issues debt secured by
water and sewer revenues.  In addition, the City issues revenue and tax anticipation notes
to finance its seasonal working capital requirements.  The success of projected public
sales of City, Water Authority, TFA and other bonds and notes will be subject to prevailing
market conditions.  Future developments concerning the City and public discussion of such
developments, as well as prevailing market conditions, may affect the market for
outstanding City general obligation bonds and notes.

      |X|   The City's 2004-2008 Financial Plan.  For the 2003 fiscal year, the City's
General Fund had an operating surplus of $1.928 billion, before discretionary and other
transfers, and achieved balanced operating results in accordance with GAAP, after
discretionary and other transfers.  The 2004 fiscal year was the twenty-fourth consecutive
year that the City had achieved an operating surplus, before discretionary and other
transfers, and balanced operating results, after discretionary and other transfers.

      The Financial Plan projected revenues and expenditures for the 2005 fiscal year
balanced in accordance with GAAP, and projected gaps of $3.0 billion, $4.2 billion and $3.3
billion in fiscal years 2006 through 2008, respectively.  The Financial Plan included an
out-year gap-closing program to reduce expenditures and increase revenues by a total of
$3.0 billion in fiscal years 2005 and 2006, and $1.9 billion and $1.7 billion in fiscal
years 2007 and 2008, respectively.

      Changes in projected revenues since the June Financial Plan included: (i) increases
in projected tax revenues of $577 million, $589 million, $544 million and $524 million in
fiscal years 2005 through 2008, respectively, resulting primarily from increases in real
property transaction and property tax revenues, and increases in baseline projections of
non-property taxes as a result of strong fiscal year 2004 collections, partially offset by
decreases in personal income, business income and sales taxes as a result of lower forecast
securities industry profits in calendar year 2004; (ii) increases in non-tax revenues of
$33 million in fiscal year 2005, reflecting primarily increased investment earnings; and
(iii) reductions in anticipated State assistance of $201 million, $196 million, $94
million, and $77 million in fiscal years 2005 through 2008.  Changes in projected
expenditures since the June Financial Plan included (i) increased energy costs of $40
million in fiscal year 2005 and $65 million in each of fiscal years 2006 through 2008; (ii)
increases in education spending of $87 million in fiscal year 2005; and (iii) decreases in
debt service costs of $72 million and $27 million in fiscal years 2005 and 2006,
respectively, and decreases in debt service of $39 million and $48 million in fiscal years
2007 and 2008, respectively.

      The Financial Plan also reflected legislation enacted by the State Legislature
pursuant to which the LGAC is to make available to the City or its assignee $170 million
annually.  The City had assigned the $170 million annual payment to the Sales Tax Asset
Receivable Corporation ("STAR Corp."), a local development corporation created to issue
bonds to finance the cost of debt service on bonds of the Municipal Assistance Corporation
For The City of New York ("MAC") otherwise payable from City sales tax revenues.  On
September 2004, the first $170 million annual payment was received by STAR Corp. which
completed its financing on November 4, 2004.  The proceeds of the STAR Corp. financing were
expected be used to reimburse the City for $622 million of revenues retained by MAC and to
provide MAC with an amount sufficient to defease the outstanding debt.  The City expected
the economic impact on the City's budget of the STAR Corp. financing to make available to
the City approximately $1.0 billion in fiscal year 2005 and $500 million annually in fiscal
years 2006 through 2008 by eliminating future City revenues retained by MAC for its debt
service and reimbursing the City for revenues already retained in the 2004 and 2005 fiscal
years.

      The Financial Plan makes provisions for wage increases for all City employees for the
2002-05 round of bargaining consistent with the settlement with District Council 37 of the
American Federation of State, County and Municipal Employees.  In addition, the economic
and financial condition of the City may be affected by the various financial, social,
economic, geo-political and other factors which have a material effect on the City.

      The Financial Plan is based on numerous assumptions, including the condition of the
City's and the region's economies and the concomitant receipt of economically sensitive tax
revenues in the amounts projected.  The Financial Plan is subject to various other
uncertainties and contingencies relating to, among other factors, the effects on the City
economy of the September 11 attack, the extent, if any, to which wage increases for City
employees exceed the annual wage costs assumed for the 2004 through 2008 fiscal years;
realization of projected interest earnings for pension fund assets and current assumptions
with respect to wages for City employees affecting the City's required pension fund
contributions; the willingness and ability of the State to provide the aid contemplated by
the Financial Plan and to take various other actions to assist the City; the ability of HHC
and other such entities to maintain balanced budgets; the willingness of the federal
government to provide the amount of federal aid contemplated in the Financial Plan; the
impact on City revenues and expenditures of federal and State welfare reform and any future
legislation affecting Medicare or other entitlement programs; adoption of the City's
budgets by the City Council in substantially the forms submitted by the Mayor; the ability
of the City to implement cost reduction initiatives and the success with which the City
controls expenditures; the impact of conditions in the real estate market on real estate
tax revenues; and the ability of the City and other financing entities to market their
securities successfully in the public credit markets.  Certain of these assumptions have
been questioned by the City Comptroller and other public officials.

      From time to time, the City Comptroller and other public officials issue reports and
make public statements regarding the City's financial condition, commenting on, among other
matters, the City's financial plans, projected revenues and expenditures and actions by the
City to eliminate projected operating deficits.  Some of these reports and statements have
warned that the City may have underestimated certain expenditures and overestimated certain
revenues and have suggested that the City may not have adequately provided for future
contingencies.  Certain of these reports have analyzed the City's future economic and
social conditions and have questioned whether the City has the capacity to generate
sufficient revenues in the future to meet the costs of its expenditure increases and to
provide necessary services.  It is reasonable to expect that reports and statements will
continue to be issued and to engender public comment.

      On February 12, 2004, the City Comptroller released a report on the adopted budget
for fiscal year 2005 and the June Financial Plan.  The report concluded that the City has
adopted a fiscal year 2005 budget that is likely to end the year in balance, with reserves
available to the City which appear to be sufficient to offset risks identified by the City
Comptroller.  However, the report noted that the subsequent years of the June Financial
Plan continue to contain multi-billion dollar deficits because the City's expenses continue
to outpace the growth of its revenues.  In his report, the City Comptroller identified net
risks of $516 million, $524 million, $471 million and $301 million in fiscal years 2005
through 2008, respectively, which, when added to the gaps in the June Financial Plan,
result in gaps of $516 million, $4.2 billion, $5.0 billion and $4.0 billion in fiscal years
2005 through 2008, respectively.  The risks and possible resources set forth in the City
Comptroller's report include:  (i) the possibility that taxes could be less than projected
in the June Financial Plan by $146 million, $190 million, and $137 million in fiscal years
2005 through 2007, respectively, and greater than projected in the June Financial Plan by
$33 million in fiscal year 2008; (ii) possible increased overtime expenditures of $121
million in fiscal year 2005 and $75 million in each of fiscal years 2006 through 2008; and
(iii) a possible $200 million annual shortfall in State gap-closing assistance assumed in
the June Financial Plan for fiscal years 2005 through 2008, which reflects shortfalls in
assistance in the Governor's Executive Budget and which depends upon the results of the
State budget negotiation process.

      Various actions proposed in the Financial Plan are uncertain.  If these measures
cannot be implemented, the City will be required to take other actions to decrease
expenditures or increase revenues to maintain a balanced financial plan.

      The projections and assumptions contained in the Financial Plan are subject to
revision which may involve substantial change, and no assurance can be given that these
estimates and projections, which include actions which the City expects will be taken but
which are not within the City's control, will be realized.

      |X|   Ratings of the City's Bonds.  As of November 5, 2004, Moody's, S&P and Fitch
rated the City's general obligations bonds A2, A and A+, respectively.  These ratings
reflect only the views of Moody's, S&P and Fitch from which an explanation of the
significance of such ratings may be obtained.  There is no assurance that those ratings
will continue for any given period of time or that they will not be revised downward or
withdrawn entirely.  Any such downward revision or withdrawal could have an adverse effect
on the market prices of the City's bonds.  On November 26, 2002, S&P issued a negative
outlook on City bonds and on May 27, 2003 changed the outlook to stable.  On November 15,
2001, Moody's issued a negative outlook on City bonds and on January 28, 2004 revised the
outlook to stable.  On December 23, 2002, Fitch issued a negative outlook on City bonds and
on December 8, 2003 changed the outlook to stable.

      |X|   The City's Outstanding Indebtedness.  As of September 30, 2004, the City and
the Municipal Assistance Corporation for the City of New York had, respectively, $30.783
billion and $1.757 billion of outstanding net long-term debt.

      For its normal operations, the City depends on aid from the State both to enable the
City to balance its budget and to meet its cash requirements.  There can be no assurance
that there will not be delays or reductions in State aid to the City from the amounts
projected; that State budgets in future fiscal years will be adopted by the April 1
statutory deadline, or interim appropriations will be enacted; or that any such reductions
or delays will not have adverse effects on the City's cash flow or expenditures.  In
addition, the Federal budget negotiation process could result in a reduction or a delay in
the receipt of Federal grants which could have adverse effects on the City's cash flow or
revenues.

|X|   Pending Litigation.  The City is a defendant in lawsuits pertaining to material
matters and claims asserted that are incidental to performing routine governmental and
other functions. That litigation includes, but is not limited to, actions commenced and
claims asserted against the City arising out of alleged constitutional violations, torts,
breaches of contract, and other violations of law and condemnation proceedings.  While the
ultimate outcome and fiscal impact, if any, on the City of such proceedings and claims were
not predictable, adverse determinations in certain of them might have a material adverse
effect upon the City's ability to carry out the Financial Plan.  For the fiscal year ended
on June 30, 2004, the City paid $591 million for judgments and claims, $159.8 million of
which was reimbursed by the Health & Hospitals Corporation.  The Financial Plan includes
provisions for the payment of judgments and claims of $612.2 million, $640.7 million,
$675.5 million and $717.8 million for the 2005 through 2008 fiscal years, respectively.
The City has estimated that its potential future liability for outstanding claims against
it as of June 30, 2004 amounted to approximately $4.4 billion.


Tobacco Settlement Revenue Bonds. The Fund may invest a significant portion of its assets
in tobacco settlement revenue bonds.  As of the Fund's fiscal year ended December 31, 2004,
10.0% of the Fund's assets were invested in tobacco revenue settlement bonds.

      Tobacco settlement revenue bonds are secured by an issuing state's proportionate
share in the Master Settlement Agreement ("MSA"). The MSA is an agreement, reached out of
court in November 1998 between 46 states and nearly all the U.S. tobacco manufacturers
(approximately 99% of the current combined market share of tobacco manufacturers). The MSA
provides for payments annually by the manufacturers to the states and jurisdictions in
perpetuity, in exchange for releasing all claims against the manufacturers and a pledge of
no further litigation. Tobacco manufacturers pay into a master escrow trust based on their
market share, and each state receives a fixed percentage of the payment as set forth in the
MSA.

      A number of states  have  securitized  the future  flow of those  payments  by selling
bonds pursuant to indentures,  some through distinct  governmental entities created for such
purpose.  The bonds are backed by the future  revenue  flow that is used for  principal  and
interest  payments on the bonds.  Annual  payments on the bonds,  and thus risk to the Fund,
are highly  dependent  on the  receipt  of future  settlement  payments  to the state or its
governmental  entity,  as well as  several  other  factors.  The  actual  amount  of  future
settlement payments,  therefore,  is dependent on many factors,  including,  but not limited
to, annual domestic cigarette shipments, cigarette consumption,  inflation and the financial
capability  of  participating  tobacco  companies.  As a result,  payments  made by  tobacco
manufacturers  could be  negatively  impacted  if the  decrease  in tobacco  consumption  is
significantly  greater than the forecasted decline. A market share loss by the MSA companies
to non-MSA  participating  tobacco  manufacturers  would cause a downward  adjustment in the
payment amounts. A participating  manufacturer filing for bankruptcy also could cause delays
or  reductions in bond  payments.  The MSA itself has been subject to legal  challenges  and
has, to date, withstood those challenges.

      On September 21, 2004, a civil trial (United States v. Philip Morris, et. al.) began
in U.S. district court nearly five years after the U.S. Department of Justice first filed
charges against the tobacco industry. The federal government alleges that the major tobacco
companies defrauded and misled the American public about the health risks associated with
smoking cigarettes. The civil lawsuit seeks a disgorgement of $280 billion, representing
industry profits, and funding for cessation and counter-advertising programs, and release
of all industry documents. The named defendant tobacco companies represent approximately
98% of the tobacco industry's market share. The tobacco industy denies any wrongdoing and
counters that it has greatly modified its practices, including warning labels on cigarette
packs since the 1960s and agreeing to the MSA with the states. A negative outcome to the
trial would adversely affect the MSA companies and, in turn, could potentially cause delays
or reductions in bond payments by those companies. However, to date, it is not possible to
predict the outcome of the litigation.


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

      |X|   Floating Rate and Variable Rate Obligations. Variable rate demand obligations
may have a demand feature that allows the Fund to tender the obligation to the issuer or a
third party prior to its maturity. The tender may be at par value plus accrued interest,
according to the terms of the obligations.
      The interest rate on a floating rate demand note is based on a stated prevailing
market rate, such as a bank's prime rate, the 91-day U.S. Treasury Bill rate or some other
standard, and is adjusted automatically each time such rate is adjusted. The interest rate
on a variable rate note is also based on a stated prevailing market rate but is adjusted
automatically at specified intervals of not less than one year. Generally, the changes in
the interest rate on such securities reduce the fluctuation in their market value. As
interest rates decrease or increase, the potential for capital appreciation or depreciation
is less than that for fixed-rate obligations of the same maturity. The Manager may
determine that an unrated floating rate or variable rate obligation meets the Fund's
quality standards by reason of the backing provided by a letter of credit or guarantee
issued by a bank that meets those quality standards.

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

      |X|   Inverse Floaters and Other Derivative Investments. "Inverse floaters" are
municipal obligations on which the interest rates typically fall as market rates increase
and increase as market rates fall. Changes in market interest rates or the floating rate of
the security inversely affect the residual interest rate of an inverse floater. As a
result, the price of an inverse floater will be considerably more volatile than that of a
fixed-rate obligation when interest rates change. The Fund can invest up to 20% of its
total assets in inverse floaters. Certain inverse floaters may be illiquid and therefore
subject to the Fund's limitation on illiquid securities.

      To provide investment leverage, a municipal issuer might decide to issue two variable
rate obligations instead of a single long-term, fixed-rate bond. The interest rate on one
obligation reflects short-term interest rates. The interest rate on the other instrument,
the inverse floater, reflects the approximate rate the issuer would have paid on a
fixed-rate bond, multiplied by a factor of two, minus the rate paid on the short-term
instrument. The two portions may be recombined to create a fixed-rate bond. The Manager
might acquire both portions of that type of offering, to reduce the effect of the
volatility of the individual securities. This provides the Manager with a flexible
portfolio management tool to vary the degree of investment leverage efficiently under
different market conditions.

      Inverse floaters may offer relatively high current income, reflecting the spread
between short-term and long-term tax-exempt interest rates. As long as the municipal yield
curve remains relatively steep and short-term rates remain relatively low, owners of
inverse floaters will have the opportunity to earn interest at above-market rates because
they receive interest at the higher long-term rates but have paid for bonds with lower
short-term rates. If the yield curve flattens and shifts upward, an inverse floater will
lose value more quickly than a conventional long-term bond. The Fund might invest in
inverse floaters to seek higher tax-exempt yields than are available from fixed-rate bonds
that have comparable maturities and credit ratings. In some cases, the holder of an inverse
floater may have an option to convert the floater to a fixed-rate bond, pursuant to a
"rate-lock" option.

      Some inverse floaters have a feature known as an interest rate "cap" as part of the
terms of the investment. Investing in inverse floaters that have interest rate caps might
be part of a portfolio strategy to try to maintain a high current yield for the Fund when
the Fund has invested in inverse floaters that expose the Fund to the risk of short-term
interest rate fluctuations. "Embedded" caps can be used to hedge a portion of the Fund's
exposure to rising interest rates. When interest rates exceed a pre-determined rate, the
cap generates additional cash flows that offset the decline in interest rates on the
inverse floater, and the hedge is successful. However, the Fund bears the risk that if
interest rates do not rise above the pre-determined rate, the cap (which is purchased for
additional cost) will not provide additional cash flows and will expire worthless.

      Inverse floaters are a form of derivative investment. Certain derivatives, such as
options, can be used to increase or decrease the Fund's exposure to changing security
prices, interest rates or other factors that affect the value of securities. However, these
techniques could result in losses to the Fund, if the Manager judges market conditions
incorrectly or employs a strategy that does not correlate well with the Fund's other
investments. These techniques can cause losses if the counterparty does not perform its
promises. An additional risk of investing in municipal securities that are derivative
investments is that their market value could be expected to vary to a much greater extent
than the market value of municipal securities that are not derivative investments but have
similar credit quality, redemption provisions and maturities.

      |X|   Options Transactions. The Fund can write (that is, sell) call options. The
Fund's call writing is subject to a number of restrictions:
(1)   Calls the Fund sells must be listed on a national securities exchange.
(2)   Each call the Fund writes must be "covered" while it is outstanding. That means the
              Fund must own the investment on which the call was written.
(3)   As an operating policy, no more than 5% of the Fund's net assets will be invested in
              options transactions.

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

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

      To terminate its obligation on a call it has written, the Fund may purchase a
corresponding call in a "closing purchase transaction."  The Fund will then realize a
profit or loss, depending upon whether the net of the amount of the option transaction
costs and the premium received on the call the Fund wrote was more or less than the price
of the call the Fund purchased to close out the transaction. A profit may also be realized
if the call lapses unexercised, because the Fund retains the underlying investment and the
premium received. Any such profits are considered short-term capital gains for federal tax
purposes, as are premiums on lapsed calls. When distributed by the Fund they are taxable as
ordinary income.

o     Purchasing Calls and Puts. The Fund may buy calls only to close out a call it has
written, as discussed above. Calls the Fund buys must be listed on a securities exchange. A
call or put option may not be purchased if the purchase would cause the value of all the
Fund's put and call options to exceed 5% of its total assets. The Fund may not sell puts
other than puts it has previously purchased, to close out a position.

      When the Fund purchases a put, it pays a premium. The Fund then has the right to sell
the underlying investment to a seller of a corresponding put on the same investment during
the put period at a fixed exercise price. Puts on municipal bond indices are settled in
cash. Buying a put on a debt security the Fund owns enables it to protect itself during the
put period against a decline in the value of the underlying investment below the exercise
price. If the market price of the underlying investment is equal to or above the exercise
price and as a result the put is not exercised or resold, the put will become worthless at
its expiration date. In that case the Fund will lose its premium payment and the right to
sell the underlying investment. A put may be sold prior to expiration (whether or not at a
profit).

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

      The Fund's option activities could affect its portfolio turnover rate and brokerage
commissions. The exercise of calls written by the Fund might cause the Fund to sell related
portfolio securities, thus increasing its turnover rate. The Fund could pay a brokerage
commission each time it buys a call or put, sells a call or put, or buys or sells an
underlying investment in connection with the exercise of a call or put. Such commissions
might be higher on a relative basis than the commissions for direct purchases or sales of
the underlying investments. Premiums paid for options are small in relation to the market
value of the underlying investments. Consequently, put and call options offer large amounts
of leverage. The leverage offered by trading in options could result in the Fund's net
asset value being more sensitive to changes in the value of the underlying investment.

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

      An option position may be closed out only on a market that provides secondary trading
for options of the same series. There is no assurance that a liquid secondary market will
exist for a particular option. If the Fund could not effect a closing purchase transaction
due to a lack of a market, it would have to hold the callable investment until the call
lapsed or was exercised, and could experience losses.

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

|X|   When-Issued  and  Delayed-Delivery  Transactions.  Subject to the  Fund's  fundamental
policy as stated  in the  Prospectus,  the Fund can  purchase  securities,  up to 10% of the
Fund's net assets,  on a "when-issued"  basis, and may purchase or sell such securities on a
"delayed-delivery"  or "forward  commitment"  basis.  "When-issued"  or  "delayed  delivery"
refers to securities  whose terms and indenture are available and for which a market exists,
but which are not available for immediate delivery.

      When such transactions are negotiated the price (which is generally expressed in
yield terms) is fixed at the time the commitment is made. Delivery and payment for the
securities take place at a later date. Normally the settlement date is within six months of
the purchase of municipal bonds and notes. However, the Fund may, from time to time,
purchase municipal securities having a settlement date more than six months and possibly as
long as two years or more after the trade date. The securities are subject to change in
value from market fluctuation during the settlement period. The value at delivery may be
less than the purchase price. For example, changes in interest rates in a direction other
than that expected by the Manager before settlement will affect the value of such
securities and may cause loss to the Fund. No income begins to accrue to the Fund on a
when-issued security until the Fund receives the security at settlement of the trade.

      The Fund may engage in when-issued transactions in order to secure what is considered
to be an advantageous price and yield at the time of entering into the obligation. When the
Fund engages in when-issued or delayed-delivery transactions, it relies on the buyer or
seller, as the case may be, to complete the transaction. Its failure to do so may cause the
Fund to lose the opportunity to obtain the security at a price and yield it considers
advantageous.

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

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

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

      |X|   Zero-Coupon Securities. The Fund can invest without limit in zero-coupon and
delayed interest municipal securities. Zero-coupon securities do not make periodic interest
payments and are sold at a deep discount from their face value. The buyer recognizes a rate
of return determined by the gradual appreciation of the security, which is redeemed at face
value on a specified maturity date. This discount depends on the time remaining until
maturity, as well as prevailing interest rates, the liquidity of the security and the
credit quality of the issuer. In the absence of threats to the issuer's credit quality, the
discount typically decreases as the maturity date approaches. Some zero-coupon securities
are convertible, in that they are zero-coupon securities until a predetermined date, at
which time they convert to a security with a specified coupon rate.

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

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

      |X|   Puts and Standby Commitments. The Fund can acquire "stand-by commitments" or
"puts" with respect to municipal securities it purchases in order to enhance portfolio
liquidity. These arrangements give the Fund the right to sell the securities at a set price
on demand to the issuing broker-dealer or bank. However, securities having this feature may
have a relatively lower interest rate.

      When the Fund buys a municipal security subject to a standby commitment to repurchase
the security, the Fund is entitled to same-day settlement from the purchaser. The Fund
receives an exercise price equal to the amortized cost of the underlying security plus any
accrued interest at the time of exercise. A put purchased in conjunction with a municipal
security enables the Fund to sell the underlying security within a specified period of time
at a fixed exercise price.

      The Fund might purchase a standby commitment or put separately in cash or it might
acquire the security subject to the standby commitment or put (at a price that reflects
that additional feature). The Fund will enter into these transactions only with banks and
securities dealers that, in the Manager's opinion, present minimal credit risks. The Fund's
ability to exercise a put or standby commitment will depend on the ability of the bank or
dealer to pay for the securities if the put or standby commitment is exercised. If the bank
or dealer should default on its obligation, the Fund might not be able to recover all or a
portion of any loss sustained from having to sell the security elsewhere.

      Puts and standby commitments are not transferable by the Fund. They terminate if the
Fund sells the underlying security to a third party. The Fund intends to enter into these
arrangements to facilitate portfolio liquidity, although such arrangements might enable the
Fund to sell a security at a pre-arranged price that may be higher than the prevailing
market price at the time the put or standby commitment is exercised. However, the Fund
might refrain from exercising a put or standby commitment if the exercise price is
significantly higher than the prevailing market price, to avoid imposing a loss on the
seller that could jeopardize the Fund's business relationships with the seller.

      A put or standby commitment increases the cost of the security and reduces the yield
otherwise available from the security. Any consideration paid by the Fund for the put or
standby commitment will be reflected on the Fund's books as unrealized depreciation while
the put or standby commitment is held, and a realized gain or loss when the put or
commitment is exercised or expires. Interest income received by the Fund from municipal
securities subject to puts or stand-by commitments may not qualify as tax-exempt in its
hands if the terms of the put or stand-by commitment cause the Fund not to be treated as
the tax owner of the underlying municipal securities.

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

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

      The majority of these transactions run from day to day. Delivery pursuant to resale
typically will occur within one to five days of the purchase. Repurchase agreements having
a maturity beyond seven days are subject to the Fund's limits on holding illiquid
securities.

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

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

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

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

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

      |X|   Borrowing for Leverage. As a fundamental policy, the Fund may borrow up to 5%
of its total assets from banks on an unsecured basis for temporary and emergency purposes
or to purchase additional portfolio securities. Borrowing to purchase portfolio securities
is a speculative investment technique known as "leveraging."  This investment technique may
subject the Fund to greater risks and costs, including the burden of interest expense, an
expense the Fund would not otherwise incur. The Fund can borrow only if it maintains a 300%
ratio of assets to borrowings at all times in the manner required under applicable
provisions of the Investment Company Act. If the value of the Fund's assets fails to meet
this 300% asset coverage requirement, the Fund is required to reduce its bank debt within
three days to meet the requirement. To do so, the Fund might have to sell a portion of its
investments at a disadvantageous time.

      The Fund will pay interest on these loans, and that interest expense will raise the
overall expenses of the Fund and reduce its returns. If it does borrow, its expenses will
be greater than comparable funds that do not borrow for leverage. The interest on a loan
might be more (or less) than the yield on the securities purchased with the loan proceeds.
Additionally, the Fund's net asset value per share might fluctuate more than that of funds
that do not borrow.

      The Fund has entered into an agreement enabling it to participate with other
OppenheimerFunds in an unsecured line of credit with a bank. Interest is charged to each
fund based on its respective borrowings. The Fund pays a commitment fee equal to its pro
rata share of the average amortized amount of the credit line. This fee is described in the
notes to the Financial Statements at the end of this Statement of Additional Information.

      In addition, pursuant to an exemptive order issued by the SEC to Citicorp North
America, Inc. ("Citicorp"), the Fund also has the ability to borrow, subject to the limits
established by its investment policies, from commercial paper and medium-term note conduits
administered by Citicorp that issue promissory notes to fund loans to investment companies
such as the Fund. These loans may be secured by assets of the Fund, so long as the Fund's
policies permit it to pledge its assets to secure a debt. Liquidity support for these loans
will be provided by banks obligated to make loans to the Fund in the event the conduit or
conduits are unable or unwilling to make such loans. The Fund will have the right to prepay
such loans and terminate its participation in the conduit loan facility at any time upon
prior notice. As a borrower under a conduit loan facility, the Fund maintains rights and
remedies under state and federal law comparable to those it would maintain with respect to
a loan from a bank.

      |X|   Taxable Investments. While the Fund can invest up to 20% of its net assets in
investments that generate income subject to income taxes, it attempts to invest 100% of its
assets in tax-exempt securities under normal market conditions. The Fund does not
anticipate investing substantial amounts of its assets in taxable investments under normal
market conditions or as part of its normal trading strategies and policies. To the extent
it invests in taxable securities, the Fund would not be able to meet its objective of
providing tax-exempt income to its shareholders. Taxable investments include, for example,
options, repurchase agreements and some of the types of securities it would buy for
temporary defensive purposes.

      |X|   Portfolio Turnover. A change in the securities held by the Fund from buying and
selling investments is known as "portfolio turnover." Short-term trading increases the rate
of portfolio turnover and could increase the Fund's transaction costs. However, the Fund
ordinarily incurs little or no brokerage expense because most of the Fund's portfolio
transactions are principal trades that do not require payment of brokerage commissions.

      The Fund ordinarily does not trade securities to achieve capital gains, because they
would not be tax-exempt income. To a limited degree, the Fund may engage in short-term
trading to attempt to take advantage of short-term market variations. It may also do so to
dispose of a portfolio security prior to its maturity. That might be done if, on the basis
of a revised credit evaluation of the issuer or other considerations, the Manager believes
such disposition is advisable or the Fund needs to generate cash to satisfy requests to
redeem Fund shares. In those cases, the Fund may realize a capital gain or loss on its
investments. The Fund's annual portfolio turnover rate normally is not expected to exceed
50%.

|X|   Temporary Defensive and Interim Investments.  The securities the Fund can invest in
for temporary defensive purposes include the following:
o     short-term municipal securities;
o     obligations issued or guaranteed by the U.S. government or its agencies or
            instrumentalities;
o     commercial paper rated "A-1" by Standard & Poor's, or having a comparable rating by
            another nationally-recognized rating agency; and
o     certificates of deposit of domestic banks with assets of $1 billion or more.

      The Fund also might hold these types of securities pending the investment of proceeds
from the sale of portfolio securities or to meet anticipated redemptions of Fund shares.
The income from some of these temporary defensive or interim investments may not be
tax-exempt. Therefore when making those investments, the Fund might not achieve its
objective.

      |X|   Investments in Other Investment Companies. On a temporary basis, the Fund can
invest up to 5% of its total assets in shares of other investment companies that have an
investment objective of seeking income exempt from federal, New York State and New York
City personal income taxes. It can invest up to 5% of its total assets in any one
investment company (but cannot own more than 3% of the outstanding voting stock of that
company). These limits do not apply to shares acquired in a merger, consolidation,
reorganization or acquisition of another investment company. Because the Fund would be
subject to its ratable share of the other investment company's expenses, the Fund will not
make these investments unless the Manager believes that the potential investment benefits
justify the added costs and expenses.

Other Investment Restrictions

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

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


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

o     The Fund cannot borrow money or mortgage or pledge any of its assets, except that the
Fund may borrow from a bank for temporary or emergency purposes or for investment purposes
in amounts not exceeding 5% of its total assets. Where borrowings are made for a purpose
other than temporary or emergency purposes, the Investment Company Act requires that the
Fund maintain asset coverage of at least 300% for all such borrowings. Should such asset
coverage at any time fall below 300%, the Fund will be required to reduce its borrowings
within three days to the extent necessary to meet that asset coverage requirement. To
reduce its borrowings, the Fund might have to sell investments at a time when it would be
disadvantageous to do so. Additionally, interest paid by the Fund on its borrowings will
decrease the net earnings of the Fund.

o     The Fund cannot buy any securities on margin or sell any securities short.

o     The Fund cannot lend any of its funds or other assets, except by the purchase of a
portion of an issue of publicly distributed bonds, debentures, notes or other debt
securities.

o     The Fund cannot act as underwriter of securities issued by other persons. A permitted
exception is if the Fund technically is deemed to be an underwriter under the federal
securities laws in connection with the disposition of its portfolio securities.

o     The Fund cannot purchase the securities of any issuer that would result in the Fund
owning more than 10% of the voting securities of that issuer.

o     The Fund cannot purchase securities from or sell them to its officers and trustees,
or any firm of which any officer or trustee is a member, as principal. However, the Fund
may deal with such persons or firms as brokers and pay a customary brokerage commission.
The Fund cannot retain securities of any issuer, if to the knowledge of the Fund, one or
more of its officers, trustees or investment advisor, own beneficially more than1/2of 1% of
the securities of such issuer and all such officers and trustees together own beneficially
more than 5% of those securities.

o     The Fund cannot acquire, lease or hold real estate, except as may be necessary or
advisable for the maintenance of its offices or to enable the Fund to take appropriate such
action in the event of financial difficulties, default or bankruptcy of either the issuer
of or the underlying source of funds for debt service for any obligations in the Fund's
portfolio.

o     The Fund cannot invest in commodities and commodity contracts, puts, calls,
straddles, spreads or any combination thereof, or interests in oil, gas or other mineral
exploration or development programs. The Fund may, however, write covered call options (or
purchase put options) listed for trading on a national securities exchange. The Fund can
also purchase call options (and sell put options) to the extent necessary to close out call
options it previously wrote or put options it previously purchased.

o     The Fund cannot invest in companies for the purpose of exercising control or
management.

o     The Fund cannot invest more than 25% of its total assets in securities of  issuers of
a particular industry. For the purposes of this limitation, tax-exempt securities and
United States government obligations are not considered to be part of an industry. However,
with respect to industrial development bonds and other revenue obligations for which the
underlying credit is a business or charitable entity, the industry of that entity will be
considered for purposes of this 25% limitation.

o     The Fund cannot issue "senior securities," but this does not prohibit certain
investment activities for which assets of the Fund are designated as segregated, or margin,
collateral or escrow arrangements are established, to cover the related obligations.
Examples of those activities include borrowing money, reverse repurchases agreements,
delayed-delivery and when-issued arrangements for portfolio securities transactions and
contracts to buy or sell derivatives, hedging instruments, options or futures.

