Oppenheimer Enterprise Fund

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QsXMrt07x43q/oOvylt9WIQD1iMtEA3PB+RHCGLRJJi2tvpU0AjEV/pMRz/nyRlg fjH/dqoHYLtzLrmmdCJGiw== 0000728889-05-001340.txt : 20051229 0000728889-05-001340.hdr.sgml : 20051229 20051229153242 ACCESSION NUMBER: 0000728889-05-001340 CONFORMED SUBMISSION TYPE: 497 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20051229 DATE AS OF CHANGE: 20051229 EFFECTIVENESS DATE: 20051229 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPPENHEIMER ENTERPRISE FUND CENTRAL INDEX KEY: 0000939801 IRS NUMBER: 133819189 STATE OF INCORPORATION: MA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 497 SEC ACT: 1933 Act SEC FILE NUMBER: 033-58343 FILM NUMBER: 051291395 BUSINESS ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY STREET 2: N/A CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 BUSINESS PHONE: 303-768-3200 MAIL ADDRESS: STREET 1: 6803 SOUTH TUCSON WAY STREET 2: N/A CITY: CENTENNIAL STATE: CO ZIP: 80112-3924 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER NEW ENTERPRISE FUND DATE OF NAME CHANGE: 19950901 FORMER COMPANY: FORMER CONFORMED NAME: OPPENHEIMER SMALL CAP FUND DATE OF NAME CHANGE: 19950228 497 1 body.htm PROSPECTUS AND SAI Oppenheimer Enterprise Fund

Oppenheimer
Enterprise Fund

Prospectus dated December 28, 2005 Oppenheimer Enterprise Fund is a
mutual fund. It seeks capital
appreciation to make your investment
grow. It emphasizes investments in
common stocks of companies that have
growth potential.
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
As with all mutual funds, the invest and keep it for future
Securities and Exchange Commission reference about your account.
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.

CONTENTS

ABOUT THE FUND

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

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

Special Investor Services
AccountLink
PhoneLink
OppenheimerFunds Internet Website
Automatic Withdrawal and Exchange Plans
Retirement Plans

How to Sell Shares
By Mail
By Telephone

How to Exchange Shares
Shareholder Account Rules and Policies
Dividends, Capital Gains and Taxes
Financial Highlights

ABOUT THE FUND

The Fund's Investment Objective and Principal Investment Strategies

WHAT IS THE FUND'S INVESTMENT OBJECTIVE? The Fund seeks capital appreciation.

WHAT DOES THE FUND MAINLY INVEST IN? The Fund invests mainly in common stocks of
"growth" companies. These may be newer companies or established companies of any
capitalization range that the portfolio manager believes have favorable growth
prospects. The Fund may invest without limit in companies in any capitalization range.
The Fund focuses mainly on domestic companies, but may buy foreign stocks as well. The
Fund may also invest its assets in a variety of industry categories, although it may
from time to time emphasize investments in one or more industries. For example, the
Fund has, at certain times, invested a significant amount of its assets in technology
and healthcare companies.

HOW DOES THE PORTFOLIO MANAGER DECIDE WHAT SECURITIES TO BUY OR SELL? The Fund's portfolio
manager uses fundamental analysis, relying on internal and external research and analysis,
to look for growth companies. He generally considers a company's financial statements,
interviews with management, and analysis of the company's operations and product
developments. The portfolio manager also evaluates research on particular industries,
market trends and general economic conditions. The portfolio manager focuses on factors
that may vary in particular cases and over time. Currently, the portfolio manager looks
for:
o Companies with a history of positive revenue and earnings growth,
o Companies with management the portfolio manager believes have demonstrated an
ability to handle growth,
o Companies with growth rates that the portfolio manager believes are sustainable over time.

WHO IS THE FUND DESIGNED FOR? The Fund is designed for aggressive investors seeking capital
appreciation in their investment over the long term. Investors in the Fund should be
willing to assume the greater risks of volatile short-term share price fluctuations and
realized losses that are typical for an aggressive growth fund. Since the Fund does not
seek income and the income from its investments will likely be small, it is not designed
for investors needing current income. Because of its focus on long-term growth, the Fund
may be appropriate for a portion of a retirement plan investment for investors with a high
risk tolerance. The Fund is not a complete investment program.

Main Risks of Investing in the Fund

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

RISKS OF INVESTING IN STOCKS. Stocks fluctuate in price, and their short-term volatility at
times may be great. Because the Fund invests primarily in common stocks of U.S. companies,
the value of the Fund's portfolio will be affected by changes in the U.S. stock markets and
the special economic and other factors that might primarily affect the prices of growth
stocks. Market risk will affect the Fund's net asset value per share, which will fluctuate
as the values of the Fund's portfolio securities change. A variety of factors can affect
the price of a particular stock and the prices of individual stocks do not all move in the
same direction uniformly or at the same time. Different stock markets may behave
differently from each other.

Other factors can affect a particular stock's price, such as poor earnings reports by
the issuer, loss of major customers, major litigation against the issuer, or changes in
government regulations affecting the issuer or its industry.

Risks of Growth Stocks. Stocks of growth companies, particularly newer companies,
may offer opportunities for greater long-term capital appreciation but may be more volatile
than stocks of larger, more established companies. They have greater risks if the company's
earnings growth or stock price fails to increase as expected.

THERE ARE SPECIAL RISKS OF FOREIGN INVESTING. The Fund can buy securities of companies or
governments in any country, including developed countries and emerging markets. There is no
limit on the amount of the Fund's assets that may be invested in foreign securities. While
foreign securities may offer special investment opportunities, there are also special
risks.

The change in value of a foreign currency against the U.S. dollar will result in a
change in the U.S. dollar value of securities denominated in that foreign currency. Foreign
issuers are not subject to the same accounting and disclosure requirements to which U.S.
companies are subject. The value of foreign investments may be affected by exchange control
regulations, expropriation or nationalization of a company's assets, foreign taxes, delays
in settlement of transactions, changes in governmental economic or monetary policy in the
U.S. or abroad, or other political and economic factors. These risks could cause the prices
of foreign stocks to fall and could therefore depress the Fund's share price.

Additionally, if a fund invests a significant amount of its assets in foreign
securities, it might expose the fund to "time-zone arbitrage" attempts by investors seeking
to take advantage of the differences in value of foreign securities that might result from
events that occur after the close of the foreign securities market on which a foreign
security is traded and the close of the New York Stock Exchange (the "NYSE") that day, when
the Fund's net asset value is calculated. If such time-zone arbitrage were successful, it
might dilute the interests of other shareholders. However, the Fund's use of "fair value
pricing" to adjust the closing market prices of foreign securities under certain
circumstances, to reflect what the Manager and the Board believe to be their fair value may
help deter those activities.

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.

In the short term, high-growth stocks can be very volatile. The price of the Fund's
shares can go up and down substantially. The Fund generally does not use income-oriented
investments to help cushion the Fund's total return from changes in stock prices. In the
OppenheimerFunds spectrum, the Fund is an aggressive growth fund, designed for investors
willing to assume greater risks. It is likely to be subject to greater fluctuations in its
share prices than funds that emphasize large capitalization stocks, or funds that focus on
both stocks and bonds.

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

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 full calendar years since the Fund's inception and by showing how the average annual
total returns of the Fund's shares, both before and after taxes, compared to those of
broad-based market indices. 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 after-tax returns set
forth below are not relevant to investors who hold their fund shares through tax-deferred
arrangements such as 401(k) plans or IRAs or to institutional investors not subject to tax.
The Fund's past investment performance, before and after taxes, is not necessarily an
indication of how the Fund will perform in the future.

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

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

Sales charges and taxes are not included in the calculations of return in this bar chart,
and if those charges and taxes were included, the returns may be less than those shown.
For the period from 1/1/05 through 9/30/05, the cumulative return (not annualized) before
taxes for Class A shares was 7.41%. During the period shown in the bar chart, the highest
return (not annualized) before taxes for a calendar quarter was 55.70% (4th Q`99) and the
lowest return (not annualized) before taxes for a calendar quarter was -32.16% (4th Q'00).

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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
11/7/95) 6.50% -19.48% 6.13%
Return Before Taxes 6.50% -19.94% 4.89%
Return After Taxes on 4.22% -15.30% 4.82%
Distributions
Return After Taxes on
Distributions and Sale of
Fund Shares
- -----------------------------------------------------------------------------------
S&P 500 Index (reflects no
deduction for fees, expenses
or taxes) 10.87% -2.30% 10.11%(1)
- -----------------------------------------------------------------------------------
Russell 3000 Growth Index
(reflects no deduction for 6.93% -8.87% 7.04%(1)
fees, expenses or taxes)
- -----------------------------------------------------------------------------------
Class B Shares (inception 7.19% -19.42% 6.30%
11/7/95)
- -----------------------------------------------------------------------------------
Class C Shares (inception 11.27% -19.12% 6.04%
11/7/95)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Class N Shares (inception 11.76% -7.64% N/A
3/1/01)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
Class Y Shares (inception 13.54% -18.23% -6.81%
4/1/99)
- -----------------------------------------------------------------------------------
1 From 10/31/95.

The Fund's average annual total returns include applicable sales charges: for Class A
shares, the current maximum initial sales charge of 5.75%; for Class B shares, the
contingent deferred sales charges of 5% (1-year) and 2% (5-year); and for Class C and Class
N shares, the 1% contingent deferred sales charge for the 1-year period. There is no sales
charge for Class Y shares. Because Class B shares convert to Class A shares 72 months after
purchase, Class B "life-of-class" performance does not include the 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 S&P 500 Index, an unmanaged
index of equity securities, and the Russell 3000 Growth Index, a multi-cap index that
measures the broad growth market. The indices' performance includes reinvestment of income
but does not reflect transaction costs, fees, expenses or taxes. The Fund's investments
vary from those in the indices.

Fees and Expenses of the Fund

The following tables are provided to help you understand the fees and expenses you may pay
if you buy and hold shares of the Fund. The Fund pays a variety of expenses directly for
management of its assets, administration, distribution of its shares and other services.
Those expenses are subtracted from the Fund's assets to calculate the Fund's net asset
value per share. All shareholders therefore pay those expenses indirectly. Shareholders pay
other transaction expenses directly, such as sales charges. The numbers below are based on
the Fund's expenses during its fiscal year ended August 31, 2005.

Shareholder Fees (charges paid directly from your investment):
Class A Class B Class C Class N Class Y
Shares Shares Shares Shares Shares
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Maximum Sales Charge (Load)
on purchases (as % of 5.75% None None None None
offering price)
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Maximum Deferred Sales Charge
(Load) (as % of the lower of None(1) 5%(2) 1%(3) 1%(4) None
the original offering price
or redemption proceeds)

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

Class A Class B Class C Class N Class Y
Shares Shares Shares Shares Shares
------------------------------------------------------------------------------
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Management Fees 0.75% 0.75% 0.75% 0.75% 0.75%
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Distribution and/or 0.24% 1.00% 1.00% 0.49% None
Service
(12b-1) Fees
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Other Expenses 0.62% 0.52% 0.66% 0.76% 0.30%
------------------------------------------------------------------------------
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Total Annual Operating 1.61% 2.27% 2.41% 2.00% 1.05%
Expenses
------------------------------------------------------------------------------

Expenses may vary in future years. "Other Expenses" include transfer agent fees,
custodial fees, and accounting and legal expenses the Fund pays. The "Other Expenses" in
the table are based on, among other things, the fees the Fund would have paid if the
transfer agent had not waived a portion of its fee under a voluntary undertaking to the
Fund to limit these fees to 0.35% of average daily net assets per fiscal year for all
classes. That undertaking may be amended or withdrawn at any time. After the waiver, the
actual "Other Expenses" and "Total Annual Operating Expenses" as percentages of average
daily net assets were 0.43% and 1.42%, respectively, for Class A shares, 0.43% and 2.18%,
respectively, for Class B shares, 0.43% and 2.18%, respectively, for Class C shares and
0.44% and 1.68%, respectively, for Class N shares. Class Y shares were the same as shown
above.

1. A contingent deferred sales charge may apply to redemptions of investments of $1
million or more ($500,000 for certain retirement plan accounts) of Class A shares. See
"How to Buy Shares" for details.
2. Applies to redemptions in first year after purchase. The contingent deferred sales
charge declines from 5% to 1% in years one through six and is eliminated after that.
3. Applies to shares redeemed within 12 months of a purchase.
4. Applies to shares redeemed within 18 months of a retirement plan's first purchase of
Class N shares.

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

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

If shares are redeemed: 1 Year 3 Years 5 Years 10 Years
------------------------------------------------------------------------------
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Class A Shares $731 $1,058 $1,407 $2,390
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Class B Shares $733 $1,017 $1,429 $2,311(1)
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Class C Shares $347 $ 760 $1,301 $2,779
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Class N Shares $305 $ 634 $1,088 $2,350
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Class Y Shares $108 $ 336 $ 582 $1,289
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If shares are not 1 Year 3 Years 5 Years 10 Years
redeemed:
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Class A Shares $731 $1,058 $1,407 $2,390
------------------------------------------------------------------------------
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Class B Shares $233 $ 717 $1,229 $2,311(1)
------------------------------------------------------------------------------
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Class C Shares $247 $ 760 $1,301 $2,779
------------------------------------------------------------------------------
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Class N Shares $205 $ 634 $1,088 $2,350
------------------------------------------------------------------------------
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Class Y Shares $108 $ 336 $ 582 $1,289
------------------------------------------------------------------------------

In the first example, expenses include the initial sales charge for Class A and the
applicable Class B, Class C and Class N contingent deferred sales charges. In the second
example, the Class A expenses include the sales charge, but Class B, Class C and Class N
expenses do not include the contingent deferred sales charges. There is no sales charge
on Class Y shares.
1. Class B expenses for years 7 through 10 are based on Class A expenses because Class B
shares automatically convert to Class A shares 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 upon 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 in this Prospectus. The Statement of Additional
Information contains more detailed information about the Fund's investment policies and
risks.

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

However, changes in the overall market prices of securities can occur at any time. The
share prices of the Fund will change daily based on changes in market prices of securities
and market conditions and in response to other economic events.

Growth Stock Investments. The Manager looks for stocks of companies that have growth
potential. Growth companies may be developing new products or services or may be
expanding into new markets for their products. They may be newer companies or more
established companies entering a growth cycle. The Fund's investments are not
limited to issuers in a specific capitalization range, such as large-cap or
small-cap companies, and the Fund can invest in issuers in all capitalization
ranges. Market capitalization refers to the market value of all of a company's
issued and outstanding stock. Because the stocks of companies that have smaller
market capitalizations tend to be more volatile, to the extent that the Fund holds
small-cap stocks, its share prices may fluctuate more and the risks of loss are
greater.
Newer growth companies tend to retain a large part of their earnings for research,
development or investment in capital assets. Therefore, they do not tend to emphasize
paying dividends, and may not pay any dividends for a protracted period. They are selected
for the Fund's portfolio because the Manager believes the price of the stock will increase
over time.

Industry Focus. At times, the Fund might increase the relative emphasis of its investments
in a particular industry or group of industries. Stocks of issuers in a particular
industry might be affected by changes in economic conditions or by changes in
government regulations, availability of basic resources or supplies, or other events
that affect that industry more than others. To the extent that the Fund has a greater
emphasis on investments in a particular industry, its share values may fluctuate in
response to events affecting that industry.

Portfolio Turnover. The Fund's investment process may cause the Fund to engage in active
and frequent trading. The Fund can engage in active and frequent trading to try to
achieve its objective, and may have a high portfolio turnover rate (for example, over
100%). Increased portfolio turnover creates higher brokerage and transaction costs for
the Fund (and may reduce performance). If the Fund realizes capital gains when it
sells its portfolio investments, it must generally pay those gains out to
shareholders, increasing their taxable distributions. The Financial Highlights table
at the end of this Prospectus shows the Fund's portfolio turnover rates during prior
fiscal years.

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 also use the investment
techniques and strategies described below. The Fund might not always use all of the
different types of techniques and investments described below. These techniques have risks,
although some are designed to help reduce overall investment or market risks.