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

Diversification. The Fund intends to be "diversified," as defined in the Investment Company
Act, with respect to 75% of its total assets, and to satisfy the restrictions against
investing too much of its assets in any "issuer" as set forth above. Under the Investment
Company Act's requirements for diversification, as to 75% of its total assets, the Fund
cannot invest more than 5% of its total assets in the securities of any one issuer (other
than the U.S. government, its agencies or instrumentalities) nor can it own more than 10%
of an issuer's voting securities.

      In implementing this policy, the identification of the issuer of a municipal security
depends on the terms and conditions of the security. When the assets and revenues of an
agency, authority, instrumentality or other political subdivision are separate from those
of the government creating it and the security is backed only by the assets and revenues of
the subdivision, agency, authority or instrumentality, the latter would be deemed to be the
sole issuer. Similarly, if an industrial development bond is backed only by the assets and
revenues of the non-governmental user, then that user would be deemed to be the sole
issuer. However, if in either case the creating government or some other entity guarantees
a security, the guarantee would be considered a separate security and would be treated as
an issue of that government or other entity.

      In implementing the Fund's policy not to concentrate its investments, the Manager
will consider a non-governmental user of facilities financed by industrial development
bonds as being in a particular industry. That is done even though the bonds are municipal
securities, as to which the Fund has no concentration limitation. Although this application
of the concentration restriction is not a fundamental policy of the Fund, it will not be
changed without shareholder approval.

      For the purposes of the Fund's policy not to concentrate in securities of issuers as
described in the investment restrictions listed in the Prospectus and this Statement of
Additional Information, the Fund has adopted the industry classifications set forth in
Appendix B to this Statement of Additional Information. This is not a fundamental policy.
Bonds which are refunded with escrowed U.S. government securities are considered U.S.
government securities for purposes of the Fund's policy not to concentrate.

      Subject to the limitations stated above, from time to time the Fund may increase the
relative emphasis of its investments in a particular segment of the municipal securities
market above 25% of its net assets. For example, these might include, among others, general
obligation bonds, pollution control bonds, hospital bonds, or any other segment of the
municipal securities market as listed in Appendix B to this Statement of Additional
Information. To the extent it does so, the Fund's exposure to market risks from economic,
business, political or other changes affecting one bond in a particular segment (such as
proposed legislation affecting the financing of a project or decreased demand for a type of
project) might also affect other bonds in the same.

      |X|   Does the Fund Have Any Restrictions That Are Not Fundamental? The Fund operates
under certain investment restrictions which are non-fundamental investment policies of the
Fund and which can be changed by the Board without shareholder approval. These restrictions
provide that:

o     The Fund may not acquire more than 3% of the voting securities issued by any one
investment company. An exception is if the acquisition results from a dividend or a merger,
consolidation or other reorganization. Also, the Fund cannot invest more than 5% of its
assets in securities issued by any one investment company or invest more than 5% of the
Fund's assets in securities of other investment companies.

o     For purposes of the Fund's investment restriction as to concentration described
above, its policy with respect to concentration of investments shall be interpreted as
prohibiting the Fund from making an investment in any given industry if, upon making the
proposed investment, 25% or more of the value of its total assets would be invested in such
industry.

o     For the purposes of the Fund's policy regarding minimum investments in the tax-exempt
securities, the minimum investment requirement is based on net assets plus borrowings used
for investment purposes.


Disclosure of Portfolio Holdings.  The Fund has adopted policies and procedures concerning
the dissemination by employees, officers and/or directors of the Manager, Distributor, and
Transfer Agent of information about the portfolio securities holdings of the Funds.  These
policies are designed to assure that dissemination of non-public information about
portfolio securities is distributed for a legitimate business purpose, and is done in a
manner that (a) conforms to applicable laws and regulations and (b) is designed to prevent
that information from being used in a way that could negatively affect the Fund's
investment program or enable third parties to use that information in a manner that is
harmful to a Fund.

      Until publicly disclosed, a Fund's portfolio holdings are proprietary, confidential
business information. While recognizing the importance of providing Fund shareholders with
information about their Fund's investments and providing portfolio information to a variety
of third parties to assist with the management, distribution and administrative process,
such need for transparency must be balanced against the risk that third parties who gain
access to a Fund's portfolio holdings information could attempt to use that information to
trade ahead of or against the Fund, which could negatively affect the prices the Fund is
able to obtain in portfolio transactions or the availability of the portfolio securities
that portfolio managers are trading in on a Fund's behalf.

      The Manager and its subsidiaries and affiliates, employees, officers, and directors,
shall neither solicit nor accept any compensation or other consideration (including any
agreement to maintain assets in the Fund or in other investment companies or accounts
managed by the Manager or any affiliated person of the Manager) in connection with the
disclosure a Fund's non-public portfolio holdings. The receipt of investment advisory fees
or other fees and compensation paid to the Manager and their subsidiaries pursuant to
agreements approved by the Fund's Board shall not be deemed to be "compensation" or
"consideration" for these purposes.  It is a violation of the Code of Ethics for any
covered person to release holdings in contravention of portfolio holdings disclosure
policies and procedures adopted by the Fund.

      A list of the top 10 or more portfolio securities holdings (based on invested
                        ----------
assets), listed by security or by issuer, as of the end of each month may be disclosed to
third parties (subject to the procedures below) no sooner than 15 days after month-end.
The top 10 or more holdings also shall be posted on the OppenheimerFunds' website at
www.oppenheimerfunds.com in the "Fund Profiles" section.  Other general information about a
Fund's portfolio investments, such as portfolio composition by asset class, industry,
country, currency, credit rating or maturity, may also be posted with a 15-day lag.

      Except under special limited circumstances discussed below, month-end lists of a
Fund's complete portfolio holdings may be disclosed no sooner than 30-days after the
relevant month-end, subject to the procedures below. If they have not been disclosed
publicly, they may be disclosed pursuant to special requests for legitimate business
reasons, provided that:

o     The third-party recipient must first submit a request for release of Fund portfolio
            holdings, explaining the business reason for the request;
o     Senior officers (a Senior Vice President or above) in the Manager's Portfolio and
            Legal departments must approve the completed request for release of Fund
            portfolio holdings; and
o     The third-party recipient must sign the Manager's portfolio holdings non-disclosure
            agreement before receiving the data, agreeing to keep confidential information
            that is not publicly available regarding a Fund's holdings and agreeing not to
            trade directly or indirectly based on the information.

      Complete Fund portfolio holdings positions may be released to the following
categories of entities or individuals on an ongoing basis, provided that such entity or
individual either (1) has signed an agreement to keep such information confidential and not
trade on the basis of such information or (2) is subject to fiduciary obligations, as a
member of the Fund's Board, or as an employee, officer and/or director of the Manager,
Distributor, or Transfer Agent, or their respective legal counsel, not to disclose such
information except in conformity with these policies and procedures and not to trade for
his/her personal account on the basis of such information:

o     Employees of the Fund's Manager, Distributor and Transfer Agent who need to have
            access to such information (as determined by senior officers of such entity),
o     The Fund's certified public accountants and auditors,
o     Members of the Fund's Board and the Board's legal counsel,
o     The Fund's custodian bank,
o     A proxy voting service designated by the Fund and its Board,
o     Rating/ranking organizations (such as Lipper and Morningstar),
o     Portfolio pricing services retained by the Manager to provide portfolio security
            prices, and
o     Dealers, to obtain bids (price quotations, because securities are not priced by the
            Fund's regular pricing services).

      Portfolio holdings information of a Fund may be provided, under limited
circumstances, to brokers and dealers or with whom the Fund trades and/or entities that
provide investment coverage and/or analytical information regarding the Fund's portfolio,
provided that there is a legitimate investment reason for providing the information to the
broker or dealer or other entity.  Month-end portfolio holdings information may, under this
procedure, be provided to vendors providing research information and/or analytics to the
fund, with at least a 15-day delay after the month end, but in certain cases may be
provided to a broker or analytical vendor with a 1- 2 day lag to facilitate the provision
of requested investment information to the manager to facilitate a particular trade or the
portfolio manager's investment process for the Fund.  Any third party receiving such
information must first sign the Manager's portfolio holdings non-disclosure agreement as a
pre-condition to receiving this information.

      Portfolio holdings information (which may include information on individual
securities positions or multiple securities) may be provided to the entities listed below
(1) by portfolio traders employed by the Manager in connection with portfolio trading, and
(2) by the members of the Manager's Security Valuation Group and Accounting Departments in
connection with portfolio pricing or other portfolio evaluation purposes:

o     Brokers and dealers in connection with portfolio transactions (purchases and sales)
o     Brokers and dealers to obtain bids or bid and asked prices (if securities held by a
            Fund are not priced by the fund's regular pricing services)
o     Dealers to obtain price quotations where the fund is not identified as the owner

      Portfolio holdings information (which may include information on a Fund's entire
portfolio or individual securities therein) may be provided by senior officers of the
Manager or attorneys on the legal staff of the Manager, Distributor, or Transfer Agent, in
the following circumstances:

o     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,
o     Response to regulatory requests for information (the SEC, NASD, state securities
            regulators, and/or foreign securities authorities, including without limitation
            requests for information in inspections or for position reporting purposes),
o     To potential sub-advisors of portfolios (but only pursuant to confidentiality
            agreements),
o     To consultants for retirement plans for plan sponsors/discussions at due diligence
            meetings (if entire portfolio holdings are provided, however, it shall be done
            only pursuant to a confidentiality agreement),
o     Investment bankers in connection with merger discussions (but only pursuant to
            confidentiality agreements)

      Portfolio managers and analysts may, subject to the Manager's policies on
communications with the press and other media, discuss portfolio information in interviews
with members of the media, or in due diligence or similar meetings with clients or
prospective purchasers of Fund shares or their financial intermediary representatives.

      The Fund's shareholders may, under unusual circumstances (such as a lack of liquidity
in the Fund's portfolio to meet redemptions), receive redemption proceeds of their Fund
shares paid as pro rata shares of securities held in the Fund's portfolio.  In such
circumstances, disclosure of the Fund's portfolio holdings may be made to such shareholders.

      The Chief Compliance Officer of the Fund and the Manager, Distributor, and Transfer
Agent (the "CCO") shall oversee the compliance by the Manager, Distributor, Transfer Agent,
and their personnel with these policies and procedures. At least annually, the CCO shall
report to the Fund Board on such compliance oversight and on the categories of entities and
individuals to which disclosure of portfolio holdings of the Funds has been made during the
preceding year pursuant to these policies. The CCO shall report to the Fund Board any
material violation of these policies and procedures during the previous calendar quarter
and shall make recommendations to the Companies and to the Boards as to any amendments that
the CCO believes are necessary and desirable to carry out or improve these policies and
procedures.

      The Manager and/or the Fund have entered into ongoing arrangements to make available
information about the Fund's portfolio holdings.  One or more of the Oppenheimer funds may
currently disclose portfolio holdings information based on ongoing arrangements to the
following parties:


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

            A.G. Edwards & Sons         Keijser Securities

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

            ABG Securities              Kempen & Co. USA Inc.

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

            ABN AMRO                    Kepler Equities/Julius
                                        Baer Sec

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

            Advest                      KeyBanc Capital Markets

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

            AG Edwards                  Leerink Swan

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

            American Technology ResearchLegg Mason

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

            Auerbach Grayson            Lehman

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

            Banc of America Securities  Lehman Brothers

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

            Barclays                    Lipper

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

            Baseline                    Loop Capital Markets

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

            Bear Stearns                MainFirst Bank AG

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

            Belle Haven                 Makinson Cowell US Ltd

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

            Bloomberg                   Maxcor Financial

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

            BNP Paribas                 Merrill

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

            BS Financial Services       Merrill Lynch

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

            Buckingham Research Group   Midwest Research

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

            Caris & Co.                 Mizuho Securities

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

            CIBC World Markets          Morgan Stanley

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

            Citigroup                   Morningstar

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

            Citigroup Global Markets    Natexis Bleichroeder

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

            Collins Stewart             Ned Davis Research Group

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

            Craig-Hallum Capital Group  Nomura Securities
            LLC

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

            Credit Agricole Cheuvreux   Pacific Crest
            N.A. Inc.

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

            Credit Suisse First Boston  Pacific Crest Securities

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

            Daiwa Securities            Pacific Growth Equities

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

            Davy                        Petrie Parkman

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

            Deutsche Bank               Pictet

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

            Deutsche Bank Securities    Piper Jaffray Inc.

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

            Dresdner Kleinwort          Plexus
            Wasserstein

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

            Emmet & Co                  Prager Sealy & Co.

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

            Empirical Research          Prudential Securities

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

            Enskilda Securities         Ramirez & Co.

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

            Essex Capital Markets       Raymond James

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

            Exane BNP Paribas           RBC Capital Markets

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

            Factset                     RBC Dain Rauscher

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

            Fidelity Capital Markets    Research Direct

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

            Fimat USA Inc.              Robert W. Baird

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

            First Albany                Roosevelt & Cross

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

            First Albany Corporation    Russell Mellon

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

            Fixed Income Securities     Ryan Beck & Co.

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

            Fortis Securities           Sanford C. Bernstein

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

            Fox-Pitt, Kelton            Scotia Capital Markets

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

            Friedman, Billing, Ramsey   SG Cowen & Co.

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

            Fulcrum Global Partners     SG Cowen Securities

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

            Garp Research               Soleil Securities Group

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

            George K Baum & Co.         Standard & Poors

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

            Goldman                     Stone & Youngberg

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

            Goldman Sachs               SWS Group

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

            HSBC                        Taylor Rafferty

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

            HSBC Securities Inc         Think Equity Partners

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

            ING Barings                 Thomas Weisel Partners

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

            ISI Group                   UBS

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

            Janney Montgomery           Wachovia

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

            Jefferies                   Wachovia Corp

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

            Jeffries & Co.              Wachovia Securities

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

            JP Morgan                   Wescott Financial

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

            JP Morgan Securities        William Blair

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

            JPP Eurosecurities          Yieldbook

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

            Keefe, Bruyette & Woods

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


How the Fund Is Managed

Organization and History. The Fund was organized as a New York corporation in June 1965 and
reorganized as Massachusetts business trust in February 1991. The Fund is an open-end,
diversified management investment company with an unlimited number of authorized shares of
beneficial interest.

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

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

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

      Meetings of Shareholders.  As a Massachusetts business trust, the Fund is not
required to hold, and does not plan to hold, regular annual meetings of shareholders, but
may do so from time to time on important matters or when required to do so by the
Investment Company Act or other applicable law. Shareholders have the right, upon the
declaration in writing or vote of two-thirds of the outstanding shares of the Fund, to
remove a Trustee or to take other action described in the Fund's Declaration of Trust.

      The Trustees will call a meeting of shareholders to vote on the removal of a Trustee
upon the written request of the record holders of 10% of its outstanding shares.  If the
Trustees receive a request from at least 10 shareholders stating that they wish to
communicate with other shareholders to request a meeting to remove a Trustee, the Trustees
will then either make the Fund's shareholder list available to the applicants or mail their
communication to all other shareholders at the applicants' expense. The shareholders making
the request must have been shareholders for at least six months and must hold shares of the
Fund valued at $25,000 or more or constituting at least 1% of the Fund's outstanding
shares. The Trustees may also take other action as permitted by the Investment Company Act.

|X|   Shareholder and Trustee Liability.  The Fund's Declaration of Trust contains an
express disclaimer of shareholder or Trustee liability for the Fund's obligations. It also
provides for indemnification and reimbursement of expenses out of the Fund's property for
any shareholder held personally liable for its obligations.  The Declaration of Trust also
states that upon request, the Fund shall assume the defense of any claim made against a
shareholder for any act or obligation of the Fund and shall satisfy any judgment on that
claim.  Massachusetts law permits a shareholder of a business trust (such as the Fund) to
be held personally liable as a "partner" under certain circumstances. However, the risk
that a Fund shareholder will incur financial loss from being held liable as a "partner" of
the Fund is limited to the relatively remote circumstances in which the Fund would be
unable to meet its obligations.

      The Fund's contractual arrangements state that any person doing business with the
Fund (and each shareholder of the Fund) agrees under its Declaration of Trust to look
solely to the assets of the Fund for satisfaction of any claim or demand that may arise out
of any dealings with the Fund. Additionally, the Trustees shall have no personal liability
to any such person, to the extent permitted by law.

Board of Trustees and Oversight Committees. The Fund is governed by a Board of Trustees,
which is responsible for protecting the interests of shareholders under Massachusetts law.
The Trustees meet periodically throughout the year to oversee the Fund's activities, review
its performance, and review the actions of the Manager.


      The Board of Trustees has an Audit Committee which is comprised solely of Independent
Trustees.  The members of the Audit Committee are John Cannon, Paul Y. Clinton (Chairman),
Thomas W. Courtney, Robert G. Galli, Lacy B. Herrmann and Brian Wruble.  The Audit
Committee met ___ times during the Fund's fiscal year ended December 31, 2004.
The Audit Committee provides the Board with recommendations regarding the selection of the
Fund's independent auditor. The Audit Committee also reviews the scope and results of
audits and the audit fees charged, reviews reports from the Fund's independent auditor
concerning the Fund's internal accounting procedures, and controls, and reviews reports of
                                                                  -
the Manager's internal auditor, among other duties as set forth in the Committee's charter.

The Audit Committee's functions include selecting and nominating, to the full Board,
nominees for election as Directors and selecting and nominating Independent Trustees for
election.  The Audit Committee may, but need not, consider the advice and recommendation of
the Manager and its affiliates in selecting nominees.  The full Board elects new Trustees
except for those instances when a shareholder vote is required.

      To date, the Committee has been able to identify from its own resources an ample
number of qualified candidates.  Nonetheless, shareholders may submit names of individuals,
accompanies by complete and properly supported resumes, for the Audit Committee's
consideration by mailing such information to the Committee in care of the Fund.  The
Committee may consider such persons at such time as it meets to consider possible
nominees.  The Committee, however, reserves sole discretion to determine the candidates to
present to the Board and/or shareholders when it meets for the purpose of considering
potential nominees.


Trustees and Officers of the Fund. Each of the Trustees is an "Independent Trustee" under
the Investment Company Act. The Fund's Trustees and officers and their positions held with
the Fund and length of service in such position(s) and their principal occupations and
business affiliations during the past five years are listed in the chart below. The
information for the Trustees also includes the dollar range of shares of the Fund as well
as the aggregate dollar range of shares beneficially owned in any of the Oppenheimer funds
overseen by the Trustees. All of the Trustees are also trustees or directors of the
following Oppenheimer funds (except for Mr. Cannon who is only a Trustee of Rochester Fund
Municipals, Limited-Term New York Municipal Fund and Convertible Securities Fund) (referred
to as "Board III Funds"):

Oppenheimer Quest For Value Funds, a
  series fund having the following three
  series:
  Oppenheimer Small Cap Value Fund,        Oppenheimer Quest  International Value
                                           Fund, Inc.
  Oppenheimer Quest Balanced Value Fund    Oppenheimer  Quest Capital Value Fund,
  and                                      Inc.
  Oppenheimer Quest Opportunity Value Fund Oppenheimer Quest Value Fund, Inc.
Rochester Portfolio Series, a series fund  Bond Fund Series, a series fund
  having one series: Limited-Term New        having one series: Oppenheimer
  York Municipal Fund                        Convertible Securities Fund
Rochester Fund Municipals                  Oppenheimer MidCap Fund

      In addition to being a trustee or director of the Board III Funds, Mr. Galli is also
a director or trustee of 25 other portfolios in the OppenheimerFunds complex. Present or
former officers, directors, trustees and employees (and their immediate family members) of
the Fund, the Manager and its affiliates, and retirement plans established by them for
their employees are permitted to purchase Class A shares of the Fund and the other
Oppenheimer funds at net asset value without sales charge. The sales charge on Class A
shares is waived for that group because of the economies of sales efforts realized by the
Distributor.


      Messrs. Fielding, Murphy, Peteresen, Vandehey, Vottiero, Wixted and Zack and Mses.
Bloomberg and Ives who are officers of the Fund, respectively hold the same offices of one
or more of the other Board III Funds as with the Fund. As of March __, 2005, the Trustees
and officers of the Fund, as a group, owned of record or beneficially less than 1% of each
class of shares of the Fund.  The foregoing statement does not reflect ownership of shares
of the Fund held of record by an employee benefit plan for employees of the Manager, other
than the shares beneficially owned under the plan by the officers of the Fund listed above.
In addition, each Independent Trustee, and their family members, do not own securities of
either the Manager or Distributor of the Board III Funds or any person directly or
indirectly controlling, controlled by or under common control with the Manager or
Distributor.


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

- -------------------------------------------------------------------------------------
                                Independent Trustees
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Name,              Principal Occupation(s) During Past 5      Dollar     Aggregate
                                                                         Dollar
                                                                         Range Of
                                                                         Shares
                                                                         Beneficially
                                                                         Owned in
                   Years;                                     Range of   Any of the
                   Other Trusteeships/Directorships Held by   Shares     Oppenheimer
Position(s) Held   Trustee;                                   BeneficiallFunds
with Fund, Length  Number of Portfolios in Fund Complex       Owned in   Overseen
of Service, Age    Currently Overseen by Trustee              the Fund   by Trustee
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
                                                                As of December 31,

                                                                       2004

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

Thomas W.          Principal  of  Courtney  Associates,  Inc.
Courtney,          (venture  capital  firm);  former  General
Chairman of the    Partner of Trivest  Venture Fund  (private
Board of Trustees, venture  capital fund);  former  President
Trustee since 1995 of   Investment    Counseling    Federated
Age: 71            Investors,  Inc.; Trustee of the following

                   open-end   investment   companies:    Cash
                   Assets  Trust,  PIMCO  ADVISORS  VIT,  Tax
                   Free Trust of Arizona  and 4 funds for the
                   Hawaiian  Tax  Free  Trust.   Oversees  10
                   portfolios    in   the    OppenheimerFunds
                   complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------

John Cannon,       Director,    Neuberger    Berman    Income
Trustee, since     Managers Trust,  Neuberger & Berman Income
1992               Funds   and   Neuberger    Berman   Trust,
Age: 75            (1995-present);  Neuberger  Berman  Equity

                   Funds  (November  2000-present);  Trustee,
                   Neuberger  Berman  Mutual  Funds  (October
                   1994-present);   formerly   Chairman   and
                   Treasurer,  CDC  Associates,  a registered
                   investment        adviser        (December
                   1993-February      1996);      Independent
                   Consultant;  Chief Investment Officer, CDC
                   Associates  (1996-June  2000);  Consultant
                   and  director,  CDC  Associates  (December
                   1993-February     1999).     Oversees    3
                   portfolios    in   the    OppenheimerFunds
                   complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------

Paul Y. Clinton,   Principal     of    Clinton     Management
Trustee, since     Associates   (1996-present)  (a  financial
1995               and  venture  capital   consulting  firm);
Age: 74            Trustee of PIMCO  ADVISORS  VIT  (open-end
                   investment  company).  Formerly a director
                   or  trustee  of  the  following   open-end
                   investment  companies:  OCC Cash Reserves,
                   Inc.  (1989-December  2002),  Capital Cash
                   Management  Trust  (1979-December   2004),
                   Prime Cash Fund and  Narragansett  Insured
                   Tax-Free   Income   Fund    (1996-December
                   2004).   Oversees  10  portfolios  in  the
                   OppenheimerFunds complex.

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

Robert G. Galli,   A   trustee   or    director    of   other
Trustee since 1998 Oppenheimer funds.  Oversees 35 portfolios
Age: 71            in the OppenheimerFunds complex.

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

Lacy B. Herrmann,  Chairman of Aquila Management
Trustee since 1995 Corporation, the sponsoring organization
Age: 75            and manager, administrator and/or
                   sub-adviser to the following open-end
                   investment companies, and Chairman of the
                   Board of Trustees and President of each:
                   Churchill Cash Reserves Trust,
                   Aquila-Cascadia Equity Fund, Cash Assets
                   Trust, Prime Cash Fund, Narragansett
                   Insured Tax-Free Income Fund, Tax-Free
                   Fund For Utah, Churchill Tax-Free Fund of
                   Kentucky, Tax-Free Fund of Colorado,
                   Tax-Free Trust of Oregon, Tax-Free Trust
                   of Arizona, and Aquila Rocky Mountain
                   Equity Fund and PIMCO ADVISORS VIT; Vice
                   President, Director, Secretary, and
                   formerly Treasurer of Aquila
                   Distributors, Inc., distributor of the
                   above funds; President and Chairman of
                   the Board of Trustees of Capital Cash
                   Management Trust ("CCMT"), and an Officer
                   and Trustee/Director of its predecessors;
                   President and Director of STCM Management
                   Company, Inc., sponsor and adviser to
                   CCMT; Chairman, President and a Director
                   of InCap Management Corporation. Formerly
                   Chief Executive Officer of Aquila
                   Investment Management (1986-2004),
                   sub-adviser and administrator of Prime
                   Cash Fund and Short Term Asset Reserves;
                   Trustee Emeritus of Brown University.
                   Formerly Chairman of the Board of
                   Trustees and President of Hawaiian
                   Tax-Free Trust. Oversees 10 portfolios in
                   the OppenheimerFunds complex.

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

Brian Wruble,      General Partner (since  September 1995) of
Trustee since 2001 Odyssey  Partners,  L.P.  (hedge  fund  in
Age:  61           distribution   since   1/1/97);   Director
                   (since  September  2004) of Special  Value
                   Opportunities    Fund,   LLC;   Investment
                   Advisory  Board  (since  October  2004) of
                   Zurich   Financial   Services;   Board  of
                   Governing  Trustees (since August 1990) of
                   The    Jackson    Laboratory     (genetics
                   laboratory,  non profit);  Trustee  (since
                   May 1992) of Institute for Advanced  Study
                   (educational institute);  Formerly Special
                   Limited  Partner  (1999-2004) and Managing
                   Principal   (through   December  1998)  of
                   Odyssey Investment Partners,  LLC (private
                   equity  investment);  Trustee  (2000-2002)
                   of    Research    Foundation    of    AIMR
                   (investment     research,     non-profit);
                   Governor,  Jerome Levy Economics Institute
                   of  Bard  College   (economics   research)
                   (August  1990-September 2001); Director of
                   Ray & Berendtson,  Inc.  (executive search
                   firm) (May 2000-April  2002).  Oversees 10
                   portfolios    in   the    OppenheimerFunds
                   complex.

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


      The address of the Officers in the chart below is as follows: for Messrs. Fielding ,
Murphy, Zack, Gillespie and Miao and Ms. Bloomberg, Two World Financial Center, 225 Liberty
Street, New York, NY 10281-1008, for Messrs. Vandehey, Vottiero, Petersen and Wixted and
Ms. Ives, 6803 S. Tucson Way, Centennial, CO 80112-3924. Mr. Fielding, 350 Linden Oaks,
Rochester, NY 14625. Each Officer serves for an annual term or until his or her earlier
resignation, death or removal.


- -------------------------------------------------------------------------------------
                                Officers of the Fund
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Name,                   Principal Occupation(s) During Past 5 Years
Position(s) Held with
Fund,
Length of Service,
Age
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Ronald H. Fielding,     Senior Vice  President  (since January 1996) of the Manager;
Vice President and      Chairman of the  Rochester  Division  of the Manager  (since
Portfolio Manager       January   1996);   an  officer  of  9   portfolios   in  the
since 1996              OppenheimerFunds complex.
Age: 54
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------

John V. Murphy,         Chairman,  Chief Executive  Officer and director (since June
President since 2001    2001) and President  (since  September 2000) of the Manager;
Age: 55                 President  and a director  or  trustee of other  Oppenheimer
                        funds;  President  and  a  director  (since  July  2001)  of
                        Oppenheimer  Acquisition Corp. (the Manager's parent holding
                        company) and of Oppenheimer  Partnership  Holdings,  Inc. (a
                        holding  company  subsidiary  of the  Manager);  a  director
                        (since November 2001) of OppenheimerFunds  Distributor, Inc.
                        (a  subsidiary  of the  Manager);  Chairman  and a  director
                        (since  July  2001) of  Shareholder  Services,  Inc.  and of
                        Shareholder   Financial   Services,   Inc.  (transfer  agent
                        subsidiaries  of  the  Manager);  President  and a  director
                        (since  July  2001) of  OppenheimerFunds  Legacy  Program (a
                        charitable  trust program  established  by the  Manager);  a
                        director  of the  investment  advisory  subsidiaries  of the
                        Manager:  OFI  Institutional  Asset  Management,   Inc.  and
                        Centennial  Asset  Management  Corporation  (since  November
                        2001),  HarbourView  Asset  Management  Corporation  and OFI
                        Private  Investments,  Inc.  (since  July  2001);  President
                        (since  November  1, 2001) and a director  (since July 2001)
                        of  Oppenheimer  Real  Asset  Management,  Inc.;  a director
                        (since  November  2001)  of  Trinity  Investment  Management
                        Corp.  and  Tremont  Advisers,   Inc.  (Investment  advisory
                        affiliates of the Manager);  Executive Vice President (since
                        February  1997)  of  Massachusetts   Mutual  Life  Insurance
                        Company (the Manager's  parent  company);  a director (since
                        June  1995)  of  DLB  Acquisition   Corporation  (a  holding
                        company  that owns the shares of David L.  Babson & Company,
                        Inc.);   formerly,   Chief  Operating   Officer   (September
                        2000-June  2001)  of  the  Manager;  President  and  trustee
                        (November  1999-November 2001) of MML Series Investment Fund
                        and  MassMutual  Institutional  Funds  (open-end  investment
                        companies);  a director (September 1999-August 2000) of C.M.
                        Life Insurance Company;  President,  Chief Executive Officer
                        and director  (September  1999-August 2000) of MML Bay State
                        Life   Insurance   Company.   Oversees  62   portfolios   as
                        Trustee/Director and 21 additional  portfolios as Officer in
                        the OppenheimerFunds complex.

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

Mark S. Vandehey,       Senior Vice  President and Chief  Compliance  Officer (since
Vice President and      March  2004) of the  Manager;  Vice  President  (since  June
Chief Compliance        1983)  of  OppenheimerFunds  Distributor,  Inc.,  Centennial
Officer since 2004      Asset Management Corporation and Shareholder Services,  Inc.
Age:  54                Formerly  (until  February 2004) Vice President and Director
                        of  Internal  Audit  of  the  Manager.   An  officer  of  84
                        portfolios in the Oppenheimer funds complex.

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

Brian W. Wixted,        Senior Vice  President and  Treasurer  (since March 1999) of
Treasurer since 1999    the  Manager;  Treasurer  of  HarbourView  Asset  Management
Age: 45                 Corporation,    Shareholder   Financial   Services,    Inc.,
                        Shareholder   Services,   Inc.,   Oppenheimer   Real   Asset
                        Management   Corporation,    and   Oppenheimer   Partnership
                        Holdings,   Inc.   (since  March   1999),   of  OFI  Private
                        Investments,  Inc. (since March 2000),  of  OppenheimerFunds
                        International  Ltd.  and  OppenheimerFunds  plc  (since  May
                        2000), of OFI Institutional  Asset  Management,  Inc. (since
                        November 2000),  and of  OppenheimerFunds  Legacy Program (a
                        Colorado   non-profit   corporation)   (since   June  2003);
                        Treasurer and Chief  Financial  Officer  (since May 2000) of
                        OFI  Trust  Company  (a  trust  company  subsidiary  of  the
                        Manager);   Assistant   Treasurer   (since  March  1999)  of
                        Oppenheimer  Acquisition Corp.  Formerly Assistant Treasurer
                        of   Centennial   Asset   Management    Corporation   (March
                        1999-October  2003)  and  OppenheimerFunds   Legacy  Program
                        (April  2000-June  2003). An officer of 84 portfolios in the
                        OppenheimerFunds complex.

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

Brian Petersen,         Assistant  Vice  President of the Manager since August 2002;
Assistant Treasurer     formerly   Manager/Financial  Product  Accounting  (November
since 2004              1998-July 2002) of the Manager.  An officer of 84 portfolios
Age: 34                 in the OppenheimerFunds complex.

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

Philip Vottiero,        Vice  President/Fund  Accounting  of the Manager since March
Assistant Treasurer     2002.  Formerly Vice  President/Corporate  Accounting of the
since 2002              Manager (July 1999-March  2002). An officer of 84 portfolios
Age: 41                 in the OppenheimerFunds complex.

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

Robert G. Zack,         Executive  Vice  President  (since January 2004) and General
Secretary since 2001    Counsel  (since  February  2002)  of  the  Manager;  General
Age: 56                 Counsel  and  a  director   (since  November  2001)  of  the
                        Distributor;   General  Counsel  (since  November  2001)  of
                        Centennial   Asset  Management   Corporation;   Senior  Vice
                        President  and  General  Counsel  (since  November  2001) of
                        HarbourView  Asset  Management  Corporation;  Secretary  and
                        General   Counsel  (since   November  2001)  of  Oppenheimer
                        Acquisition  Corp.;   Assistant  Secretary  and  a  director
                        (since October 1997) of OppenheimerFunds  International Ltd.
                        and  OppenheimerFunds  plc;  Vice  President  and a director
                        (since November 2001) of Oppenheimer  Partnership  Holdings,
                        Inc.; a director (since  November 2001) of Oppenheimer  Real
                        Asset  Management,  Inc.;  Senior  Vice  President,  General
                        Counsel and a director  (since November 2001) of Shareholder
                        Financial Services,  Inc.,  Shareholder Services,  Inc., OFI
                        Private  Investments,  Inc.  and  OFI  Trust  Company;  Vice
                        President (since November 2001) of  OppenheimerFunds  Legacy
                        Program;  Senior Vice  President and General  Counsel (since
                        November 2001) of OFI Institutional Asset Management,  Inc.;
                        a  director  (since  June 2003) of  OppenheimerFunds  (Asia)
                        Limited.  Formerly Senior Vice President (May  1985-December
                        2003), Acting General Counsel (November  2001-February 2002)
                        and Associate  General  Counsel (May  1981-October  2001) of
                        the Manager;  Assistant  Secretary of Shareholder  Services,
                        Inc.  (May  1985-November   2001),   Shareholder   Financial
                        Services,    Inc.   (November   1989-November   2001);   and
                        OppenheimerFunds  International Ltd. (October  1997-November
                        2001).  An officer of 84 portfolios in the  OppenheimerFunds
                        complex.

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

Kathleen T. Ives,       Vice  President  (since  June 1998) and Senior  Counsel  and
Assistant Secretary     Assistant  Secretary  (since  October  2003) of the Manager;
since 2001              Vice President  (since 1999) and Assistant  Secretary (since
Age: 39                 October  2003)  of  the  Distributor;   Assistant  Secretary
                        (since   October  2003)  of  Centennial   Asset   Management
                        Corporation;  Vice President and Assistant  Secretary (since
                        1999) of Shareholder  Services,  Inc.;  Assistant  Secretary
                        (since  December  2001) of  OppenheimerFunds  Legacy Program
                        and of Shareholder  Financial  Services,  Inc..  Formerly an
                        Assistant Counsel (August  1994-October 2003). An officer of
                        84 portfolios in the OppenheimerFunds complex.

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

Lisa I. Bloomberg,      Vice  President and  Associate  Counsel of the Manager since
Assistant Secretary     May  2004;  formerly  First  Vice  President  and  Associate
since 2004              General  Counsel of UBS Financial  Services Inc.  (formerly,
Age:  37                PaineWebber  Incorporated)  (May  1999  -  April  2004).  An
                        officer of 84 portfolios in the OppenheimerFunds complex.

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

Phillip S. Gillespie,   Senior  Vice  President  and Deputy  General  Counsel of the
Assistant Secretary     Manager since  September 2004.  Formerly Mr.  Gillespie held
since 2004              the  following   positions  at  Merrill   Lynch   Investment
Age:  40                Management:  First  Vice  President  (2001-September  2004);
                        Director  (from  2000) and Vice  President  (1998-2000).  An
                        officer of 84 portfolios in the OppenheimerFunds complex.

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

Wayne Miao,             Assistant  Vice  President  and  Assistant  Counsel  of  the
Assistant Secretary     Manager since June 2004.  Formerly an Associate  with Sidley
since 2004              Austin  Brown & Wood LLP  (September  1999 - May  2004).  An
Age:  33                officer of 84 portfolios in the OppenheimerFunds complex.

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



|X|   Remuneration of Trustees. The officers of the Fund who are affiliated with the
Manager receive no salary or fee from the Fund. The Trustees of the Fund received the
compensation shown below from the Fund during the Fund's fiscal year ended December 31,
2004. The compensation from all 10 of the Board III Funds (including the Fund) represents
compensation received for serving as a director or trustee and member of a committee (if
applicable) of the boards of those funds during the calendar year 2004. The amounts shown
for Mr. Cannon relate solely to Rochester Fund Municipals, Limited Term New York Municipal
Fund and Oppenheimer Convertible Securities Fund, as Mr. Cannon serves as Trustee of those
Board III Funds only.










- --------------------------------------------------------------------------------
Trustee Name and         Aggregate   Retirement   Estimated         Total
                                                                Compensation
                                                    Annual        From All
                                      Benefits    Retirement     Oppenheimer
                                     Accrued as  Benefits to   Funds For Which
Other Fund                             Part of     be Paid       Individual
Position(s) (as        Compensation     Fund         Upon         Serves As
applicable)             From Fund1    Expenses   Retirement2  Trustee/Director
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Thomas W. Courtney           $            $           $               $
Board Chairman and
Audit Committee Member
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
John Cannon3                 $            $           $               $
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Paul Y. Clinton              $            $           $               $
Audit Committee
Chairman
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

Robert G. Galli              $            $           $4             $5

Audit Committee Member
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Lacy B. Herrmann             $            $           $               $
Audit Committee Member
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

Brian Wruble                $6            $           $               $

Audit Committee Member
- --------------------------------------------------------------------------------
1.    Aggregate Compensation From Fund includes fees and deferred compensation, if any, for
   a Trustee.
2.    Estimated Annual Retirement Benefits to be Paid Upon Retirement is based on a
   straight life payment plan election, with the assumption that a trustee will retire at
   the age of 75 and is eligible (after 7 years of service) to receive retirement plan
   benefits as described below under "Retirement Plan for Trustees."
3.    Compensation for Mr. Cannon was paid by Rochester Fund Municipals, Limited Term New
   York Municipal Fund and Oppenheimer Convertible Securities Fund only.

4.    Includes $_______ estimated to be paid to Mr. Galli for serving as a trustee or
   director of 25 other Oppenheimer funds (at December 31, 2004) that are not Board III
   Funds.
5.    Includes $_______ paid to Mr. Galli for serving as trustee or director of 25 other
   Oppenheimer funds (at December 31, 2004) that are not Board III Funds.
6.    Includes $_______ deferred by Mr. Wruble under the Deferred Compensation Plan
   described below.


|X|   Retirement Plan for Trustees. The Fund has adopted a retirement plan that provides
for payments to retired Trustees. Payments are up to 80% of the average compensation paid
during a Trustee's five years of service in which the highest compensation was received. A
Trustee must serve as Trustee for any of the Board III Funds listed above for at least 15
years to be eligible for the maximum payment. Each Trustee's retirement benefits will
depend on the amount of the Trustee's future compensation and length of service.

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

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


      |X|   Major Shareholders. As of March __, 2005, the only person who owned of record
or were known by the Fund to own beneficially 5% or more of any class of the Fund's
outstanding shares were:

      Citigroup Global Markets, Inc., 109801250, Attn Cindy Tempesta, 7th. Floor, 333 West
      34th Street, New York, NY 10001-2483, which owned ______________ Class A shares
      (____% of the outstanding Class A shares).

      Merrill Lynch Pierce Fenner & Smith, Inc. for the sole benefit of its customers, Attn
      Fund Admin/975G2, 4800 Deer Lake Drive, E FL 3, Jacksonville, FL 32246-6484, which
      owned _____________ Class A shares (____% of the outstanding Class A shares).

      Citigroup Global Markets, Inc., 109801250, Attn Cindy Tempesta, 7th. Floor, 333 West
      34th Street, New York, NY 10001-2483, which owned _______________ Class B shares
      (____% of the outstanding Class B shares).

      Merrill Lynch Pierce Fenner & Smith, Inc. for the sole benefit of its customers, Attn
      Fund Admin, 4800 Deer Lake Drive, E FL 3, Jacksonville, FL 32246-6484, which owned
      _______________ Class B shares (____% of the outstanding Class B shares).

      Merrill Lynch Pierce Fenner & Smith, Inc. for the sole benefit of its customers, Attn
      Fund Admin, 4800 Deer Lake Drive, E FL 3, Jacksonville, FL 32246-6484, which owned
      ______________ Class C shares (_____% of the outstanding Class C shares).

      Citigroup Global Markets, Inc., 109801250, Attn Cindy Tempesta, 7th. Floor, 333 West
      34th Street, New York, NY 10001-2483, which owned ____________ Class C shares (____%
      of the outstanding Class C shares).

      Roger W. Kirby Trust, UW Gwenoline Hoguet Trust, FBO Geoffrey R. Hoguet, 580 Park
      Ave. New York, NY 10021-7313, who owned _____________ Class Y shares (____% of the
      outstanding Class Y shares).

      Elizabeth N. Hoguet, 238 McLain Street, Mount Kisco, NY 10549-4931, who owed
      _______________ Class Y shares (_____% of the outstanding Class Y shares).


The Manager. The Manager is wholly-owned by Oppenheimer Acquisition Corp., a holding
company controlled by Massachusetts Mutual Life Insurance Company, a global, diversified
insurance and financial services organization.

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

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

|X|   Portfolio Proxy Voting.  The Fund has adopted Portfolio Proxy Voting Policies and
Procedures under which the Fund votes proxies relating to securities ("portfolio proxies")
held by the Fund.  The Fund's primary consideration in voting portfolio proxies is the
financial interests of the Fund and its shareholders. The Fund has retained an unaffiliated
third-party as its agent to vote portfolio proxies in accordance with the Fund's Portfolio
Proxy Voting Guidelines and to maintain records of such portfolio proxy voting. The Proxy
Voting Guidelines include provisions to address conflicts of interest that may arise
between the Fund and OFI where an OFI directly-controlled affiliate manages or administers
the assets of a pension plan of a company soliciting the proxy. The Fund's Portfolio Proxy
Voting Guidelines on routine and non-routine proxy proposals are summarized below.

o     The Fund votes with the recommendation of the issuer's management on routine matters,
            including election of directors nominated by management and ratification of auditors,
            unless circumstances indicate otherwise.
o     In general, the Fund opposes anti-takeover proposals and supports elimination of
            anti-takeover proposals, absent unusual circumstances.
o     The Fund supports shareholder proposals to reduce a super-majority vote requirement,
            and opposes management proposals to add a super-majority vote requirement.
o     The Fund opposes proposals to classify the board of directors.
o     The Fund supports proposals to eliminate cumulative voting.
o     The Fund opposes re-pricing of stock options.
o     The Fund generally considers executive compensation questions such as stock option
            plans and bonus plans to be ordinary business activity.  The Fund analyzes stock
            option plans, paying particular attention to their dilutive effect. While the Fund
            generally supports management proposals, the Fund opposes plans it considers to be
            excessive.


      The Fund is required to file Form N-PX, with its complete proxy voting record for the
12 months ended June 30th, no later than August 31st of each year.  The Fund's Form N-PX
filing is available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525-7048 and (ii) on the SEC's website at www.sec.gov.
                                                -----------


      |X|   The Investment Advisory Agreement. The Manager provides investment advisory and
management services to the Fund under an investment advisory agreement between the Manager
and the Fund. The Manager selects securities for the Fund's portfolio and handles its
day-to day business. That agreement requires the Manager, at its expense, to provide the
Fund with adequate office space, facilities and equipment. It also requires the Manager to
provide and supervise the activities of all administrative and clerical personnel required
to provide effective corporate administration for the Fund. Those responsibilities include
the compilation and maintenance of records with respect to the Fund's operations, the
preparation and filing of specified reports, and the composition of proxy materials and
registration statements for continuous public sale of shares of the Fund.

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

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

Fiscal Year ended 12/31:         Management Fees Paid to OppenheimerFunds, Inc.

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

           2002                                        $

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

           2003                                        $

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

           2004                                        $

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


      The investment advisory agreement states that in the absence of willful misfeasance,
bad faith, gross negligence in the performance of its duties, or reckless disregard for its
obligations and duties under the investment advisory agreement, the Manager is not liable
for any loss the Fund sustains for any investment, adoption of any investment policy or the
purchase, sale or retention of any security.


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

o     Accounting and Administrative Services. The Manager provides accounting and
administrative services to the Fund pursuant to an Accounting and Administration Agreement
approved by the Board of Trustees. Under that agreement, the Manager maintains the general
ledger accounts and records relating to the Fund's business and calculates the daily net
asset values of the Fund's shares. The Accounting and Administrative Services fees paid by
the Fund to the Manager during its last three fiscal years are listed below.

- -------------------------------------------------------------------------------
Fiscal Year        Management Fee Paid to       Accounting and Administrative
                                                    Services Fee Paid to
Ended 12/31        OppenheimerFunds, Inc.          OppenheimerFunds, Inc.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
    2002                $28,013,299                      $1,814,185
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
    2003                $26,976,540                      $1,745,069
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

    2004                     $                                $

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

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

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

      The Board reviewed the foregoing information in arriving at its decision to renew the
investment advisory agreement.  Among other factors, the Board considered:
o     The nature, cost, and quality of the services provided to the Fund and its
         shareholders;
o     The profitability of the Fund to the Manager;
o     The investment performance of the Fund in comparison to regular market indices
o     Economies of scale that may be available to the Fund from the Manager;
o     Fees paid by other mutual funds for similar services;
o     The value and quality of any other benefits or services received by the Fund from its

         relationship with the Manager, and

o     The direct and indirect benefits the Manager received from its relationship with the
         Fund.  These included services provided by the Distributor and the Transfer Agent,
         and brokerage and soft dollar arrangements permissible under Section 28(e) of the
         Securities Exchange Act.

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

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

      After careful deliberation, the Board, including the Independent Trustees, concluded
that it was in the best interest of shareholders to continue the investment advisory
agreement for another year. In arriving at a decision, the Board did not single out any one
factor or group of factors as being more important than other factors, but considered all
factors together.  The Board judged the terms and conditions of the investment advisory
agreement, including the investment advisory fee, in light of all of the surrounding
circumstances.


Brokerage Policies of the Fund


Brokerage Provisions of the Investment Advisory Agreement. One of the duties of the Manager
under the investment advisory agreement is to buy and sell portfolio securities for the
Fund. The investment advisory agreement allows the Manager to use broker-dealers to effect
the Fund's portfolio transactions. The Manager is authorized by the advisory agreement to
employ broker-dealers, including "affiliated" brokers, as that term is defined in the
Investment Company Act) that, in the Manager's best judgment based on all relevant factors,
will implement the Fund's policy to obtain, at reasonable expense, the "best execution" of
portfolio transactions. "Best execution" refers to prompt and reliable execution at the
most favorable price obtainable. The Manager need not seek competitive commission bidding.
However, the Manager is expected to minimize the commissions paid to the extent consistent
with the interest and policies of the Fund as established by its Board of Trustees.

      Under the investment advisory agreement, in choosing brokers to execute portfolio
transactions for the Fund, the Manager may select brokers (other than affiliates) that
provide brokerage and/or research services to the Fund and/or the other accounts over which
the Manager or its affiliates have investment discretion.  The commissions paid to those
brokers may be higher than another qualified broker would charge, if the Manager makes a
good faith determination that the commission is fair and reasonable in relation to the
services provided.

      Rule 12b-1 under the Investment Company Act prohibits any fund from compensating a
broker or dealer for promoting or selling the fund's shares by (1) directing to that broker
or dealer any of the fund's portfolio transactions, or (2) directing any other remuneration
to that broker or dealer, such as commissions, mark-ups, mark downs or other fees from the
fund's portfolio transactions, that were effected by another broker or dealer (these latter
arrangements are considered to be a type of "step-out" transaction). In other words, a fund
and its investment adviser cannot use the fund's brokerage for the purpose of rewarding
broker-dealers for selling the fund's shares.

      However, the Rule permits funds to effect brokerage transactions through firms that
also sell fund shares, provided that certain procedures are adopted to prevent a quid pro
quo with respect to portfolio brokerage allocations. As permitted by the Rule, the Manager
has adopted procedures (and the Fund's Board of Trustees has approved those procedures)
that permit the Fund to direct portfolio securities transactions to brokers or dealers that
also promote or sell shares of the Fund, subject to the "best execution" considerations
discussed above. Those procedures are designed to prevent: (1) the Manager's personnel who
effect the Fund's portfolio transactions from taking into account a broker's or dealer's
promotion or sales of the Fund shares when allocating the Fund's portfolio transactions,
and (2) the Fund, the Manager and the Distributor from entering into agreements or
understandings under which the Manager directs or is expected to direct the Fund's
brokerage directly, or through a "step-out" arrangement, to any broker or dealer in
consideration of that broker's or dealer's promotion or sale of the Fund's shares or the
shares of any of the other Oppenheimer funds.


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

      Most securities purchases made by the Fund are in principal transactions at net
prices. The Fund usually deals directly with the selling or purchasing principal or market
maker without incurring charges for the services of a broker on its behalf unless the
Manager determines that a better price or execution may be obtained by using the services
of a broker. Therefore, the Fund does not incur substantial brokerage costs. Portfolio
securities purchased from underwriters include a commission or concession paid by the
issuer to the underwriter in the price of the security. Portfolio securities purchased from
dealers include a spread between the bid and asked price.

      The Fund seeks to obtain prompt execution of orders at the most favorable net prices.
In an option transaction, the Fund ordinarily uses the same broker for the purchase or sale
of the option and any transaction in the investment to which the option relates. Other
funds advised by the Manager have investment objectives and policies similar to those of
the Fund. Those other funds may purchase or sell the same securities as the Fund at the
same time as the Fund, which could affect the supply and price of the securities. When
possible, the Manager tries to combine concurrent orders to purchase or sell the same
security by more than one of the accounts managed by the Manager or its affiliates. The
transactions under those combined orders are averaged as to price and allocated in
accordance with the purchase or sale orders actually placed for each account.

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

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


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








- ----------------------------------------------------------------
  Fiscal Year Ended    Total Brokerage Commissions Paid by the
        12/31                           Fund1
- ----------------------------------------------------------------
- ----------------------------------------------------------------

         2002                            None

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

         2003                            None

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

         2004

- ----------------------------------------------------------------
1.    Amounts do not include spreads or commissions on principal amounts on a net trade
           basis.

Distribution and Service Plans

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

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

- -------------------------------------------------------------------------------
Fiscal    Aggregate     Class A      Concessions    Concessions  Concessions
          Front-End     Front-End
Year      Sales         Sales        on Class A     on Class B   on Class C
Ended     Charges       Charges      Shares         Shares       Shares
12/31:    on Class A    Retained by  Advanced by    Advanced by  Advanced by
          Shares        Distributor  Distributor1   Distributor1 Distributor1
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
  2002     $15,818,044   $2,187,155    $2,632,657   $12,022,476   $1,480,192
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
  2003     $8,983,346    $1,256,842     $790,325     $4,732,115    $608,374
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

  2004          $            $             $             $             $

- -------------------------------------------------------------------------------
1. The Distributor advances concession payments to dealers for certain sales of Class A
   shares and for sales of Class B and Class C shares from its own resources at the time of
   sale.

- -------------------------------------------------------------------------------
Fiscal Year  Class A Contingent    Class B Contingent    Class C Contingent
             Deferred Sales        Deferred Sales        Deferred Sales
             Charges Retained by   Charges Retained by   Charges Retained by
Ended 12/31: Distributor           Distributor           Distributor
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
    2002           $163,987             $3,268,897             $134,035
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
    2003           $117,684             $3,574,383              $79,710
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------

    2004               $                     $                     $

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

Distribution and Service Plans. The Fund has adopted a Service Plan for Class A shares and
Distribution and Service Plans for Class B and Class C shares under Rule 12b-1 of the
Investment Company Act. Under those plans the Fund pays the Distributor for all or a
portion of its costs incurred in connection with the distribution and/or servicing of the
shares of the particular class. Each plan has been approved by a vote of the Board of
Trustees, including a majority of the Independent Trustees1, cast in person at a meeting
called for the purpose of voting on that plan.


      Under the Plans, the Manager and the Distributor may make payments to affiliates.  In
their sole discretion, they may also from time to time make substantial payments from their
own resources, which include the profits the Manager derives from the advisory fees it
receives from the Fund, to compensate brokers, dealers, financial institutions and other
intermediaries for providing distribution assistance and/or administrative services or that
otherwise promote sales of the Fund's shares.  These payments, some of which may be
referred to as "revenue sharing," may relate to the Fund's inclusion on a financial
intermediary's preferred list of funds offered to its clients.

      Financial intermediaries, brokers and dealers may receive other payments from the
Distributor or the Manager from their own resources in connection with the promotion and/or
sale of shares of the Fund, including payments to defray expenses incurred in connection
with educational seminars and meetings.  The Manager or Distributor may share expenses
incurred by financial intermediaries in conducting training and educational meetings about
aspects of the Fund for employees of the intermediaries or for hosting client seminars or
meetings at which the Fund is discussed.  In their sole discretion, the Manager and/or the
Distributor may increase or decrease the amount of payments they make from their own
resources for these purposes.


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

      The Board of Trustees and the Independent Trustees must approve all material
amendments to a plan. An amendment to increase materially the amount of payments to be made
under a plan must be approved by shareholders of the class affected by the amendment.
Because Class B shares of the Fund automatically convert into Class A shares 72 months
after purchase, the Fund must obtain the approval of both Class A and Class B shareholders
for a proposed material amendment to the Class A plan that would materially increase
payments under the plan. That approval must be by a majority of the shares of each class,
voting separately by class.

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

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

      Under the plans for a class, no payment will be made to any recipient in any quarter
in which the aggregate net asset value of all Fund shares of that class held by the
recipient for itself and its customers does not exceed a minimum amount, if any, that may
be set from time to time by a majority of the Independent Trustees. The Board of Trustees
currently limits aggregate payments under the Class A plan to 0.15% of average annual net
assets.


|X|   Class A Service Plan Fees. Under the Class A service plan, the Distributor currently
uses the fees it receives from the Fund to pay brokers, dealers and other financial
institutions (they are referred to as "recipients") for personal services and account
maintenance services they provide for their customers who hold Class A shares. The services
include, among others, answering customer inquiries about the Fund, assisting in
establishing and maintaining accounts in the Fund, making the Fund's investment plans
available and providing other services at the request of the Fund or the Distributor. The
Class A service plan permits reimbursements to the Distributor at a rate of up to 0.15% of
average annual net assets of Class A shares. The Board has set the rate at that level. The
Distributor does not receive or retain the service fee on Class A shares in accounts for
which the Distributor has been listed as the broker-dealer of record. While the plan
permits the Board to authorize payments to the Distributor to reimburse itself for services
under the plan, the Board has not yet done so. The Distributor makes payments to plan
recipients quarterly at an annual rate currently not to exceed 0.15% of the average annual
net assets consisting of Class A shares held in the accounts of the recipients or their
customers.

      For the fiscal year ended December 31, 2004 payments under the Class A plan totaled
$____________, all of which was paid by the Distributor to recipients, and included
$____________ paid to an affiliate of the Distributor's parent company. Any unreimbursed
expenses the Distributor incurs with respect to Class A shares for any fiscal year may not
be recovered in subsequent years. The Distributor may not use payments received under the
Class A plan to pay any of its interest expenses, carrying charges, other financial costs
or allocation of overhead.


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


      Each plan permits the Distributor to retain both the asset-based sales charges and
the service fee on shares or to pay recipients the service fee on a quarterly basis,
without payment in advance. However, the Distributor currently intends to pay the service
fee to recipients in advance for the first year after Class B and Class C shares are
purchased. After the first year shares are outstanding, after their purchase, the
Distributor makes service fee payments quarterly on those shares. The advance payment is
based on the net asset value of shares sold. Shares purchased by exchange do not qualify
for the advance service fee payment. If Class B or Class C shares are redeemed during the
first year after their purchase, the recipient of the service fees on those shares will be
obligated to repay the Distributor a pro rata portion of the advance payment made on those
shares. Class B or Class C shares may not be purchased by an investor directly from the
Distributor without the investor designating another broker-dealer of record.  If the
investor no longer has another broker-dealer of record for an existing account, the
Distributor is automatically designated as the broker-dealer of record, but solely for the
purpose of acting as the investor's agent to purchase the shares.  In those cases, the
Distributor retains the asset-based sales charge paid on Class B and Class C shares, but
does not retain any service fees as to the assets represented by that account.


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

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

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

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

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

 Distribution Fees Paid to the Distributor for the Fiscal Year Ended 12/31/2004


- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class:        Total          Amount         Distributor's       Distributor's
                                                                Unreimbursed
                                            Aggregate           Expenses as %
              Payments       Retained by    Unreimbursed        of Net Assets
              Under Plan     Distributor    Expenses Under Plan of Class
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Class B Plan        $             $ 1                $                 %

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

Class C Plan        $             $ 2                $                 %

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

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

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


Performance of the Fund


Explanation of Performance Terminology. The Fund uses a variety of terms to illustrate its
performance. These terms include "standardized yield," "tax-equivalent yield," "dividend
yield," "average annual total return," "cumulative total return," "average annual total
return at net asset value" and "total return at net asset value." An explanation of how
yields and total returns are calculated is set forth below. The charts below show the
Fund's performance as of the Fund's most recent fiscal year end. You can obtain current
performance information by calling the Fund's Transfer Agent at 1.800.225.5677 or by
visiting the OppenheimerFunds Internet website at www.oppenheimerfunds.com.


      The Fund's illustrations of its performance data in advertisements must comply with
rules of the SEC. Those rules describe the types of performance data that may be used and
how it is to be calculated. In general, any advertisement by the Fund of its performance
data must include the average annual total returns for the advertised class of shares of
the Fund.

      Use of standardized performance calculations enables an investor to compare the
Fund's performance to the performance of other funds for the same periods. However, a
number of factors should be considered before using the Fund's performance information as a
basis for comparison with other investments:
o     Yields and total returns measure the performance of a hypothetical account in the
         Fund over various periods and do not show the performance of each shareholder's
         account. Your account's performance will vary from the model performance data if
         your dividends are received in cash, or you buy or sell shares during the period,
         or you bought your shares at a different time and price than the shares used in
         the model.
o     The Fund's performance returns may not reflect the effect of taxes on dividends and
         capital gains distributions.
o     An investment in the Fund is not insured by the FDIC or any other government agency.
o     The principal value of the Fund's shares, and its yields and total returns are not
         guaranteed and normally will fluctuate on a daily basis.
o     When an investor's shares are redeemed, they may be worth more or less than their
         original cost.
o     Yields and total returns for any given past period represent historical performance
         information and are not, and should not be considered, a prediction of future
         yields or returns.

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

|X|   Yields. The Fund uses a variety of different yields to illustrate its current
returns. Each class of shares calculates its yield separately because of the different
expenses that affect each class.
o     Standardized Yield. The "standardized yield" (sometimes referred to just as "yield")
is shown for a class of shares for a stated 30-day period. It is not based on actual
distributions paid by the Fund to shareholders in the 30-day period, but is a hypothetical
yield based upon the net investment income from the Fund's portfolio investments for that
period. It may therefore differ from the "dividend yield" for the same class of shares,
described below.

      Standardized yield is calculated using the following formula set forth in rules
adopted by the SEC, designed to assure uniformity in the way that all funds calculate their
yields:

 Standardized Yield = 2a-b +1)6 -1]
                       ---
                     [(
                       cd

      The symbols above represent the following factors:
      a =  dividends and interest earned during the 30-day period.
      b =  expenses accrued for the period (net of any expense assumptions).
      c =  the average daily number of shares of that class outstanding during the 30-day
           period that were entitled to receive dividends.
      d =  the maximum offering price per share of that class on the last day of the
           period, adjusted for undistributed net investment income.

      The standardized yield for a particular 30-day period may differ from the yield for
other periods. The SEC formula assumes that the standardized yield for a 30-day period
occurs at a constant rate for a six-month period and is annualized at the end of the
six-month period. Additionally, because each class of shares is subject to different
expenses, it is likely that the standardized yields of the Fund's classes of shares will
differ for any 30-day period.

o     Dividend Yield. The Fund may quote a "dividend yield" for each class of its shares.
Dividend yield is based on the dividends paid on a class of shares during the actual
dividend period. To calculate dividend yield, the dividends of a class declared during a
stated period are added together, and the sum is multiplied by 12 (to annualize the yield)
and divided by the maximum offering price on the last day of the dividend period. The
formula is shown below:

         Dividend Yield = dividends paid x 12/maximum offering price (payment date)

      The maximum offering price for Class A shares includes the current maximum initial
sales charge. The maximum offering price for Class B and Class C shares is the net asset
value per share, without considering the effect of contingent deferred sales charges. There
is no sales charge on Class Y shares. The Class A dividend yield may also be quoted without
deducting the maximum initial sales charge.

o     Tax-Equivalent Yield. The "tax-equivalent yield" of a class of shares is the
 equivalent yield that would have to be earned on a taxable investment to achieve the
 after-tax results represented by the Fund's tax-equivalent yield. It adjusts the Fund's
 standardized yield, as calculated above, by a stated tax rate. Using different tax rates
 to show different tax equivalent yields shows investors in different tax brackets the tax
 equivalent yield of the Fund based on their own tax bracket.

      The tax-equivalent yield is based on a 30-day period, and is computed by dividing the
tax-exempt portion of the Fund's current yield (as calculated above) by one minus a stated
income tax rate. The result is added to the portion (if any) of the Fund's current yield
that is not tax-exempt.