Other Equity Securities. While the Fund emphasizes investments in common stocks, it can
also buy preferred stocks and securities convertible into common stock. They can be
securities issued by domestic or foreign companies, although the Fund's foreign
holdings currently are small. The Manager considers some convertible securities to be
"equity equivalents" because of the conversion feature and in that case their credit
rating has less impact on the investment decision than in the case of other debt
securities.

Investing in Special Situations. At times the Fund might use aggressive investment
techniques, seeking to benefit from what the portfolio manager perceives to be special
situations. These may be mergers, reorganizations or other unusual events expected to
affect a particular issuer. However, there is a risk that the change or event might
not occur, which could have a negative impact on the price of the security. The Fund's
investment might not produce the expected gains or could incur a loss for the
portfolio.

Investing in Small, Unseasoned Companies. The Fund can invest in small, unseasoned
companies. These are companies that have been in operation less than three years,
including the operations of any predecessors. These securities may have limited
liquidity and their prices may be very volatile. The Fund currently does not intend to
invest more than 10% of its net assets in these securities.

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. Restricted securities may have terms that limit their resale
to other investors or may require registration under applicable securities laws before
they may be sold publicly. The Fund will not invest more than 10% of its net assets in
illiquid or restricted securities. The Board can increase that limit to 15%. Certain
restricted securities that are eligible for resale to qualified institutional
purchasers may not be subject to that limit. The Manager monitors holdings of illiquid
securities on an ongoing basis to determine whether to sell any holdings to maintain
adequate liquidity.

Derivative Investments. The Fund can invest in a number of different kinds of "derivative"
investments. In general terms, a derivative investment is an investment contract whose
value depends on (or is derived from) the value of an underlying asset, interest rate
or index. In the broadest sense, options, futures contracts, and other hedging
instruments the Fund might use may be considered "derivative" investments. In addition
to using derivatives for hedging, the Fund might use other derivative investments
because they offer the potential for increased value. The Fund currently does not use
derivatives to a significant degree and is not required to use them in seeking its
objective.

Derivatives have risks. If the issuer of the derivative investment does not pay the
amount due, the Fund can lose money on the investment. The underlying security or
investment on which a derivative is based, and the derivative itself, may not perform
the way the Manager expected it to. As a result of these risks the Fund could realize
less principal or income from the investment than expected or its hedge might be
unsuccessful. As a result, the Fund's share prices could fall. Certain derivative
investments held by the Fund might be illiquid.

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

Some of these strategies would hedge the Fund's portfolio against price fluctuations.
Other hedging strategies, such as buying futures and call options, would tend to
increase the Fund's exposure to the securities market.

There are also special risks in particular hedging strategies. Options trading
involves the payment of premiums and can increase portfolio turnover. If the Manager
used a hedging instrument at the wrong time or judged market conditions incorrectly,
the strategy could reduce the Fund's return. The Fund could also experience losses if
the prices of its futures and options were not correlated with its other investments
or if it could not close a position because of an illiquid market.

Temporary Defensive and Interim Investments. In times of adverse or unstable market,
economic or political conditions, the Fund can invest up to 100% of its total assets
in temporary defensive investments that are inconsistent with the Fund's principal
investment strategies. Generally they would be cash equivalents (such as commercial
paper), money market instruments, short-term debt securities, U.S. government
securities, or repurchase agreements and may include other investment grade debt
securities. The Fund could also hold these types of securities pending the investment
of proceeds from the sale of Fund shares or portfolio securities or to meet
anticipated redemptions of Fund shares. To the extent the Fund invests defensively in
these securities, it might not achieve its investment objective of capital
appreciation.

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 discloses its
portfolio holdings in its Statements of Investments on Form N-Q, which are filed with
the Securities and Exchange Commission (the "SEC") no later than 60 days after the
close of its first and third fiscal quarters. These required 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 each of the Fund's fiscal quarters.

A description of the Fund's policies and procedures with respect to the disclosure of
the Fund's portfolio securities is available in the Fund's Statement of Additional
Information.

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 adviser since January 1960. The Manager and its
subsidiaries and controlled affiliates managed more than $190 billion in assets as of
September 30, 2005, including other Oppenheimer funds with more than 6 million shareholder
accounts. The Manager is located at Two World Financial Center, 225 Liberty Street, 11th
Floor, New York, New York 10281-1008.

Advisory Fees. Under the investment advisory agreement, the Fund pays the Manager an
advisory fee at an annual rate that declines as the Fund's assets grow: 0.75% of the
first $200 million of average annual net assets, 0.72% of the next $200 million,
0.69% of the next $200 million, 0.66% of the next $200 million, 0.60% of the next
$700 million, and 0.58% of average annual net assets over $1.5 billion. The Fund's
management fee for its last fiscal year ended August 31, 2005 was 0.75% of average
annual net assets for each class of shares.

A discussion regarding the basis for the Board of Trustees' approval of the Fund's
investment advisory contract is available in the Fund's Annual Report to shareholders for
the year ended August 31, 2005.

Portfolio Manager. The Fund's portfolio is managed by Alan Gilston. Mr. Gilston is the
Fund's lead portfolio manager and has been the person primarily responsible for the
day-to-day management of the Fund's portfolio since June 2004. Mr. Gilston is a Vice
President of the Fund and has been a Vice President of the Manager since September
1997.

The Statement of Additional Information provides additional information about the
Portfolio Manager's compensation, other accounts he manages and his ownership of Fund
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, 30 present and former
Directors or Trustees and 8 present and former officers of certain of the funds. This
complaint, initially filed in the U.S. District Court for the Southern District of New York
on January 10, 2005 and amended on March 4, 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 of 1940 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 defendants believe the claims asserted in these lawsuits 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. A broker or dealer may
charge for that service.
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. Class B, Class C or
Class N shares may not be purchased by an investor directly from the Distributor
without the investor designating another registered broker-dealer. The Fund's
management recommends 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 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 If you establish one of the many types of retirement plan accounts that
OppenheimerFunds offers, more fully described below under "Special Investor
Services," you can start your account with as little as $500.
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 the 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 NYSE, on each day the NYSE is open for trading (referred to in this
Prospectus as a "regular business day"). The NYSE 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 NYSE or
market on which the security is principally traded, that security may be valued by
another method that the Board of Trustees believes accurately reflects the fair
value. Because some foreign securities trade in markets and on exchanges that operate
on weekends and U.S. holidays, the values of some of the Fund's foreign investments
may change on days when investors cannot buy or redeem Fund shares.

The Board has adopted 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, in good order, by the time the NYSE
closes that day. If your order is received on a day when the NYSE 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 NYSE (normally 4:00 p.m.) 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 five different
classes of shares. The different classes of shares represent investments in the same
portfolio of securities, but the classes are subject to different expenses and will likely
have different share prices. When you buy shares, be sure to specify the class of shares.
If you do not choose a class, your investment will be made in Class A shares.
- --------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------
Class A Shares. If you buy Class A shares, you pay an initial sales charge (on investments
up to $1 million for regular accounts or lesser amounts for certain retirement
plans). The amount of that sales charge will vary depending on the amount you invest.
The sales charge rates are listed in "How Can You Buy Class A Shares?" below.
- --------------------------------------------------------------------------------------------
Class B Shares. If you buy Class B shares, you pay no sales charge at the time of purchase,
but you will pay an annual asset-based sales charge. If you sell your shares within 6
years of buying them, you will normally pay a contingent deferred sales charge. That
contingent deferred sales charge varies depending on how long you own your shares, as
described in "How Can You Buy Class B Shares?" below.
- --------------------------------------------------------------------------------------------
Class C Shares. If you buy Class C shares, you pay no sales charge at the time of purchase,
but you will pay an annual asset-based sales charge. If you sell your shares within
12 months of buying them, you will normally pay a contingent deferred sales charge of
1.0%, as described in "How Can You Buy Class C Shares?" below.
- --------------------------------------------------------------------------------------------
Class N Shares. If you buy Class N shares (available only through certain retirement
plans), you pay no sales charge at the time of purchase, but you will pay an annual
asset-based sales charge. If you sell your shares within 18 months of the retirement
plan's first purchase of Class N shares, you may pay a contingent deferred sales
charge of 1.0%, as described in "How Can You Buy Class N Shares?" below.
Class Y Shares. Class Y shares are offered only to certain institutional investors that
have a special agreement with the Distributor.

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

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

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

o Investing for the Shorter Term. While the Fund is meant to be a long-term investment,
if you have a relatively short-term investment horizon (that is, you plan to hold
your shares for not more than six years), you should 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. For that
reason, the Distributor normally will not accept purchase orders of more than
$100,000 of 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, Class C and Class N shareholders. Other features may not be
advisable (because of the effect of the contingent deferred sales charge) for Class
B, Class C and Class N shareholders. Therefore, you should carefully review how you
plan to use your investment account before deciding which class of shares to buy.

Additionally, the dividends payable to Class B, Class C and Class N shareholders will
be reduced by the additional expenses borne by those classes that are not borne by
Class A or Class Y shares, such as the Class B, Class C and Class N asset-based sales
charge described below and in the Statement of Additional Information.

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

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

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

------------------------------------------------------------------------------
Amount of Purchase Front-End Sales Front-End Sales Concession As a
Charge As a
Charge As a Percentage of
Percentage of Net Percentage of
Offering Price Amount Invested Offering Price
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Less than $25,000 5.75% 6.10% 4.75%
------------------------------------------------------------------------------
------------------------------------------------------------------------------
$25,000 or more but 5.50% 5.82% 4.75%
less than $50,000
------------------------------------------------------------------------------
------------------------------------------------------------------------------
$50,000 or more but 4.75% 4.99% 4.00%
less than $100,000
------------------------------------------------------------------------------
------------------------------------------------------------------------------
$100,000 or more but 3.75% 3.90% 3.00%
less than $250,000
------------------------------------------------------------------------------
------------------------------------------------------------------------------
$250,000 or more but 2.50% 2.56% 2.00%
less than $500,000
------------------------------------------------------------------------------
------------------------------------------------------------------------------
$500,000 or more but 2.00% 2.04% 1.60%
less than $1 million
------------------------------------------------------------------------------
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 B to the Statement of Additional
Information details the conditions for the waiver of sales charges that apply in certain
cases, and the special sales charge rates that apply to purchases of shares of the Fund by
certain groups, or under specified retirement plan arrangements or in other special types
of transactions. To receive a waiver or special sales charge rate, you must advise the
Distributor when purchasing shares or the Transfer Agent when redeeming shares that 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, 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 that has multiple accounts (including employee
benefit plans for the same employer). If you are buying shares directly from the
Fund, you must inform the Distributor of your eligibility and holdings at the time
of your purchase in order to qualify for the Right of Accumulation. If you are
buying shares through your financial intermediary you must notify your
intermediary of your eligibility for the 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 with a copy of all account statements
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 calculate the
value of your eligible Oppenheimer fund shares, based on the current offering
price, to determine which Class A sales charge rate you 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
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 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 have
not paid 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
may also be able to 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, or
any of the other Oppenheimer funds into which shares of the Fund may be exchanged,
without a 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 or financial intermediary for that privilege at the
time of reinvestment and must identify the account from which the redemption was
made.
o 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 B to
the Statement of Additional Information, which may be ordered by calling
800.225.5677 or through the OppenheimerFunds website, at www.oppenheimerfunds.com
(follow the hyperlinks: "Access Accounts and Services" - "Forms & Literature" -
"Order Literature" - "Statements of Additional Information"). A description of
these waivers and special sales charge arrangements is also available for viewing
on the OppenheimerFunds website (follow the hyperlinks: "Research Funds" - "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.

o Purchases by Certain Retirement Plans. There is no initial sales charge on purchases
of Class A shares of the Fund by retirement plans that have $5 million or more in
plan assets. In that case the Distributor may pay from its own resources, at the
time of sale, concessions in an amount equal to 0.25% of the purchase price of
Class A shares purchased within the first six months of account establishment by
those retirement plans to dealers of record, subject to certain exceptions
described in "Retirement Plans" in the Statement of Additional Information.

There is also no initial sales charge on purchases of Class A shares of the Fund
by certain retirement plans that are part of a retirement plan or platform offered
by banks, broker-dealers, financial advisors, insurance companies or
recordkeepers. No contingent deferred sales charge is charged upon the redemption
of such shares.

Class A Contingent Deferred Sales Charge. There is no initial sales charge on purchases of
Class A shares of any one or more of the Oppenheimer funds aggregating $1 million or
more, or on purchases of Class A shares by certain retirement plans that satisfied
certain requirements prior to March 1, 2001 ("grandfathered retirement accounts").
However, those Class A shares may be subject to a Class A contingent deferred sales
charge, as described below. Retirement plans holding shares of Oppenheimer funds in
an omnibus account(s) for the benefit of plan participants in the name of a fiduciary
or financial intermediary (other than OppenheimerFunds-sponsored Single DB Plus
plans) are not permitted to make initial purchases of Class A shares subject to a
contingent deferred sales charge.

The Distributor pays dealers of record concessions in an amount equal to 1.0% of
purchases of $1 million or more other than purchases by grandfathered retirement
accounts. For grandfathered retirement accounts, the concession is 0.75% of the
first $2.5 million of purchases plus 0.25% of purchases in excess of $2.5 million.
In either case, the concession will not be paid on purchases of shares by exchange or
that were previously subject to a front-end sales charge and dealer concession.

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

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

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.

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

Class N shares are sold at net asset value without an initial sales charge. A
contingent deferred sales charge of 1.0% will be imposed upon the redemption of Class N
shares, if:
o The group retirement plan is terminated or Class N shares of all Oppenheimer funds
are terminated as an investment option of the plan and Class N shares are redeemed
within 18 months after the plan's first purchase of Class N shares of any Oppenheimer
fund, or
o With respect to an IRA or 403(b) plan, Class N shares are redeemed within 18 months
of the plan's first purchase of Class N shares of any Oppenheimer fund.

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

WHO CAN BUY CLASS Y SHARES? Class Y shares are sold at net asset value per share without a
sales charge directly to institutional investors that have special agreements with the
Distributor for this purpose. They may include insurance companies, registered investment
companies, employee benefit plans and Section 529 plans, among others. Individual investors
cannot buy Class Y shares directly.

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

DISTRIBUTION AND SERVICE (12b-1) PLANS.

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

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

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

The Distributor uses the service fees to compensate dealers for providing personal
services for accounts that hold Class B, Class C or Class N shares. The Distributor
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 periodically.

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 1.0% of the purchase price. The
Distributor pays the asset-based sales charge as an ongoing concession to the dealer
on Class C shares that have been outstanding for a year or more. The Distributor
normally retains the asset-based sales charge on Class C shares during the first year
after the purchase of Class C shares. See the Statement of Additional Information for
exceptions.

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

For certain group retirement plans held in omnibus accounts, the Distributor will pay
the full Class C or Class N asset-based sales charge and the service fee to the
dealer beginning in the first year after the 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. New group omnibus plans may not purchase Class B shares.

For Class C shares purchased through the OppenheimerFunds Recordkeeper Pro program,
the Distributor will pay the Class C asset-based sales charge to the dealer of record
in the first year after the purchase of such shares in lieu of paying the dealer a
sales concession at the time of purchase. The Distributor will use the service fee
it receives from the Fund on those shares to reimburse FASCorp for providing personal
services to the Class C accounts holding those shares.

OTHER PAYMENTS TO FINANCIAL INTERMEDIARIES AND SERVICE PROVIDERS. The Manager and the
Distributor, in their discretion, also may pay dealers or other financial intermediaries
and service providers for distribution and/or shareholder servicing activities. These
payments are made out of the Manager's and/or the Distributor's own resources, including
from the profits derived from the advisory fees the Manager receives from the Fund. These
cash payments, which may be substantial, are paid to many firms having business
relationships with the Manager and Distributor. These payments are in addition to any
distribution fees, servicing fees, or transfer agency fees paid directly or indirectly by
the Fund to these financial intermediaries and any commissions the Distributor pays to
these firms out of the sales charges paid by investors. These payments by the Manager or
Distributor from their own resources are not reflected in the tables in the section called
"Fees and Expenses of the Fund" in this prospectus because they are not paid by the Fund.