      The  tax-equivalent  yield may be used to compare  the tax  effects of income  derived
from the Fund  with  income  from  taxable  investments  at the tax rates  stated.  Your tax
bracket is determined by your federal and state  taxable  income (the net amount  subject to
federal and state income tax after deductions and exemptions).


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

The Fund's Yields for the 30-Day Periods Ended 12/31/2004

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class of    Standardized Yield      Dividend Yield       Tax-Equivalent Yield
                                                           (39.45%Combined
                                                         Federal/New York Tax
Shares                                                        Bracket)1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
          Without     After      Without    After      Without      After
          Sales       Sales      Sales      Sales                   Sales
          Charge      Charge     Charge     Charge     Sales Charge Charge
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

Class A        %          %          %          %           %            %

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

Class B        %         N/A         %         N/A          %           N/A

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

Class C        %         N/A         %         N/A          %           N/A

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

Class Y        %         N/A         %         N/A          %           N/A

- --------------------------------------------------------------------------------
1. The  tax-equivalent  yield calculation  assumes that the investor is taxed just below the
   highest  federal  income tax bracket  (currently  35%) and also assumes the 2003 combined
   federal  and New  York  State  rates  (regardless  of  whether  a switch  to  non-taxable
   investments would cause a lower bracket to apply).

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

      In calculating total returns for Class A shares, the current maximum sales charge of
4.75% (as a percentage of the offering price) is deducted from the initial investment ("P"
in the formula below) (unless the return is shown without sales charge, as described
below). For Class B shares, payment of the applicable contingent deferred sales charge is
applied, depending on the period for which the return is shown: 5.0% in the first year,
4.0% in the second year, 3.0% in the third and fourth years, 2.0% in the fifth year, 1.0%
in the sixth year and none thereafter. For Class C shares, the 1.0% contingent deferred
sales charge is deducted for returns for the one-year period. There is no sales charge on
Class Y shares.

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

    ERV      - 1  Average Annual Total
          l/n     Return
    ------
      P

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

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

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

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

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

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


o     Total Returns at Net Asset Value. From time to time the Fund may also quote a
cumulative or an average annual total return "at net asset value" (without deducting sales
charges) for each class of shares. There is no sales charge on Class Y shares. Each is
based on the difference in net asset value per share at the beginning and the end of the
period for a hypothetical investment in that class of shares (without considering front-end
or contingent deferred sales charges) and takes into consideration the reinvestment of
dividends and capital gains distributions.


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

The Fund's Total Returns for the Periods Ended 12/31/2004

- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Class of  Cumulative Total               Average Annual Total Returns
               Returns
            (10 Years or
           life-of-class,
Shares        if less)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
                                 1-Year            5-Year            10-Year
                                                 (or life of
                                                   class)       (or life of class)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
          After    Without  After     Without After     Without  After    Without
          Sales    Sales    Sales     Sales   Sales     Sales    Sales    Sales
           Charge   Charge   Charge   Charge   Charge    Charge   Charge   Charge
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------

Class A1     %        %         %        %        %        %        %        %

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

Class B      %2       %2        %        %        %        %        %2       %2

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

Class C      %3       %3        %        %        %        %        %3       %3

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

Class Y     N/A       %4       N/A       %       N/A       %4      N/A      N/A

- -----------------------------------------------------------------------------------
1. Inception of Class A:      5/15/86
2. Inception of Class B:      3/17/97
3. Inception of Class C:      3/17/97
4. Inception of Class Y:      4/28/00

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

   Average Annual Total Returns for Class A Shares (After Sales Charge)
                     For the Periods Ended 12/31/2004

- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
                                1-Year         5-Year          10-Year
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------

After Taxes on Distributions       %              %               %

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

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

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

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

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

|X|   Morningstar Ratings. From time to time the Fund may publish the star rating of the
performance of its classes of shares by Morningstar, Inc., an independent mutual fund
monitoring service. Morningstar rates and ranks mutual funds in broad investment
categories: domestic stock funds, international stock funds, taxable bond funds and
municipal bond funds. The Fund is ranked among muni New York long-term funds.

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

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

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

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

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



ABOUT YOUR ACCOUNT

How to Buy Shares

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


When you purchase shares of the Fund, your ownership interest in the shares of the Fund
will be recorded as a book entry on the records of the Fund.  The Fund will not issue or
re-register physical share certificates.


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

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

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

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

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


Oppenheimer AMT-Free Municipals           Oppenheimer Limited Term Municipal Fund
Oppenheimer AMT-Free New York Municipals  Oppenheimer Main Street Fund
Oppenheimer Balanced Fund                 Oppenheimer Main Street Opportunity Fund
Oppenheimer Bond Fund                     Oppenheimer Main Street Small Cap Fund
Oppenheimer California Municipal Fund     Oppenheimer MidCap Fund
Oppenheimer Capital Appreciation Fund     Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Income Fund           Oppenheimer Pennsylvania Municipal Fund
                                          Oppenheimer   Principal  Protected  Main
Oppenheimer Champion Income Fund          Street Fund

                                          Oppenheimer   Principal  Protected  Main

Oppenheimer Convertible Securities Fund   Street Fund II

                                          Oppenheimer   Principal  Protected  Main

Oppenheimer Developing Markets Fund       Street Fund III
Oppenheimer Disciplined Allocation Fund   Oppenheimer Quest Balanced Fund

                                          Oppenheimer  Quest  Capital  Value Fund,
Oppenheimer Discovery Fund                Inc.
                                          Oppenheimer  Quest  International  Value
Oppenheimer Emerging Growth Fund          Fund, Inc.
Oppenheimer Emerging Technologies Fund    Oppenheimer Quest Opportunity Value Fund
Oppenheimer Enterprise Fund               Oppenheimer Quest Value Fund, Inc.
Oppenheimer Equity Fund, Inc.             Oppenheimer Real Asset Fund
Oppenheimer Global Fund                   Oppenheimer Real Estate Fund
                                          Oppenheimer      Rochester      National

Oppenheimer Global Opportunities Fund     Municipals
Oppenheimer Gold & Special Minerals Fund  Oppenheimer Select Value Fund
Oppenheimer Growth Fund                   Oppenheimer Senior Floating Rate Fund
Oppenheimer High Yield Fund               Oppenheimer Small Cap Value Fund
Oppenheimer International Bond Fund       Oppenheimer Strategic Income Fund
Oppenheimer International Growth Fund     Oppenheimer Total Return Bond Fund
Oppenheimer  International  Small Company
Fund                                      Oppenheimer U.S. Government Trust
Oppenheimer International Value Fund      Oppenheimer Value Fund
Oppenheimer   Limited   Term   California
Municipal Fund                            Limited-Term New York Municipal Fund
Oppenheimer Limited-Term Government Fund  Rochester Fund Municipals

And the following money market funds:

Oppenheimer Cash Reserves                 Centennial Money Market Trust
Oppenheimer Money Market Fund, Inc.       Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust    Centennial Tax Exempt Trust
Centennial Government Trust


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


   Letters of Intent. Under a Letter of Intent ("Letter"), you can reduce the sales charge
   rate that applies to your purchases of Class A shares if you purchase Class A, Class B
   or (effective March 18, 2005) Class C shares of the Fund or other Oppenheimer funds
   during a 13-month period. The total amount of your purchases of Class A, Class B
   and (effective March 18th) Class C shares will determine the sales charge rate that
   applies to your Class A share purchases during that period. You can choose to include
   purchases that you made up to 90 days before the date of the Letter. Class A shares of
   Oppenheimer Money Market Fund and Oppenheimer Cash Reserves on which you have not paid a
   sales charge and any Class N shares you purchase, or may have purchased, will not be
   counted towards satisfying the purchases specified in a Letter.

         A Letter is an investor's statement in writing to the Distributor of his or her
   intention to purchase a specified value of Class A, Class B and (effective March 18th)
   Class C shares of the Fund and other Oppenheimer funds during a 13-month period (the
   "Letter period"). At the investor's request, this may include purchases made up to 90
   days prior to the date of the Letter. The Letter states the investor's intention to make
   the aggregate amount of purchases of shares which will equal or exceed the amount
   specified in the Letter. Purchases made by reinvestment of dividends or capital gains
   distributions and purchases made at net asset value (i.e. without a sales charge) do not
   count toward satisfying the amount of the Letter.

      Each purchase of Class A shares under the Letter will be made at the offering price
(including the sales charge) that would apply to a single lump-sum purchase of shares in
the amount intended to be purchased under the Letter.

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

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

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

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


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

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


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

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


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

5.    The shares eligible for purchase under the Letter (or the holding of which may be
counted toward completion of a Letter) include:
(a)   Class A shares sold with a front-end sales charge or subject to a Class A contingent
            deferred sales charge,
(b)   Class B shares of other Oppenheimer funds acquired subject to a contingent deferred
            sales charge, and
(c)   Class A or Class B shares acquired by exchange of either (1) Class A shares of one of
            the other Oppenheimer funds that were acquired subject to a Class A initial or
            contingent deferred sales charge or (2) Class B shares of one of the other
            Oppenheimer funds that were acquired subject to a contingent deferred sales
            charge.

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

Asset Builder Plans. As explained in the Prospectus, you must initially establish your
account with $500. Subsequently, you can establish an Asset Builder Plan to automatically
purchase additional shares directly from a bank account for as little as $50. For those
accounts established prior to November 1, 2002 and which have previously established Asset
Builder Plans, additional purchases will remain at $25. Shares purchased by Asset Builder
Plan payments from bank accounts are subject to the redemption restrictions for recent
purchases described in the Prospectus. Asset Builder Plans are available only if your bank
is an ACH member. Asset Builder Plans may not be used to buy shares for OppenheimerFunds
employer-sponsored qualified retirement accounts. Asset Builder Plans also enable
shareholders of Oppenheimer Cash Reserves to use their fund account to make monthly
automatic purchases of shares of up to four other Oppenheimer funds.

      If you make payments from your bank account to purchase shares of the Fund, your bank
account will be debited automatically. Normally the debit will be made two business days
prior to the investment dates you selected on your application. Neither the Distributor,
the Transfer Agent or the Fund shall be responsible for any delays in purchasing shares
that result from delays in ACH transmissions.


      Before you establish Asset Builder payments, you should obtain a prospectus of the
selected fund(s) from your financial advisor (or the Distributor) and request an
application from the Distributor. Complete the application and return it. You may change
the amount of your Asset Builder payment or you can terminate these automatic investments
at any time by writing to the Transfer Agent. The Transfer Agent requires a reasonable
period (approximately 10 days) after receipt of your instructions to implement them. The
Fund reserves the right to amend, suspend or discontinue offering Asset Builder plans at
any time without prior notice.


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

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


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

The Distributor will not accept a purchase order of $100,000 or more for Class B shares or
a purchase order of $1 million or more to purchase Class C shares on behalf of a single
investor (not including dealer "street name" or omnibus accounts).


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

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

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

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


Fund Account Fees. As stated in the Prospectus, a $12 annual "Minimum Balance Fee" is
assessed on each Fund account with a share balance valued under $500. The Minimum Balance
Fee is automatically deducted from each such Fund account on or about the second to last
business day of September.

   Listed below are certain cases in which the Fund has elected, in its discretion, not to
   assess the Fund Account Fees.  These exceptions are subject to change:
   A fund account whose shares were acquired after September 30th of the prior year;
o     A fund account that has a balance below $500 due to the automatic conversion of
      shares from Class B to Class A shares. However, once all Class B shares held in the
      account have been converted to Class A shares the new account balance may become
      subject to the Minimum Balance Fee;
o     Accounts of shareholders who elect to access their account documents electronically
      via eDoc Direct;
o     A fund account that has only certificated shares and, has a balance below $500 and is
      being escheated;
o     Accounts of shareholders that are held by broker-dealers under the NSCC Fund/SERV
      system;
o     Accounts held under the Oppenheimer Legacy Program and/or holding certain Oppenheimer
      Variable Account Funds;
o     Omnibus accounts holding shares pursuant to the Pinnacle, Ascender, Custom Plus,
      Recordkeeper Pro and Pension Alliance Retirement Plan programs; and
o     A fund account that falls below the $500 minimum solely due to market fluctuations

      within the 12-month period preceding the date the fee is deducted.

To access account documents electronically via eDocs Direct, please visit the Service
Center on our website at www.oppenheimerfunds.com or call 1.888.470.0862 for instructions.
                         ------------------------


      The Fund reserves the authority to modify Fund Account Fees in its discretion.

Determination of Net Asset Values Per Share. The net asset values per share of each class
of shares of the Fund are determined as of the close of business of the Exchange on each
day that the Exchange is open. The calculation is done by dividing the value of the Fund's
net assets attributable to a class by the number of shares of that class that are
outstanding. The Exchange normally closes at 4:00 P.M., Eastern time, but may close earlier
on some other days (for example, in case of weather emergencies or on days falling before a
U.S. holiday).  All references to time in this Statement of Additional Information mean
"Eastern time." The Exchange's most recent annual announcement regarding holidays and days
when the market may close early is available on the Exchange's website at www.nyse.com.


      Dealers other than Exchange members may conduct trading in municipal securities on
days on which the Exchange is closed (including weekends and holidays) or after 4:00 P.M.
on a regular business day. Because the Fund's net asset values will not be calculated on
those days, the Fund's net asset values per share may be significantly affected on such
days when shareholders may not purchase or redeem shares.

      |X|   Securities Valuation. The Fund's Board of Trustees has established procedures
for the valuation of the Fund's securities. In general those procedures are as follows:

o     Long-term debt securities having a remaining maturity in excess of 60 days are valued
based on the mean between the "bid" and "asked" prices determined by a portfolio pricing
service approved by the Fund's Board of Trustees or obtained by the Manager from two active
market makers in the security on the basis of reasonable inquiry.
o     The following securities are valued at the mean between the "bid" and "asked" prices
determined by a pricing service approved by the Fund's Board of Trustees or obtained by the
Manager from two active market makers in the security on the basis of reasonable inquiry:
(1)   debt instruments that have a maturity of more than 397 days when issued,
(2)   debt instruments that had a maturity of 397 days or less when issued and have a
               remaining maturity of more than 60 days, and
(3)   non-money market debt instruments that had a maturity of 397 days or less when issued
               and which have a remaining maturity of 60 days or less.
o     The following securities are valued at cost, adjusted for amortization of premiums
and accretion of discounts:
(1)   money market debt securities held by a non-money market fund that had a maturity of
               less than 397 days when issued that have a remaining maturity of 60 days or
               less, and
(2)   debt instruments held by a money market fund that have a remaining maturity of 397
               days or less.


o        Securities (including restricted securities) not having readily-available market
quotations are valued at fair value determined under the Board's procedures. If the Manager
is unable to locate two market makers willing to give quotes, a security may be priced at
the mean between the "bid" and "asked" prices provided by a single active market maker
(which in certain cases may be the "bid" price if no "asked" price is available).


      In the case of municipal securities, when last sale information is not generally
available, the Manager may use pricing services approved by the Board of Trustees. The
pricing service may use "matrix" comparisons to the prices for comparable instruments on
the basis of quality, yield and maturity. Other special factors may be involved (such as
the tax-exempt status of the interest paid by municipal securities). The Manager will
monitor the accuracy of the pricing services. That monitoring may include comparing prices
used for portfolio valuation to actual sales prices of selected securities.


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


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

How to Sell Shares

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

Checkwriting. When a check is presented to United Missouri Bank (the "Bank") for clearance,
the Bank will ask the Fund to redeem a sufficient number of full and fractional shares in
the shareholder's account to cover the amount of the check. This enables the shareholder to
continue receiving dividends on those shares until the check is presented to the Fund.
Checks may not be presented for payment at the offices of the Bank or the Fund's custodian.
This limitation does not affect the use of checks for the payment of bills or to obtain
cash at other banks. The Fund reserves the right to amend, suspend or discontinue offering
checkwriting privileges at any time.  The Fund will provide you notice whenever it is
required to do so by applicable law.

      In choosing to take advantage of the Checkwriting privilege, by signing the account
application or by completing a Checkwriting card, each individual who signs:
(1)   for individual accounts, represents that they are the registered owner(s) of the
           shares of the Fund in that account;

(2)   for accounts for corporations, partnerships, trusts and other entities, represents
           that they are an officer, general partner, trustee or other fiduciary or agent,
           as applicable, duly authorized to act on behalf of the registered owner(s);

(3)   authorizes the Fund, its Transfer Agent and any bank through which the Fund's drafts
           (checks) are payable to pay all checks drawn on the Fund account of such
           person(s) and to redeem a sufficient amount of shares from that account to cover
           payment of each check;
(4)   specifically acknowledges that if they choose to permit checks to be honored if there
           is a single signature on checks drawn against joint accounts, or accounts for
           corporations, partnerships, trusts or other entities, the signature of any one
           signatory on a check will be sufficient to authorize payment of that check and
           redemption from the account, even if that account is registered in the names of
           more than one person or more than one authorized signature appears on the
           Checkwriting card or the application, as applicable;
(5)   understands that the Checkwriting privilege may be terminated or amended at any time
           by the Fund and/or the Fund's bank; and
(6)   acknowledges and agrees that neither the Fund nor its bank shall incur any liability
           for that amendment or termination of checkwriting privileges or for redeeming
           shares to pay checks reasonably believed by them to be genuine, or for returning
           or not paying checks that have not been accepted for any reason.

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

Reinvestment Privilege. Within six months of a redemption, a shareholder may reinvest all
or part of the redemption proceeds of:
o     Class A shares purchased subject to an initial sales charge or Class A shares on
         which a contingent deferred sales charge was paid, or
o     Class B shares that were subject to the Class B contingent deferred sales charge when
         redeemed.


      The reinvestment may be made without sales charge only in Class A shares of the Fund
or any of the other Oppenheimer funds into which shares of the Fund are exchangeable as
described in "How to Exchange Shares" below. Reinvestment will be at the net asset value
next computed after the Transfer Agent receives the reinvestment order. The shareholder
must ask the Transfer Agent for that privilege at the time of reinvestment. This privilege
does not apply to Class C or Class Y shares. The Fund may amend, suspend or cease offering
this reinvestment privilege at any time as to shares redeemed after the date of such
amendment, suspension or cessation.


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

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

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

Involuntary Redemptions. The Fund's Board of Trustees has the right to cause the
involuntary redemption of the shares held in any account if the aggregate net asset value
of those shares is less than $200 or such lesser amount as the Board may fix. The Board of
Trustees will not cause the involuntary redemption of shares in an account if the aggregate
net asset value of such shares has fallen below the stated minimum solely as a result of
market fluctuations. If the Board exercises this right, it may also fix the requirements
for any notice to be given to the shareholders in question (not less than 30 days). The
Board may alternatively set requirements for the shareholder to increase the investment, or
set other terms and conditions so that the shares would not be involuntarily redeemed.

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

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

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


      Ordinarily, for accounts redeemed by a broker-dealer under this procedure, payment
will be made within three business days after the shares have been redeemed upon the
Distributor's receipt of the required redemption documents in proper form. The signature(s)
of the registered owners on the redemption documents must be guaranteed as described in the
Prospectus


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

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

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


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

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


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

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

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

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

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


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


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

How to Exchange Shares

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

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

   The following funds only offer Class A shares:

   Centennial California Tax Exempt Trust    Centennial New York Tax Exempt

                                             Trust

   Centennial Government Trust               Centennial Tax Exempt Trust
   Centennial Money Market Trust             Oppenheimer Money Market Fund,

                                             Inc.


   The following funds do not offer Class N shares:
   Oppenheimer AMT-Free Municipals           Oppenheimer Pennsylvania Municipal
                                             Fund
   Oppenheimer AMT-Free New York             Oppenheimer Rochester National
   Municipals                                Municipals
   Oppenheimer California Municipal Fund     Limited Term New York Municipal Fund
   Oppenheimer Limited Term Municipal        Oppenheimer Senior Floating Rate Fund
   Fund
   Oppenheimer New Jersey Municipal Fund     Rochester Fund Municipals

   The following funds do not offer Class Y shares:
   Oppenheimer AMT-Free Municipals          Oppenheimer Limited Term Municipal Fund
   Oppenheimer AMT-Free New York Municipals Oppenheimer Multiple Strategies Fund
   Oppenheimer California Municipal Fund    Oppenheimer New Jersey Municipal Fund
   Oppenheimer Capital Income Fund          Oppenheimer Pennsylvania Municipal Fund
   Oppenheimer Cash Reserves                Oppenheimer Principal Protected Main
                                            Street Fund
   Oppenheimer Champion Income Fund         Oppenheimer Principal Protected Main
                                            Street Fund II
   Oppenheimer Convertible Securities Fund  Oppenheimer Quest Capital Value Fund,
                                            Inc.
   Oppenheimer Disciplined Allocation Fund  Oppenheimer Quest International Value
                                            Fund, Inc.
   Oppenheimer Developing Markets Fund      Oppenheimer Rochester National Municipals
   Oppenheimer Gold & Special Minerals Fund Oppenheimer Senior Floating Rate Fund
   Oppenheimer International Bond Fund      Oppenheimer Small Cap Value Fund
   Oppenheimer International Growth Fund    Oppenheimer Total Return Bond Fund
   Oppenheimer International Small Company  Limited Term New York Municipal Fund
   Fund



o     Oppenheimer Money Market Fund, Inc. only offers Class A and Class Y shares.
o     Class Y shares of Oppenheimer Real Asset Fund may not be exchanged for shares of any

      other fund.
o     Class B, Class C and Class N shares of Oppenheimer Cash Reserves are generally
      available only by exchange from the same class of shares of other Oppenheimer funds
      or through OppenheimerFunds-sponsored 401(k) plans.
o     Class M shares of Oppenheimer Convertible Securities Fund may be exchanged only for
      Class A shares of other Oppenheimer funds. They may not be acquired by exchange of
      shares of any class of any other Oppenheimer funds except Class A shares of
      Oppenheimer Money Market Fund or Oppenheimer Cash Reserves acquired by exchange of
      Class M shares.
o     Class X shares of Limited Term New York Municipal Fund may be exchanged only for
      Class B shares of other Oppenheimer funds and no exchanges may be made to Class X
      shares.
   o  Class A shares of Oppenheimer funds may be exchanged at net asset value for shares of
      any money market fund offered by the Distributor. Shares of any money market fund
      purchased without a sales charge may be exchanged for shares of Oppenheimer funds
      offered with a sales charge upon payment of the sales charge. They may also be used
      to purchase shares of Oppenheimer funds subject to an early withdrawal charge or
      contingent deferred sales charge.
o     Shares of the Fund acquired by reinvestment of dividends or distributions from any of
      the other Oppenheimer funds or from any unit investment trust for which reinvestment
      arrangements have been made with the Distributor may be exchanged at net asset value
      for shares of any of the Oppenheimer funds.
o     Shares of Oppenheimer Principal Protected Main Street Fund may be exchanged at net
      asset value for shares of any of the Oppenheimer funds.  However, shareholders are
      not permitted to exchange shares of other Oppenheimer funds for shares of Oppenheimer
      Principal Protected Main Street Fund until after the expiration of the warranty
      period (8/5/2010).
o     Shares of Oppenheimer Principal Protected Main Street Fund II may be exchanged at net
      asset value for shares of any of the Oppenheimer funds. However, shareholders are not
      permitted to exchange shares of other Oppenheimer funds for shares of Oppenheimer
      Principal Protected Main Street Fund II until after the expiration of the warranty
      period (3/3/2011).

o     Shares of Oppenheimer Principal Protected Main Street Fund III may be exchanged at
      net asset value for shares of any of the Oppenheimer funds. However, shareholders are
      not permitted to exchange shares of other Oppenheimer funds for shares of Oppenheimer
      Principal Protected Main Street Fund III until after the expiration of the warranty
      period (12/06/2011).


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

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

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

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

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

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


o     With respect to Class B shares except for the funds listed in the next item
immediately below, the Class B contingent deferred sales charge is imposed on Class B
shares acquired by exchange if they are redeemed within six years of the initial purchase
of the exchanged Class B shares.

o     With respect to Class B shares of Limited-Term Government Fund, Limited Term
Municipal Fund, Limited Term New York Municipal Fund, Oppenheimer Senior Floating Rate Fund
and Cash Reserves that were initially purchased as shares of Oppenheimer Capital
Preservation Fund, the Class B contingent deferred sales charge is imposed on Class B
shares acquired by exchange if they are redeemed within 5 years of the initial purchase of
the exchanged Class B shares


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

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

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

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

      |X|   Limits on Multiple Exchange Orders. The Fund reserves the right to reject
telephone or written exchange requests submitted in bulk by anyone on behalf of more than
one account.

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

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

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

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


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


Dividends, Capital Gains and Taxes

Dividends and Distributions. Dividends will be payable on shares held of record at the time
of the previous determination of net asset value, or as otherwise described in "How to Buy
Shares."  Daily dividends will not be declared or paid on newly purchased shares until such
time as Federal Funds (funds credited to a member bank's account at the Federal Reserve
Bank) are available from the purchase payment for such shares. Normally, purchase checks
received from investors are converted to Federal Funds on the next business day. Shares
purchased through dealers or brokers normally are paid for by the third business day
following the placement of the purchase order.

      Shares redeemed through the regular redemption procedure will be paid dividends
through and including the day on which the redemption request is received by the Transfer
Agent in proper form. Dividends will be declared on shares repurchased by a dealer or
broker for three business days following the trade date (that is, up to and including the
day prior to settlement of the repurchase). If all shares in an account are redeemed, all
dividends accrued on shares of the same class in the account will be paid together with the
redemption proceeds.

      The Fund's practice of attempting to pay dividends on Class A shares at a constant
level requires the Manager to monitor the Fund's portfolio and, if necessary, to select
higher-yielding securities when it is deemed appropriate to seek income at the level needed
to meet the target. Those securities must be within the Fund's investment parameters,
however. The Fund expects to pay dividends at a targeted level from its net investment
income and other distributable income without any impact on the net asset values per share.

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

      The amount of a distribution paid on a class of shares may vary from time to time
depending on market conditions, the composition of the Fund's portfolio, and expenses borne
by the Fund or borne separately by a class. Dividends are calculated in the same manner, at
the same time and on the same day for shares of each class. However, dividends on Class B
and Class C shares are expected to be lower than dividends on Class A shares. That is due
to the effect of the asset-based sales charge on Class B and Class C shares. Those
dividends will also differ in amount as a consequence of any difference in net asset value
among the different classes of shares.

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

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

      Qualification as a Regulated  Investment Company.  The Fund has elected to be taxed as
a regulated  investment  company under Subchapter M of the Internal Revenue Code of 1986, as
amended. As a regulated  investment  company,  the Fund is not subject to federal income tax
on the portion of its net  investment  income (that is,  taxable  interest,  dividends,  and
other taxable  ordinary  income,  net of expenses) and capital gain net income (that is, the
excess  of net  long-term  capital  gains  over  net  short-term  capital  losses)  that  it
distributes to shareholders.

      If the Fund qualifies as a "regulated investment company" under the Internal Revenue
Code, it will not be liable for federal income tax on amounts it pays as dividends and
other distributions. That qualification enables the Fund to "pass through" its income and
realized capital gains to shareholders without having to pay tax on them. The Fund
qualified as a regulated investment company in its last fiscal year and intends to qualify
in future years, but reserves the right not to qualify. The Internal Revenue Code contains
a number of complex tests to determine whether the Fund qualifies. The Fund might not meet
those tests in a particular year. If it does not qualify, the Fund will be treated for tax
purposes as an ordinary corporation and will receive no tax deduction for payments of
dividends and other distributions made to shareholders. In such an instance, all of the
Fund's dividends would be taxable to shareholders.


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

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


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


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

|X|   Taxation of Fund Distributions. The Fund intends to qualify under the Internal
Revenue Code during each fiscal year to pay "exempt-interest dividends" to its
shareholders. To satisfy this qualification, at the end of each quarter of its taxable
year, at least 50% of the value of the Fund's total assets consists of obligations as
defined in Section 103(a) of the Internal Revenue Code, as amended. Exempt-interest
dividends that are derived from net investment income earned by the Fund on municipal
securities will be excludable from gross income of shareholders for federal income tax
purposes. To the extent the Fund fails to qualify to pay exempt-interest dividends in any
given form, such dividends would be included in the gross income of shareholders for
federal income tax purposes.

      Net investment income includes the allocation of amounts of income from the municipal
securities in the Fund's portfolio that are free from federal income taxes. This allocation
will be made by the use of one designated percentage applied uniformly to all income
dividends paid during the Fund's tax year. That designation will normally be made following
the end of each fiscal year as to income dividends paid in the prior year. The percentage
of income designated as tax-exempt may substantially differ from the percentage of the
Fund's income that was tax-exempt for a given period.

      A portion of the exempt-interest dividends paid by the Fund may be an item of tax
preference for shareholders subject to the federal alternative minimum tax. The amount of
any dividends attributable to tax preference items for purposes of the alternative minimum
tax will be identified when tax information is distributed by the Fund.

      A shareholder receiving a dividend from income earned by the Fund from one or more of
the following sources must treat the dividend as ordinary income in the computation of the
shareholder's gross income, regardless of whether the dividend is reinvested:
(1)   certain taxable temporary investments (such as certificates of deposit, repurchase
          agreements, commercial paper and obligations of the U.S. government, its agencies
          and instrumentalities);

(2)   income from securities loans;
(3)   income or gains from options or futures,
(4)   any net short-term capital gain; and
(5)   any market discount amortization on tax-exempt bonds.


      The Fund's dividends will not be eligible for the dividends-received deduction for
corporations. Shareholders receiving Social Security or railroad retirement benefits should
be aware that exempt-interest dividends are a factor in determining whether (and the extent
to which) such benefits are subject to federal income tax. Losses realized by shareholders
on the redemption of Fund shares within six months of purchase will be disallowed for
federal income tax purposes to the extent of exempt-interest dividends received on such
shares.

      In any year in which the Fund qualifies as a regulated investment company under the
Internal Revenue Code, the Fund will also be exempt from New York corporate income and
franchise taxes. It will also be qualified under New York law to pay exempt-interest
dividends that will be exempt from New York State and New York City personal income taxes.
That exemption applies to the extent that the Fund's distributions are attributable to
interest on New York municipal securities. Distributions from the Fund attributable to
income from sources other than New York municipal securities and U.S. government
obligations will generally be subject to New York State and New York City personal income
taxes as ordinary income.

      Distributions by the Fund from investment income and long- and short-term capital
gains will generally not be excludable from taxable net investment income in determining
New York corporate franchise tax and New York City general corporation tax for corporate
shareholders of the Fund. Additionally, certain distributions paid to corporate
shareholders of the Fund may be includable in income subject to the New York alternative
minimum tax.

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

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

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


      The Fund will be required in certain cases to withhold 28% of ordinary income
dividends (not including "exempt-interest dividends"), capital gains distributions and the
proceeds of the redemption of shares, paid to any shareholder (1) who has failed to provide
a correct taxpayer identification number or to properly certify that number when required,
  -------
(2) who is subject to backup withholding for failure to report the receipt of interest or
dividend income properly, or (3) who has failed to certify to the Fund that the shareholder
is not subject to backup withholding or is an "exempt recipient" (such as a corporation).
Any tax withheld by the Fund is remitted by the Fund to the U.S. Treasury and all income
and any tax withheld is identified in reports mailed to shareholders in January of each
year with a copy sent to the IRS.