"Financial intermediaries" are firms that offer and sell Fund shares to their clients,
or provide shareholder services to the Fund, or both, and receive compensation for doing
so. Your securities dealer or financial adviser, for example, is a financial intermediary,
and there are other types of financial intermediaries that receive payments relating to the
sale or servicing of the Fund's shares. In addition to dealers, the financial
intermediaries that may receive payments include sponsors of fund "supermarkets," sponsors
of fee-based advisory or wrap fee programs, sponsors of college and retirement savings
programs, banks and trust companies offering products that hold Fund shares, and insurance
companies that offer variable annuity or variable life insurance products.

In general, these payments to financial intermediaries can be categorized as
"distribution-related" or "servicing" payments. Payments for distribution-related expenses,
such as marketing or promotional expenses, are often referred to as "revenue sharing."
Revenue sharing payments may be made on the basis of the sales of shares attributable to
that dealer, the average net assets of the Fund and other Oppenheimer funds attributable to
the accounts of that dealer and its clients, negotiated lump sum payments for distribution
services provided, or sales support fees. In some circumstances, revenue sharing 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. These
payments also may give an intermediary an incentive to cooperate with the Distributor's
marketing efforts. A revenue sharing payment may, for example, qualify the Fund for
preferred status with the intermediary receiving the payment or provide representatives of
the Distributor with access to representatives of the intermediary's sales force, in some
cases on a preferential basis over funds of competitors. Additionally, as firm support, the
Manager or Distributor may reimburse expenses related to educational seminars and "due
diligence" or training meetings (to the extent permitted by applicable laws or the rules of
the NASD) designed to increase sales representatives' awareness about Oppenheimer funds,
including travel and lodging expenditures. However, the Manager does not consider a
financial intermediary's sale of shares of the Fund or other Oppenheimer funds when
selecting brokers or dealers to effect portfolio transactions for the funds.

Various factors are used to determine whether to make revenue sharing payments.
Possible considerations include, without limitation, the types of services provided by the
intermediary, sales of Fund shares, the redemption rates on accounts of clients of the
intermediary or overall asset levels of Oppenheimer funds held for or by clients of the
intermediary, the willingness of the intermediary to allow the Distributor to provide
educational and training support for the intermediary's sales personnel relating to the
Oppenheimer funds, the availability of the Oppenheimer funds on the intermediary's sales
system, as well as the overall quality of the services provided by the intermediary and the
Manager or Distributor's relationship with the intermediary. The Manager and Distributor
have adopted guidelines for assessing and implementing each prospective revenue sharing
arrangement. To the extent that financial intermediaries receiving distribution-related
payments from the Manager or Distributor sell more shares of the Oppenheimer funds or
retain more shares of the funds in their client accounts, the Manager and Distributor
benefit from the incremental management and other fees they receive with respect to those
assets.

Payments may also be made by the Manager, the Distributor or the Transfer Agent to
financial intermediaries to compensate or reimburse them for administrative or other client
services provided such as sub-transfer agency services for shareholders or retirement plan
participants, omnibus accounting or sub-accounting, participation in networking
arrangements, account set-up, recordkeeping and other shareholder services. Payments may
also be made for administrative services related to the distribution of Fund shares through
the intermediary. Firms that may receive servicing fees include retirement plan
administrators, qualified tuition program sponsors, banks and trust companies, and others.
These fees may be used by the service provider to offset or reduce fees that would
otherwise be paid directly to them by certain account holders, such as retirement plans.

The Statement of Additional Information contains more information about revenue
sharing and service payments made by the Manager or the Distributor. Your dealer may charge
you fees or commissions in addition to those disclosed in this prospectus. You should ask
your dealer or financial intermediary for details about any such payments it receives from
the Manager or the Distributor and their affiliates, or any other fees or expenses it
charges.

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.

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

How to Sell Shares

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

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

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

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

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

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

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

HOW DO YOU SELL SHARES BY TELEPHONE? You and your dealer representative of record may also
sell your shares by telephone. To receive the redemption price calculated on a particular
regular business day, your call must be received by the Transfer Agent by the close of the
NYSE that day, which is normally 4:00 p.m., but may be earlier on some days. You may not
redeem shares held in an OppenheimerFunds-sponsored qualified retirement plan account or
under a share certificate by telephone.
o To redeem shares through a service representative or automatically on PhoneLink, call
1.800.225.5677.
Whichever method you use, you may have a check sent to the address on the account
statement, or, if you have linked your Fund account to your bank account on AccountLink,
you may have the proceeds sent to that bank account.

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

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

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

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

HOW CONTINGENT DEFERRED SALES CHARGES AFFECT REDEMPTIONS. If you purchase shares subject to
a Class A, Class B, Class C or Class N contingent deferred sales charge and redeem any of
those shares during the applicable holding period for the class of shares, the contingent
deferred sales charge will be deducted from the redemption proceeds (unless you are
eligible for a waiver of that sales charge based on the categories listed in Appendix B 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 B to the Statement
of Additional Information.
To determine whether a contingent deferred sales charge applies to a redemption, the
Fund redeems shares in the following order:
1. shares acquired by reinvestment of dividends and capital gains distributions,
2. shares held for the holding period that applies to the class, and
3. shares held the longest during the holding period.

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

How to Exchange Shares

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
carefully.

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 into 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.

A contingent deferred sales charge (CDSC) is not charged when you exchange shares of
the Fund for shares of another Oppenheimer fund. However, if you exchange your shares
during the applicable CDSC holding period, the holding period will carry over to the fund
shares that you acquire. Similarly, if you acquire shares of the Fund in exchange for
shares of another Oppenheimer fund that are subject to a CDSC holding period, that holding
period will carry over to the acquired shares of the Fund. In either of these situations, a
CDSC may be imposed if the acquired shares are redeemed before the end of the CDSC holding
period that applied to the exchanged shares.

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 a request letter, 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 letter.

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 NYSE that day, which is normally 4:00 p.m. Eastern time,
but may be earlier on some days, in order to receive that day's net asset value on
the exchanged shares. Exchange requests received after the close of the NYSE will
receive the next net asset value calculated after the request is received. However,
the Transfer Agent may delay transmitting the 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 being made or the fund into which the exchange is
being made. The proceeds will be invested in the fund into which the exchange is
being made at the next net asset value calculated after the proceeds are received. In
the event that such a delay in the reinvestment of proceeds occurs, the Transfer
Agent will notify you or your financial representative.

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. Further details are provided under "How
to Sell Shares."
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 that 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 the following additional
policies and procedures to detect and prevent frequent and/or excessive exchanges and
purchase and redemption activity:

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 in 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 $500 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 within 30 days after the Transfer Agent receives your request to stop
householding.

Dividends, Capital Gains and Taxes

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

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

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

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

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

The Fund intends to qualify each year 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.

Avoid "Buying a Distribution." If you buy shares on or just before the ex-dividend date, or
just before the Fund declares a capital gains distribution, you will pay the full
price for the shares and then receive a portion of the price back as a taxable
dividend or capital gain.
Remember, There May be Taxes on Transactions. Because the Fund's share prices fluctuate,
you may have a capital gain or loss when you sell or exchange your shares. A capital
gain or loss is the difference between the price you paid for the shares and the
price you received when you sold them. Any capital gain is subject to capital gains
tax.
Returns of Capital Can Occur. In certain cases, distributions made by the Fund may be
considered a non-taxable return of capital to shareholders. If that occurs, it will
be identified in notices to shareholders.

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

Financial Highlights

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



FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

CLASS A YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  11.29      $  11.50    $   8.91   $  14.92   $  39.08
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.04) 1,2     (.12) 1     (.06)      (.09)      (.18)
Net realized and unrealized gain (loss)               2.77          (.09) 1     2.65      (5.92)    (21.40)
                                                  ----------------------------------------------------------
Total from investment operations                      2.73          (.21)       2.59      (6.01)    (21.58)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  14.02      $  11.29    $  11.50   $   8.91   $  14.92
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   24.18%        (1.83)%     29.07%    (40.28)%   (57.56)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $121,097      $101,934    $120,101   $103,105   $233,045
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $113,233      $111,924    $100,922   $166,632   $357,113
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (0.29)% 2     (1.07)%     (0.93)%    (1.09)%    (0.81)%
Total expenses                                        1.61%         1.66%       1.83%      1.95%      1.33%
Expenses after payments and waivers and
reduction to custodian expenses                       1.42%         1.44%       1.29%      1.60%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        28 | OPPENHEIMER ENTERPRISE FUND


CLASS B YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  10.48      $  10.76    $   8.40   $  14.17   $  37.57
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.11) 1,2     (.20) 1     (.20)      (.41)      (.30)
Net realized and unrealized gain (loss)               2.54          (.08) 1     2.56      (5.36)    (20.52)
                                                  ----------------------------------------------------------
Total from investment operations                      2.43          (.28)       2.36      (5.77)    (20.82)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  12.91      $  10.48    $  10.76   $   8.40   $  14.17
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   23.19%        (2.60)%     28.10%    (40.72)%   (57.87)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 35,359      $ 45,904    $ 62,170   $ 52,633   $125,772
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 41,821      $ 54,878    $ 52,441   $ 86,628   $181,217
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (0.96)% 2     (1.86)%     (1.69)%    (1.85)%    (1.58)%
Total expenses                                        2.27%         2.53%       2.79%      2.71%      2.10%
Expenses after payments and waivers and
reduction to custodian expenses                       2.18%         2.23%       2.05%      2.36%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        29 | OPPENHEIMER ENTERPRISE FUND


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

CLASS C YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  10.49      $  10.77    $   8.41   $  14.19   $  37.61
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.12) 1,2     (.20) 1     (.17)      (.37)      (.32)
Net realized and unrealized gain (loss)               2.56          (.08) 1     2.53      (5.41)    (20.52)
                                                  ----------------------------------------------------------
Total from investment operations                      2.44          (.28)       2.36      (5.78)    (20.84)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  12.93      $  10.49    $  10.77   $   8.41   $  14.19
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   23.26%        (2.60)%     28.06%    (40.73)%   (57.86)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 13,600      $ 12,790    $ 14,594   $ 11,578   $ 25,468
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 13,458      $ 13,979    $ 12,521   $ 18,550   $ 37,410
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (1.03)% 2     (1.83)%     (1.70)%    (1.85)%    (1.57)%
Total expenses                                        2.41%         2.59%       2.80%      2.71%      2.10%
Expenses after payments and waivers and
reduction to custodian expenses                       2.18%         2.20%       2.06%      2.36%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        30 | OPPENHEIMER ENTERPRISE FUND


CLASS N YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001 1
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  11.18      $  11.41    $   8.87   $  14.90   $  17.74
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.08) 2,3     (.15) 2     (.13)      (.28)      (.01)
Net realized and unrealized gain (loss)               2.74          (.08) 2     2.67      (5.75)     (2.83)
                                                  ----------------------------------------------------------
Total from investment operations                      2.66          (.23)       2.54      (6.03)     (2.84)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --         --
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  13.84      $  11.18    $  11.41   $   8.87   $  14.90
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 4                   23.79%        (2.02)%     28.64%    (40.47)%   (16.01)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $  1,196      $    839    $    685   $    456   $     83
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $  1,058      $    781    $    537   $    249   $     12
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment loss                                  (0.66)% 3     (1.32)%     (1.24)%    (1.44)%    (0.94)%
Total expenses                                        2.00%         2.10%       2.09%      2.25%      1.75%
Expenses after payments and waivers and
reduction to custodian expenses                       1.68%         1.70%       1.60%      1.90%       N/A 6
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. For the period from March 1, 2001 (inception of offering) to August 31, 2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

4. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        31 | OPPENHEIMER ENTERPRISE FUND


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

CLASS Y  YEAR ENDED AUGUST 31,                                         2005          2004         2003       2002        2001
- --------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                               $  11.52      $  11.67     $   9.02   $  15.05   $   39.32
- --------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                            .01 1,2      (.07) 1      (.10)      (.10)       (.09)
Net realized and unrealized gain (loss)                                2.82          (.08) 1      2.75      (5.93)     (21.60)
                                                                   -------------------------------------------------------------
Total from investment operations                                       2.83          (.15)        2.65      (6.03)     (21.69)
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                                     --            --           --         --       (2.58)
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                                     $  14.35      $  11.52     $  11.67   $   9.02   $   15.05
                                                                   =============================================================

- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                    24.57%        (1.29)%      29.38%    (40.07)%    (57.48)%
- --------------------------------------------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                           $ 14,240      $ 14,376     $ 22,461   $ 16,020   $  25,450
- --------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                  $ 14,157      $ 19,642     $ 16,675   $ 19,590   $  49,978
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss)                                           0.10% 2      (0.62)%      (0.67)%    (0.70)%     (0.67)%
Total expenses                                                         1.05%         0.98%        1.72%      2.16%       1.36% 5
Expenses after payments and waivers and reduction to custodian
expenses                                                                N/A 6         N/A 6       1.03%      1.19%       1.20%
- --------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                  59%          123%         103%       150%        160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment income per share and the net investment income ratio include
$.08 and 0.64%, respectively, resulting from a special dividend from Microsoft
Corp. in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Added since August 31, 2001 to reflect expenses before reduction to custodian
expenses and voluntary waiver of transfer agent fees.

6. Reduction to custodian expenses less than 0.01%.

INFORMATION AND SERVICES

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

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

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

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

- ------------------------------------------------------------------------------
By Telephone:                 Call OppenheimerFunds Services toll-free:
                              1.800.CALL OPP (225.5677)
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
By Mail:                      Write to:
                              OppenheimerFunds Services
                              P.O. Box 5270
                              Denver, Colorado 80217-5270
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
On the Internet:              You can request these documents by e-mail
                              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.: 811-07265
PR0885.001.1205
Printed on recycled paper


                                 Appendix to Prospectus of
                                Oppenheimer Enterprise Fund


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

      A bar chart will be included in the Prospectus of Oppenheimer Enterprise Fund (the
"Fund") depicting the annual total returns of a hypothetical investment in Class A shares
of the Fund for each of the calendar years since the Fund's inception, 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

12/31/96                26.77%
12/31/97                18.75%
12/31/98                34.81%
12/31/99                105.75%
12/31/00                -40.60%
12/31/01                -36.28%
12/31/02                -37.33%
12/31/03                 34.02%
12/31/04                 12.99%

Oppenheimer Enterprise Fund

6803 South Tucson Way, Centennial, CO 80112-3924
1.800.CALL OPP (225.5677)

Statement of Additional Information dated December 28, 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 December 28, 2005. It should be read
together with the Prospectus. You can obtain the Prospectus 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.....................................
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.........................................
Payments to Fund Intermediaries........................................
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
Report of Independent Registered Public Accounting Firm................
Financial Statements...................................................

Appendix A: Industry Classifications................................... A-1
Appendix B: Special Sales Charge Arrangements and Waivers.............. B-1

ABOUT THE FUND

Additional Information About the Fund's Investment Policies and Risks

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

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

|X| Investments in Equity Securities. The Fund may invest in equity
securities of companies in any market capitalization range. Equity securities
include common stocks, preferred stocks, rights and warrants, and securities
convertible into common stock.

The Fund can also hold a portion of its assets in securities of issuers
having a larger market capitalization. At times, in the Manager's view, the
market may favor or disfavor securities of issuers of a particular
capitalization range. Therefore the Fund may focus its equity investments in
securities of one or more capitalization ranges, based upon the Manager's
judgment of where the best market opportunities are to seek the Fund's
objective.

Current income is not a criterion used to select portfolio securities.
However, certain debt securities may be selected for the Fund's portfolio for
defensive purposes (including debt securities that the Manager believes may
offer some opportunities for capital appreciation when stocks are
disfavored). Other debt securities may be selected because they are
convertible into common stock, as discussed below in "Convertible Securities."

|_| Over-the-Counter Securities. Securities of small
capitalization issuers may traded on securities exchanges or in the
over-the-counter market. The over-the-counter markets, both in the U.S. and
abroad, may have less liquidity than securities exchanges. That can affect
the price the Fund is able to obtain when it wants to sell a security.

Small-cap growth companies may offer greater opportunities for capital
appreciation than securities of large, more established companies. However,
these securities also involve greater risks than securities of larger
companies. Securities of small capitalization issuers may be subject to
greater price volatility in general than securities of large-cap and mid-cap
companies. Therefore, to the degree that the Fund has investments in smaller
capitalization companies at times of market volatility, the Fund's share
price may fluctuate more. As noted below, the Fund limits its investments in
unseasoned small cap issuers.

? Convertible Securities. While some convertible securities are a
form of debt security, in many cases their conversion feature (allowing
conversion into equity securities) causes them to be regarded by the Manager
more as "equity equivalents." As a result, the credit rating assigned to the
security has less impact on the Manager's investment decision with respect to
convertible debt securities than in the case of non-convertible fixed income
securities. To determine whether convertible securities should be regarded as
"equity equivalents," the Manager examines the following factors:
(1) whether, at the option of the investor, the convertible security can be
exchanged for a fixed number of shares of common stock of the
issuer,
(2) whether the issuer of the convertible securities has restated its
earnings per share of common stock on a fully diluted basis
(considering the effect of conversion of the convertible
securities), and
(3) the extent to which the convertible security may be a defensive "equity
substitute," providing the ability to participate in any
appreciation in the price of the issuer's common stock.

Convertible securities rank senior to common stock in a corporation's capital
structure and therefore are subject to less risk than common stock in case of
the issuer's bankruptcy or liquidation.

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

The Fund has no limitations on the ratings of the convertible debt
securities that it can buy. They can include securities that are investment
grade or below investment grade. Securities that are below investment grade
(whether they are rated by a nationally-recognized rating organization or are
unrated securities that the Manager deems to be below investment grade) have
greater risks of default than investment grade securities. Additionally, debt
securities are subject to interest rate risk. Their values tend to fall when
interest rates rise. The Fund does not anticipate that it will invest a
substantial amount of its assets in these types of securities.

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

? Preferred Stock. Preferred stock, unlike common stock, has a
stated dividend rate payable from the corporation's earnings. Preferred stock
dividends may be cumulative or non-cumulative. "Cumulative" dividend
provisions require all or a portion of prior unpaid dividends to be paid
before dividends can be paid on the issuer's common stock. Preferred stock
may be "participating" stock, which means that it may be entitled to a
dividend exceeding the stated dividend in certain cases.

If interest rates rise, the fixed dividend on preferred stocks may be
less attractive, causing the price of preferred stocks to decline. Preferred
stock may have mandatory sinking fund provisions, as well as provisions
allowing calls or redemptions prior to maturity, which can also have a
negative impact on prices when interest rates decline. Preferred stock
generally has a preference over common stock on the distribution of a
corporation's assets in the event of liquidation of the corporation. The
rights of preferred stock on distribution of a corporation's assets in the
event of a liquidation are generally subordinate to the rights associated
with a corporation's debt securities.

? Foreign Securities. The Fund can purchase equity securities issued or
guaranteed by foreign companies. "Foreign securities" include equity and debt
securities of companies organized under the laws of countries other than the
United States. They may be traded on foreign securities exchanges or in the
foreign over-the-counter markets.

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

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

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

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

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

|_| Passive Foreign Investment Companies. Some securities of corporations
domiciled outside the U.S. which the Fund may purchase, may be considered
passive foreign investment companies ("PFICs") under U.S. tax laws. PFICs are
those foreign corporations which generate primarily passive income. They tend
to be growth companies or "start-up" companies. For federal tax purposes, a
corporation is deemed a PFIC if 75% or more of the foreign corporation's
gross income for the income year is passive income or if 50% or more of its
assets are assets that produce or are held to produce passive income. Passive
income is further defined as any income to be considered foreign personal
holding company income within the subpart F provisions defined by IRCss.954.

Investing in PFICs involves the risks associated with investing in
foreign securities, as described above. There are also the risks that the
Fund may not realize that a foreign corporation it invests in is a PFIC for
federal tax purposes. Federal tax laws impose severe tax penalties for
failure to properly report investment income from PFICs. Following industry
standards, the Fund makes every effort to ensure compliance with federal tax
reporting of these investments. PFICs are considered foreign securities for
the purposes of the Fund's minimum percentage requirements or limitations of
investing in foreign securities.

|_| Special Risks of Emerging Markets. Emerging and developing
markets abroad may also offer special opportunities for growth investing but
have greater risks than more developed foreign markets, such as those in
Europe, Canada, Australia, New Zealand and Japan. There may be even less
liquidity in their securities markets, and settlements of purchases and sales
of securities may be subject to additional delays. They are subject to
greater risks of limitations on the repatriation of income and profits
because of currency restrictions imposed by local governments. Those
countries may also be subject to the risk of greater political and economic
instability, which can greatly affect the volatility of prices of securities
in those countries.

? Portfolio Turnover. "Portfolio turnover" describes the rate at which
the Fund traded its portfolio securities during its last fiscal year. For
example, if a fund sold all of its securities during the year, its portfolio
turnover rate would have been 100% annually. The Fund's portfolio turnover
rate will fluctuate from year to year, and the Fund may have a portfolio
turnover rate of more than 100% annually.

Increased portfolio turnover creates higher brokerage and transaction
costs for the Fund,
which may reduce its overall performance. Additionally, the realization of
capital gains from selling portfolio securities may result in distributions
of taxable long-term capital gains to shareholders, since the Fund will
normally distribute all of its capital gains realized each year, to avoid
excise taxes under the Internal Revenue Code.

Other Investment Techniques and Strategies. In seeking its objective, the
Fund from time to time can 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 them.

? Investing in Small, Unseasoned Companies. The Fund can invest in
securities of companies in any market capitalization range, including small,
unseasoned companies. These are companies that have been in operation for
less than three years, including the operations of any predecessors.
Securities of these companies may be subject to volatility in their prices.
They might have a limited trading market, which could adversely affect the
Fund's ability to dispose of them and could reduce the price the Fund might
be able to obtain for them. Other investors that own a security issued by a
small, unseasoned issuer for which there is limited liquidity might trade the
security when the Fund is attempting to dispose of its holdings of that
security. In that case the Fund might receive a lower price for its holdings
than might otherwise be obtained. The Fund currently does not intend to
invest more than 10% of its net assets in those securities.

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

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

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

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

Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission (the "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.

? 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 applicable
securities laws, 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 can 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 and participation interests that do not have puts exercisable
within seven days.

? Loans of Portfolio Securities. To raise cash for liquidity purposes,
the Fund can lend its portfolio securities to brokers, dealers and other
types of financial institutions approved by the Fund's Board of Trustees.
These loans are limited to not more than 25% of the value of the Fund's total
assets. The Fund currently does not intend to engage in loans of securities,
but if it does so, such loans will not likely exceed 5% of the Fund's total
assets.

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

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

? Borrowing for Leverage. The Fund may not borrow money, except to the
extent permitted under the Investment Company act, the rules or regulations
thereunder or any exemption therefrom that is applicable to the Fund, as such
statute, rules or regulations may be amended or interpreted from time to
time. Under current regulatory requirements, borrowings can be made only to
the extent that the value of the Fund's assets, less its liabilities other
than borrowings, is equal to at least 300% of all borrowings (including the
proposed borrowing). If the value of the Fund's assets fails to meet this
300% asset coverage requirement, the Fund will 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. Additionally, the Fund's net asset value per share might
fluctuate more than that of funds that do not borrow. Currently, the Fund
does not contemplate using this technique, but if it does so, it will not
likely do so to a substantial degree.

? Derivatives. The Fund can invest in a variety of derivative
investments to seek income for liquidity needs or for hedging purposes. Some
derivative investments the Fund can use are the hedging instruments described
below in this Statement of Additional Information. However, the Fund does not
use, and does not currently contemplate using, derivatives or hedging
instruments to a significant degree.

Some of the derivative investments the Fund can use include debt
exchangeable for common stock of an issuer or "equity-linked debt securities"
of an issuer. At maturity, the debt security is exchanged for common stock of
the issuer or it is payable in an amount based on the price of the issuer's
common stock at the time of maturity. Both alternatives present a risk that
the amount payable at maturity will be less than the principal amount of the
debt because the price of the issuer's common stock might not be as high as
the Manager expected.

? Hedging. Although the Fund does not anticipate the extensive use of
hedging instruments, the Fund can use them. It is not required to do so in
seeking its objective. To attempt to protect against declines in the market
value of the Fund's portfolio, to permit the Fund to retain unrealized gains
in the value of portfolio securities which have appreciated, or to facilitate
selling securities for investment reasons, the Fund could:
? sell futures contracts,
? buy puts on such futures or on securities, or
? write covered calls on securities or futures. Covered calls can also
be used to seek income, but the Manager does not expect to engage
extensively in that practice.

The Fund can use hedging to establish a position in the securities
market as a temporary substitute for purchasing particular securities. In
that case the Fund would normally seek to purchase the securities and then
terminate that hedging position. The Fund might also use this type of hedge
to attempt to protect against the possibility that its portfolio securities
would not be fully included in a rise in value of the market. To do so the
Fund could:
? buy futures, or
? buy calls on such futures or on securities.
The Fund's strategy of hedging with futures and options on futures will
be incidental to the Fund's activities in the underlying cash market. The
particular hedging instruments the Fund can use are described below. The Fund
may employ new hedging instruments and strategies when they are developed, if
those investment methods are consistent with the Fund's investment objective
and are permissible under applicable regulations governing the Fund.

? Futures. The Fund can buy and sell futures contracts that
relate to (1) broadly-based stock indices (these are referred to as "stock
index futures"), (2) other broadly-based securities indices (these are
referred to as "financial futures"), (3) debt securities (these are referred
to as "interest rate futures"), (4) foreign currencies (these are referred to
as "forward contracts"), (5) commodities (these are referred to as "commodity
futures") and (6) an individual stock ("single stock future").

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

The Fund can invest a portion of its assets in commodity futures
contracts. Commodity futures may be based upon commodities within five main
commodity groups: (1) energy, which includes crude oil, natural gas, gasoline
and heating oil; (2) livestock, which includes cattle and hogs; (3)
agriculture, which includes wheat, corn, soybeans, cotton, coffee, sugar and
cocoa; (4) industrial metals, which includes aluminum, copper, lead, nickel,
tin and zinc; and (5) precious metals, which includes gold, platinum and
silver. The Fund may purchase and sell commodity futures contracts, options
on futures contracts and options and futures on commodity indices with
respect to these five main commodity groups and the individual commodities
within each group, as well as other types of commodities.

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

Similarly, a single stock future obligates the seller to deliver (and
the purchaser to take) cash or a specified equity security to settle the
futures transaction. Either party could also enter into an offsetting
contract to close out the position. Single stock futures trade on a very
limited number of exchanges, with contracts typically not fungible among the
exchanges.

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

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

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

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

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

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

The Fund's custodian 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 option or when the
Fund enters into a closing transaction.

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

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

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

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

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

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

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

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

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

The Fund can buy puts whether or not it holds the underlying investment
in its portfolio. When the Fund purchases a put, it pays a premium and,
except as to puts on indices, has the right to sell the underlying investment
to a seller of a put on a corresponding investment during the put period at a
fixed exercise price.

Buying a put on an investment the Fund does not own (such as an index
or future) permits the Fund to resell the put or to buy the underlying
investment and sell it at the exercise price. The resale price will vary
inversely to the price of the underlying investment. If the market price of
the underlying investment is above the exercise price and, as a result, the
put is not exercised, the put will become worthless on its expiration date.

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

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

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

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

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

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

The Fund could write a call on a foreign currency to provide a hedge
against a decline in the U.S. dollar value of a security which the Fund owns
or has the right to acquire and which is denominated in the currency
underlying the option. That decline might be one that occurs due to an
expected adverse change in the exchange rate. This is known as a
"cross-hedging" strategy. In those circumstances, the Fund covers the option
by maintaining cash, U.S. government securities or other liquid, high-grade
debt securities in an amount equal to the exercise price of the option, in a
segregated account with the Fund's custodian bank.

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

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

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

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

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

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

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

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

The Fund can use hedging instruments to establish a position in the
securities markets as a temporary substitute for the purchase of individual
securities (long hedging) by buying futures and/or calls on such futures,
broadly-based indices or on securities. It is possible that when the Fund
does so the market might decline. If the Fund then concludes not to invest in
securities because of concerns that the market might decline further or for
other reasons, the Fund will realize a loss on the hedging instruments that
is not offset by a reduction in the price of the securities purchased.
? Forward Contracts. Forward contracts are foreign currency
exchange contracts. They are used to buy or sell foreign currency for future
delivery at a fixed price. The Fund uses them to "lock in" the U.S. dollar
price of a security denominated in a foreign currency that the Fund has
bought or sold, or to protect against possible losses from changes in the
relative values of the U.S. dollar and a foreign currency. The Fund limits
its exposure in foreign currency exchange contracts in a particular foreign
currency to the amount of its assets denominated in that currency or a
closely-correlated currency. The Fund may also use "cross-hedging" where the
Fund hedges against changes in currencies other than the currency in which a
security it holds is denominated.

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

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

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

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

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

However, to avoid excess transactions and transaction costs, the Fund
may maintain a net exposure to forward contracts in excess of the value of
the Fund's portfolio securities or other assets denominated in foreign
currencies if the excess amount is "covered" by liquid securities denominated
in any currency. The cover must be at least equal at all times to the amount
of that excess. As one alternative, the Fund may purchase a call option
permitting the Fund to purchase the amount of foreign currency being hedged
by a forward sale contract at a price no higher than the forward contract
price. As another alternative, the Fund may purchase a put option permitting
the Fund to sell the amount of foreign currency subject to a forward purchase
contract at a price as high or higher than the forward contact price.

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

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

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

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

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

? Regulatory Aspects of Hedging Instruments. The Commodities
Futures Trading Commission (the "CFTC") has eliminated limitations on futures
trading by certain regulated entities including registered investment
companies and consequently registered investment companies may engage in
unlimited futures transactions and options thereon provided that the Fund
claims an exclusion from regulation as a commodity pool operator. The Fund
has claimed such an exclusion from registration as a commodity pool operator
under the Commodity Exchange Act ("CEA"). The Fund may use futures and
options for hedging and non-hedging purposes to the extent consistent with
its investment objective, internal risk management guidelines adopted by the
Fund's investment advisor (as they may be amended from time to time), and as
otherwise set forth in the Fund's prospectus.

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 adviser as the Fund (or
an adviser that is an affiliate of the Fund's adviser). The exchanges also
impose position limits on futures transactions. An exchange may order the
liquidation of positions found to be in violation of those limits and may
impose certain other sanctions.

Under interpretations of staff members of the SEC regarding applicable
provisions of the Investment Company Act, when the Fund purchases a future,
it must segregate liquid assets in an amount equal to the purchase price of
the future, less the margin deposit applicable to it.

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

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

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

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

? Temporary Defensive and Interim Investments. When market or economic
conditions are unstable, or the Manager believes it is otherwise appropriate
to reduce holdings in stocks, the Fund can invest in a variety of debt
securities for defensive purposes. The Fund can also purchase these
securities for liquidity purposes to meet cash needs due to the redemption of
Fund shares, or to hold while waiting to reinvest cash received from the sale
of other portfolio securities. The Fund can buy:
|_| high-quality (rated in the top rating categories of
nationally-recognized rating organizations or deemed by the Manager
to be of comparable quality), short-term money market instruments,
including those issued by the U. S. Treasury or other government
agencies,
|_| commercial paper (short-term, unsecured, promissory notes of domestic
or foreign companies) rated in the top rating category of a
nationally recognized rating organization,
|_| debt obligations of corporate issuers, rated investment grade (rated at
least Baa by Moody's Investors Service, Inc. or at least BBB by
Standard & Poor's Corporation, or a comparable rating by another
rating organization), or unrated securities judged by the Manager to
have a comparable quality to rated securities in those categories,
|_| preferred stocks,
|_| certificates of deposit and bankers' acceptances of domestic and
foreign banks and savings and loan associations, and
|_| repurchase agreements.
Short-term debt securities would normally be selected for defensive or
cash management purposes because they can normally be disposed of quickly,
are not generally subject to significant fluctuations in principal value and
their value will be less subject to interest rate risk than longer-term debt
securities.