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

      In general, any gain or loss arising from the redemption of shares of the Fund will
be considered capital gain or loss, if the shares were held as a capital asset. It will be
long-term capital gain or loss if the shares were held for more than one year.  However,
any capital loss arising from the redemption of shares held for six months or less will be
treated as a long-term capital loss to the extent of the amount of capital gain dividends
received on those shares. Special holding period rules under the Internal Revenue Code
apply in this case to determine the holding period of shares and there are limits on the
deductibility of capital losses in any year.

|X|   Foreign  Shareholders.  Under U.S. tax law, taxation of a shareholder who is a foreign
person (to include,  but not limited to, a nonresident alien individual,  a foreign trust, a
foreign  estate,  a foreign  corporation,  or a foreign  partnership)  primarily  depends on
whether the foreign person's income from the Fund is effectively  connected with the conduct
of a U.S.  trade or business.  Typically,  ordinary  income  dividends  paid (not  including
exempt-interest  dividends  paid  by the  Fund)  from  a  mutual  fund  are  not  considered
"effectively connected" income.


      Ordinary income dividends that are paid by the Fund (and are deemed not "effectively
connected income") to foreign persons will be subject to a U.S. tax withheld by the Fund at
a rate of 30%, provided the Fund obtains a properly completed and signed Certificate of
Foreign Status. The tax rate may be reduced if the foreign person's country of residence
has a tax treaty with the U.S. allowing for a reduced tax rate on ordinary income dividends
paid by the Fund. Any tax withheld by the Fund is remitted by the Fund to the U.S. Treasury
and all income and any tax withheld is identified in reports mailed to shareholders in
March of each year with a copy sent to the IRS.

      If the ordinary income dividends from the Fund are effectively connected with the
                                                     ---
conduct of a U.S. trade or business, then the foreign person may claim an exemption from
the U.S. tax described above provided the Fund obtains a properly completed and signed
Certificate of Foreign Status. If the foreign person fails to provide a certification of
his/her foreign status, the Fund will be required to withhold U.S. tax at a rate of 28% on
ordinary income dividends (not including "exempt-interest dividends"), capital gains
distributions (including short-term and long-term) and the proceeds of the redemption of
shares, paid to any foreign person. All income and any tax withheld (in this situation) by
the Fund is remitted by the Fund to the U.S. Treasury and is identified in reports mailed
to shareholders in January of each year with a copy sent to the IRS.


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

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


Additional Information About the Fund

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

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

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


Independent Registered Public Accounting Firm. KPMG LLP serves as the Independent
Registered Public Accounting Firm for the Fund.  KPMG LLP audits the Fund's financial
statements and performs other related audit services.  KPMG LLP also acts as the
independent registered public accounting firm for the Manager and certain other funds
advised by the Manager and its affiliates. Audit and non-audit services provided by KPMG
LLP to the Fund must be pre-approved by the Audit Committee.









                                            A-7

                                         Appendix A

                             MUNICIPAL BOND RATINGS DEFINITIONS
                             ----------------------------------

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

Moody's Investors Service, Inc. ("Moody's")
Municipal Ratings are opinions of the investment quality of issuers and issues in the U.S.
municipal and tax-exempt markets. As such, these ratings incorporate Moody's assessment of
the default probability and loss severity of these issuers and issues.

Municipal Ratings are based upon the analysis of four primary factors relating to municipal
finance: economy, debt, finances, and administration/management strategies. Each of the
factors is evaluated individually and for its effect on the other factors in the context of
the municipality's ability to repay its debt.

MUNICIPAL LONG-TERM RATING DEFINITIONS

Aaa:  Issuers or issues rated Aaa demonstrate the strongest creditworthiness relative to
other US municipal or tax-exempt issuers or issues.

Aa:  Issuers or issues rated Aa demonstrate very strong creditworthiness relative to other
US municipal or tax-exempt issuers or issues.

A:  Issuers or issues rated A present above-average creditworthiness relative to other US
municipal or tax-exempt issuers or issues.

Baa:  Issuers or issues rated Baa represent average creditworthiness relative to other US
municipal or tax- exempt issuers or issues.

Ba:  Issuers or issues rated Ba demonstrate below-average creditworthiness relative to
other US municipal or tax-exempt issuers or issues.

B:  Issuers or issues rated B demonstrate weak creditworthiness relative to other US
municipal or tax- exempt issuers or issues.

Caa:  Issuers or issues rated Caa demonstrate very weak creditworthiness relative to other
US municipal or tax-exempt issuers or issues.

Ca:  Issuers or issues rated Ca demonstrate extremely weak creditworthiness relative to
other US municipal or tax-exempt issuers or issues.

C:  Issuers or issues rated C demonstrate the weakest creditworthiness relative to other US
municipal or tax-exempt issuers or issues.

Moody's applies numerical modifiers 1, 2, and 3 in each generic rating classification from
Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its
generic rating category; the modifier 2 indicates a mid- range ranking; and the modifier 3
indicates a ranking in the lower end of that generic rating category.

MIG/VMIG RATINGS: U.S. SHORT-TERM RATINGS
In municipal debt issuance, there are three rating categories for short-term obligations
that are considered investment grade. These ratings are designated as Moody's Investment
Grade (MIG) and are divided into three levels -- MIG 1 through MIG 3.
In addition, those short-term obligations that are of speculative quality are designated
SG, or speculative grade.

In the case of variable rate demand obligations (VRDOs), a two-component rating is
assigned. The first element represents Moody's evaluation of the degree of risk associated
with scheduled principal and interest payments. The second element represents Moody's
evaluation of the degree of risk associated with the demand feature, using the MIG rating
scale.

The short-term rating assigned to the demand feature of VRDOs is designated as VMIG. When
either the long- or short-term aspect of a VRDO is not rated, that piece is designated NR,
e.g., Aaa/NR or NR/VMIG 1.

MIG ratings expire at note maturity. By contrast, VMIG rating expirations will be a
function of each issue's specific structural or credit features.

MIG 1/VMIG 1: Denotes superior credit quality. Excellent protection is afforded by
established cash flows, highly reliable liquidity support or demonstrated broad-based
access to the market for refinancing.

MIG 2/VMIG 2: Denotes strong credit quality. Margins of protection are ample although not
as large as in the preceding group.

MIG 3/VMIG 3: Denotes acceptable credit quality. Liquidity and cash-flow protection may be
narrow, and market access for refinancing is likely to be less well established.

SG:  Denotes speculative-grade credit quality. Debt instruments in this category may lack
margins of protection.

Standard & Poor's Ratings Services ("Standard & Poor's"), a division of The McGraw-Hill
Companies, Inc.

LONG-TERM ISSUE CREDIT RATINGS
Issue credit ratings are based in varying degrees, on the following considerations:
o     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;
o     Nature of and provisions of the obligation; and
o     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.
   The issue ratings definitions are expressed in terms of default risk. As such, they
pertain to senior obligations of an entity. Junior obligations are typically rated lower
than senior obligations, to reflect the lower priority in bankruptcy, as noted above.

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






AA: An obligation rated `AA' differs from the highest-rated obligations only in small
degree. The obligor's capacity to meet its financial commitment on the obligation is very
strong.

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

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

BB, B, CCC, CC, and C

An obligation rated `BB', `B', `CCC', `CC', and `C' are regarded as having significant
speculative characteristics. `BB' indicates the least degree of speculation and `C' the
highest. While such obligations will likely have some quality and protective
characteristics, these may be outweighed by large uncertainties or major exposures to
adverse conditions.

BB: An obligation rated `BB' are less vulnerable to nonpayment than other speculative
issues. However, it faces major ongoing uncertainties or exposure to adverse business,
financial, or economic conditions, which could lead to the obligor's inadequate capacity to
meet its financial commitment on the obligation.

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

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

CC: An obligation rated `CC' are currently highly vulnerable to nonpayment.

C: The `C' rating may be used to cover a situation where a bankruptcy petition has been
filed or similar action has been taken, but payments on this obligation are being continued.

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

The ratings from "AA" to "CCC" may be modified by the addition of a plus (+) or minus (-)
sign to show relative standing within the major rating categories.







c: The `c' subscript is used to provide additional information to investors that the bank
may terminate its obligation to purchase tendered bonds if the long-term credit rating of
the issuer is below an investment-grade level and/or the issuer's bonds are deemed
taxable.

p: The letter `p' indicates that the rating is provisional. A provisional rating assumes
the successful completion of the project financed by the debt being rated and indicates
that payment of debt service requirements is largely or entirely dependent upon the
successful, timely completion of the project. This rating, however, while addressing credit
quality subsequent to completion of the project, makes no comment on the likelihood of or
the risk of default upon failure of such completion. The investor should exercise his own
judgment with respect to such likelihood and risk.

Continuance of the ratings is contingent upon Standard & Poor's receipt of an executed copy
of the escrow agreement or closing documentation confirming investments and cash flows.

r: The `r' highlights derivative, hybrid, and certain other obligations that Standard &
Poor's believes may experience high volatility or high variability in expected returns as a
result of noncredit risks. Examples of such obligations are securities with principal or
interest return indexed to equities, commodities, or currencies; certain swaps and options;
and interest-only and principal-only mortgage securities. The absence of an `r' symbol
should not be taken as an indication that an obligation will exhibit no volatility or
variability in total return.

N.R. Not rated.

Debt obligations of issuers outside the United States and its territories are rated on the
same basis as domestic corporate and municipal issues. The ratings measure the
creditworthiness of the obligor but do not take into account currency exchange and related
uncertainties.

Bond Investment Quality Standards

Under present commercial bank regulations issued by the Comptroller of the Currency, bonds
rated in the top four categories (`AAA', `AA', `A', `BBB', commonly known as
investment-grade ratings) generally are regarded as eligible for bank investment. Also, the
laws of various states governing legal investments impose certain rating or other standards
for obligations eligible for investment by savings banks, trust companies, insurance
companies, and fiduciaries in general.

SHORT-TERM ISSUE CREDIT RATINGS
Short-term ratings are generally assigned to those obligations considered short-term in the
relevant market. In the U.S., for example, that means obligations with an original maturity
of no more than 365 days-including commercial paper.

A-1: A short-term obligation rated "A-1" is rated in the highest category by Standard &
Poor's. The obligor's capacity to meet its financial commitment on the obligation is
strong. Within this category, certain obligations are designated with a plus sign (+). This
indicates that the obligor's capacity to meet its financial commitment on these obligations
is extremely strong.







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

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

B: A short-term obligation rated "B" is regarded as having significant speculative
characteristics. The obligor currently has the capacity to meet its financial commitment on
the obligation; however, it faces major ongoing uncertainties which could lead to the
obligor's inadequate capacity to meet its financial commitment on the obligation.

C: A short-term obligation rated "C" is currently vulnerable to nonpayment and is dependent
upon favorable business, financial, and economic conditions for the obligor to meet its
financial commitment on the obligation.

D: A short-term obligation rated "D" is in payment default. The "D" rating category is used
when payments on an obligation are not made on the date due even if the applicable grace
period has not expired, unless Standard & Poor's believes that such payments will be made
during such grace period. The "D" rating also will be used upon the filing of a bankruptcy
petition or the taking of a similar action if payments on an obligation are jeopardized.

Notes. A Standard & Poor's note rating reflects the liquidity factors and market access
risks unique to notes. Notes due in three years or less will likely receive a note rating.
Notes maturing beyond three years will most likely receive a long-term debt rating. The
following criteria will be used in making that assessment:
o.....Amortization schedule-the larger the final maturity relative to other maturities, the
      more likely it will
      be treated as a note; and
o     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.

SP-1: Strong capacity to pay principal and interest. An issue with a very strong capacity
to pay debt service is given a (+) designation.

SP-2: Satisfactory capacity to pay principal and interest, with some vulnerability to
adverse financial and economic changes over the term of the notes.

SP-3: Speculative capacity to pay principal and interest.


Fitch, Inc.
International credit ratings assess the capacity to meet foreign currency or local currency
commitments. Both "foreign currency" and "local currency" ratings are internationally
comparable assessments. The local currency rating measures the probability of payment
within the relevant sovereign state's currency and jurisdiction and therefore, unlike the
foreign currency rating, does not take account of the possibility of foreign exchange
controls limiting transfer into foreign currency.

INTERNATIONAL LONG-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings.
Investment Grade:

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

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

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

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

Speculative Grade:

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

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

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

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

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

INTERNATIONAL SHORT-TERM CREDIT RATINGS
The following ratings scale applies to foreign currency and local currency ratings. A
short-term rating has a time horizon of less than 12 months for most obligations, or up to
three years for U.S. public finance securities, and thus places greater emphasis on the
liquidity necessary to meet financial commitments in a timely manner.

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

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

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

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

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

D: Default. Denotes actual or imminent payment default.







                                            B-1
                                         Appendix B

                          MUNICIPAL BOND INDUSTRY CLASSIFICATIONS

Adult Living Facilities
Airlines
Education
Electric Utilities
Gas Utilities
General Obligation
Higher Education
Highways/Railways
Hospital/Healthcare
Hotels, Restaurants & Leisure
Manufacturing, Durable Goods
Manufacturing, Non Durable Goods
Marine/Aviation Facilities
Multi-Family Housing
Municipal Leases
Non Profit Organization
Paper, Containers & Packaging
Parking Fee Revenue
Pollution Control
Resource Recovery
Sales Tax Revenue
Sewer Utilities
Single Family Housing
Special Assessment
Special Tax
Sports Facility Revenue
Student Loans
Telephone Utilities
Tobacco
Water Utilities














                                            C-12
                                         Appendix C

OppenheimerFunds Special Sales Charge Arrangements and Waivers
- --------------------------------------------------------------

In certain cases, the initial sales charge that applies to purchases of Class A shares1 of
the Oppenheimer funds or the contingent deferred sales charge that may apply to Class A,
Class B or Class C shares may be waived.2  That is because of the economies of sales
efforts realized by OppenheimerFunds Distributor, Inc., (referred to in this document as
the "Distributor"), or by dealers or other financial institutions that offer those shares
to certain classes of investors.

Not all waivers apply to all funds. For example, waivers relating to Retirement Plans do
not apply to Oppenheimer municipal funds, because shares of those funds are not available
for purchase by or on behalf of retirement plans. Other waivers apply only to shareholders
of certain funds.

For the purposes of some of the waivers described below and in the Prospectus and Statement
of Additional Information of the applicable Oppenheimer funds, the term "Retirement Plan"
refers to the following types of plans:
         1) plans qualified under Sections 401(a) or 401(k) of the Internal Revenue Code,
         2) non-qualified deferred compensation plans,
         3) employee benefit plans3
         4) Group Retirement Plans4
         5) 403(b)(7) custodial plan accounts
         6) Individual Retirement Accounts ("IRAs"), including traditional IRAs, Roth IRAs,
            SEP-IRAs, SARSEPs or SIMPLE plans

The interpretation of these provisions as to the applicability of a special arrangement or
waiver in a particular case is in the sole discretion of the Distributor or the transfer
agent (referred to in this document as the "Transfer Agent") of the particular Oppenheimer
fund. These waivers and special arrangements may be amended or terminated at any time by a
particular fund, the Distributor, and/or OppenheimerFunds, Inc. (referred to in this
document as the "Manager").

Waivers that apply at the time shares are redeemed must be requested by the shareholder
and/or dealer in the redemption request.
I.






        Applicability of Class A Contingent Deferred Sales Charges in Certain Cases
- --------------------------------------------------------------------------------------------

Purchases of Class A Shares of Oppenheimer Funds That Are Not Subject to Initial Sales
Charge but May Be Subject to the Class A Contingent Deferred Sales Charge (unless a waiver
applies).

      There is no initial sales charge on purchases of Class A shares of any of the
Oppenheimer funds in the cases listed below. However, these purchases may be subject to the
Class A contingent deferred sales charge if redeemed within 18 months (24 months in the
case of Oppenheimer Rochester National Municipals and Rochester Fund Municipals) of the
beginning of the calendar month of their purchase, as described in the Prospectus (unless a
waiver described elsewhere in this Appendix applies to the redemption). Additionally, on
shares purchased under these waivers that are subject to the Class A contingent deferred
sales charge, the Distributor will pay the applicable concession described in the
Prospectus under "Class A Contingent Deferred Sales Charge."5 This waiver provision applies
to:
|_|   Purchases of Class A shares aggregating $1 million or more.
|_|   Purchases of Class A shares by a Retirement Plan that was permitted to purchase such
         shares at net asset value but subject to a contingent deferred sales charge prior
         to March 1, 2001. That included plans (other than IRA or 403(b)(7) Custodial
         Plans) that: 1) bought shares costing $500,000 or more, 2) had at the time of
         purchase 100 or more eligible employees or total plan assets of $500,000 or more,
         or 3) certified to the Distributor that it projects to have annual plan purchases
         of $200,000 or more.
|_|   Purchases by an OppenheimerFunds-sponsored Rollover IRA, if the purchases are made:
         1) through a broker, dealer, bank or registered investment adviser that has made
            special arrangements with the Distributor for those purchases, or
         2) by a direct rollover of a distribution from a qualified Retirement Plan if the
            administrator of that Plan has made special arrangements with the Distributor
            for those purchases.
|_|   Purchases of Class A shares by Retirement Plans that have any of the following
         record-keeping arrangements:
         1) The record keeping is performed by Merrill Lynch Pierce Fenner & Smith, Inc.
            ("Merrill Lynch") on a daily valuation basis for the Retirement Plan. On the
            date the plan sponsor signs the record-keeping service agreement with Merrill
            Lynch, the Plan must have $3 million or more of its assets invested in (a)
            mutual funds, other than those advised or managed by Merrill Lynch Investment
            Management, L.P. ("MLIM"), that are made available under a Service Agreement
            between Merrill Lynch and the mutual fund's principal underwriter or
            distributor, and  (b)  funds advised or managed by MLIM (the funds described in
            (a) and (b) are referred to as "Applicable Investments").
         2) The record keeping for the Retirement Plan is performed on a daily valuation
            basis by a record keeper whose services are provided under a contract or
            arrangement between the Retirement Plan and Merrill Lynch. On the date the plan
            sponsor signs the record keeping service agreement with Merrill Lynch, the Plan
            must have $3 million or more of its assets (excluding assets invested in money
            market funds) invested in Applicable Investments.
         3) The record keeping for a Retirement Plan is handled under a service agreement
            with Merrill Lynch and on the date the plan sponsor signs that agreement, the
            Plan has 500 or more eligible employees (as determined by the Merrill Lynch
            plan conversion manager).
II.






                   Waivers of Class A Sales Charges of Oppenheimer Funds
- --------------------------------------------------------------------------------------------

A. Waivers of Initial and Contingent Deferred Sales Charges for Certain Purchasers.

Class A shares purchased by the following investors are not subject to any Class A sales
charges (and no concessions are paid by the Distributor on such purchases):
|_|   The Manager or its affiliates.

|_|   Present or former officers, directors, trustees and employees (and their "immediate
         families") of the Fund, the Manager and its affiliates, and retirement plans
         established by them for their employees. The term "immediate family" refers to
         one's spouse, children, grandchildren, grandparents, parents, parents-in-law,
         brothers and sisters, sons- and daughters-in-law, a sibling's spouse, a spouse's
         siblings, aunts, uncles, nieces and nephews; relatives by virtue of a remarriage
         (step-children, step-parents, etc.) are included.

|_|   Registered management investment companies, or separate accounts of insurance
         companies having an agreement with the Manager or the Distributor for that
         purpose.
|_|   Dealers or brokers that have a sales agreement with the Distributor, if they purchase
         shares for their own accounts or for retirement plans for their employees.
|_|   Employees and registered representatives (and their spouses) of dealers or brokers
         described above or financial institutions that have entered into sales
         arrangements with such dealers or brokers (and which are identified as such to the
         Distributor) or with the Distributor. The purchaser must certify to the
         Distributor at the time of purchase that the purchase is for the purchaser's own
         account (or for the benefit of such employee's spouse or minor children).
|_|   Dealers, brokers, banks or registered investment advisors that have entered into an
         agreement with the Distributor providing specifically for the use of shares of the
         Fund in particular investment products made available to their clients. Those
         clients may be charged a transaction fee by their dealer, broker, bank or advisor
         for the purchase or sale of Fund shares.
|_|   Investment advisors and financial planners who have entered into an agreement for
         this purpose with the Distributor and who charge an advisory, consulting or other
         fee for their services and buy shares for their own accounts or the accounts of
         their clients.
|_|   "Rabbi trusts" that buy shares for their own accounts, if the purchases are made
         through a broker or agent or other financial intermediary that has made special
         arrangements with the Distributor for those purchases.
|_|   Clients of investment advisors or financial planners (that have entered into an
         agreement for this purpose with the Distributor) who buy shares for their own
         accounts may also purchase shares without sales charge but only if their accounts
         are linked to a master account of their investment advisor or financial planner on
         the books and records of the broker, agent or financial intermediary with which
         the Distributor has made such special arrangements . Each of these investors may
         be charged a fee by the broker, agent or financial intermediary for purchasing
         shares.
|_|   Directors, trustees, officers or full-time employees of OpCap Advisors or its
         affiliates, their relatives or any trust, pension, profit sharing or other benefit
         plan which beneficially owns shares for those persons.
|_|   Accounts for which Oppenheimer Capital (or its successor) is the investment advisor
         (the Distributor must be advised of this arrangement) and persons who are
         directors or trustees of the company or trust which is the beneficial owner of
         such accounts.
|_|   A unit investment trust that has entered into an appropriate agreement with the
         Distributor.
|_|   Dealers, brokers, banks, or registered investment advisers that have entered into an
         agreement with the Distributor to sell shares to defined contribution employee
         retirement plans for which the dealer, broker or investment adviser provides
         administration services.
      Retirement Plans and deferred compensation plans and trusts used to fund those plans
         (including, for example, plans qualified or created under sections 401(a), 401(k),
         403(b) or 457 of the Internal Revenue Code), in each case if those purchases are
         made through a broker, agent or other financial intermediary that has made special
         arrangements with the Distributor for those purchases.
|_|   A TRAC-2000 401(k) plan (sponsored by the former Quest for Value Advisors) whose
         Class B or Class C shares of a Former Quest for Value Fund were exchanged for
         Class A shares of that Fund due to the termination of the Class B and Class C
         TRAC-2000 program on November 24, 1995.
|_|   A qualified Retirement Plan that had agreed with the former Quest for Value Advisors
         to purchase shares of any of the Former Quest for Value Funds at net asset value,
         with such shares to be held through DCXchange, a sub-transfer agency mutual fund
         clearinghouse, if that arrangement was consummated and share purchases commenced
         by December 31, 1996.

B. Waivers of Initial and Contingent Deferred Sales Charges in Certain Transactions.

Class A shares issued or purchased in the following transactions are not subject to sales
charges (and no concessions are paid by the Distributor on such purchases):
|_|   Shares issued in plans of reorganization, such as mergers, asset acquisitions and
         exchange offers, to which the Fund is a party.
|_|   Shares purchased by the reinvestment of dividends or other distributions reinvested
         from the Fund or other Oppenheimer funds (other than Oppenheimer Cash Reserves) or
         unit investment trusts for which reinvestment arrangements have been made with the
         Distributor.
      |_|   Shares purchased by the reinvestment of loan repayments by a participant in a
         Retirement Plan for which the Manager or an affiliate acts as sponsor.

|_|   Shares purchased in amounts of less than $5.


C. Waivers of the Class A Contingent Deferred Sales Charge for Certain Redemptions.

The Class A contingent deferred sales charge is also waived if shares that would otherwise
be subject to the contingent deferred sales charge are redeemed in the following cases:
|_|   To make Automatic Withdrawal Plan payments that are limited annually to no more than
         12% of the account value adjusted annually.
|_|   Involuntary redemptions of shares by operation of law or involuntary redemptions of
         small accounts (please refer to "Shareholder Account Rules and Policies," in the
         applicable fund Prospectus).
|_|   For distributions from Retirement Plans, deferred compensation plans or other
         employee benefit plans for any of the following purposes:
         1) Following the death or disability (as defined in the Internal Revenue Code) of

            the participant or beneficiary. The death or disability must occur after the
            participant's account was established.

         2) To return excess contributions.
         3) To return contributions made due to a mistake of fact.
         Hardship withdrawals, as defined in the plan.6
         5) Under a Qualified Domestic Relations Order, as defined in the Internal Revenue
            Code, or, in the case of an IRA, a divorce or separation agreement described in
            Section 71(b) of the Internal Revenue Code.
         6) To meet the minimum distribution requirements of the Internal Revenue Code.
         7) To make "substantially equal periodic payments" as described in Section 72(t)
            of the Internal Revenue Code.
         8) For loans to participants or beneficiaries.
         9) Separation from service.7
         10)      Participant-directed redemptions to purchase shares of a mutual fund
            (other than a fund managed by the Manager or a subsidiary of the Manager) if
            the plan has made special arrangements with the Distributor.
         11)      Plan termination or "in-service distributions," if the redemption
            proceeds are rolled over directly to an OppenheimerFunds-sponsored IRA.
|_|   For distributions from 401(k) plans sponsored by broker-dealers that have entered
         into a special agreement with the Distributor allowing this waiver.
|_|   For distributions from retirement plans that have $10 million or more in plan assets
         and that have entered into a special agreement with the Distributor.
|_|   For distributions from retirement plans which are part of a retirement plan product
         or platform offered by certain banks, broker-dealers, financial advisors,
         insurance companies or record keepers which have entered into a special agreement
         with the Distributor.
III.        Waivers of Class B, Class C and Class N Sales Charges of Oppenheimer Funds
- --------------------------------------------------------------------------------------------

The Class B, Class C and Class N contingent deferred sales charges will not be applied to
shares purchased in certain types of transactions or redeemed in certain circumstances
described below.

A. Waivers for Redemptions in Certain Cases.

The Class B, Class C and Class N contingent deferred sales charges will be waived for
redemptions of shares in the following cases:
|_|   Shares redeemed involuntarily, as described in "Shareholder Account Rules and
         Policies," in the applicable Prospectus.
|_|   Redemptions from accounts other than Retirement Plans following the death or
         disability of the last surviving shareholder. The death or disability must have
         occurred after the account was established, and for disability you must provide
         evidence of a determination of disability by the Social Security Administration.
|_|   The contingent deferred sales charges are generally not waived following the death or
         disability of a grantor or trustee for a trust account. The contingent deferred
         sales charges will only be waived in the limited case of the death of the trustee
         of a grantor trust or revocable living trust for which the trustee is also the
         sole beneficiary. The death or disability must have occurred after the account was
         established, and for disability you must provide evidence of a determination of
         disability by the Social Security Administration.
|_|   Distributions from accounts for which the broker-dealer of record has entered into a
         special agreement with the Distributor allowing this waiver.
|_|   Redemptions of Class B shares held by Retirement Plans whose records are maintained
         on a daily valuation basis by Merrill Lynch or an independent record keeper under
         a contract with Merrill Lynch.
|_|   Redemptions of Class C shares of Oppenheimer U.S. Government Trust from accounts of
         clients of financial institutions that have entered into a special arrangement
         with the Distributor for this purpose.

|_|   Redemptions of Class C shares of an Oppenheimer fund in amounts of $1 million or more
         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 N shares of one or more
         Oppenheimer funds.

|_|   Distributions8 from Retirement Plans or other employee benefit plans for any of the
         following purposes:
         1) Following the death or disability (as defined in the Internal Revenue Code) of
            the participant or beneficiary. The death or disability must occur after the
            participant's account was established in an Oppenheimer fund.
         2) To return excess contributions made to a participant's account.
         3) To return contributions made due to a mistake of fact.
         4) To make hardship withdrawals, as defined in the plan.9
         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.10
         9) On account of the participant's separation from service.11
         10)      Participant-directed redemptions to purchase shares of a mutual fund
            (other than a fund managed by the Manager or a subsidiary of the Manager)
            offered as an investment option in a Retirement Plan if the plan has made
            special arrangements with the Distributor.
         11)      Distributions made on account of a plan termination or "in-service"
            distributions, if the redemption proceeds are rolled over directly to an
            OppenheimerFunds-sponsored IRA.

         12)      For distributions from a participant's account under an Automatic
            Withdrawal Plan after the participant reaches age 59 1/2, as long as the aggregate
            value of the distributions does not exceed 10% of the account's value, adjusted
            annually.

         13)      Redemptions of Class B shares under an Automatic Withdrawal Plan for an
            account other than a Retirement Plan, if the aggregate value of the redeemed
            shares does not exceed 10% of the account's value, adjusted annually.
         14)      For distributions from 401(k) plans sponsored by broker-dealers that have
            entered into a special arrangement with the Distributor allowing this waiver.

|_|   Redemptions of Class B shares or Class C shares under an Automatic Withdrawal Plan
         from an account other than a Retirement Plan if the aggregate value of the
         redeemed shares does not exceed 10% of the account's value annually.


B. Waivers for Shares Sold or Issued in Certain Transactions.

The contingent deferred sales charge is also waived on Class B and Class C shares sold or
issued in the following cases:
|_|   Shares sold to the Manager or its affiliates.
|_|   Shares sold to registered management investment companies or separate accounts of
         insurance companies having an agreement with the Manager or the Distributor for
         that purpose.
|_|   Shares issued in plans of reorganization to which the Fund is a party.
      Shares sold to present or former officers, directors, trustees or employees (and
         their "immediate families" as defined above in Section I.A.) of the Fund, the
         Manager and its affiliates and retirement plans established by them for their
         employees.

IV.







  Special Sales Charge Arrangements for Shareholders of Certain Oppenheimer Funds Who Were
                          Shareholders of Former Quest for Value Funds
- ---------------------------------------------------------------------------------------------

The initial and contingent deferred sales charge rates and waivers for Class A, Class B and
Class C shares described in the Prospectus or Statement of Additional Information of the
Oppenheimer funds are modified as described below for certain persons who were shareholders
of the former Quest for Value Funds.  To be eligible, those persons must have been
shareholders on November 24, 1995, when OppenheimerFunds, Inc. became the investment
advisor to those former Quest for Value Funds.  Those funds include:

   Oppenheimer Quest Value Fund, Inc.           Oppenheimer Small Cap Value Fund
   Oppenheimer Quest Balanced Fund              Oppenheimer Quest International Value Fund,
   Inc.

   Oppenheimer Quest Opportunity Value Fund

      These arrangements also apply to shareholders of the following funds when they merged
(were reorganized) into various Oppenheimer funds on November 24, 1995:

   Quest for Value U.S. Government Income Fund  Quest for Value New York Tax-Exempt Fund
   Quest for Value Investment Quality Income Fund     Quest for Value National Tax-Exempt
   Fund
   Quest for Value Global Income Fund     Quest for Value California Tax-Exempt Fund

      All of the funds listed above are referred to in this Appendix as the "Former Quest
for Value Funds."  The waivers of initial and contingent deferred sales charges described
in this Appendix apply to shares of an Oppenheimer fund that are either:
|_|   acquired by such shareholder pursuant to an exchange of shares of an Oppenheimer fund
         that was one of the Former Quest for Value Funds, or
|_|   purchased by such shareholder by exchange of shares of another Oppenheimer fund that
         were acquired pursuant to the merger of any of the Former Quest for Value Funds
         into that other Oppenheimer fund on November 24, 1995.

A. Reductions or Waivers of Class A Sales Charges.

|X|   Reduced Class A Initial Sales Charge Rates for Certain Former Quest for Value Funds
Shareholders.