Other Investment Restrictions

? What Are "Fundamental Policies?" Fundamental policies are those
policies that the Fund has adopted to govern its investments that can be
changed only by the vote of a "majority" of the Fund's outstanding voting
securities. Under the Investment Company Act, a "majority" vote is defined as
the vote of the holders of the lesser of:

? 67% or more of the shares present or represented by proxy at a
shareholder meeting, if the holders of more than 50% of the
outstanding shares are present or represented by proxy, or
? more than 50% of the outstanding shares.

The Fund'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 principal investment policies are
described in the Prospectus.

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

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

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

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

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

? The Fund cannot underwrite securities of other companies. A permitted
exception is in case it is deemed to be an underwriter under the Securities
Act of 1933 when reselling any securities held in its own portfolio.

? The Fund cannot invest in real estate, physical commodities or
commodity contracts, except to the extent permitted under the Investment
Company Act, the rules or regulations thereunder or any exemption therefrom,
as such statute, rules or regulations may be amended or interpreted from time
to time.

|_| The Fund cannot issue senior securities, except to the extent
permitted under the Investment Company Act, the rules or regulations
thereunder or any exemption therefrom, as such statute, rules or regulations
may be amended or interpreted from time to time.

Unless the Prospectus or this Statement of Additional Information
states that a percentage restriction applies on an ongoing basis, it applies
only at the time the Fund makes an investment (except in the case of
borrowing and investments in illiquid securities). 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.

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

o The Fund cannot invest in the securities of other registered
investment companies or registered unit investment trusts in
reliance on sub-paragraph (F) or (G) of section 12(d)(1) of the
Investment Company Act.

o The Fund cannot invest in physical commodities or physical
commodity contracts or buy securities for speculative
short-term purposes. However, the Fund can buy and sell any of
the hedging instruments permitted by any of its other
policies. It can also buy and sell options, futures,
securities or other instruments backed by physical commodities
or whose investment return is linked to changes in the price
of physical commodities.

o The Fund cannot invest in other open-end investment companies or invest
more than 5% of its net assets in closed-end investment companies,
including small business investment companies. The Fund cannot make
any such investment at commission rates in excess of normal
brokerage commissions.

Another non-fundamental policy adopted by the Fund permits it to
invest all of its assets in the securities of a single open-end
management investment company for which the Manager, one of its
subsidiaries or a successor is the investment adviser or
sub-adviser. That fund must have substantially the same fundamental
investment objective, policies and limitations as the Fund. This
policy would permit the Fund to adopt a "master-feeder" structure.
Under that structure, the Fund would be a "feeder" fund and would
invest all of its assets in a single pooled "master fund" in which
other feeder funds could also invest. This could enable the Fund to
take advantage of potential operational and cost efficiencies in the
master-feeder structure. The Fund has no present intention of
adopting the master-feeder structure. If it did so, the Prospectus
and this Statement of Additional Information would be revised
accordingly.

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

Disclosure of Portfolio Holdings. The Fund has adopted policies and
procedures concerning the dissemination of information by employees, officers
and/or directors of the Manager, Distributor, and Transfer Agent. These
policies are designed to assure that non-public information about portfolio
securities is distributed only 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 the Fund.

o Public Disclosure. The Fund's portfolio holdings are made publicly
available no later than 60 days after the close of each of the Fund's
fiscal quarters in semi-annual and annual reports to shareholders, or
in its Statements of Investments on Form N-Q, which are publicly
available at the SEC. In addition, the top 10 or more holdings are
posted on the OppenheimerFunds' website at www.oppenheimerfunds.com in
the "Fund Profiles" section. Other general information about the Fund's
portfolio investments, such as portfolio composition by asset class,
industry, country, currency, credit rating or maturity, may also be
posted with a 15-day lag.

Until publicly disclosed, the 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, the
need for transparency must be balanced against the risk that third parties
who gain access to the 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 securities that portfolio managers
are trading on the 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 of the
Fund's non-public portfolio holdings. The receipt of investment advisory fees
or other fees and compensation paid to the Manager and its 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.

Except under special limited circumstances discussed below, month-end
lists of the Fund's complete portfolio holdings may be disclosed no sooner
than 30-days after the relevant month-end, subject to the procedures below.
If the Fund's complete portfolio holdings 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
information that is not publicly available regarding the Fund's
holdings confidential and agreeing not to trade directly or indirectly
based on the information.

The Fund's complete 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 independent registered public accounting firm,
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, if 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/or dealers 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, 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 the 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 the
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 (pursuant to confidentiality
agreements),
o To consultants for retirement plans for plan sponsors/discussions at
due diligence meetings (pursuant to confidentiality agreements),
o Investment bankers in connection with merger discussions (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's Board on
such compliance oversight and on the categories of entities and individuals
to which disclosure of portfolio holdings of the Fund has been made during
the preceding year pursuant to these policies. The CCO shall report to the
Fund's Board any material violation of these policies and procedures during
the previous calendar quarter and shall make recommendations to the Board 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 Research Legg 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 LLCNomura Securities
---------------------------------------------------------
---------------------------------------------------------
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 WassersteinPlexus
---------------------------------------------------------
---------------------------------------------------------
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
---------------------------------------------------------
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First Albany Roosevelt & Cross
---------------------------------------------------------
---------------------------------------------------------
First Albany Corporation Russell Mellon
---------------------------------------------------------
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Fixed Income Securities Ryan Beck & Co.
---------------------------------------------------------
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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
---------------------------------------------------------
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Goldman Stone & Youngberg
---------------------------------------------------------
---------------------------------------------------------
Goldman Sachs SWS Group
---------------------------------------------------------
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HSBC Taylor Rafferty
---------------------------------------------------------
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HSBC Securities Inc Think Equity Partners
---------------------------------------------------------
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ING Barings Thomas Weisel Partners
---------------------------------------------------------
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ISI Group UBS
---------------------------------------------------------
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Janney Montgomery Wachovia
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Jefferies Wachovia Corp
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---------------------------------------------------------
Jeffries & Co. Wachovia Securities
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JP Morgan Wescott Financial
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JP Morgan Securities William Blair
---------------------------------------------------------
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JPP Eurosecurities Yieldbook
---------------------------------------------------------
---------------------------------------------------------
Keefe, Bruyette & Woods
---------------------------------------------------------

How the Fund is Managed

Organization and History. The Fund is an open-end, diversified management
investment company with an unlimited number of authorized shares of
beneficial interest. The Fund was organized as a Massachusetts business trust
in 1995.

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 five classes of shares: Class A, Class B, Class
C, Class N and Class Y. All classes invest in the same investment
portfolio. Only retirement plans may purchase Class N shares. Only certain
institutional investors may elect to purchase Class Y shares. Each class of
shares:
o has its own dividends and distributions,
o pays certain expenses which may be different for the different classes,
o will generally have a different net asset value,
o will generally 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 a 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 a vote or declaration in writing 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, a Regulatory &
Oversight Committee, a Governance Committee and a Proxy Committee. The Audit
Committee is comprised solely of Independent Trustees. The members of the
Audit Committee are Joel W. Motley (Chairman), Kenneth A. Randall, Mary F.
Miller and Joseph M. Wikler. The Audit Committee held 6 meetings during the
Fund's fiscal year ended August 31, 2005. The Audit Committee furnishes the
Board with recommendations regarding the selection of the Fund's independent
registered public accounting firm (also referred to as the "independent
Auditors"). Other main functions of the Audit Committee outlined in the Audit
Committee Charter, include, but are not limited to: (i) reviewing the scope
and results of financial statement audits and the audit fees charged;
(ii) reviewing reports from the Fund's independent Auditors regarding the
Fund's internal accounting procedures and controls; (iii) reviewing reports
from the Manager's Internal Audit Department; (iv) maintaining a separate
line of communication between the Fund's independent Auditors and the
Trustees who are not "interested persons" under the Investment Company Act
(the "Independent Trustees"); (v) reviewing the independence of the Fund's
independent Auditors; and (vi) pre-approving the provision of any audit or
non-audit services by the Fund's independent Auditors, including tax
services, that are not prohibited by the Sarbanes-Oxley Act, to the Fund, the
Manager and certain affiliates of the Manager.

The members of the Regulatory & Oversight Committee are Robert G. Galli
(Chairman), Matthew P. Fink, Phillip A. Griffiths, Joel W. Motley and Brian
F. Wruble. The Regulatory & Oversight Committee held 6 meetings during the
Fund's fiscal year ended August 31, 2005. The Regulatory & Oversight
Committee evaluates and reports to the Board on the Fund's contractual
arrangements, including the Investment Advisory and Distribution Agreements,
transfer agency and shareholder service agreements and custodian agreements
as well as the policies and procedures adopted by the Fund to comply with the
Investment Company Act and other applicable law, among other duties as set
forth in the Regulatory & Oversight Committee's Charter.

The members of the Governance Committee are, Phillip A. Griffiths
(Chairman), Kenneth A. Randall, Russell S. Reynolds, Jr. and Peter I Wold.
The Governance Committee held 8 meetings during the Fund's fiscal year ended
August 31, 2005. The Governance Committee reviews the Fund's governance
guidelines, the adequacy of the Fund's Codes of Ethics, and develops
qualification criteria for Board members consistent with the Fund's
governance guidelines, among other duties set forth in the Governance
Committee's Charter.

The Governance Committee's functions also include the selection and
nomination of Trustees, including Independent Trustees, for election. The
Governance 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 Governance Committee has been able to identify from its
own resources an ample number of qualified candidates. Nonetheless, under the
current policy of the Board, if the Board determines that a vacancy exists or
is likely to exist on the Board, the Governance Committee will consider
candidates for Board membership including those recommended by the Fund's
shareholders. The Governance Committee will consider nominees recommended by
Independent Board members or recommended by any other Board members including
Board members affiliated with the Fund's Manager. The Governance Committee
may, upon Board approval, retain an executive search firm to assist in
screening potential candidates. Upon Board approval, the Governance Committee
may also use the services of legal, financial, or other external counsel that
it deems necessary or desirable in the screening process. Shareholders
wishing to submit a nominee for election to the Board may do so by mailing
their submission to the offices of OppenheimerFunds, Inc., Two World
Financial Center, 225 Liberty Street, 11th Floor, New York, New York
10281-1008, to the attention of the Board of Trustees of Oppenheimer
Enterprise Fund, c/o the Secretary of the Fund.

Submissions should, at a minimum, be accompanied by the following: (1)
the name, address, and business, educational, and/or other pertinent
background of the person being recommended; (2) a statement concerning
whether the person is an "interested person" as defined in the Investment
Company Act; (3) any other information that the Fund would be required to
include in a proxy statement concerning the person if he or she was
nominated; and (4) the name and address of the person submitting the
recommendation and, if that person is a shareholder, the period for which
that person held Fund shares. Shareholders should note that a person who owns
securities issued by Massachusetts Mutual Life Insurance Company (the parent
company of the Manager) would be deemed an "interested person" under the
Investment Company Act. In addition, certain other relationships with
Massachusetts Mutual Life Insurance Company or its subsidiaries, with
registered broker-dealers, or with the Funds' outside legal counsel may cause
a person to be deemed an "interested person."

The Governance Committee has not established specific qualifications
that it believes must be met by a Trustee nominee. In evaluating trustee
nominees, the Governance Committee considers, among other things, an
individual's background, skills, and experience; whether the individual is an
"interested person" as defined in the Investment Company Act; and whether the
individual would be deemed an "audit committee financial expert" within the
meaning of applicable SEC rules. The Governance Committee also considers
whether the individual's background, skills, and experience will complement
the background, skills, and experience of other Trustees and will contribute
to the Board. There are no differences in the manner in which the Governance
Committee evaluates nominees for trustees based on whether the nominee is
recommended by a shareholder. Candidates are expected to provide a mix of
attributes, experience, perspective and skills necessary to effectively
advance the interests of shareholders.

The members of the Proxy Committee are Russell S. Reynolds, Jr.
(Chairman), Matthew P. Fink and Mary F. Miller. The Proxy Committee held 1
meeting during the Fund's fiscal year ended August 31, 2005. The Proxy
Committee provides the Board with recommendations for the proxy voting of
portfolio securities held by the Fund and monitors proxy voting by the Fund.

Trustees and Officers of the Fund. Except for Mr. Murphy, each of the
Trustees is an "Independent Trustee" under the Investment Company Act. All of
the Trustees are also trustees or directors of the following Oppenheimer
funds (referred to as "Board I Funds"):

- ----------------------------------------------------------------------------------
Oppenheimer AMT-Free Municipals Oppenheimer International Growth Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer AMT-Free New York Oppenheimer International Large Cap Core
Municipals Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer International Small Company
Oppenheimer Balanced Fund Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer California Municipal Fund Oppenheimer International Value Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Limited Term California
Oppenheimer Capital Appreciation Fund Municipal Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Developing Markets Fund Oppenheimer Money Market Fund, Inc.
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Discovery Fund Oppenheimer Multi-State Municipal Trust
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Dividend Growth Fund Oppenheimer Portfolio Series
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Emerging Growth Fund Oppenheimer Real Estate Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Emerging Technologies Fund Oppenheimer Select Value Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Enterprise Fund Oppenheimer Series Fund, Inc.
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Global Fund OFI Tremont Core Strategies Hedge Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Global Opportunities Fund OFI Tremont Market Neutral Hedge Fund
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Gold & Special Minerals Oppenheimer Tremont Market Neutral Fund
Fund LLC
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer Growth Fund Oppenheimer Tremont Opportunity Fund LLC
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
Oppenheimer International Diversified
Fund Oppenheimer U.S. Government Trust
- ----------------------------------------------------------------------------------

In addition to being a director or trustee of each of the Board I
Funds, Messrs. Galli and Wruble are directors or trustees of ten other
portfolios, and Messrs. Wikler and Wold are trustees of one other portfolio,
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 reduced sales efforts realized by the
Distributor.

Messrs. Gilston, Gillespie, Murphy, Petersen, Szilagyi, Vandehey,
Wixted and Zack and Mses. Bloomberg and Ives, who are officers of the Fund,
hold the same offices with one or more of the other Board I Funds as with the
Fund. As of November 30, 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
held of record by an employee benefit plan for employees of the Manager,
other than the shares beneficially owned under that plan by the officers of
the Fund listed above. In addition, none of the Independent Trustees (nor any
of their immediate family members) owns securities of either the Manager or
the Distributor of the Board I Funds or of any entity directly or indirectly
controlling, controlled by or under common control with the Manager or the
Distributor.

|X| Affiliated Transactions and Material Business Relationships. Mr.
Reynolds has reported he has a controlling interest in The Directorship
Group, Inc. (the "Directorship Group"), a director recruiting firm that
provided consulting services to Massachusetts Mutual Life Insurance Company
(which controls the Manager) for fees of $137,500 for calendar year ended
December 31, 2002. Mr. Reynolds reported that the Directorship Group did not
provide consulting services to Massachusetts Mutual Life Insurance Company
during the calendar years ended December 31, 2003 and 2004 and does not
expect to provide any such services in the calendar year ending December 31,
2005.

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

Biographical Information. The Trustees and officers, their positions
with the Fund, length of service in such position(s) and principal
occupations and business affiliations during at least the past five years are
listed in the charts below. The charts also include information about each
Trustee's beneficial share ownership in the Fund and in all of the registered
investment companies that the Trustee oversees in the Oppenheimer family of
funds ("Supervised Funds"). Ms. Miller was elected to certain Board I Funds
during 2004 and did not hold shares of Board I Funds during the calendar year
ended December 31, 2004. Mr. Fink was elected to the Board I Funds in 2005
and did not hold shares of Board I Funds during the calendar year ended
December 31, 2004. The address of each Trustee in the chart below is 6803 S.
Tucson Way, Centennial, Colorado 80112-3924. Each Trustee serves for an
indefinite term, or until his or her resignation, retirement, death or
removal.