Purchases by Groups and Associations.  The following table sets forth the initial sales
charge rates for Class A shares purchased by members of "Associations" formed for any
purpose other than the purchase of securities. The rates in the table apply if that
Association purchased shares of any of the Former Quest for Value Funds or received a
proposal to purchase such shares from OCC Distributors prior to November 24, 1995.

- --------------------------------------------------------------------------------
                      Initial Sales       Initial Sales Charge   Concession as
Number of Eligible    Charge as a % of    as a % of Net Amount   % of Offering
Employees or Members  Offering Price      Invested               Price
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
9 or Fewer                   2.50%                2.56%              2.00%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
At  least  10 but not        2.00%                2.04%              1.60%
more than 49
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------
      For purchases by Associations having 50 or more eligible employees or members, there
is no initial sales charge on purchases of Class A shares, but those shares are subject to
the Class A contingent deferred sales charge described in the applicable fund's Prospectus.







      Purchases made under this arrangement qualify for the lower of either the sales
charge rate in the table based on the number of members of an Association, or the sales
charge rate that applies under the Right of Accumulation described in the applicable fund's
Prospectus and Statement of Additional Information. Individuals who qualify under this
arrangement for reduced sales charge rates as members of Associations also may purchase
shares for their individual or custodial accounts at these reduced sales charge rates, upon
request to the Distributor.

|X|   Waiver of Class A Sales Charges for Certain Shareholders.  Class A shares purchased
by the following investors are not subject to any Class A initial or contingent deferred
sales charges:
o     Shareholders who were shareholders of the AMA Family of Funds on February 28, 1991
            and who acquired shares of any of the Former Quest for Value Funds by merger of
            a portfolio of the AMA Family of Funds.
o     Shareholders who acquired shares of any Former Quest for Value Fund by merger of any
            of the portfolios of the Unified Funds.

|X|   Waiver of Class A Contingent Deferred Sales Charge in Certain Transactions.  The
Class A contingent deferred sales charge will not apply to redemptions of Class A shares
purchased by the following investors who were shareholders of any Former Quest for Value
Fund:

      Investors who purchased Class A shares from a dealer that is or was not permitted to
receive a sales load or redemption fee imposed on a shareholder with whom that dealer has a
fiduciary relationship, under the Employee Retirement Income Security Act of 1974 and
regulations adopted under that law.

B. Class A, Class B and Class C Contingent Deferred Sales Charge Waivers.

|X|   Waivers for Redemptions of Shares Purchased Prior to March 6, 1995.  In the following
cases, the contingent deferred sales charge will be waived for redemptions of Class A,
Class B or Class C shares of an Oppenheimer fund. The shares must have been acquired by the
merger of a Former Quest for Value Fund into the fund or by exchange from an Oppenheimer
fund that was a Former Quest for Value Fund or into which such fund merged. Those shares
must have been purchased prior to March 6, 1995 in connection with:
o     withdrawals under an automatic withdrawal plan holding only either Class B or Class C
            shares if the annual withdrawal does not exceed 10% of the initial value of the
            account value, adjusted annually, and
o     liquidation of a shareholder's account if the aggregate net asset value of shares
            held in the account is less than the required minimum value of such accounts.

|X|   Waivers for Redemptions of Shares Purchased on or After March 6, 1995 but Prior to
November 24, 1995. In the following cases, the contingent deferred sales charge will be
waived for redemptions of Class A, Class B or Class C shares of an Oppenheimer fund. The
shares must have been acquired by the merger of a Former Quest for Value Fund into the fund
or by exchange from an Oppenheimer fund that was a Former Quest For Value Fund or into
which such Former Quest for Value Fund merged. Those shares must have been purchased on or
after March 6, 1995, but prior to November 24, 1995:
o     redemptions following the death or disability of the shareholder(s) (as evidenced by
            a determination of total disability by the U.S. Social Security Administration);
o     withdrawals under an automatic withdrawal plan (but only for Class B or Class C
            shares) where the annual withdrawals do not exceed 10% of the initial value of
            the account value; adjusted annually, and

o     liquidation of a shareholder's account if the aggregate net asset value of shares
            held in the account is less than the required minimum account value.

      A shareholder's account will be credited with the amount of any contingent deferred
sales charge paid on the redemption of any Class A, Class B or Class C shares of the
Oppenheimer fund described in this section if the proceeds are invested in the same Class
of shares in that fund or another Oppenheimer fund within 90 days after redemption.
V.     Special Sales Charge Arrangements for Shareholders of Certain Oppenheimer Funds Who
               Were Shareholders of Connecticut Mutual Investment Accounts, Inc.
- -----------------------------------------------------------------------------------------

The initial and contingent deferred sale charge rates and waivers for Class A and Class B
shares described in the respective Prospectus (or this Appendix) of the following
Oppenheimer funds (each is referred to as a "Fund" in this section):
   Oppenheimer U. S. Government Trust,
   Oppenheimer Bond Fund,
   Oppenheimer Value Fund and
   Oppenheimer Disciplined Allocation Fund
are modified as described below for those Fund shareholders who were shareholders of the
following funds (referred to as the "Former Connecticut Mutual Funds") on March 1, 1996,
when OppenheimerFunds, Inc. became the investment adviser to the Former Connecticut Mutual
Funds:
   Connecticut Mutual Liquid Account         Connecticut Mutual Total Return Account
   Connecticut Mutual Government Securities Account   CMIA LifeSpan Capital Appreciation
   Account
   Connecticut Mutual Income Account         CMIA LifeSpan Balanced Account
   Connecticut Mutual Growth Account         CMIA Diversified Income Account

A. Prior Class A CDSC and Class A Sales Charge Waivers.

|X|   Class A Contingent Deferred Sales Charge. Certain shareholders of a Fund and the
other Former Connecticut Mutual Funds are entitled to continue to make additional purchases
of Class A shares at net asset value without a Class A initial sales charge, but subject to
the Class A contingent deferred sales charge that was in effect prior to March 18, 1996
(the "prior Class A CDSC"). Under the prior Class A CDSC, if any of those shares are
redeemed within one year of purchase, they will be assessed a 1% contingent deferred sales
charge on an amount equal to the current market value or the original purchase price of the
shares sold, whichever is smaller (in such redemptions, any shares not subject to the prior
Class A CDSC will be redeemed first).

      Those shareholders who are eligible for the prior Class A CDSC are:
         1) persons whose purchases of Class A shares of a Fund and other Former
            Connecticut Mutual Funds were $500,000 prior to March 18, 1996, as a result of
            direct purchases or purchases pursuant to the Fund's policies on Combined
            Purchases or Rights of Accumulation, who still hold those shares in that Fund
            or other Former Connecticut Mutual Funds, and
         2) persons whose intended purchases under a Statement of Intention entered into
            prior to March 18, 1996, with the former general distributor of the Former
            Connecticut Mutual Funds to purchase shares valued at $500,000 or more over a
            13-month period entitled those persons to purchase shares at net asset value
            without being subject to the Class A initial sales charge

      Any of the Class A shares of a Fund and the other Former Connecticut Mutual Funds
that were purchased at net asset value prior to March 18, 1996, remain subject to the prior
Class A CDSC, or if any additional shares are purchased by those shareholders at net asset
value pursuant to this arrangement they will be subject to the prior Class A CDSC.


|X|






      Class A Sales Charge Waivers. Additional Class A shares of a Fund may be purchased
without a sales charge, by a person who was in one (or more) of the categories below and
acquired Class A shares prior to March 18, 1996, and still holds Class A shares:
         1) any purchaser, provided the total initial amount invested in the Fund or any
            one or more of the Former Connecticut Mutual Funds totaled $500,000 or more,
            including investments made pursuant to the Combined Purchases, Statement of
            Intention and Rights of Accumulation features available at the time of the
            initial purchase and such investment is still held in one or more of the Former
            Connecticut Mutual Funds or a Fund into which such Fund merged;
         2) any participant in a qualified plan, provided that the total initial amount
            invested by the plan in the Fund or any one or more of the Former Connecticut
            Mutual Funds totaled $500,000 or more;
         3) Directors of the Fund or any one or more of the Former Connecticut Mutual Funds
            and members of their immediate families;
         4) employee benefit plans sponsored by Connecticut Mutual Financial Services,
            L.L.C. ("CMFS"), the prior distributor of the Former Connecticut Mutual Funds,
            and its affiliated companies;
         5) one or more members of a group of at least 1,000 persons (and persons who are
            retirees from such group) engaged in a common business, profession, civic or
            charitable endeavor or other activity, and the spouses and minor dependent
            children of such persons, pursuant to a marketing program between CMFS and such
            group; and
         6) an institution acting as a fiduciary on behalf of an individual or individuals,
            if such institution was directly compensated by the individual(s) for
            recommending the purchase of the shares of the Fund or any one or more of the
            Former Connecticut Mutual Funds, provided the institution had an agreement with
            CMFS.

      Purchases of Class A shares made pursuant to (1) and (2) above may be subject to the
Class A CDSC of the Former Connecticut Mutual Funds described above.

      Additionally, Class A shares of a Fund may be purchased without a sales charge by any
holder of a variable annuity contract issued in New York State by Connecticut Mutual Life
Insurance Company through the Panorama Separate Account which is beyond the applicable
surrender charge period and which was used to fund a qualified plan, if that holder
exchanges the variable annuity contract proceeds to buy Class A shares of the Fund.

B. Class A and Class B Contingent Deferred Sales Charge Waivers.

In addition to the waivers set forth in the Prospectus and in this Appendix, above, the
contingent deferred sales charge will be waived for redemptions of Class A and Class B
shares of a Fund and exchanges of Class A or Class B shares of a Fund into Class A or Class
B shares of a Former Connecticut Mutual Fund provided that the Class A or Class B shares of
the Fund to be redeemed or exchanged were (i) acquired prior to March 18, 1996 or (ii) were
acquired by exchange from an Oppenheimer fund that was a Former Connecticut Mutual Fund.
Additionally, the shares of such Former Connecticut Mutual Fund must have been purchased
prior to March 18, 1996:
   1) by the estate of a deceased shareholder;
   2) upon the disability of a shareholder, as defined in Section 72(m)(7) of the Internal
      Revenue Code;
   3) for retirement distributions (or loans) to participants or beneficiaries from
      retirement plans qualified under Sections 401(a) or 403(b)(7)of the Code, or from
      IRAs, deferred compensation plans created under Section 457 of the Code, or other
      employee benefit plans;
   as tax-free returns of excess contributions to such retirement or employee benefit
      plans;
   5) in whole or in part, in connection with shares sold to any state, county, or city, or
      any instrumentality, department, authority, or agency thereof, that is prohibited by
      applicable investment laws from paying a sales charge or concession in connection
      with the purchase of shares of any registered investment management company;
   6) in connection with the redemption of shares of the Fund due to a combination with
      another investment company by virtue of a merger, acquisition or similar
      reorganization transaction;
   7) in connection with the Fund's right to involuntarily redeem or liquidate the Fund;
   8) in connection with automatic redemptions of Class A shares and Class B shares in
      certain retirement plan accounts pursuant to an Automatic Withdrawal Plan but limited
      to no more than 12% of the original value annually; or

   9) as involuntary redemptions of shares by operation of law, or under procedures set
      forth in the Fund's Articles of Incorporation, or as adopted by the Board of
      Directors of the Fund.

VI.       Special Reduced Sales Charge for Former Shareholders of Advance America Funds,
                                               Inc.
- --------------------------------------------------------------------------------------------

Shareholders of Oppenheimer AMT-Free Municipals, Oppenheimer U.S. Government Trust,
Oppenheimer Strategic Income Fund and Oppenheimer Capital Income Fund who acquired (and
still hold) shares of those funds as a result of the reorganization of series of Advance
America Funds, Inc. into those Oppenheimer funds on October 18, 1991, and who held shares
of Advance America Funds, Inc. on March 30, 1990, may purchase Class A shares of those four
Oppenheimer funds at a maximum sales charge rate of 4.50%.
VII.      Sales Charge Waivers on Purchases of Class M Shares of Oppenheimer Convertible
                                         Securities Fund
- --------------------------------------------------------------------------------------------

Oppenheimer Convertible Securities Fund (referred to as the "Fund" in this section) may
sell Class M shares at net asset value without any initial sales charge to the classes of
investors listed below who, prior to March 11, 1996, owned shares of the Fund's
then-existing Class A and were permitted to purchase those shares at net asset value
without sales charge:
|_|   the Manager and its affiliates,
|_|   present or former officers, directors, trustees and employees (and their "immediate
         families" as defined in the Fund's Statement of Additional Information) of the
         Fund, the Manager and its affiliates, and retirement plans established by them or
         the prior investment advisor of the Fund for their employees,
|_|   registered management investment companies or separate accounts of insurance
         companies that had an agreement with the Fund's prior investment advisor or
         distributor for that purpose,
|_|   dealers or brokers that have a sales agreement with the Distributor, if they purchase
         shares for their own accounts or for retirement plans for their employees,
|_|   employees and registered representatives (and their spouses) of dealers or brokers
         described in the preceding section or financial institutions that have entered
         into sales arrangements with those dealers or brokers (and whose identity is made
         known to the Distributor) or with the Distributor, but only if the purchaser
         certifies to the Distributor at the time of purchase that the purchaser meets
         these qualifications,
|_|   dealers, brokers, or registered investment advisors that had entered into an
         agreement with the Distributor or the prior distributor of the Fund specifically
         providing for the use of Class M shares of the Fund in specific investment
         products made available to their clients, and
|_|   dealers, brokers or registered investment advisors that had entered into an agreement
         with the Distributor or prior distributor of the Fund's shares to sell shares to
         defined contribution employee retirement plans for which the dealer, broker, or
         investment advisor provides administrative services.









Rochester Fund Municipals

Internet Website
     www.oppenheimerfunds.com
     ------------------------

Investment Advisor
      OppenheimerFunds, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Distributor
      OppenheimerFunds Distributor, Inc.
      Two World Financial Center
      225 Liberty Street, 11th Floor
      New York, New York 10281-1008

Transfer Agent
     OppenheimerFunds Services
     P.O. Box 5270
     Denver, Colorado 80217
     1.800.CALLOPP(225.5677)

Custodian Bank
     Citibank, N.A.
     111 Wall Street
     New York, New York 10005


Independent Registered Public Accounting Firm

     KPMG LLP
     707 Seventeenth Street
     Denver, Colorado 80202

Legal Counsel
     Mayer, Brown, Rowe & Maw LLP
     1675 Broadway
     New York, New York 10019


1234
PX0365.001.0405



- --------
1 In accordance with Rule 12b-1 of the Investment Company Act, the term "Independent
Trustees" in this Statement of Additional Information refers to those Trustees who are not
"interested persons" of the Fund and who do not have any direct or indirect financial
interest in the operation of the distribution plan or any agreement under the plan.
1 Certain waivers also apply to Class M shares of Oppenheimer Convertible Securities Fund.
2 In the case of Oppenheimer Senior Floating Rate Fund, a continuously-offered closed-end
fund, references to contingent deferred sales charges mean the Fund's Early Withdrawal
Charges and references to "redemptions" mean "repurchases" of shares.
3 An "employee benefit plan" means any plan or arrangement, whether or not it is
"qualified" under the Internal Revenue Code, under which Class N shares of an Oppenheimer
fund or funds are purchased by a fiduciary or other administrator for the account of
participants who are employees of a single employer or of affiliated employers. These may
include, for example, medical savings accounts, payroll deduction plans or similar plans.
The fund accounts must be registered in the name of the fiduciary or administrator
purchasing the shares for the benefit of participants in the plan.
4 The term "Group Retirement Plan" means any qualified or non-qualified retirement plan for
employees of a corporation or sole proprietorship, members and employees of a partnership
or association or other organized group of persons (the members of which may include other
groups), if the group has made special arrangements with the Distributor and all members of
the group participating in (or who are eligible to participate in) the plan purchase shares
of an Oppenheimer fund or funds through a single investment dealer, broker or other
financial institution designated by the group. Such plans include 457 plans, SEP-IRAs,
SARSEPs, SIMPLE plans and 403(b) plans other than plans for public school employees. The
term "Group Retirement Plan" also includes qualified retirement plans and non-qualified
deferred compensation plans and IRAs that purchase shares of an Oppenheimer fund or funds
through a single investment dealer, broker or other financial institution that has made
special arrangements with the Distributor.
5 However, that concession will not be paid on purchases of shares in amounts of $1 million
or more (including any right of accumulation) by a Retirement Plan that pays for the
purchase with the redemption proceeds of Class C shares of one or more Oppenheimer funds
held by the Plan for more than one year.
6 This provision does not apply to IRAs.

7 This provision only applies to qualified retirement plans and 403(b)(7) custodial plans
after your separation from service in or after the year you reached age 55.
8 The distribution must be requested prior to Plan termination or the elimination of the
Oppenheimer funds as an investment option under the Plan.

9 This provision does not apply to IRAs.
10 This provision does not apply to loans from 403(b)(7) custodial plans and loans from the
OppenheimerFunds-sponsored Single K retirement plan.
11 This provision does not apply to 403(b)(7) custodial plans if the participant is less
than age 55, nor to IRAs.

                          ROCHESTER FUND MUNICIPALS

                                  FORM N-1A

                                    PART C

                              OTHER INFORMATION



Item 23. Exhibits
- -----------------

(a)   (i)   Amended and Restated Agreement and Declaration of Trust dated
      1/26/95: Previously filed with Registrant's Post Effective Amendment
      No. 16 filed 1/11/96, and incorporated herein by reference.

(ii)  Amendment dated 11/1/95 to the Amended and Restated Agreement and
      Declaration of Trust dated 1/26/95: Previously filed with Registrant's
      Post Effective Amendment No. 16 filed 1/11/96, and incorporated herein
      by reference.

(iii) Amendment dated 6/17/97 to the Amended and Restated Agreement and
      Declaration of Trust dated 1/26/95: Previously filed with Registrant's
      Post Effective Amendment No. 22 filed 4/30/99, and incorporated herein
      by reference.

(iv)  Amendment dated 6/10/98 to the Amended and Restated Agreement and
      Declaration of Trust dated 1/26/95: Previously filed with Registrant's
      Post Effective Amendment No. 22 filed 4/30/99, and incorporated herein
      by reference.


(v)   Amendment No. 4 dated 6/10/02 to the Amended and Restated Agreement and
      Declaration of Trust dated 1/26/95: Previously filed with registrant's
      Post Effective Amendment No. 27 filed 2/24/03, and incorporated herein
      by reference.


(b)   (i)   Bylaws: Previously filed with Registrant's Post Effective
      Amendment No. 13 filed 5/1/93, and incorporated herein by reference.

      (ii)  Amendment No. 1 to By-laws dated 7/22/98: Previously filed with
       Registrant's Post Effective Amendment No. 24 filed 4/27/00 and
       incorporated by reference.

(c)   (i)   Class A Specimen Share Certificate: Previously filed with
      Registrant's Post Effective Amendment No. 26 filed 4/29/02, and
      incorporated herein by reference.

      (ii)  Class B Specimen Share Certificate: Previously filed with
      Registrant's Post Effective Amendment No. 26 filed 4/29/02, and
      incorporated herein by reference.

      (iii) Class C Specimen Share Certificate: Previously filed with
      Registrant's Post Effective Amendment No. 26 filed 4/29/02, and
      incorporated herein by reference.

      (iv)  Class Y Specimen Share Certificate: Previously filed with
      Registrant's Post Effective Amendment No. 26 filed 4/29/02, and
      incorporated herein by reference.


(d)   Amended and Restated Investment Advisory Agreement dated 1/1/05 with
      OppenheimerFunds, Inc.: Filed herewith.


(e)   (i)   General Distributor's Agreement dated 1/4/96 with Oppenheimer
      Funds Distributor, Inc.: Filed with Registrant's Post Effective
      Amendment No. 16 filed 1/11/96, and incorporated herein by reference.

      (ii)  Form of Dealer 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.

      (iii) Form of Broker 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.

      (iv)  Form of Agency 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.

      (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.
      45 to the Registration Statement of Oppenheimer High Yield Fund (Reg.
      No. 2-62076), 10/26/01, and incorporated herein by reference.

(f)   (i)   Form of Deferred Compensation Plan for Disinterested
      Trustees/Directors: Previously filed with Post-Effective Amendment No.
      43 to the Registration Statement of Oppenheimer Quest For Value Funds
      (Reg. No. 33-15489), 12/21/98, and incorporated herein by reference.

(g)   (i) Global Custodial Services Agreement dated July 15, 2003, between
      Registrant and Citibank, N.A.: Previously filed with the Pre-Effective
      Amendment No. 1 to the Registration Statement of Oppenheimer
      International Large-Cap Core Trust (Reg. No. 333-106014), 8/5/03, and
      incorporated herein by reference.

      (ii) Amended and Restated Foreign Custody Manager Agreement dated May
      31, 2001, as amended July 15, 2003, between Registrant and Citibank,
      N.A: Previously filed with the Pre-Effective Amendment No. 1 to the
      Registration Statement of Oppenheimer International Large-Cap Core
      Trust (Reg. No. 333-106014), 8/5/03, and incorporated herein by
      reference.


(h)   Not applicable.

(i)   Opinion and Consent of Counsel: Incorporated herein by reference to the
      Registrant's Rule 24f-2 Notice filed on 2/27/97.


(j)   Independent Registered Public Accounting Firm's Consents for KPMG LLP,
      the Fund's Independent Auditors: To be filed by Amendment.

(k)   Not applicable.

(l)   (i)   Form of Investment Letter regarding Class B shares from
      OppenheimerFunds, Inc.: Previously filed with Registrant's
      Post-Effective Amendment No. 19 filed 3/16/97, and incorporated herein
      by reference.

(ii)  Form of Investment Letter regarding Class C shares from
      OppenheimerFunds, Inc.: Previously filed with Registrant's
      Post-Effective Amendment No. 19 filed 3/16/97, and incorporated herein
      by reference.


(m)   (i)   Amended and Restated Service Plan and Agreement with Oppenheimer
      Funds Distributor, Inc. for Class A Shares dated 4/5/04: Filed herewith.


      (ii)  Amended and Restated Distribution and Service Plan and Agreement
      for Class B Shares dated 2/3/98 under Rule 12b-1 of the Investment
      Company Act of 1940: Previously filed with Registration's
      Post-Effective Amendment No. 20, 3/31/98, and incorporated herein by
      reference.


      (iii) Amended and Restated Distribution and Service Plan and Agreement
      for Class C Shares dated 2/18/04 under Rule 12b-1 of the Investment
      Company Act of 1940: To be filed by Amendment.


(n)   Oppenheimer Funds Multiple Class Plan under Rule 18f-3 updated through
      10/22/03: Previously filed with Post-Effective Amendment No. 11 to the
      Registration Statement of Oppenheimer Senior Floating Rate Fund (Reg.
      No. 333-82579), 11/17/03, and incorporated herein by reference.

(o)   (i) Powers of Attorney: Previously filed with Post-Effective Amendment
      No. 15 to the Registration Statement of Oppenheimer Convertible
      Securities Fund (Reg. No. 33-3076), 1/11/96, and incorporated herein by
      reference.

      (ii) Power of Attorney (including Certified Board resolution) for
      Robert G. Galli: Previously filed with Post-Effective Amendment No. 43
      to the Registration Statement of Oppenheimer Quest For Value Funds
      (Reg. No. 33-15489), 12/21/98, and incorporated herein by reference.

      (iii) Power of Attorney for Brian W. Wixted: Previously filed with
      Post-Effective Amendment No. 20 to the Registration Statement of
      Oppenheimer Convertible Securities Fund (Reg. No. 33-3076), 4/28/99,
      and incorporated herein by reference.

      (iv) Power of Attorney for Brian Wruble and John V. Murphy: Previously
      filed with Post Effective Amendment No. 49 to the Registration
      Statement of Oppenheimer Quest Value Fund, Inc., (Reg. No. 2-65223),
      2/26/02, and incorporated herein by reference.


(p)   Amended and Restated Code of Ethics of the Oppenheimer Funds dated
      February 1, 2005 under Rule 17j-1 of the Investment Company Act of
      1940: Previously filed with the Initial Registration Statement of
      Oppenheimer Dividend Growth Fund (Reg. No. 333-122902), 2/18/05, and
      incorporated herein by reference.


Item 24.    Persons Controlled by or under Common Control with Registrant
- --------    -------------------------------------------------------------

None.

Item 25.    Indemnification
- --------    ---------------

      Registrant's  Amended and Restated  Agreement and  Declaration  of Trust
(the "Declaration of Trust"),  which is referenced  herein,  (see Item 23(a)),
contains certain  provisions  relating to the  indemnification of Registrant's
officers  and  trustees.  Section  6.4 of  Registrant's  Declaration  of Trust
provides  that  Registrant  shall  indemnify  (from the  assets of the Fund or
Funds in question)  each of its trustees and officers  (including  persons who
served at Registrant's  request as directors,  officers or trustees of another
organization in which  Registrant has any interest as a shareholder,  creditor
or  otherwise  hereinafter  referred  to as a "Covered  Person")  against  all
liabilities,  including but not limited to, amounts paid for  satisfaction  of
judgments,  in compromise or as fines and penalties,  and expenses,  including
reasonable  accountants'  and counsel fees,  incurred by any Covered Person in
connection  with the  defense  or  disposition  of any  action,  suit or other
proceeding,  whether civil or criminal,  before any court or administrative or
legislative  body,  in which  such  Covered  Person  may be or may  have  been
involved as a party or  otherwise or with which such person may be or may have
been threatened,  while in office or thereafter,  by reason of being or having
been such a trustee or officer,  director or trustee,  except with  respect to
any matter as to which it has been determined in one of the manners  described
below,  that  such  Covered  Person  (i)  did not  act in  good  faith  in the
reasonable  belief that such Covered  Person's action was in or not opposed to
the best interest of  Registrant  or (ii) had acted with willful  misfeasance,
bad faith,  gross negligence,  or reckless disregard of the duties involved in
the  conduct  described  in (i)  and  (ii)  being  referred  to  hereafter  as
"Disabling Conduct".

      Section 6.4 provides that a  determination  that the Covered Conduct may
be made by (i) a final  decision on the merits by a court or other body before
whom the  proceeding  was brought  that the person to be  indemnified  was not
liable by reason of Disabling Conduct,  (ii) dismissal of a court action or an
administrative  proceeding  against  a Covered  Person  for  insufficiency  of
evidence of  Disabling  Conduct,  or (iii) a reasonable  determination,  based
upon a review of the  facts,  that the  indemnity  was not liable by reason of
Disabling  Conduct by (a) a vote of a majority of a quorum of trustees who are
neither  "interested  persons" of Registrant as defined in Section 2(a)(19) of
the  1940 Act nor  parties  to the  proceeding,  or (b) an  independent  legal
counsel in a written opinion.

      In addition, Section 6.4 provides that expenses,  including accountants'
and  counsel  fees so  incurred  by any such  Covered  Person  (but  excluding
amounts  paid in  satisfaction  of  judgments,  in  compromise  or as fines or
penalties),  may be paid from time to time in advance of the final disposition
of any such  action,  suit or  proceeding,  provided  that the Covered  Person
shall  have  undertaken  to repay  the  amounts  so paid to the  Sub-trust  in
question if it is ultimately  determined that indemnification of such expenses
is not  authorized  under  Article 6 and (i) the  Covered  Person  shall  have
provided  security  for such  undertaking,  (ii)  Registrant  shall be insured
against losses arising by reason of any lawful  advances,  or (iii) a majority
of a quorum of  disinterested  trustees who are not a party to the proceeding,
by an independent  legal counsel in a written opinion,  based upon a review of
readily available facts (as opposed to a full trial-type inquiry),  that there
is  reason  to  believe  that  the  Covered  Person  ultimately  will be found
entitled to indemnification.

      Section  6.1  of   Registrant's   Agreement  and  Declaration  of  Trust
provides,  among other things,  that nothing in the Agreement and  Declaration
of Trust  shall  protect  any  trustee or officer  against  any  liability  to
Registrant  or the  shareholders  to  which  such  trustee  or  officer  would
otherwise  be  subject  by reason of willful  misfeasance,  bad  faith,  gross
negligence or reckless  disregard of the duties involved in the conduct of the
office of trustee or such officer.

      Insofar as  indemnification  for liability  arising under the Securities
Act of 1933 may be permitted to trustees,  officers and controlling persons of
the  Registrant  pursuant  to the  foregoing  provisions,  or  otherwise,  the
Registrant  has  been  advised  that  in the  opinion  of the  Securities  and
Exchange   Commission  such   indemnification  is  against  public  policy  as
expressed  in the Act and is,  therefore,  unenforceable.  In the event that a
claim for indemnification  against such liabilities (other than the payment by
the  Registrant  of  expenses  incurred  or  paid  by a  trustee,  officer  or
controlling  person of the Registrant in the successful defense of any action,
suit or  proceeding)  is asserted  by such  director,  officer or  controlling
person in connection  with the  securities  being  registered,  the Registrant
will,  unless in the  opinion of its  counsel  the matter has been  settled by
controlling  precedent,  submit  to a court of  appropriate  jurisdiction  the
question  whether  such  indemnification  by it is  against  public  policy as
expressed  in the Act and will be governed by the final  adjudication  of such
issue.

Item 26.   Business and Other Connections of Investment Adviser
- -------    ----------------------------------------------------


(a)   OppenheimerFunds,  Inc. is the investment adviser of the Registrant;  it
and certain  subsidiaries  and  affiliates  act in the same  capacity to other
investment companies,  including without limitation those described in Parts A
and B hereof and listed in Item 26(b) below.


(b)   There  is  set  forth  below  information  as  to  any  other  business,
profession,  vocation  or  employment  of a  substantial  nature in which each
officer and director of  OppenheimerFunds,  Inc. is, or at any time during the
past two fiscal  years has been,  engaged  for  his/her  own account or in the
capacity of director, officer, employee, partner or trustee.

- ---------------------------------------------------------------------------------
Name and Current Position
with OppenheimerFunds, Inc.    Other Business and Connections During the Past
                               Two Years
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Lizbeth Aaron-DiGiovanni,      Formerly  Vice  President  (April 2000) and First
Vice President                 Vice  President   (February  2003-July  2004)  of
                               Citigroup Global Markets Inc.

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

Timothy L. Abbuhl,             Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.

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

Emeline S. Adwers,             Formerly  Senior  Analyst  at  Palantir   Capital
Vice President                 (November 1999-January 2003).

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

Robert Agan,                   Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.,  Shareholder Financial Services,  Inc., OFI
                               Private  Investments,  Inc. and Centennial  Asset
                               Management Corporation;  Senior Vice President of
                               Shareholders Services, Inc.

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

Carl Algermissen,              Formerly  Associate  Counsel and Legal Compliance
Assistant Vice President &     Officer at Great  West-Life  & Annuity  Insurance
Associate Counsel              Co.  (February  2004-October  2004);   previously
                               with   INVESCO    Funds   Group,    Inc.    (June
                               1993-December  2003),  most  recently  as  Senior
                               Staff Attorney.

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

Michael Amato,                 None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Erik Anderson,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Tracey Beck Apostolopoulos,    Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.

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

Janette Aprilante,             Secretary     (since     December    2001)    of:
Vice President & Secretary     OppenheimerFunds  Distributor,  Inc.,  Centennial
                               Asset   Management    Corporation,    Oppenheimer
                               Partnership  Holdings,   Inc.,  Oppenheimer  Real
                               Asset  Management,  Inc.,  Shareholder  Financial
                               Services,  Inc.,  Shareholder Services,  Inc. and
                               OppenheimerFunds  Legacy Program;  (since January
                               2005)   of    Trinity    Investment    Management
                               Corporation.  Secretary  (since  June  2003)  of:
                               HarbourView  Asset  Management  Corporation,  OFI
                               Private  Investments,  Inc. and OFI Institutional
                               Asset  Management,   Inc.   Assistant   Secretary
                               (since December 2001) of OFI Trust Company.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Hany S. Ayad,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Robert Baker,                  None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Michael Banta,            None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Joanne Bardell,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kevin Baum,                    None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jeff Baumgartner,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Connie Bechtolt,               None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Lalit K. Behal                 Assistant    Secretary   of   HarbourView   Asset
Assistant Vice President       Management Corporation.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kathleen Beichert,             Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Gerald Bellamy,                Assistant  Vice  President  of OFI  Institutional
Assistant Vice President       Asset Management, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Erik S. Berg,                  None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Rajeev Bhaman,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Craig Billings,                None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark Binning,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Robert J. Bishop,              Treasurer     (since     October     2003)     of
Vice President                 OppenheimerFunds     Distributor,     Inc.    and

                               Centennial Asset Management Corporation.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John R. Blomfield,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Lisa I. Bloomberg,             Formerly   First  Vice  President  and  Associate
Vice President & Associate     General  Counsel of UBS  Financial  Services Inc.
Counsel                        (May 1999-May 2004).

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

Veronika Boesch,               Formerly  (until  February  2004) an  independent
Assistant Vice President       consultant/coach in organizational development.

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

Chad Boll,                     None
Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Antulio N. Bomfim,             A  senior  economist  with  the  Federal  Reserve
Vice President                 Board (June 1992-October 2003).
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John C. Bonnell,               Vice  President of  Centennial  Asset  Management
Vice President                 Corporation.  Formerly  a  Portfolio  Manager  at
                               Strong Financial Corporation (May 1999-May 2004).

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

Michelle Borre Massick,        None
Vice President

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

Lori E. Bostrom,               Formerly Vice President and Corporate  Counsel at
Vice President & Senior        Prudential   Financial   Inc.   (October  2002  -
Counsel                        November 2004).

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

John Boydell,                  None
Assistant Vice President

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

Michael Bromberg,              None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Lowell Scott Brooks,           Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Joan Brunelle,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Paul Burke,                    None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark Burns,                    None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Jeoffrey Caan,                 Formerly  Vice  President  of ABN AMRO  NA,  Inc.
Vice President                 (June 2002-August 2003).

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

Catherine Carroll,             None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Debra Casey,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Maria Castro,                  None
Assistant Vie President

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

Lisa Chaffee,                  None
Assistant Vice President

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

Charles Chibnik,               None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brett Clark,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
H.C. Digby Clements,           None
Vice President: Rochester
Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Peter V. Cocuzza,              None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Gerald James Conception,       Formerly  (until  November 2004) an RIA Marketing
Assistant Vice President       Associate of OppenheimerFunds, Inc.

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

Susan Cornwell,                Vice  President of  Centennial  Asset  Management
Vice President                 Corporation,   Shareholder   Financial  Services,
                               Inc. and OppenheimerFunds  Legacy Program; Senior
                               Vice President of Shareholder Services, Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Scott Cottier,                 None
Vice President: Rochester
Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Laura Coulston,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Julie C. Cusker,               None
Assistant Vice President:
Rochester Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
George Curry,                  None.
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Damian,                   None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John M. Davis,                 Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor, Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Craig P. Dinsell,              None
Executive Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Randall C. Dishmon,            None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Rebecca K. Dolan               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Steven D. Dombrower,           Senior    Vice    President    of   OFI   Private
Vice President                 Investments,     Inc.;    Vice    President    of
                               OppenheimerFunds Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas Doyle,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Bruce C. Dunbar,               None
Senior Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brian Dvorak,                  None
Assistant Vice President

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

Richard Edmiston,              None
Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Daniel R. Engstrom,            None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

James Robert Erven             None
Assistant Vice President

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

George R. Evans,               None
Senior Vice President and
Director of International
Equities

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Edward N. Everett,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kathy Faber,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

David Falicia,                 Assistant   Secretary   (as  of  July   2004)  of
Assistant Vice President       HarbourView Asset Management Corporation.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Scott T. Farrar,               Vice President of OFI Private Investments, Inc.
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Thomas Farrell,                None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Emmanuel Ferreira,             Formerly  a  portfolio   manager   with   Lashire
Vice President                 Investments (July 1999-December 2002).
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Ronald H. Fielding,            Vice President of  OppenheimerFunds  Distributor,
Senior Vice President;         Inc.;  Director of ICI Mutual Insurance  Company;
Chairman of the Rochester      Governor of St. John's  College;  Chairman of the
Division                       Board of  Directors  of  International  Museum of

                               Photography at George Eastman House.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Bradley G. Finkle,             Formerly Head of Business  Management/Proprietary
Vice President                 Distribution   at  Citigroup   Asset   Management
                               (August 1986-September 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian Finley,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John E. Forrest,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jordan Hayes Foster,           Vice   President  of  OFI   Institutional   Asset
Vice President                 Management, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

David Foxhoven,                Assistant  Vice  President  of   OppenheimerFunds
Vice President                 Legacy Program.

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Colleen M. Franca,             None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Dominic Freud,                 Formerly,   a   Partner   and   European   Equity
Vice President                 Portfolio  manager  at  SLS  Management  (January
                               2002-February 2003).

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dan Gagliardo,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Hazem Gamal,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Seth Gelman,                   Formerly  an  Associate  in the Asset  Management
Vice President                 Legal   Department   at   Goldman   Sachs  &  Co.
                               (February 2003-August 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Subrata Ghose,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Charles W. Gilbert,            None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Phillip S. Gillespie,          Formerly  First Vice  President of Merrill  Lynch
Senior Vice President &        Investment Management (2001 to September 2004).
Deputy General Counsel

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Alan C. Gilston,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jill E. Glazerman,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Bejamin J. Gord,               Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset
                               Management, Inc..

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Laura Granger,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert B. Grill,               None
Senior Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert Haley,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Marilyn Hall,                  None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kelly Haney,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Steve Hauenstein,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas B. Hayes,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dennis Hess,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Joseph Higgins,                Vice   President  of  OFI   Institutional   Asset
Vice President                 Management, Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dorothy F. Hirshman,           None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Daniel Hoelscher,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Edward Hrybenko,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Scott T. Huebl,                Assistant  Vice  President  of   OppenheimerFunds
Vice President                 Legacy Program.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Margaret Hui,                  None
Assistant Vice President

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

John Huttlin,                  Senior   Vice   President    (Director   of   the
Vice President                 International  Division)  (since January 2004) of
                               OFI   Institutional   Asset   Management,   Inc.;
                               Director  (since  June 2003) of  OppenheimerFunds
                               (Asia) Limited

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

Corry E. Hyer,                 None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James G. Hyland,               None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Steve P. Ilnitzki,             Vice President of  OppenheimerFunds  Distributor,
Senior Vice President          Inc.

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

Kelly Bridget Ireland,         Vice   President    (since   January   2004)   of
Vice President                 OppenheimerFunds   Distributor   Inc.   Formerly,
                               Director  of  INVESCO  Distributors  Inc.  (April
                               2000-December 2003).

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

Kathleen T. Ives,              Vice   President  and   Assistant   Secretary  of
Vice President, Senior         OppenheimerFunds     Distributor,     Inc.    and
Counsel and Assistant          Shareholder  Services,  Inc.; Assistant Secretary
Secretary                      of  Centennial  Asset   Management   Corporation,
                               OppenheimerFunds  Legacy Program and  Shareholder
                               Financial Services, Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
William Jaume,                 Senior  Vice  President  of   HarbourView   Asset
Vice President                 Management   Corporation  and  OFI  Institutional
                               Asset  Management,  Inc.;  Director  of OFI Trust
                               Company.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Frank V. Jennings,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Jennings,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John Michael Johnson,          None
Assistant Vice President

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

Lisa Kadehjian,                Formerly Vice President,  Compensation Manager at
Assistant Vice President       The  Bank  of New  York  (November  1996-November
                               2004).

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

Charles Kandilis,              None
Vice President

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

Jennifer E. Kane,              None
Vice President

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

Lynn O. Keeshan,               Assistant  Treasurer of  OppenheimerFunds  Legacy
Senior Vice President          Program

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas W. Keffer,              None
Senior Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Cristina J. Keller,            Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael Keogh,                 Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Martin S. Korn,                Formerly  a  Senior  Vice  President  at  Bank of
Senior Vice President          America   (Wealth   and   Investment   Management
                               Technology Group) (March 2002-August 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James Kourkoulakos,            None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian Kramer,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Paul Kunz,                     None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Lisa Lamentino,                None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John W. Land,                  Formerly  Human  Resources   Manager  at  Goldman
Assistant Vice President       Sachs (October 2000-July 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Tracey Lange,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John Latino,                   None
Assistant Vice President

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

Kristina Lawrence,             Formerly     Assistant    Vice    President    of
Vice President                 OppenheimerFunds,   Inc.   (November   2002-March
                               2004).

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

Guy E. Leaf,                   None
Vice President

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

Gayle Leavitt,                 None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christopher M. Leavy,          None
Senior Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Randy Legg,                    Formerly   an   associate    with   Dechert   LLP
Assistant Vice President &     (September 1998-January 2004).
Assistant Counsel

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Laura Leitzinger,              Senior Vice  President of  Shareholder  Services,
Vice President                 Inc.;  Vice  President of  Shareholder  Financial
                               Services, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Justin Leverenz,               Formerly,   a   research/technology   analyst  at
Vice President                 Goldman Sachs, Taiwan (May 2002-May 2004)

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael S. Levine,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Gang Li,                       None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Shanquan Li,                   None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Daniel Lifshey,                Formerly a  Marketing  Manager at PIMCO  Advisors
Assistant Vice President       (January 2002-September 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mitchell J. Lindauer,          None
Vice President & Assistant
General Counsel
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Bill Linden,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Malissa B. Lischin,            Assistant  Vice  President  of   OppenheimerFunds
Vice President                 Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David P. Lolli,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Daniel G. Loughran             None
Vice President: Rochester
Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Patricia Lovett,               Vice   President   of    Shareholder    Financial
Vice President                 Services,  Inc.  and  Senior  Vice  President  of
                               Shareholder Services, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dongyan Ma,                    Formerly  an  Assistant   Vice   President   with
Assistant Vice President       Standish   Mellon   Asset   Management   (October
                               2001-October 2003).
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Steve Macchia,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Mark H. Madden,                Formerly   Senior  Vice   President   and  Senior
Vice President                 Portfolio Manager with Pioneer Investments,  Inc.
                               (July 1990-July 2004).

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

Michael Magee,                 None
Vice President

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

Kathleen Mandzij,              Formerly   Marketing   Manager   -  Sales   Force
Assistant Vice President       Marketing     (March     2003-June    2004)    of
                               OppenheimerFunds, Inc.

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

Jerry Mandzij,                 None
Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Angelo G. Manioudakis          Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation and of OFI  Institutional
                               Asset   Management,   Inc.   Formerly   Executive
                               Director  and   portfolio   manager  for  Miller,
                               Anderson  &   Sherrerd,   a  division  of  Morgan
                               Stanley Investment  Management (August 1993-April
                               2002).
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
LuAnn Mascia,                  Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Susan Mattisinko,              Assistant    Secretary   of   HarbourView   Asset
Vice President & Associate     Management  Corporation,  OppenheimerFunds Legacy
Counsel                        Program,  OFI  Private  Investments,   Inc.,  OFI
                               Institutional Asset Management,  Inc., Centennial
                               Asset  Management  Corporation,  Oppenheimer Real
                               Asset  Management,  Inc.  and Trinity  Investment
                               Management Corporation.  Formerly an Associate at
                               Sidley  Austin Brown and Wood LLP (1995 - October
                               2003).

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

Elizabeth McCormack,           Vice   President  and   Assistant   Secretary  of
Vice President                 HarbourView Asset Management Corporation.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Joseph McGovern,               None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Charles L. McKenzie,           Chairman  of the Board and  Director of OFI Trust
Senior Vice President          Company;  Chief  Executive  Officer,   President,

                               Senior   Managing   Director   and   Director  of
                               HarbourView Asset Management  Corporation and OFI
                               Institutional Asset Management,  Inc.; President,
                               Chairman  and  Director  of  Trinity   Investment
                               Management Corporation
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Lucienne Mercogliano,          None
Assistant Vice President

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

Wayne Miao,                    Formerly an Associate  with Sidley Austin Brown &
Assistant Vice President and   Wood LLP (September 1999 - May 2004).
Assistant Counsel

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

Andrew J. Mika,                None
Senior Vice President

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

Nikolaos D. Monoyios,          None
Senior Vice President

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

Charles Moon,                  Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and  of  OFI   Institutional   Asset

                               Management, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John Murphy,                   President    and    Director    of    Oppenheimer
Chairman, President, Chief     Acquisition  Corp.  and  Oppenheimer  Partnership
Executive Officer & Director   Holdings,   Inc.  Director  of  Centennial  Asset
                               Management     Corporation,      OppenheimerFunds
                               Distributor,    Inc.;    Chairman   Director   of
                               Shareholder   Services,   Inc.  and   Shareholder
                               Financial Services,  Inc.; President and Director
                               f  OppenheimerFunds  Legacy Program;  Director of
                               OFI   Institutional   Asset   Management,   Inc.,
                               Trinity   Investment   Management    Corporation,
                               Tremont  Capital  Management,  Inc.,  HarbourView
                               Asset   Management   Corporation,   OFI   Private
                               Investments,  Inc.;  President  and  Director  of
                               Oppenheimer   Real   Asset   Management,    Inc.;
                               Executive Vice President of Massachusetts  Mutual
                               Life   Insurance   Company;   Director   of   DLB
                               Acquisition   Corporation;   a   member   of  the
                               Investment    Company    Institute's   Board   of
                               Governors.

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

Meaghan Murphy,                Formerly  Marketing  Professional,  RFP Writer at
Assistant Vice President       JP Morgan  Fleming Asset  Management  (May 2002 -
                               October 2004).

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

Suzanne Murphy,                Formerly  (until December 2003) a Vice President,
Vice President                 Senior Marketing Manager with Citigroup.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas J. Murray,              None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kenneth Nadler,                None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christina Nasta,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Richard Nichols,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
William Norman,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

James B. O'Connell,            Formerly   a   Senior    Designer    Manager   of
Assistant Vice President       OppenheimerFunds,  Inc.  (April  2002 -  December
                               2004).

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

Matthew O'Donnell,             None
Assistant Vice President

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

John O'Hare,                   Formerly  Executive  Vice President and Portfolio
Vice President                 Manager  (June  2000 -  August  2003)  at  Geneva
                               Capital Management, Ltd.

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

John J. Okray,                 Formerly   Vice   President,    Head   of   Trust
Vice President                 Operations at Lehman Brothers (June  2004-October
                               2004)  prior to which  he was an  Assistant  Vice
                               President,   Director   of  Trust   Services   at
                               Cambridge Trust Company (October 2002-June 2004).

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

Lerae A. Palumbo,              None
Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David P. Pellegrino,           None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Allison C. Pells,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Robert H. Pemble,              None
Assistant Vice President

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

Lori L. Penna,                 Formerly  an RFP  Manager/Associate  at  JPMorgan
Assistant Vice President       Chase & Co. (June 2001-September 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian Petersen,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Marmeline Petion-Midy,         Formerly a Senior Financial  Analyst with General
Assistant Vice President       Motors,  NY Treasurer's  Office (July  2000-Augut
                               2004).

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

David Pfeffer,                 Senior  Vice  President  of   HarbourView   Asset
Senior Vice President and      Management   Corporation   since  February  2004.
Chief Financial Officer        Formerly,  Director and Chief  Financial  Officer
                               at   Citigroup   Asset    Management    (February
                               2000-February 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James F. Phillips,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Scott Phillips,                Formerly   Vice   President   at  Merrill   Lynch
Vice President                 Investment Management (June 2000-July 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Gary Pilc,                     None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Jason Pizzorusso,              Formerly   a   Vice   President,   Research   and
Assistant Vice President       Development  at  Crucial  Security  Inc.  (August
                               2000-May 2002;  part-time while attending  school
                               until 2003).

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

David Poiesz,                  Formerly  a Senior  Portfolio  Manager at Merrill
Senior Vice President, Head    Lynch (October  2002-May 2004).  Founding partner
of Growth Equity Investments   of  RiverRock,   a  hedge  fund  product   (April
                               1999-July 2001).

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

Jeffrey Portnoy,               None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Raghaw Prasad,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

David Preuss,                  None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jane C. Putnam,                None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael E. Quinn,              None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Julie S. Radtke,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Norma J. Rapini,               None
Assistant Vice President:
Rochester Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brian N. Reid,                 None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Marc Reinganum,                Formerly  (until  August  2002)  Vaughn  Rauscher
Vice President                 Chair  in  Financial  Investments  and  Director,
                               Finance    Institute   of   Southern    Methodist
                               University, Texas.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jill Reiter,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Claire Ring,                   None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David Robertson,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Antoinette Rodriguez,          None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Stacey Roode,                  None
Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jeffrey S. Rosen,              None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Stacy Roth,                    None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James H. Ruff,                 President   and   Director  of   OppenheimerFunds
Executive Vice President       Distributor,    Inc.   and    Centennial    Asset
                               Management Corporation;  Executive Vice President
                               of OFI Private Investments, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Andrew Ruotolo,                Vice   Chairman,   Treasurer,   Chief   Financial
Executive Vice President and   Officer and  Management  Director of  Oppenheimer
Director                       Acquisition  Corp.;  President  and  Director  of
                               Shareholder   Services,   Inc.  and   Shareholder
                               Financial  Services,  Inc.;  Director  of Trinity
                               Investment  Management  Corporation  and Director
                               of OFI Trust Company.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Kim Russomanno,                None
Assistant Vice President

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

Timothy Ryan,                  Formerly   a   research   analyst  in  the  large
Vice President                 equities group at Credit Suisse Asset  Management
                               (August 2001-June 2004)

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Rohit Sah,                     None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Valerie Sanders,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Karen Sandler,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Rudi W. Schadt,                None
Assistant Vice President

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

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Ellen P. Schoenfeld,           None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Maria Schulte,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Scott A. Schwegel,             None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Allan P. Sedmak                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jennifer L. Sexton,            Senior    Vice    President    of   OFI   Private
Vice President                 Investments, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Navin Sharma,                  None
Vice President

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

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Bonnie Sherman,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David C. Sitgreaves,           None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Edward James Sivigny           None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Enrique H. Smith,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Louis Sortino,                 None
Assistant Vice President:
Rochester Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Keith J. Spencer,              None
Senior Vice President

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

Marco Antonio Spinar,          None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Richard A. Stein,              None
Vice President: Rochester
Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Arthur P. Steinmetz,           Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management Corporation.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jennifer Stevens,              None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John P. Stoma,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael Stricker,              Vice President of Shareholder Services, Inc.
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Deborah A. Sullivan,           Secretary of OFI Trust Company.
Assistant Vice President &
Assistant Counsel

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mary Sullivan,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael Sussman,               Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Susan B. Switzer,              None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brian C. Szilagyi,             Manager of Compliance at Berger  Financial  Group
Assistant Vice President       LLC (May 2001-March 2003);  Director of Financial
                               Reporting   and    Compliance   at   First   Data
                               Corporation (April 2003-June 2004).

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Martin Telles,                 Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Paul Temple,                   None
Vice President

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

Jeaneen Terrio,                None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Vincent Toner,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Eamon Tubridy,                 None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Keith Tucker,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Cameron Ullyat,                None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Angela Uttaro,                 None
Assistant Vice President:
Rochester Division

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

Mark S. Vandehey,              Vice President of  OppenheimerFunds  Distributor,
Senior Vice President and      Inc.,  Centennial  Asset  Management  Corporation
Chief Compliance Officer       and Shareholder  Services,  Inc.  Formerly (until
                               March 2004) Vice  President of  OppenheimerFunds,
                               Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Maureen Van Norstrand,         None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Nancy Vann,                    Formerly  Assistant  General  Counsel  at Reserve
Vice President and Assistant   Management  Company,   Inc.  (April  to  December
Counsel                        2004);  attorney  at Sidley  Austin  Brown & Wood
                               LLP (October 1997 - April 2004).

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

Rene Vecka,                    Formerly Vice President of Shareholder  Services,
Assistant Vice President,      Inc. (September 2000-July 2003).
Rochester Division

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

Vincent Vermette,              Vice President of  OppenheimerFunds  Distributor,
Assistant Vice President       Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Phillip F. Vottiero,           None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Lisa Walsh,                    None
Assistant Vice President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Teresa M. Ward,                Vice President of  OppenheimerFunds  Distributor,
Vice President                 Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jerry A. Webman,               Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management Corporation.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christopher D. Weiler,         None
Vice President: Rochester
Division
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Adam Weiner,                   Formerly a Vice  President at AIG Trading  (March
Assistant Vice President       2003-May  2004)  prior to which he was a Managing
                               Director at ING Barings  (December  1999-February
                               2003).

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

Barry D. Weiss,                Vice  President of HarbourView  Asset  Management
Vice President                 Corporation  and of Centennial  Asset  Management
                               Corporation.

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

Melissa Lynn Weiss,            None
Vice President & Associate
Counsel

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christine Wells,               None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Joseph J. Welsh,               Vice  President of HarbourView  Asset  Management
Vice President                 Corporation.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Diederick Wermolder,           Director of  OppenheimerFunds  International Ltd.
Senior Vice President          and  OppenheimerFunds  plc; Senior Vice President
                               (Managing    Director   of   the    International
                               Division) of OFI Institutional  Asset Management,
                               Inc.;   Director   of   OppenheimerFunds   (Asia)
                               Limited.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Catherine M. White,            Assistant  Vice  President  of   OppenheimerFunds
Assistant Vice President       Distributor,   Inc.;   member  of  the   American
                               Society of Pension Actuaries (ASPA) since 1995.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Annabel Whiting,               None
Assistant Vice President

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

William L. Wilby,              None
Senior Vice President and
Senior Investment Officer,
Director of Equities

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

Donna M. Winn,                 President,  Chief Executive  Officer and Director
Senior Vice President          of OFI Private  Investments,  Inc.;  Director and
                               President  of  OppenheimerFunds  Legacy  Program;
                               Senior   Vice   President   of   OppenheimerFunds
                               Distributor, Inc.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Philip Witkower,               Senior   Vice   President   of   OppenheimerFunds
Senior Vice President          Distributor, Inc.
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian W. Wixted,               Treasurer   of   HarbourView   Asset   Management
Senior Vice President and      Corporation;    OppenheimerFunds    International
Treasurer                      Ltd.,  Oppenheimer  Partnership  Holdings,  Inc.,

                               Oppenheimer   Real   Asset   Management,    Inc.,
                               Shareholder    Services,     Inc.,    Shareholder
                               Financial    Services,    Inc.,    OFI    Private
                               Investments,   Inc.,  OFI   Institutional   Asset
                               Management,   Inc.,   OppenheimerFunds   plc  and
                               OppenheimerFunds  Legacy  Program;  Treasurer and
                               Chief  Financial  Officer  of OFI Trust  Company;
                               Assistant  Treasurer of  Oppenheimer  Acquisition
                               Corp.

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

Carol E. Wolf,                 Senior  Vice  President  of   HarbourView   Asset
Senior Vice President          Management  Corporation  and of Centennial  Asset
                               Management  Corporation;  serves  on the Board of
                               the Colorado Ballet.

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

Kurt Wolfgruber,               Director  of Tremont  Capital  Management,  Inc.,
Executive Vice President,      HarbourView Asset Management  Corporation and OFI
Chief Investment Officer and   Institutional Asset Management,  Inc. (since June
Director                       2003)

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Caleb C. Wong,                 None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Edward C. Yoensky,             None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Lucy Zachman,                  None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Robert G. Zack                 General Counsel and Director of  OppenheimerFunds
Executive Vice President and   Distributor,  Inc.; General Counsel of Centennial
General Counsel                Asset   Management   Corporation;   Senior   Vice
                               President  and  General  Counsel  of  HarbourView
                               Asset    Management     Corporation    and    OFI
                               Institutional  Asset  Management,   Inc.;  Senior
                               Vice  President,  General Counsel and Director of
                               Shareholder     Financial     Services,     Inc.,
                               Shareholder    Services,    Inc.,   OFI   Private
                               Investments,  Inc.  and OFI Trust  Company;  Vice
                               President    and    Director    of    Oppenheimer
                               Partnership   Holdings,    Inc.;   Director   and
                               Assistant  Secretary  of  OppenheimerFunds   plc;
                               Secretary  and  General  Counsel  of  Oppenheimer
                               Acquisition   Corp.;   Director   and   Assistant
                               Secretary   of   OppenheimerFunds   International
                               Ltd.;   Director   of   Oppenheimer   Real  Asset
                               Management,   Inc.  and  OppenheimerFunds  (Asia)
                               Limited);   Vice  President  of  OppenheimerFunds
                               Legacy Program.

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Neal A. Zamore,                None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark D. Zavanelli,             None
Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Alex Zhou,                     None
Assistant Vice President
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Arthur J. Zimmer,              Senior  Vice  President  (since  April  1999)  of
Senior Vice President          HarbourView Asset Management Corporation.
- ---------------------------------------------------------------------------------


The Oppenheimer Funds include the following:

Centennial California Tax Exempt Trust
Centennial Government Trust
Centennial Money Market Trust
Centennial New York Tax Exempt Trust
Centennial Tax Exempt Trust

Limited Term New York Municipal Fund (Rochester Portfolio Series)
OFI Tremont Core Strategies Hedge Fund
OFI Tremont Market Neutral Hedge Fund
Oppenheimer AMT-Free Municipals
Oppenheimer AMT-Free New York Municipals
Oppenheimer Balanced Fund
Oppenheimer California Municipal Fund
Oppenheimer Capital Appreciation Fund
Oppenheimer Capital Income Fund
Oppenheimer Cash Reserves
Oppenheimer Champion Income Fund
Oppenheimer Convertible Securities Fund (Bond Fund Series)
Oppenheimer Core Bond Fund (a series of Oppenheimer Integrity Funds)
Oppenheimer Developing Markets Fund
Oppenheimer Discovery Fund
Oppenheimer Emerging Growth Fund
Oppenheimer Emerging Technologies Fund
Oppenheimer Enterprise Fund
Oppenheimer Equity Fund, Inc.

Oppenheimer Global Fund
Oppenheimer Global Opportunities Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Growth Fund
Oppenheimer High Yield Fund
Oppenheimer International Bond Fund
Oppenheimer International Growth Fund
Oppenheimer International Large-Cap Core Fund (a series of Oppenheimer
International Large-
    Cap Core Trust)
Oppenheimer International Small Company Fund

Oppenheimer International Value Fund (a series of Oppenheimer International
Value Trust)
Oppenheimer Limited Term California Municipal Fund
Oppenheimer Limited-Term Government Fund
Oppenheimer Limited Term Municipal Fund (a series of Oppenheimer Municipal
Fund)
Oppenheimer Main Street Fund (a series of Oppenheimer Main Street Funds, Inc.)
Oppenheimer Main Street Opportunity Fund
Oppenheimer Main Street Small Cap Fund
Oppenheimer MidCap Fund
Oppenheimer Money Market Fund, Inc.
Oppenheimer Multi-Sector Income Trust
Oppenheimer Multi-State Municipal Trust (3 series):

     Oppenheimer New Jersey Municipal Fund
     Oppenheimer Pennsylvania Municipal Fund
     Oppenheimer Rochester National Municipals
Oppenheimer Principal Protected Main Street Fund (a series of Oppenheimer
Principal
     Protected Trust)
Oppenheimer Principal Protected Main Street Fund II (a series of Oppenheimer
     Principal Protected Trust II)

Oppenheimer Principal Protected Main Street Fund III (a series of Oppenheimer
     Principal Protected Trust III)

Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Quest For Value Funds (3 series)
     Oppenheimer Quest Balanced Fund
     Oppenheimer Quest Opportunity Value Fund
     Oppenheimer Small Cap Value Fund

Oppenheimer Quest International Value Fund, Inc.
Oppenheimer Quest Value Fund, Inc.
Oppenheimer Real Asset Fund
Oppenheimer Real Estate Fund
Oppenheimer Select Value Fund
Oppenheimer Senior Floating Rate Fund
Oppenheimer Series Fund, Inc. (2 series):

     Oppenheimer Disciplined Allocation Fund
     Oppenheimer Value Fund

Oppenheimer Strategic Income Fund
Oppenheimer Total Return Bond Fund
Oppenheimer Tremont Market Neutral Fund, LLC
Oppenheimer Tremont Opportunity Fund, LLC
Oppenheimer U.S. Government Trust
Oppenheimer Variable Account Funds (11 series):
     Oppenheimer Aggressive Growth Fund/VA
     Oppenheimer Balanced Fund/VA

     Oppenheimer Bond Fund/VA
     Oppenheimer Capital Appreciation Fund/VA
     Oppenheimer Global Securities Fund/VA
     Oppenheimer High Income Fund/VA
     Oppenheimer Main Street Fund/VA
     Oppenheimer Main Street Small Cap Fund/VA
     Oppenheimer Money Fund/VA
     Oppenheimer Strategic Bond Fund/VA
     Oppenheimer Value Fund/VA
Panorama Series Fund, Inc. (4 series):
     Growth Portfolio
     Government Securities Portfolio
     Oppenheimer International Growth Fund/VA
     Total Return Portfolio
Rochester Fund Municipals

The address of the  Oppenheimer  funds  listed  above,  Shareholder  Financial
Services,  Inc.,  Shareholder  Services,  Inc.,   OppenheimerFunds   Services,
Centennial   Asset   Management   Corporation,   Centennial   Capital   Corp.,
Oppenheimer Real Asset Management,  Inc. and  OppenheimerFunds  Legacy Program
is 6803 South Tucson Way, Centennial, Colorado 80112-3924.

The address of OppenheimerFunds,  Inc.,  OppenheimerFunds  Distributor,  Inc.,
HarbourView Asset Management  Corporation,  Oppenheimer  Partnership Holdings,
Inc.,  Oppenheimer  Acquisition  Corp.,  OFI Private  Investments,  Inc.,  OFI
Institutional Asset Management,  Inc. and Oppenheimer Trust Company is 2 World
Financial  Center,  225  Liberty  Street,  11th  Floor,  New  York,  New  York
10281-1008.

The address of Tremont  Advisers,  Inc. is 555 Theodore  Fremd  Avenue,  Suite
206-C, Rye, New York 10580.

The  address  of  OppenheimerFunds  International  Ltd.  is Bloc C, Irish Life
Center, Lower Abbey Street, Dublin 1, Ireland.

The address of Trinity Investment  Management  Corporation is 301 North Spring
Street, Bellefonte, Pennsylvania 16823.


Item 27. Principal Underwriter
- ------------------------------

(a)   OppenheimerFunds   Distributor,   Inc.   is  the   Distributor   of  the
Registrant's  shares.  It is  also  the  Distributor  of  each  of  the  other
registered open-end investment companies for which  OppenheimerFunds,  Inc. is
the  investment  adviser,  as described  in Part A and B of this  Registration
Statement  and listed in Item 26(b)  above  (except  Oppenheimer  Multi-Sector
Income Trust and Panorama Series Fund, Inc.) and for MassMutual  Institutional
Funds.