- --------------------------------------------------------------------------------------
Independent Trustees
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Name, Principal Occupation(s) During the Past Dollar Aggregate
Dollar Range
5 Years; Range of Of Shares
Position(s) Held Other Trusteeships/Directorships Held Shares Beneficially
with Fund, by Trustee; BeneficialOwned in
Length of Service, Number of Portfolios in Fund Complex Owned in Supervised
Age Currently Overseen by Trustee the Fund Funds
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
As of December 31, 2004
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Clayton K. Director of American Commercial Lines $0 Over $100,000
Yeutter, Chairman (barge company) (since January 2005);
of the Board of Attorney at Hogan & Hartson (law firm)
Trustees since (since June 1993); Director of Covanta
2003; Holding Corp. (waste-to-energy company)
Trustee since 1995 (since 2002); Director of Weyerhaeuser
Age: 75 Corp. (1999-April 2004); Director of
Caterpillar, Inc. (1993-December 2002);
Director of ConAgra Foods (1993-2001);
Director of Texas Instruments
(1993-2001); Director of FMC
Corporation (1993-2001). Oversees 38
portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Matthew P. Fink, Trustee of the Committee for Economic $0 $0
Trustee since 2005 Development (policy research
Age: 64 foundation) (since 2005); Director of
ICI Education Foundation (education
foundation) (since October 1991);
President of the Investment Company
Institute (trade association)
(1991-2004); Director of ICI Mutual
Insurance Company (insurance company)
(1991-2004). Oversees 38 portfolios in
the OppenheimerFunds complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Robert G. Galli, A director or trustee of other $0 Over $100,000
Trustee since 1995 Oppenheimer funds. Oversees 48
Age: 72 portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Phillip A. Director of GSI Lumonics Inc. $0 Over $100,000
Griffiths, Trustee (precision medical equipment supplier)
since 1999 (since 2001); Trustee of Woodward
Age: 67 Academy (since 1983); Senior Advisor of
The Andrew W. Mellon Foundation (since
2001); Member of the National Academy
of Sciences (since 1979); Member of the
American Philosophical Society (since
1996); Council on Foreign Relations
(since 2002); Director of the Institute
for Advanced Study (1991-2004);
Director of Bankers Trust New York
Corporation (1994-1999). Oversees 38
portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Mary F. Miller, Trustee of the American Symphony $0 $0
Trustee since 2004 Orchestra (not-for-profit) (since
Age: 63 October 1998); and Senior Vice
President and General Auditor of
American Express Company (financial
services company) (July 1998-February
2003). Oversees 38 portfolios in the
OppenheimerFunds complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Joel W. Motley, Director of Columbia Equity Financial $0 Over $100,000
Trustee since 2002 Corp. (privately-held financial
Age: 53 adviser) (since 2002); Managing
Director of Carmona Motley, Inc.
(privately-held financial adviser)
(since January 2002); Managing Director
of Carmona Motley Hoffman Inc.
(privately-held financial adviser)
(January 1998-December 2001); Member of
the Finance and Budget Committee of the
Council on Foreign Relations, the
Investment Committee of the Episcopal
Church of America, the Investment
Committee of Human Rights Watch and the
Investment Committee of Historic Hudson
Valley. Oversees 38 portfolios in the
OppenheimerFunds complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Kenneth A. Director of Dominion Resources, Inc. $0 Over $100,000
Randall, Trustee (electric utility holding company)
since 1995 (since February 1972); Former Director
Age: 78 of Prime Retail, Inc. (real estate
investment trust), Dominion Energy Inc.
(electric power and oil & gas
producer), Lumbermens Mutual Casualty
Company, American Motorists Insurance
Company and American Manufacturers
Mutual Insurance Company; Former
President and Chief Executive Officer
of The Conference Board, Inc.
(international economic and business
research). Oversees 38 portfolios in
the OppenheimerFunds complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Russell S. Chairman of The Directorship Search $0 Over $100,000
Reynolds, Jr., Group, Inc. (corporate governance
Trustee since 1995 consulting and executive recruiting)
Age: 74 (since 1993); Life Trustee of
International House (non-profit
educational organization); Former
Trustee of The Historical Society of
the Town of Greenwich. Oversees 38
portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Joseph M. Wikler, Director of the following medical $0 $50,001-$100,000
Trustee since 2005 device companies: Medintec (since 1992)
Age: 64 and Cathco (since 1996); Director of
Lakes Environmental Association (since
1996); Member of the Investment
Committee of the Associated Jewish
Charities of Baltimore (since 1994);
Director of Fortis/Hartford mutual
funds (1994-December 2001). Oversees 39
portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Peter I. Wold, President of Wold Oil Properties, Inc. $0 Over $100,000
Trustee since 2005 (oil and gas exploration and production
Age: 57 company) (since 1994); Vice President,
Secretary and Treasurer of Wold Trona
Company, Inc. (soda ash processing and
production) (since 1996); Vice
President of Wold Talc Company, Inc.
(talc mining) (since 1999); Managing
Member of Hole-in-the-Wall Ranch
(cattle ranching) (since 1979);
Director and Chairman of the Denver
Branch of the Federal Reserve Bank of
Kansas City (1993-1999); and Director
of PacifiCorp. (electric utility)
(1995-1999). Oversees 39 portfolios in
the OppenheimerFunds complex.
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
Brian F. Wruble, General Partner of Odyssey Partners, $0 Over $100,000
Trustee since L.P. (hedge fund) (since September
October 2005 1995); Director of Special Value
Age: 62 Opportunities Fund, LLC (registered
investment company) (since September
2004); Director of Zurich Financial
Investment Advisory Board (affiliate of
the Manager's parent company) (since
October 2004); Board of Governing
Trustees of The Jackson Laboratory
(non-profit) (since August 1990);
Trustee of the Institute for Advanced
Study (non-profit educational
institute) (since May 1992); Special
Limited Partner of Odyssey Investment
Partners, LLC (private equity
investment) (January 1999-September
2004); Trustee of Research Foundation
of AIMR (2000-2002) (investment
research, non-profit); Governor, Jerome
Levy Economics Institute of Bard
College (August 1990-September 2001)
(economics research); Director of Ray &
Berendtson, Inc. (May 2000-April 2002)
(executive search firm). Oversees 48
portfolios in the OppenheimerFunds
complex.
- --------------------------------------------------------------------------------------

The address of Mr. Murphy is Two World Financial Center, 225 Liberty
Street, 11th Floor, New York, NY 10281-1008. Mr. Murphy serves as a Trustee
for an indefinite term and as an officer for an indefinite term, or until his
resignation, retirement, death or removal. Mr. Murphy is an "Interested
Trustee" because he is affiliated with the Manager by virtue of his positions
as an officer and director of the Manager, and as a shareholder of its parent
company.

---------------------------------------------------------------------------------------
Interested Trustee and Officer
---------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
Name, Principal Occupation(s) During the Past 5 Dollar Aggregate
Dollar Range
Position(s) Range of Of Shares
Held with Shares Beneficially
Fund, Years; Other Trusteeships/Directorships Beneficially Owned in
Length of Held; Number of Portfolios in the Fund Owned in Supervised
Service, Age Complex Currently Overseen the Fund Funds
----------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------
As of December 31, 2004
----------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
John V. Chairman, Chief Executive Officer and $0 Over $100,000
Murphy, Director (since June 2001) and President
President (since September 2000) of the Manager;
and President and a director or trustee of other
Trustee Oppenheimer funds; President and Director of
since 2001 Oppenheimer Acquisition Corp. ("OAC") (the
Age: 56 Manager's parent holding company) and of
Oppenheimer Partnership Holdings, Inc.
(holding company subsidiary of the Manager)
(since July 2001); Director of
OppenheimerFunds Distributor, Inc.
(subsidiary of the Manager) (since November
2001); Chairman and Director of Shareholder
Services, Inc. and of Shareholder Financial
Services, Inc. (transfer agent subsidiaries
of the Manager) (since July 2001); President
and Director of OppenheimerFunds Legacy
Program (charitable trust program established
by the Manager) (since July 2001); Director
of the following investment advisory
subsidiaries of the Manager: OFI
Institutional Asset Management, Inc.,
Centennial Asset Management Corporation,
Trinity Investment Management Corporation and
Tremont Capital Management, Inc. (since
November 2001), HarbourView Asset Management
Corporation and OFI Private Investments, Inc.
(since July 2001); President (since November
1, 2001) and Director (since July 2001) of
Oppenheimer Real Asset Management, Inc.;
Executive Vice President of Massachusetts
Mutual Life Insurance Company (OAC's parent
company) (since February 1997); Director of
DLB Acquisition Corporation (holding company
parent of Babson Capital Management LLC)
(since June 1995); Member of the Investment
Company Institute's Board of Governors (since
October 3, 2003); Chief Operating Officer of
the Manager (September 2000-June 2001);
President and Trustee of MML Series
Investment Fund and MassMutual Select Funds
(open-end investment companies) (November
1999-November 2001); Director of C.M. Life
Insurance Company (September 1999-August
2000); President, Chief Executive Officer and
Director of MML Bay State Life Insurance
Company (September 1999-August 2000);
Director of Emerald Isle Bancorp and Hibernia
Savings Bank (wholly-owned subsidiary of
Emerald Isle Bancorp) (June 1989-June 1998).
Oversees 87 portfolios in the
OppenheimerFunds complex.
---------------------------------------------------------------------------------------

The address of the Officers in the chart below is as follows: for
Messrs. Gilston, Gillespie and Zack and Ms. Bloomberg, Two World Financial
Center, 225 Liberty Street, New York, New York 10281-1008, for Messrs.
Petersen, Szilagyi, Vandehey and Wixted and Ms. Ives, 6803 S. Tucson Way,
Centennial, CO 80112-3924. Each Officer serves for an indefinite term or
until his or her earlier resignation, retirement, death or removal.

- -------------------------------------------------------------------------------------
Officers of the Fund
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Name, Principal Occupation(s) During the Past 5 Years
Position(s) Held with Fund
Length of Service,
Age
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Alan Gilston, Vice President of the Manager since September 1997; an
Vice President and officer of 1 portfolio in the OppenheimerFunds complex.
Portfolio Manager since
2004
Age: 47
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Mark S. Vandehey, Senior Vice President and Chief Compliance Officer of
Vice President and Chief the Manager (since March 2004); Vice President of
Compliance Officer since OppenheimerFunds Distributor, Inc., Centennial Asset
2004 Management Corporation and Shareholder Services, Inc.
Age: 55 (since June 1983). Former Vice President and Director of
Internal Audit of the Manager (1997-February 2004). An
officer of 87 portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Brian W. Wixted, Senior Vice President and Treasurer of the Manager
Treasurer since 1999 (since March 1999); Treasurer of the following:
Age: 46 HarbourView Asset Management Corporation, Shareholder
Financial Services, Inc., Shareholder Services, Inc.,
Oppenheimer Real Asset Management Corporation, and
Oppenheimer Partnership Holdings, Inc. (since March
1999), OFI Private Investments, Inc. (since March 2000),
OppenheimerFunds International Ltd. (since May 2000),
OppenheimerFunds plc (since May 2000), OFI Institutional
Asset Management, Inc. (since November 2000), and
OppenheimerFunds Legacy Program (charitable trust
program established by the Manager) (since June 2003);
Treasurer and Chief Financial Officer of OFI Trust
Company (trust company subsidiary of the Manager) (since
May 2000); Assistant Treasurer of the following: OAC
(since March 1999),Centennial Asset Management
Corporation (March 1999-October 2003) and
OppenheimerFunds Legacy Program (April 2000-June 2003);
Principal and Chief Operating Officer of Bankers Trust
Company-Mutual Fund Services Division (March 1995-March
1999). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Brian Petersen, Assistant Vice President of the Manager (since August
Assistant Treasurer since 2002); Manager/Financial Product Accounting of the
2004 Manager (November 1998-July 2002). An officer of 87
Age: 35 portfolios in the OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Brian C. Szilagyi, Assistant Vice President of the Manager (since July
Assistant Treasurer since 2004); Director of Financial Reporting and Compliance of
2005 First Data Corporation (April 2003-July 2004); Manager
Age: 35 of Compliance of Berger Financial Group LLC (May
2001-March 2003). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Robert G. Zack, Executive Vice President (since January 2004) and
Secretary since 2001 General Counsel (since March 2002) of the Manager;
Age: 57 General Counsel and Director of the Distributor (since
December 2001); General Counsel of Centennial Asset
Management Corporation (since December 2001); Senior
Vice President and General Counsel of HarbourView Asset
Management Corporation (since December 2001); Secretary
and General Counsel of OAC (since November 2001);
Assistant Secretary (since September 1997) and Director
(since November 2001) of OppenheimerFunds International
Ltd. and OppenheimerFunds plc; Vice President and
Director of Oppenheimer Partnership Holdings, Inc.
(since December 2002); Director of Oppenheimer Real
Asset Management, Inc. (since November 2001); Senior
Vice President, General Counsel and Director of
Shareholder Financial Services, Inc. and Shareholder
Services, Inc. (since December 2001); Senior Vice
President, General Counsel and Director of OFI Private
Investments, Inc. and OFI Trust Company (since November
2001); Vice President of OppenheimerFunds Legacy Program
(since June 2003); Senior Vice President and General
Counsel of OFI Institutional Asset Management, Inc.
(since November 2001); Director of OppenheimerFunds
(Asia) Limited (since December 2003); 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 the following: Shareholder
Services, Inc. (May 1985-November 2001), Shareholder
Financial Services, Inc. (November 1989-November 2001),
and OppenheimerFunds International Ltd. (September
1997-November 2001). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Kathleen T. Ives, Vice President (since June 1998) and Senior Counsel and
Assistant Secretary since Assistant Secretary (since October 2003) of the Manager;
2001 Vice President (since 1999) and Assistant Secretary
Age: 40 (since October 2003) of the Distributor; Assistant
Secretary of Centennial Asset Management Corporation
(since October 2003); Vice President and Assistant
Secretary of Shareholder Services, Inc. (since 1999);
Assistant Secretary of OppenheimerFunds Legacy Program
and Shareholder Financial Services, Inc. (since December
2001); Assistant Counsel of the Manager (August
1994-October 2003). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Lisa I. Bloomberg, Vice President and Associate Counsel of the Manager
Assistant Secretary since (since May 2004); First Vice President (April 2001-April
2004 2004), Associate General Counsel (December 2000-April
Age: 37 2004), Corporate Vice President (May 1999-April 2001)
and Assistant General Counsel (May 1999-December 2000)
of UBS Financial Services Inc. (formerly, PaineWebber
Incorporated). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------
Phillip S. Gillespie, Senior Vice President and Deputy General Counsel of the
Assistant Secretary since Manager (since September 2004); Mr. Gillespie held the
2004 following positions at Merrill Lynch Investment
Age: 41 Management: First Vice President (2001-September 2004);
Director (2000-September 2004) and Vice President
(1998-2000). An officer of 87 portfolios in the
OppenheimerFunds complex.
- -------------------------------------------------------------------------------------

Remuneration of the Officers and Trustees. The officers and the interested
Trustee of the Fund, who are affiliated with the Manager, receive no salary
or fee from the Fund. The Independent Trustees' compensation from the Fund,
shown below, is for serving as a Trustee and member of a committee (if
applicable), with respect to the Fund's fiscal year ended August 31, 2005.
The total compensation from the Fund and fund complex represents
compensation, including accrued retirement benefits, for serving as a Trustee
and member of a committee (if applicable) of the Boards of the Fund and other
funds in the OppenheimerFunds complex during the calendar year ended
December 31, 2004.