(b)   The directors  and officers of the  Registrant's  principal  underwriter
are:

- ---------------------------------------------------------------------------------
Name & Principal                Position & Office         Position and Office
Business Address                with Underwriter          with Registrant
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Timothy Abbhul(1)               Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert Agan(1)                  Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Janette Aprilante(2)            Secretary                 None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James Barker                    Vice President            None
2901B N. Lakewood Avenue
Chicago, IL 60657
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kathleen Beichert(1)            Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert J. Bishop(1)             Treasurer                 None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Douglas S. Blankenship          Vice President            None
17011 Wood Bark Road
Springs, TX 77379
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Tracey Blinzler(1)              Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David A Borrelli                Vice President            None
105 Black Calla Ct.
San Ramon, CA 94583
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Michelle Brennan(2)             Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
L. Scott Brooks(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kevin E. Brosmith               Senior Vice President     None
5 Deer Path
South Natlick, MA 01760
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jeffrey W. Bryan                Vice President            None
1048 Malaga Avenue
Coral Gables, FL 33134
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Patrick Campbell(1)             Assistant Vice President  None

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

Andrew Chonofsky                Vice President            None
300 West Fifth Street, Apt. 118
Charlotte, NC 28202

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

Melissa Clayton(2)              Assistant Vice President  None

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

Julian C. Curry(2)              Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Jeffrey D. Damia(2)             Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Davis(2)                   Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Stephen J. Demetrovits(2)       Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Joseph A. DiMauro               Vice President            None
522 Lakeland Avenue
Grosse Pointe, MI 48230
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Steven Dombrower(2)             Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
George P. Dougherty             Vice President            None
328 Regency Drive
North Wales, PA 19454
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Ryan Drier(2)                   Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Cliff H. Dunteman               Vice President            None
N 53 27761 Bantry Road
Sussex, WI 53089-45533
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Hillary Eigen                   Assistant Vice President  None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Eiler(2)                   Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kent M. Elwell                  Vice President            None
35 Crown Terrace
Yardley, PA 19067
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Gregg A. Everett                Vice President            None
4328 Auston Way
Palm Harbor, FL 34685-4017
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
George R. Fahey                 Senior Vice President     None
2 Pheasant Drive
Ringoes, NJ 08551
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Eric C. Fallon                  Vice President            None
10 Worth Circle
Newton, MA 02458
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Joseph Fernandez                Vice President            None
1717 Richbourg Park Drive
Brentwood, TN 37027

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark J. Ferro(2)                Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Ronald H. Fielding(3)           Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Eric Fishel                     Vice President            None
3A Lawnwood Place, Apt. 1
Charlestown, MA 02129

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Patrick W. Flynn (1)            Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John E. Forrest(2)              Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John ("J) Fortuna(2)            Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Lucio Giliberti                 Vice President            None
6 Cyndi Court
Flemington, NJ 08822
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Raquel Granahan(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Ralph Grant                     Senior Vice President     None
10 Boathouse Close
Mt. Pleasant, SC 29464
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael D. Guman                Vice President            None
3913 Pleasant Avenue
Allentown, PA 18103
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

James E. Gunther(2)             Vice President            None

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

Kevin Healy(2)                  Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Phillipe D. Hemery              Vice President            None
5 Duck Pond Lane
Ramsey, NJ 07446
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Kevin Hennessey                 Vice President            None
10206 Emerald Woods Avenue
Orlando, FL 32836

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

Elyse R. Jurman Herman          Vice President            None
5486 NW 42 Avenue
Boca Raton, FL 33496

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Wendy G. Hetson                 Vice President            None
4 Craig Street
Jericho, NY 11753
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
William E. Hortz(2)             Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Edward Hrybenko(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Andrew Humble                   Vice President            None
419 Phillips Avenue
len Ellyn, IL 60137

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian F. Husch(2)               Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Stephen Ilnitzki(2)             Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kathleen T. Ives(1)             Vice President &          Assistant Secretary
                                Assistant Secretary
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Nivan Jaleeli                   Vice President            None
13622 E. Geronimo Rd.
Scottsdale, AZ 85259

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Eric K. Johnson(1)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark D. Johnson                 Vice President            None
15792 Scenic Green Court
Chesterfield, MO 63017
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christina J. Keller(2)          Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael Keogh(2)                Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Lisa Klassen(1)                 Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Richard Klein                   Senior Vice President     None
4820 Fremont Avenue So.
Minneapolis, MN 55409
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Richard Knott(1)                Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dean Kopperud(2)                Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brent A. Krantz                 Senior Vice President     None
61500 Tam McArthurLoop
Bend, OR 97702

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David T. Kuzia                  Vice President            None
19102 Miranda Circle
Omaha, NE 68130
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Tracey Lange(2)                 Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Paul R. LeMire(2)               Vice President            None

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

Eric J. Liberman(2)             Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Malissa Lischin(2)              Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James V. Loehle                 Vice President            None
30 Wesley Hill Lane
Warwick, NY 10990
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Thomas Loncar(1)                Vice President            None

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

Montana W. Low                  Vice President            None
1636 N. Wells Street, Apt. 3411
Chicago, IL 60614

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

Craig Lyman                     Vice President            None
3930 Swenson St. #502
Las Vegas, NV 89119

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John J. Lynch                   Vice President            None
6325 Bryan Parkway
Dallas, TX 75214
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Michael Malik                   Vice President            None
126 Bernard Street
San Francisco, CA 94109

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Steven C. Manns                 Vice President            None
1627 N. Hermitage Avenue
Chicago, IL 60622
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Todd A. Marion                  Vice President            None
24 Midland Avenue
Cold Spring Harbor, NY 11724
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
LuAnn Mascia(2)                 Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Theresa-Marie Maynier           Vice President            None
2421 Charlotte Drive
Charlotte, NC 28203
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Anthony P. Mazzariello          Vice President            None
8 Fairway Road
Sewickley, PA 15143
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John C. McDonough               Vice President            None
3812 Leland Street
Chevy Chase, MD 20815
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Kent C. McGowan                 Vice President            None
9510 190th Place SW

Edmonds, WA 98020
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brian F. Medina(1)              Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Daniel Melehan                  Vice President            None
906 Bridgeport Court
San Marcos, CA 92069
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Mark Mezzanotte                 Vice President            None
16 Cullen Way
Exeter, NH 03833
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Clint Modler(1)                 Vice President            None

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

David W. Mountford(2)           Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert Moser(1)                 Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Gzim Muja(2)                    Vice President            None

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

John V. Murphy(2)               Director                  President

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Wendy Jean Murray               Vice President            None
32 Carolin Road
Upper Montclair, NJ 07043
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John S. Napier(2)               Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Christina Nasta(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kevin P. Neznek(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Bradford Norford                Vice President            None
4607 Timberglen Rd.
Dallas, TX 75287

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Alan Panzer                     Vice President            None
6755 Ridge Mill Lane
Atlanta, GA 30328
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Brian C. Perkes                 Vice President            None
6 Lawton Ct.

Frisco, TX 75034
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Charles K. Pettit               Vice President            None
22 Fall Meadow Drive
Pittsford, NY 14534
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Elaine Puleo-Carter(2)          Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Minnie Ra                       Vice President            None
100 Dolores Street, #203
Carmel, CA 93923
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Dusting Raring                  Vice President            None
27 Blakemore Drive
Ladera Ranch, CA 92797
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael A. Raso                 Vice President            None
3 Vine Place
Larchmont, NY 10538
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Richard Rath                    Vice President            None
46 Mt. Vernon Ave.
Alexandria, VA 22301

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Douglas Rentschler              Vice President            None
677 Middlesex Road
Grosse Pointe Park, MI 48230
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Ruxandra Risko(2)               Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David R. Robertson(2)           Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Ian M. Roche                    Vice President            None
7070 Bramshill Circle
Bainbridge, OH 44023

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kenneth A. Rosenson             Vice President            None
24753 Vantage Pt. Terrace
Malibu, CA 90265
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James H. Ruff(2)                President & Director      None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Matthew Rutig                   Vice President            None
199 North Street
Ridgefield, CT 06877

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
William R. Rylander             Vice President            None
85 Evergreen Road
Vernon, CT 06066
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas Sabow                    Vice President            None
6617 Southcrest Drive
Edina, MN 55435
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Saunders                   Vice President            None
911 North Orange Avenue #401
Orlando, FL 32801
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Jill Schmitt(2)                 Vice President            None

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

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas Schmitt(2)               Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

William Schories(2)             Vice President            None

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

Charles F. Scully               Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Eric Sharp                      Vice President            None
862 McNeill Circle
Woodland, CA 95695
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Debbie A. Simon                 Vice President            None
1 W. Superior Street, Apt. 4101
Chicago, IL 60610
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Douglas Bruce Smith             Vice President            None
8927 35th Street W.
University Place, WA 98466
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

John Spensley(2)                Vice President            None

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

Bryan Stein(2)                  Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Stoma(2)                   Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Wayne Strauss(3)                Assistant Vice President  None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Brian C. Summe                  Vice President            None
2479 Legends Way
Crestview Hills, KY 41017
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael Sussman(2)              Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

George T. Sweeney               Senior Vice President     None
5 Smokehouse Lane

Hummelstown, PA 17036
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
James Taylor(2)                 Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Martin Telles(2)                Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
David G. Thomas                 Vice President            None
16628 Elk Run Court
Leesburg, VA 20176
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Barrie L. Tiedemann(2)          Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Bryan K.Toma                    Vice President            None
7311 W. 145th Terrace
Overland Park, KS 66223
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Mark Vandehey(1)                Vice President            Vice President and
                                                          Chief Compliance
                                                          Officer

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

Vincent Vermete(2)              Assistant Vice President  None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Kenneth Lediard Ward            Vice President            None
1400 Cottonwood Valley Circle
N.
Irving, TX 75038
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Teresa Ward(1)                  Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Michael J. Weigner              Vice President            None
4905 W. San Nicholas Street
Tampa, FL 33629
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Donn Weise                      Vice President            None
3249 Earlmar Drive
Los Angeles, CA 90064
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Chris Werner(1)                 Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Catherine White(2)              Assistant Vice President  None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Thomas Wilson(2)                Vice President            None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Donna Winn(2)                   Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Philip Witkower(2)              Senior Vice President     None
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Cary Patrick Wozniak            Vice President            None
18808 Bravata Court
San Diego, CA 92128
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
John Charles Young              Vice President            None
3914 Southwestern
Houston, TX 77005
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------

Jill Zachman(2)                 Vice President            None

- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Robert G. Zack(2)               General Counsel &         Secretary
                                Director
- ---------------------------------------------------------------------------------

(1)6803 South Tucson Way, Centennial, CO 80112-3924
(2)Two World Financial  Center,  225 Liberty Street,  11th Floor, New York, NY
10281-1008
(3)350 Linden Oaks, Rochester, NY 14623

(c)   Not applicable.


Item 28. Location of Accounts and Records
- -----------------------------------------

The  accounts,  books  and  other  documents  required  to  be  maintained  by
Registrant  pursuant to Section  31(a) of the  Investment  Company Act of 1940
and rules  promulgated  thereunder are in the possession of  OppenheimerFunds,
Inc. at its offices at 6803 South Tucson Way, Centennial, Colorado 80112-3924.



Item 29. Management Services
- ----------------------------

Not applicable

Item 30. Undertakings
- ---------------------

Not applicable.









                                  SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and/or the
Investment Company Act of 1940, the Registrant certifies that it has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York and State of
New York on the 25th day of February, 2005.


                        ROCHESTER FUND MUNICIPALS
                        By:  /s/ John V. Murphy*
                        -------------------------------------------
                        John V. Murphy, President &
                        Principal Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities on
the dates indicated:

Signatures                   Title                       Date
- ----------                   -----                       ----


/s/ Thomas W. Courtney*      Chairman of the             February 25, 2005
- ------------------------------                           Board of Trustees
Thomas W. Courtney


/s/ John V. Murphy*          President & Principal

- ------------------------------                           Executive Officer
February 25, 2005
John V. Murphy


/s/ Brian W. Wixted*         Treasurer and Chief

- --------------------------   Financial and               February 25, 2005
Brian W. Wixted              Accounting Officer


/s/ John Cannon*

- ---------------------        Trustee                     February 25, 2005
John Cannon

/s/ Paul Y. Clinton*         Trustee                     February 25, 2005

- -----------------------
Paul Y. Clinton

/s/ Robert G. Galli*

- ------------------------     Trustee                     February 25, 2005
Robert G. Galli

/s/ Lacy B. Herrmann*        Trustee                     February 25, 2005

- ---------------------------
Lacy B. Herrmann


/s/ Brian Wruble*            Trustee                     February 25, 2005

- ---------------------
Brian Wruble


*By:  /s/ Mitchell J. Lindauer

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

Mitchell J. Lindauer, Attorney-in-Fact



                                  FORM N-1A

                          ROCHESTER FUND MUNICIPALS


                        Registration Statement No. 29


                                EXHIBIT INDEX


Item No.          Description
- ----------        --------------



23(d)             Amended and Restated Investment Advisory Agreement

23(m)(i)          Amended and Restated  Service Plan and Agreement for Class A
                  Shares





























365_PartC-485a(Feb05)redline.doc

EX-99.M

                             AMENDED AND RESTATED

                          SERVICE PLAN AND AGREEMENT

                                     with

                      OppenheimerFunds Distributor, Inc.

                            For Class A Shares of

                           Rochester Fund Municipals


This Amended and Restated  SERVICE PLAN AND AGREEMENT (the "Plan") is dated as
of the 5th day of April,  2004, by and between  Rochester Fund Municipals (the
"Fund") and OppenheimerFunds Distributor, Inc. (the "Distributor").

1.    The Plan.  This Plan is the Fund's written  service plan for its Class A
      ---------
Shares  described  in the Fund's  registration  statement  as of the date this
Plan  takes  effect,  contemplated  by and to  comply  with  Rule  2830 of the
Conduct  Rules  of the  National  Association  of  Securities  Dealers,  Inc.,
pursuant to which the Fund will  reimburse  the  Distributor  for a portion of
its costs incurred in connection with the personal  service and maintenance of
shareholder  accounts  ("Accounts") that hold Class A Shares (the "Shares") of
the Fund.  The Fund may be deemed to be acting as  distributor  of  securities
of which  it is the  issuer,  pursuant  to Rule  12b-1  under  the  Investment
Company  Act of 1940 (the "1940  Act"),  according  to the terms of this Plan.
The  Distributor  is  authorized  under  the  Plan  to  pay  "Recipients,"  as
hereinafter  defined,  for  rendering  services  and  for the  maintenance  of
Accounts.  Such  Recipients are intended to have certain rights as third-party
beneficiaries under this Plan.

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
      institution  which:  (i) has rendered  services in  connection  with the
      personal  service and  maintenance  of Accounts;  (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  such  service;  and  (iii) has been  selected  by the
      Distributor  to receive  payments  under the Plan.  Notwithstanding  the
      foregoing,  a majority of the Fund's Board of Trustees (the "Board") who
      are not  "interested  persons" (as defined in the 1940 Act) and who have
      no direct or indirect  financial  interest in the operation of this Plan
      or in any agreements relating to this Plan (the "Independent  Trustees")
      may  remove  any  broker,   dealer,  bank  or  other  institution  as  a
      Recipient,  whereupon such entity's rights as a third-party  beneficiary
      hereof shall terminate.

      (b)   "Qualified  Holdings" shall mean, as to any Recipient,  all Shares
      owned  beneficially  or of record by: (i) such  Recipient,  or (ii) such
      brokerage or other  customers,  or investment  advisory or other clients
      of such  Recipient  and/or  accounts  as to which  such  Recipient  is a
      fiduciary or custodian or co-fiduciary  or  co-custodian  (collectively,
      the "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 two entities would  otherwise  qualify as Recipients as to the same
      Shares,  the Recipient which is the dealer of record on the Fund's books
      shall be deemed the  Recipient  as to such  Shares for  purposes of this
      Plan.

3.    Payments.
      ---------

      (a)   Under the Plan,  the Fund will make  payments to the  Distributor,
      within forty-five (45) days of the end of each calendar quarter,  in the
      amount of the  lesser of:  (i) 0.25% on an annual  basis of the  average
      during the  calendar  quarter of the  aggregate  net asset  value of the
      Shares,  computed  as of the  close of each  business  day,  or (ii) the
      Distributor's  actual  expenses  under the Plan for that  quarter of the
      type  approved by the Board.  Notwithstanding  the  foregoing,  the Fund
      will not make  payments to the  Distributor  in excess of the amount the
      Distributor  pays to  Recipients.  The  Distributor  will  use  such fee
      received from the Fund in its entirety to reimburse  itself for payments
      to  Recipients  and for its  other  expenditures  and  costs of the type
      approved by the Board incurred in connection  with the personal  service
      and maintenance of Accounts including,  but not limited to, the services
      described in the  following  paragraph.  The  Distributor  may make Plan
      payments to any "affiliated  person" (as defined in the 1940 Act) of the
      Distributor if such affiliated person qualifies as a Recipient.

            The services to be rendered by the  Distributor  and Recipients in
      connection  with the personal  service and the  maintenance  of Accounts
      may  include,  but shall not be  limited  to, the  following:  answering
      routine  inquiries from the Recipient's  customers  concerning the Fund,
      providing  such  customers  with  information  on  their  investment  in
      Shares,  assisting in the  establishment  and maintenance of accounts or
      sub-accounts  in the  Fund,  making  the  Fund's  investment  plans  and
      dividend   payment   options   available,   and  providing   such  other
      information  and  customer  liaison  services  and  the  maintenance  of
      Accounts as the Distributor or the Fund may reasonably  request.  It may
      be presumed  that a  Recipient  has  provided  services  qualifying  for
      compensation  under the Plan if it has  Qualified  Holdings of Shares to
      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 services, then the Distributor,  at the request of
      the Board,  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  still is not
      satisfied,  it may take  appropriate  steps to terminate the Recipient's
      status as such  under  the Plan,  whereupon  such  entity's  rights as a
      third-party beneficiary hereunder shall terminate.







            Payments  received by the Distributor from the Fund under the Plan
      will not be used to pay any interest expense,  carrying charges or other
      financial  costs, or allocation of overhead by the  Distributor,  or for
      any other purpose other than for the payments  described in this Section
      3. The amount  payable to the  Distributor  each quarter will be reduced
      to the extent that reimbursement  payments  otherwise  permissible under
      the Plan have not been  authorized  by the Board for that  quarter.  Any
      unreimbursed  expenses  incurred for any quarter by the  Distributor may
      not be recovered in later periods.

(b)   The Distributor shall make payments to any Recipient  quarterly,  within
      forty-five  (45)  days of the end of each  calendar  quarter,  at a rate
      not to  exceed  0.25% on an  annual  basis  of the  average  during  the
      calendar  quarter  of the  aggregate  net  asset  value  of  the  Shares
      computed as of the close of each  business  day, of  Qualified  Holdings
      owned  beneficially  or of record by the Recipient or by its  Customers.
      However,  no such  payments  shall be made to any Recipient for any such
      quarter in which its Qualified  Holdings do not equal or exceed,  at the
      end of such quarter, the minimum amount ("Minimum Qualified  Holdings"),
      if any,  to be set from time to time by a  majority  of the  Independent
      Trustees.

            Alternatively,  the Distributor may, at its sole option,  make the
      following  service  fee  payments  to any  Recipient  quarterly,  within
      forty-five (45) days of the end of each calendar  quarter:  (A) "Advance
      Service  Fee  Payments"  at a rate not to  exceed  0.25% of the  average
      during the calendar  quarter 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
      quarter and owned  beneficially  or of record by the Recipient or by its
      Customers,  plus (B) service fee  payments at a rate not to exceed 0.25%
      on an annual  basis of the average  during the  calendar  quarter 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.  At the  Distributor's  sole option,  Advance  Service Fee
      Payments may be made more often than quarterly,  and sooner than the end
      of the calendar quarter.  In the event Shares are redeemed less than one
      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  Service  Fee  Payments,  based on the  ratio  of the time  such
      Shares were held to one (1) year.

            A majority  of the  Independent  Trustees  may at any time or from
      time to time  increase or  decrease  and  thereafter  adjust the rate of
      fees to be  paid  to the  Distributor  or to any  Recipient,  but not to
      exceed the rate set forth above,  and/or increase or decrease the number
      of shares  constituting  Minimum  Qualified  Holdings.  The  Distributor
      shall notify all  Recipients of the Minimum  Qualified  Holdings 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  shall  constitute
      sufficient notice.

      (c)   Under  the  Plan,  payments  may 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.

4.    Selection and Nomination of Trustees.  While this Plan is in effect, the
      -------------------------------------
selection or replacement  of Independent  Trustees and the nomination of those
persons to be  Trustees  of the Fund who are not  "interested  persons" of the
Fund  shall  be  committed  to the  discretion  of the  Independent  Trustees.
Nothing  herein shall prevent the  Independent  Trustees from  soliciting  the
views or the  involvement  of others in such  selection or  nomination  if 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  at least  quarterly  a  written  report to the  Fund's  Board for its
review,  detailing the aggregate amount of payments made pursuant to this Plan
and the  purposes  for which the  payments  were made.  The report shall state
whether  all  provisions  of Section 3 of this Plan have been  complied  with.
The  Distributor  shall annually  certify to the Board the amount of its total
expenses  incurred  that  year  with  respect  to  the  personal  service  and
maintenance of Accounts in  conjunction  with the Board's annual review of the
continuation of the Plan.







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  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 voting securities of the Class, on
not more than sixty days written  notice to any other party to the  agreement;
(ii)  such  agreement  shall  automatically  terminate  in  the  event  of its
"assignment"  (as  defined  in the 1940  Act);  (iii) it 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
(iv) it 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 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  Independent  Trustees  cast in  person  at a
meeting  called on April 5,  2004,  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  thereafter or as the Board may otherwise  determine only so long as such
continuance  is  specifically  approved at least annually by the Board and its
Independent  Trustees  by a vote cast in person  at a meeting  called  for the
purpose  of voting on such  continuance.  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  voting  securities  of Class A. This Plan may not be  amended  to
increase  materially the amount of payments to be made without approval of the
Class  A  Shareholders,  in the  manner  described  above,  and  all  material
amendments  must be  approved  by a vote of the Board  and of the  Independent
Trustees.







8.    Disclaimer  of  Shareholder  and  Trustee  Liability.   The  Distributor
      -----------------------------------------------------
understands  that the  obligations of the Fund under this Plan are not binding
upon any  Trustee or  shareholder  of the Fund  personally,  but bind only the
Fund and the Fund's  property.  The Distributor  represents that it has notice
of the  provisions  of the  Declaration  of  Trust  of  the  Fund  disclaiming
shareholder and Trustee liability for acts or obligations of the Fund.

                              Rochester Fund Municipals



                              By:   /s/Robert G. Zack
                                    ------------------------
                                     Robert G. Zack, Secretary



                              OppenheimerFunds Distributor, Inc.



                                          By:   /s/James H. Ruff
                                                ------------------------
                                     James H. Ruff
                                     President

EX-99.D

                             AMENDED AND RESTATED
                        INVESTMENT ADVISORY AGREEMENT

AGREEMENT, made the 1st day of January, 2005, by and between ROCHESTER FUND
MUNICIPALS, a Massachusetts business trust (hereinafter referred to as the
"Fund"), and OPPENHEIMERFUNDS, INC. (hereinafter referred to as "OFI").

      WHEREAS, the Fund is an open-end, non-diversified management investment
company registered as such with the Securities and Exchange Commission (the
"Commission") pursuant to the Investment Company Act of 1940 (the "Investment
Company Act"), and OFI is an investment adviser registered as such with the
Commission under the Investment Advisers Act of 1940;

      WHEREAS, the Fund has  Shares of beneficial interest to be issued by
the Fund ("Shares") pursuant to the Fund's registration statement;

      WHEREAS, the Fund desires that OFI shall act as its investment adviser
pursuant to this Agreement;

      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 Provisions:
            ------------------







            The Fund hereby employs OFI and OFI hereby undertakes to act as
the investment adviser of the Fund in connection with, and for the benefit
of, the Fund and to perform for the Fund such other duties and functions in
connection with the Fund for the period and on such terms as set forth in
this Agreement.  OFI shall, in all matters, give to the Fund and its Board of
Trustees (the "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
Fund 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 Fund as amended from time to time; (iv) policies
and determinations of the Trustees; (v) the fundamental policies and
investment restrictions of the Fund as reflected in the registration
statement of the Fund under the Investment Company Act or as such policies
may, from time to time, be amended 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 shall be available upon reasonable
notice for consultation with any of the Trustees and officers of the Fund
with respect to any matters dealing with the business and affairs of the Fund
including the valuation of portfolio securities of the Fund which are either
not registered for public sale or not traded on any securities market.

      2.    Investment Management:
            ---------------------

            (a)  OFI shall, subject to the direction and control by the
Trustees, (i) regularly provide investment advise and recommendations to the
Fund with respect to the investments, investment policies and the purchase
and sale of securities and other investments for the Fund; (ii) supervise
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; 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 portfolio of the Fund.

            (b)  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 paragraph 7 hereof,
OFI 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 obtain specialized services.

            (c)  Provided that nothing herein shall be deemed to protect OFI
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 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 or any entity
controlling, controlled by or under common control with OFI or any officer
thereof from acting as investment adviser for any other person, firm or
corporation or in any way limit or restrict OFI or any of its directors,
officers, stockholders or employees from buying, selling or trading any
securities or other investments 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 of its duties and obligations under this Agreement.

      3.    Other Duties of OFI:
            -------------------

            OFI 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 shall, at its own cost and expense, also provide the Fund with adequate
office space, facilities and equipment.  OFI shall, at its own expenses,
provide such officers for the Fund as the Board of Trustees may request.

4.    Allocation of Expenses:
      ----------------------

            All other costs and expenses of the Fund not expressly assumed by
OFI under this Agreement, or to be paid by the Distributor of the Shares of
the Fund, shall be paid by the Fund, including, but not limited to: (i)
interest, taxes and governmental fees; (ii) brokerage commissions and other
expenses incurred in acquiring or disposing of the portfolio securities and
other investments of the Fund; (iii) insurance premiums for fidelity and
other coverage requisite to its operations; (iv) compensation and expenses of
its Trustees other than those affiliated with OFI; (v) legal and audit
expenses; (vi) custodian and transfer agent fees and expenses; (vii) expenses
incident to the redemption of its Shares; (viii) expenses incident 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, incident to the registration under Federal and state 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 Fund may have to indemnify its officers and Trustees
with respect thereto.  Any officers or employees of OFI (or any entity
controlling, controlled by, or under common control with OFI) who also serve
as officers, Trustees or employees of the Fund shall not receive any
compensation from the Fund  thereof for their services.

      5.    Compensation of OFI:
            -------------------

            The Fund agrees to pay OFI and OFI agrees to accept as full
compensation for the performance of all functions and duties on its part to
be performed pursuant to the provisions hereof, a fee computed on the total
net asset value of  the Fund as of the close of each business day and payable
monthly at the annual rate for each Series set forth on Schedule A hereto.

      6.    Use of Name "Oppenheimer" or "Rochester":
            ----------------------------------------

            OFI hereby grants to the Fund a royalty-free, non-exclusive
license to use the name "Oppenheimer" or "Rochester" in the name of the Fund
for the duration of this Agreement and any extensions or renewals thereof.
To the extent necessary to protect OFI's rights to the name "Oppenheimer" or
"Rochester" under applicable law, such license shall allow OFI to inspect
and, subject to control by the Fund's Board, control the nature and quality
of services offered by the Fund under such name and may, upon termination of
this Agreement, be terminated by OFI, in which event the Fund shall promptly
take whatever action may be necessary to change its name and discontinue any
further use of the name "Oppenheimer" or "Rochester" in the name of the Fund
or otherwise.  The name "Oppenheimer" and "Rochester" may be used or licensed
by OFI in connection with any of its activities, or licensed by OFI to any
other party.

      7.    Portfolio Transactions and Brokerage:
            ------------------------------------

            (a)  OFI (and any Sub Advisor) is authorized, in arranging the
purchase and sale of the portfolio securities and other investments of  the
Fund 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 portfolio
transactions of the Fund 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 (and any Sub Advisor) of its (their) investment management
functions.

            (b)  OFI (and any Sub Advisor) shall select broker-dealers to
effect the portfolio transactions of the Fund 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 (or any Sub
Advisor) 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 portfolio transactions of  the Fund 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 or other investments 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  (and any Sub Advisor) shall have discretion, in the
interests of the Fund, to allocate brokerage on the portfolio transactions of
the Fund to broker-dealers, other than an affiliated broker-dealer, 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 or its affiliates (or any Sub Advisor) 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
(or any Sub Advisor) 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 or its affiliates  (or any
Sub Advisor) with respect to accounts as to which they exercise investment
discretion.  In reaching such determination, OFI (or any Sub Advisor) 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  (and any Sub Advisor) 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 Fund's Trustees were reasonable in relation to the benefits
to the Fund.

            (d)  OFI  (or any Sub Advisor) 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 of the Fund and the provisions of
this paragraph 7.

            (e)  The Fund 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 Fund; and (iii) may effect portfolio transactions for
the Fund  only if the commissions, fees or other renumeration 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 to
be within 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 10 hereof, this
Agreement shall continue in effect from year to year, so long as such
continuance shall be approved at least annually by the Fund's Board of
Trustees, including the vote of the majority of the Trustees of the Fund who
are not parties to this Agreement or "interested persons" (as defined in the
Investment Fund 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 Fund Act) of the outstanding voting securities
of the Fund and by such a vote of the Fund's Board of Trustees.

      9.    Disclaimer of Shareholder or Trustee Liability:
            ----------------------------------------------

            OFI understands and agrees that the obligations of the Fund under
this Agreement are not binding upon any shareholder or Trustee of the Fund
personally, but bind only the Fund and the Fund's property; OFI represents
that it has notice of the provisions of the Declaration of Trust of the Fund
disclaiming shareholder or Trustee liability for acts or obligations of the
Fund.

      10.   Termination:
            -----------

            This Agreement may be terminated (i) by OFI at any time without
penalty upon sixty days' written notice to the Fund (which notice may be
waived by the Fund); or (ii) by the Fund at any time without penalty upon
sixty days' written notice to OFI (which notice may be waived by OFI)
provided that such termination by the Fund shall be directed or approved by
the vote of a majority of all of the Trustees of the Fund 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).

      11.   Assignment or Amendment:
            -----------------------

            This Agreement may not be amended, or the rights of OFI 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.

      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.

13.   Accounting, Administration and Recordkeeping Agreement:
      ------------------------------------------------------

            Notwithstanding any provision of this Agreement to the contrary,
OFI is not required under this Agreement to perform for the Fund any duties
or functions set forth in the Accounting, Administration and Recordkeeping
Agreement between the Fund and OFI.

                              ROCHESTER FUND MUNICIPALS




                              By: /s/Robert G. Zack
                                  --------------------------------------

                                    Robert G. Zack, Secretary


                              OPPENHEIMERFUNDS, INC.




                              By: /s/John V. Murphy
                                  --------------------------------
                                    John V. Murphy, Chairman, President &
                                    Chief Executive Officer








                                  Schedule A

                                      to

                        Investment Advisory Agreement

                                   between

                          Rochester Fund Municipals
                                     and
                      Oppenheimer Management Corporation


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

 Annual Fee as a Percentage of Daily Total Net Assets
=======================================================

0.54% of the first $100 million of average daily net
assets

0.52% of the next $150 million of average daily net
assets

0.47% of the next $1.75 billion of average daily net
assets

0.46% of the next $3 billion of average daily net
assets


0.45% of the next $3 billion of average daily net
assets

0.44% of average daily net assets over $8 billion