- ----------------------------------------------------------------------------------------
Trustee Name and Other Aggregate Retirement Estimated Total
Compensation
From All
Annual Oppenheimer
Benefits Retirement Funds For Which
Accrued as Benefits to Individual
Fund Position(s) Compensation Part of Fund be Paid Upon Serves As
(as applicable) From Fund(1) Expenses Retirement(2) Trustee/Director
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Clayton K. Yeutter $834(3) None $86,171 $173,700
Chairman of the Board
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Matthew P. Fink(4) None None $2,641 None
Proxy Committee
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Robert G. Galli
Regulatory & Oversight $621 None $100,824(5) $237,312(6)
Committee Chairman
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Phillip Griffiths
Governance Committee
Chairman and Regulatory $722(7) None $34,972 $142,092
& Oversight Committee
Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Mary F. Miller(8)
Audit Committee Member
and Proxy Committee $343 None $7,128 $8,532
Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Joel W. Motley
Audit Committee
Chairman and Regulatory $724(9) None $23,945 $150,760
& Oversight Committee
Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Kenneth A. Randall $644 None(10) $85,944 $134,080
Audit Committee Member
and Governance
Committee Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Edward V. Regan(11) $527 None $70,977 $118,788
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Russell S. Reynolds, Jr. $514 None $66,602 $106,792
Proxy Committee Member
and Governance
Committee Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Donald Spiro(12) $53 None $0 $64,080
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Joseph M. Wikler(13) None - - $23,000
Audit Committee Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Peter I. Wold(13)
Governance Committee None - - $20,500
Member
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
Brian F. Wruble(1(4))
Regulatory & Oversight - - $22,238(1(5)) $111,000(1(6))
Committee Member
- ----------------------------------------------------------------------------------------
1. "Aggregate Compensation From the Fund" includes fees and deferred
compensation, if any.
2. "Estimated Annual Benefits 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 with respect to certain Board I Funds as
described below under "Retirement Plan for Trustees."
3. Includes $209 deferred by Mr. Yeutter under the "Deferred Compensation
Plan" described below.
4. Mr. Fink was appointed as a Director or Trustee of 10 of the Board I
Funds effective January 1, 2005 and was elected as Director or Trustee of
all of the other Board I Funds during 2005.
5. Includes $45,840 estimated to be paid to Mr. Galli for serving as a
Trustee or Director of 10 other Oppenheimer funds that are not Board I
Funds.
6. Includes $111,000 for serving as a trustee or director of 10 other
Oppenheimer funds (at December 31, 2004) that are not Board I Funds.
7. Includes $722 deferred by Mr. Griffiths under the "Deferred
Compensation Plan" described below.
8. Ms. Miller was appointed as Director or Trustee of 13 of the Board I
Funds effective August13, 2004 and of 9 of the Board I Funds effective
October 26, 2004. She was elected as Director or Trustee of all of the
other Board I Funds during 2005.
9. Includes $290 deferred by Mr. Motley under the "Deferred Compensation
Plan" described below.
10. Due to actuarial considerations, no additional retirement benefits were
accrued with respect to Mr. Randall.
11. Mr. Regan retired as Trustee of the Board I funds effective June 30,
2005.
12. Mr. Spiro retired as Trustee of the Board I funds effective October 31,
2004.
13. Mr. Wold and Mr. Wikler were elected as Trustees of the Board I Funds
as of August 17, 2005.
14. Mr. Wruble was appointed as Trustee of the Board I Funds effective
October 10, 2005.
15. Estimated benefits to be paid to Mr. Wruble for serving as a director
or trustee of 10 other Oppenheimer funds that are not Board I Funds. Mr.
Wruble's service as a director or trustee of such funds will not be
counted towards the fulfillment of his eligibility requirements for
payments under the Board I retirement plan, described below.
16. For serving as a director or trustee of 10 other Oppenheimer funds (at
December 31, 2004) that are not Board I Funds.

|X| Retirement Plan for Trustees. The Board I Funds have adopted a
retirement plan that provides for payments to retired Independent 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 I Funds for at least seven
years in order to be eligible for retirement plan benefits and must serve for
at least 15 years to be eligible for the maximum benefit. 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 Independent Trustees that enables
them to elect to defer receipt of all or a portion of the annual fees they
are entitled to receive from certain Board I Funds. 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
is determined based upon the performance of the selected funds.

Deferral of Trustees' fees under the plan will not materially affect a
Fund's assets, liabilities or net income per share. The plan will not
obligate a 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, a 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 November 30, 2005, the only persons who
owned of record or were known by the Fund to own beneficially 5% or more of
any class of the Fund's outstanding shares was:

John Van De Wiele TR, van De Wiele Engineering Inc., 401K PSP,
Briarpark Dr. Ste. 275, Houston, TX 77042-3725, which owned
17,530.006 Class N shares (14.83% of the Class N shares then
outstanding).

MG Trust Cust, VW International Inc., 700 17th St. Ste. 300,
Denver, CO 80202-3531, which owned 12,213.824 Class N shares
(10.33% of the Class N shares then outstanding).

J Quiring & D Hoeksema Tr, QST Consultations Ltd., 6410 Lake
Michigan Dr. P.O. Box 438, Allendale, MI 49401-0428, which
owned 9,507.472 Class N shares (8.04% of the Class N shares
then outstanding).

MassMutual Life Insurance Co, Attn: N225 Separate Investment
Acct, 1295 State St, Springfield MA 01111-001, which owned
526,077.312 Class Y shares (54.82% of the Class Y shares then
outstanding).

Taynik & Co. c/o Investors Bank & Trust, P.O. Box 9130,
Boston, MA 02117-9130, which owned 360,439.226 Class Y shares
(37.56% of the Class Y shares then outstanding).

MLPF&S for the Sole Benefit of its Customers, Attn Fund Admn,
4800 Deer Lake Dr. East Floor 3, Jacksonville, FL 32246-6484
Class Y shares (7.61% of the Class Y shares then outstanding).

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

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
Portfolio Proxy Voting Policies and Procedures include provisions to address
conflicts of interest that may arise between the Fund and the Manager or the
Manager's affiliates or business relationships. Such a conflict of interest
may arise, for example, where the Manager or an affiliate of the Manager
manages or administers the assets of a pension plan or other investment
account of the portfolio company soliciting the proxy or seeks to serve in
that capacity. The Manager and its affiliates generally seek to avoid such
conflicts by maintaining separate investment decision making processes to
prevent the sharing of business objectives with respect to proposed or actual
actions regarding portfolio proxy voting decisions. Additionally, the
Manager employs the following two procedures: (1) if the proposal that gives
rise to the conflict is specifically addressed in the Guidelines, the Manager
will vote the portfolio proxy in accordance with the Guidelines, provided
that they do not provide discretion to the Manager on how to vote on the
matter; and (2) if such proposal is not specifically addressed in the
Guidelines or the Guidelines provide discretion to the Manager on how to
vote, the Manager will vote in accordance with the third-party proxy voting
agent's general recommended guidelines on the proposal provided that the
Manager has reasonably determined that there is no conflict of interest on
the part of the proxy voting agent. If neither of the previous two
procedures provides an appropriate voting recommendation, the Manager may
retain an independent fiduciary to advise the Manager on how to vote the
proposal or may abstain from voting. The Guidelines' provisions with respect
to certain routine and non-routine proxy proposals are summarized below:

o The Fund generally votes with the recommendation of the issuer's
management on routine matters, including ratification of the
independent registered public accounting firm, unless circumstances
indicate otherwise.
o The Fund evaluates nominees for director nominated by management on a
case-by-case basis, examining the following factors, among others:
Composition of the board and key board committees, attendance at
board meetings, corporate governance provisions and takeover
activity, long-term company performance and the nominee's investment
in the company.
o In general, the Fund opposes anti-takeover proposals and supports the
elimination, or the ability of shareholders to vote on the
preservation or 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 without shareholder
approval.
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. The portfolio
manager of the Fund is employed by the Manager and is the person who is
principally responsible for the day-to-day management of the Fund's
portfolio. Other members of the Manager's Equity Portfolio Department provide
the portfolio managers with counsel and support in managing the Fund's
portfolio.

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

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

- --------------------------------------------------------------------------------
Fiscal Year ended 8/31: Management Fees Paid to OppenheimerFunds, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2003 $1,371,543
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2004 $1,509,454
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2005 $1,376,470
- --------------------------------------------------------------------------------

The investment advisory agreement states that in the absence of willful
misfeasance, bad faith, gross negligence in the performance of its duties or
reckless disregard of its obligations and duties under the investment
advisory agreement, the Manager is not liable for any loss 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 right of the
Fund to use the name "Oppenheimer" as part of its name.

Portfolio Manager. The Fund's portfolio is managed by Alan Gilston (referred
to as the "Portfolio Manager"). He is the person responsible for the
day-to-day management of the Fund's investments.

Other Accounts Managed. In addition to managing the Fund's
investment portfolio, Mr. Gilston also manages other investment portfolios
and other accounts on behalf of the Manager or its affiliates. The
following table provides information regarding the other portfolios and
accounts managed by Mr. Gilston as of August 31, 2005. No account has a
performance-based advisory fee:

Registered Other Pooled Other
Investment Investment
Companies Vehicles Accounts
------------------------------------------------------------------------
------------------------------------------------------------------------
Accounts Managed 1 None 1
------------------------------------------------------------------------
------------------------------------------------------------------------
Total Assets Managed* $185.9 None $11**
* In millions.
** In thousands.

As indicated above, the Portfolio Manager also manages other funds and
accounts. Potentially, at times, those responsibilities could conflict with
the interests of the Fund. That may occur whether the investment objectives
and strategies of the other funds and accounts are the same as, or different
from, the Fund's investment objectives and strategies. For example the
Portfolio Manager may need to allocate investment opportunities between the
Fund and another fund or account having similar objectives or strategies, or
he may need to execute transactions for another fund or account that could
have a negative impact on the value of securities held by the Fund. Not all
funds and accounts advised by the Manager have the same management fee. If
the management fee structure of another fund or account is more advantageous
to the Manager than the fee structure of the Fund, the Manager could have an
incentive to favor the other fund or account. However, the Manager's
compliance procedures and Code of Ethics recognize the Manager's fiduciary
obligation to treat all of its clients, including the Fund, fairly and
equitably, and are designed to preclude the Portfolio Manager from favoring
one client over another. It is possible, of course, that those compliance
procedures and the Code of Ethics may not always be adequate to do so. At
different times, the Fund's Portfolio Manager may manage other funds or
accounts with investment objectives and strategies similar to those of the
Fund, or he may manage funds or accounts with different investment objectives
and strategies.

Compensation of the Portfolio Managers. The Fund's Portfolio Manager
is employed and compensated by the Manager, not the Fund. Under the Manager's
compensation program for its portfolio managers and portfolio analysts, their
compensation is based primarily on the investment performance results of the
funds and accounts they manage, rather than on the financial success of the
Manager. This is intended to align the portfolio managers' and analysts'
interests with the success of the funds and accounts and their investors.
The Manager's compensation structure is designed to attract and retain highly
qualified investment management professionals and to reward individual and
team contributions toward creating shareholder value. As of August 31, 2005,
the Portfolio Manager's compensation consisted of three elements: a base
salary, an annual discretionary bonus and eligibility to participate in
long-term awards of options and appreciation rights in regard to the common
stock of the Manager's holding company parent. Senior portfolio managers may
also be eligible to participate in the Manager's deferred compensation plan.

The base pay component of each portfolio manager is reviewed regularly to
ensure that it reflects the performance of the individual, is commensurate
with the requirements of the particular portfolio, reflects any specific
competence or specialty of the individual manager, and is competitive with
other comparable positions, to help the Manager attract and retain talent.
The annual discretionary bonus is determined by senior management of the
Manager and is based on a number of factors, including a fund's pre-tax
performance for periods of up to five years, measured against an appropriate
benchmark selected by management. The Lipper benchmark with respect to the
Fund is Lipper - Multi-Cap Growth Funds. Other factors include management
quality (such as style consistency, risk management, sector coverage, team
leadership and coaching) and organizational development. The Portfolio
Manager's compensation is not based on the total value of the Fund's
portfolio assets, although the Fund's investment performance may increase
those assets. The compensation structure is also intended to be internally
equitable and serve to reduce potential conflicts of interest between the
Fund and other funds managed by the Portfolio Manager. The compensation
structure of the other funds managed by the Portfolio Manager is the same as
the compensation structure of the Fund, described above.

|X| Ownership of Fund Shares. As of August 31, 2005, the Portfolio Manager
beneficially owned shares of the Fund as follows:

----------------------------------------------------------
Range of Shares
Beneficially
Portfolio Manager Owned in the Fund
----------------------------------------------------------
----------------------------------------------------------
Alan Gilston $1 - $10,000
----------------------------------------------------------

Brokerage Policies of the Fund

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

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

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

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. The investment research received for the
commissions of those other accounts may be useful both to the Fund and one or
more of the Manager's other accounts. Investment research may be supplied to
the Manager by a third party at the instance of a broker through which trades
are placed.

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

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

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

---------------------------------------------------------------------
Fiscal Year Ended 8/31: Total Brokerage Commissions Paid by the
Fund(1)
---------------------------------------------------------------------
---------------------------------------------------------------------
2003 $603,533
---------------------------------------------------------------------
---------------------------------------------------------------------
2004 $608,872
---------------------------------------------------------------------
---------------------------------------------------------------------
2005 227,489(2)
---------------------------------------------------------------------
1. Amounts do not include spreads or commissions on principal transactions
on a net trade basis.
2. In the fiscal year ended 8/31/05, the amount of transactions directed
to brokers for research services was $1,012,776 and amount of the
commissions paid to broker-dealers for those services was $2,400.

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.

- --------------------------------------------------
Aggregate Class A Front-End
Front-End Sales Sales Charges
Fiscal Year Charges on Retained by
Ended 8/31: Class A Shares Distributor(1)
- --------------------------------------------------
- --------------------------------------------------
2003 $254,370 $73,120
- --------------------------------------------------
- --------------------------------------------------
2004 $238,036 $71,197
- --------------------------------------------------
- --------------------------------------------------
2005 $188,810 $62,821
- --------------------------------------------------
1. Includes amounts retained by a broker-dealer that is an affiliate or a
parent of the Distributor.

- -------------------------------------------------------------------------------
Concessions Concessions on Concessions on Concessions on
on Class A Class C Shares Class N Shares
Fiscal Year Shares Class B Shares Advanced by Advanced by
Ended 8/31: Advanced by Advanced by Distributor(1) Distributor(1)
Distributor(1)Distributor(1)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2003 $43,873 $239,969 $23,467 $1,828
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2004 $26,376 $217,766 $24,062 $3,996
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
2005 -$16,677 $151,414 $15,557 $1,959
- -------------------------------------------------------------------------------
1. The Distributor advances concession payments to financial
intermediaries for certain sales of Class A shares and for sales of
Class B, Class C and Class N shares from its own resources at the time
of sale.

- ----------------------------------------------------------------------------------
Class A

Class B Class C
Contingent Contingent Contingent Class N
Deferred Sales Deferred Sales Deferred Sales Contingent
Fiscal Year Charges Charges Charges Deferred Sales
Ended 8/31: Retained by Retained by Retained by Charges Retained
Distributor Distributor Distributor by Distributor
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
2003 $10,421 $150,890 $3,231 $1,813
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
2004 $2,536 $110,178 $4,496 $920
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
2005 $8,702 $100,671 $3,245 $2,350
- ----------------------------------------------------------------------------------

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

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 period 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.

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

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

For the fiscal year ended August 31, 2005 payments under the Class A
plan totaled $271,075, of which $4,821 was retained by the Distributor under
the arrangement described above, regarding grandfathered retirement accounts,
and included $19,429 paid to an affiliate of the Distributor's parent
company. Any unreimbursed expenses the Distributor incurs with respect to
Class A shares in any fiscal year cannot be recovered in subsequent years.
The Distributor may not use payments received under the Class A plan to pay
any of its interest expenses, carrying charges, or other financial costs, or
allocation of overhead.

|X| Class B, Class C and Class N 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 fees or to pay recipients the service fee on a
periodic basis, without payment in advance. However, the Distributor
currently intends to pay the service fee to recipients in advance for the
first year after Class B, Class C and Class N shares are purchased. After the
first year Class B, Class C or Class N shares are outstanding, after their
purchase, the Distributor makes service fee payments periodically on those
shares. The advance payment is based on the net asset value of shares sold.
Shares purchased by exchange do not qualify for the advance service fee
payment. If Class B, Class C or Class N shares are redeemed during the first
year after their purchase, the recipient of the service fees on those shares
will be obligated to repay the Distributor a pro rata portion of the advance
payment of the service fee made on those shares. Class B, Class C or Class N
shares may not be purchased by an investor directly from the Distributor
without the investor designating another registered broker-dealer. 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, Class C and Class N 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% and the asset-based sales charge and service fees
increase Class N expenses by 0.50% of the net assets per year of the
respective classes.

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

During a calendar year, the Distributor's actual expenses in selling
Class B, Class C and Class N shares may be more than the payments it receives
from the contingent deferred sales charges collected on redeemed shares and
from the asset-based sales charges paid to the Distributor by the Fund under
the distribution and service plans. Those excess expenses are carried over on
the Distributor's books and may be recouped from asset-based sales charge
payments from the Fund in future years. However, the Distributor has
voluntarily agreed to cap the amount of expenses under the plans that may be
carried over from year to year and recouped that relate to (i) expenses the
Distributor has incurred that represent compensation and expenses of its
sales personnel and (ii) other direct distribution costs it has incurred,
such as sales literature, state registration fees, advertising and
prospectuses used to offer Fund shares. The cap on the carry-over of those
categories of expenses is set at 0.70% of annual gross sales of shares of the
Fund. If those categories of expenses exceed the capped amount, the
Distributor bears the excess costs. If the Class B, Class C or Class N plan
were to be terminated by the Fund, the Fund's Board of Trustees may allow the
Fund to continue payments of the asset-based sales charge to the Distributor
for distributing shares prior to the termination of the plan.

- --------------------------------------------------------------------------------
Distribution and Service Fees Paid to the Distributor for the Fiscal Year
Ended 8/31/05
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class: Total Payments Amount Distributor's Distributor's
Aggregate Unreimbursed
Unreimbursed Expenses as %
Retained by Expenses Under of Net Assets
Under Plan Distributor Plan of Class
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class B Plan $416,415 $325,162(1) $983,004 2.78%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class C Plan $134,083 $20,719(2) $358,698 2.64%
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class N Plan $5,237 $2,886(3) $11,322 0.95%
- --------------------------------------------------------------------------------
1. Includes $7,287 paid to an affiliate of the Distributor's parent
company.
2. Includes $4,871 paid to an affiliate of the Distributor's parent
company.
3. Includes $193 paid to an affiliate of the Distributor's parent company.

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

Payments to Fund Intermediaries

Financial intermediaries may receive various forms of compensation or
reimbursement from the Fund in the form of 12b-1 plan payments as described
in the preceding section of this Statement of Additional Information. They
may also receive reallowance of commissions from the Distributor, derived
from sales charges paid by the clients of the financial intermediary, also as
described in this Statement of Additional Information. Additionally, the
Manager and/or the Distributor (including their affiliates) may make payments
to financial intermediaries in connection with their offering and selling
shares of the Fund and other Oppenheimer funds, providing marketing or
promotional support, transaction processing and/or administrative services.
Among the financial intermediaries that may receive these payments are
brokers and dealers who sell and/or hold shares of the Fund, banks (including
bank trust departments), registered investment advisers, insurance companies,
retirement plan and qualified tuition program administrators, third party
administrators, and other institutions that have selling, servicing or
similar arrangements with the Manager or Distributor. The payments to
intermediaries vary by the types of product sold, the features of the Fund
share class and the role played by the intermediary.

Possible types of payments to financial intermediaries include, without
limitation, those discussed below.

o Payments made by the Fund, or by an investor buying or selling shares
of the Fund may include:

o depending on the share class that the investor selects, contingent
deferred sales charges or initial front-end sales charges, all
or a portion of which front-end sales charges are payable by
the Distributor to financial intermediaries as sales
commissions (see "About Your Account" in the Prospectus);
o ongoing asset-based payments attributable to the share class selected,
including fees payable under the Fund's distribution and/or
service plans adopted under Rule 12b-1 under the Investment
Company Act, which are paid from the Fund's assets and
allocated to the class of shares to which the plan relates (see
"About the Fund -- Distribution and Service Plans" above);
o shareholder servicing payments for providing omnibus accounting,
recordkeeping, networking, sub-transfer agency or other
administrative or shareholder services, including retirement
plan and 529 plan administrative services fees, which are paid
from the assets of a Fund as reimbursement to the Manager or
Distributor for expenses they incur on behalf of the Fund.
o Payments made by the Manager or Distributor out of their respective
resources and assets, which may include profits the Manager
derives from investment advisory fees paid by the Fund. These
payments are made at the discretion of the Manager and/or the
Distributor. These payments, often referred to as "revenue
sharing" payments, may be in addition to the payments by the
Fund listed above.
o These types of payments may reflect compensation for marketing support,
support provided in offering the Fund or other Oppenheimer
funds through certain trading platforms and programs,
transaction processing or other services;
o The Manager and Distributor each may also pay other compensation to the
extent the payment is not prohibited by law or by any
self-regulatory agency, such as the NASD. Payments are made
based on the guidelines established by the Manager and
Distributor, subject to applicable law.

These payments may provide an incentive to financial intermediaries to
actively market or promote the sale of shares of the Fund or other
Oppenheimer funds, or to support the marketing or promotional efforts of the
Distributor in offering shares of the Fund or other Oppenheimer funds. In
addition, some types of payments may provide a financial intermediary with an
incentive to recommend the Fund or a particular share class. Financial
intermediaries may earn profits on these payments, since the amount of the
payment may exceed the cost of providing the service. Certain of these
payments are subject to limitations under applicable law. Financial
intermediaries may categorize and disclose these arrangements to their
clients and to members of the public in a manner different from the
disclosures in the Fund's prospectus and this Statement of Additional
Information. You should ask your financial intermediary for information about
any payments it receives from the Fund, the Manager or the Distributor and
any services it provides, as well as the fees and commissions it charges.

Although brokers or dealers that sell Fund shares may also act as a
broker or dealer in connection with the execution of the purchase or sale of
portfolio securities by the Fund or other Oppenheimer funds, a financial
intermediary's sales of shares of the Fund or such other Oppenheimer funds is
not a consideration for the Manager when choosing brokers or dealers to
effect portfolio transactions for the Fund or such other Oppenheimer funds.

Revenue sharing payments can pay for distribution-related or asset
retention items including, without limitation,

o transactional support, one-time charges for setting up access for the
Fund or other Oppenheimer funds on particular trading systems, and
paying the intermediary's networking fees;
o program support, such as expenses related to including the Oppenheimer
funds in retirement plans, college savings plans, fee-based advisory
or wrap fee programs, fund "supermarkets", bank or trust company
products or insurance companies' variable annuity or variable life
insurance products;
o placement on the dealer's list of offered funds and providing
representatives of the Distributor with access to a financial
intermediary's sales meetings, sales representatives and management
representatives.

Additionally, the Manager or Distributor may make payments for firm
support, such as business planning assistance, advertising, and educating a
financial intermediary's sales personnel about the Oppenheimer funds and
shareholder financial planning needs.

For the year ended December 31, 2004, the following financial
intermediaries that are broker-dealers offering shares of the Oppenheimer
funds, and/or their respective affiliates, received revenue sharing or
similar distribution-related payments from the Manager or Distributor for
marketing or program support:

===============================================================================
ADVEST INC. AEGON
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
A.G. Edwards & Sons, Inc AIG Network
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-------------------------------------------------------------------------------
Allianz Life Insurance Company Allstate Life Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Ameritas Life Insurance Corporation American Centurian Life Insurance
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
American Enterprise Life Insurance American Express Financial Advisors
Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
American Portfolios Annuity Investors Life
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-------------------------------------------------------------------------------
AXA Advisors Banc One Securities Corporation
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-------------------------------------------------------------------------------
Bank of New York Cadaret Grant & Co. Inc.
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-------------------------------------------------------------------------------
Charter One Securities Inc. Chase Investment Services
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Citigroup Financial Network CitiStreet
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-------------------------------------------------------------------------------
Citizens Bank of Rhode Island CJM Planning Corp.
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-------------------------------------------------------------------------------
Columbus Life Insurance Company Commonwealth Financial Network
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CUNA Brokerage Services Inc. CUSO Financial Services, L.P.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Federal Kemper First Allied Securities Inc
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First Global Capital GE Financial Assurance
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
GlenBrook Life and Annuity Co. Great West Life & Annuity Co., Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
HD Vest Hewitt Associates
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HSBC Brokerage (USA) Inc. ING Network
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Jefferson Pilot Securities Corporation John Hancock Variable Life Insurance
Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Kemper Life Assurance Company Legend Equities Corporation
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Legg Mason Wood Walker, Incorporated Lincoln National Life Insurance
Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Lincoln Financial Advisors Corporation Lincoln Investment Planning
-------------------------------------------------------------------------------
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Linsco/Private Ledger Corp. MassMutual Financial Group and
affiliates
-------------------------------------------------------------------------------
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McDonald Investments, Inc. Merrill Lynch & Co., Inc. and
affiliates
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Metlife and affiliates Minnesota Life Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Morgan Stanley DW Inc. NPH Network
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-------------------------------------------------------------------------------
Nationwide and affiliates New York Life Securities, LLC
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PacLife Network Park Avenue Securities LLC
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-------------------------------------------------------------------------------
Planmember Securities Corporation Prime Capital Services, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Princor Financial Services Corporation Protective Life Insurance Co.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Provident Mutual Insurance Company Prudential Investment Management
Services LLC
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Raymond James Financial Services, Inc. Raymond James & Associates, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
RBC Dain Rauscher Inc. Securities America, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Security Benefit Life Insurance Company Signator Investments
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Sun Life Insurance Company Suntrust Investment Services, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Tower Square Securities, Inc Travelers Life & Annuity Co., Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
UBS Financial Services Inc. Union Central Life Insurance Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Wachovia Securities LLC Wells Fargo Investments, LLC
===============================================================================

For the year ended December 31, 2004, the following firms, which in
some cases are broker-dealers, received payments from the Manager or
Distributor for administrative or other services provided (other than revenue
sharing arrangements), as described above:

===============================================================================
ABN AMRO ADP
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Alliance Benefit Group AMVESCAP Retirement Plans
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American Stock & Transfer Baden Retirement
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BCG Benefit Administration Co., LLC
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-------------------------------------------------------------------------------
Benefit Administration, Inc. Benefit Plans Administrative Services
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Benetech, Inc. BISYS Retirement Services
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Boston Financial Data Services Ceridian
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Circle Trust Company Citigroup
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CitiStreet CPI
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Daily Access.Com, Inc. Digital Retirement Solutions
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Dyatech ERISA Administrative Services, Inc.
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-------------------------------------------------------------------------------
ExpertPlan.com FAScore
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FBD Consulting Federated Investors
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Fidelity Institutional First National Bank of Omaha
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First Trust Corp. Franklin Templeton
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Geller Group Gold K
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Great West Financial Services Hartford Life Insurance Co.
Equities, Inc.
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ICMA - RC Services In West Pension Mgmt
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-------------------------------------------------------------------------------
Independent Plan Coordinators Ingham Group
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Interactive Retirement Systems, Ltd. Invesmart, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Kaufman & Goble Leggette & Co., Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Manulife MassMutual Financial Group and
affiliates
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-------------------------------------------------------------------------------
Matrix Settlement & Clearance Services Mellon HR Solutions
-------------------------------------------------------------------------------
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Merrill Lynch & Co., Inc. Metavante
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Metlife Securities Inc. MFS Investment Management
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Mid Atlantic Capital Corp. Milliman USA
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Morgan Stanley DW Inc. National City Bank
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
National Financial Services Corp. National Investors Services Corp.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Nationwide Investment Service Corp. New York Life Investment Management,
Inc.
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-------------------------------------------------------------------------------
Northwest Plan Services Pension Administration and Consulting
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
PFPC, Inc. PSMI Group
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Putnam Fiduciary Trust Company Quads Trust Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
RSM McGladrey SAFECO
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Charles Schwab & Co., Inc. Security Trust Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Sentinel / National Life Standard Insurance Co
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-------------------------------------------------------------------------------
Stanley, Hunt, Dupree & Rhine State Street Bank & Trust Company
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Suntrust Investment Services, Inc. Swerdlin & Co.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
T. Rowe Price Brokerage Services, L.P. Taylor, Perky & Parker, LLC
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
The 401k Company The Investment Center, Inc.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Trusource Union Bank and Trust Co.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
USI Consulting Group Vanguard Group
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Web401K.com Wilmington Trust Company
===============================================================================

Performance of the Fund

Explanation of Performance Terminology. The Fund uses a variety of terms to
illustrate its investment performance. Those terms include "cumulative total
return," "average annual total return," "average annual total return at net
asset value" and "total return at net asset value." An explanation of how
total returns are calculated is set forth below. The charts below show the
Fund's performance as of the Fund's most recent fiscal year end. You can
obtain current performance information by calling the Fund's Transfer Agent
at 1.800.225.5677 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 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 total returns are not
guaranteed and normally will fluctuate on a daily basis.
o When an investor's shares are redeemed, they may be worth more or less
than their original cost.
o Total returns for any given past period represent historical
performance information and are not, and should not be considered, a
prediction of future returns.

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

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

In calculating total returns for Class A shares, the current maximum
sales charge of 5.75% (as a percentage of the offering price) is deducted
from the initial investment ("P" 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. For Class N shares, the 1.0% contingent deferred sales charge is
deducted for returns for the one-year period, and total returns for the
periods prior to 03/01/01 (the inception date for Class N shares) are based
on the Fund's Class A returns, adjusted to reflect the higher Class N 12b-1
fees. 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 l/n - 1 Average Annual Total
Return
P

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

- 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 Class A, Class B, Class C or Class N
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 8/31/05
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class of Cumulative Total Average Annual Total Returns
Returns (10
years or
Shares life-of-class)
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
1-Year 10-Years
(or life of
5-Years class if less)
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
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 82.75% 93.90% 17.04% 24.18% -17.77% -16.79% 6.33% 6.98%
A(1)
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class
B(2) 85.50% 85.50% 18.19% 23.19% -17.73% -17.43% 6.50% 6.50%
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class
C(3) 80.37% 80.37% 22.26% 23.26% -17.42% -17.42% 6.19% 6.19%
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class
N(4) -21.98% -21.98% 22.79% 23.79% -5.37% -5.37% N/A N/A
- ---------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------
Class
Y(5) -29.14% -29.14% 24.57% 24.57% -16.52% -16.52% -5.23% -5.23%
- ---------------------------------------------------------------------------------
1. Inception of Class A: 11/07/95
2. Inception of Class B: 11/07/95
3. Inception of Class C: 11/07/95
4. Inception of Class N: 03/01/01
5. Inception of Class Y: 04/01/99

- -------------------------------------------------------------------------------
Average Annual Total Returns for Class A(1) Shares (After Sales Charge)
For the Periods Ended 8/31/05
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1-Year 10-Years
5-Years (or life of class
if less)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
After Taxes on Distributions 17.04% -18.25% 5.17%
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
After Taxes on Distributions 11.08% -14.12% 5.02%
and Redemption of Fund Shares
- -------------------------------------------------------------------------------
1. Inception of Class A: 11/07/95

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 mutual
funds in their specialized market sector. The Fund is rated among mid-cap
growth category.

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 B 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 "NYSE"). The NYSE 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 NYSE, 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 B to this Statement of Additional Information because the
Distributor or dealer or broker incurs little or no selling expenses.

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 Main Street Opportunity
Oppenheimer Balanced Fund Fund
Oppenheimer Main Street Small Cap
Oppenheimer Core Bond Fund Fund
Oppenheimer California Municipal Fund Oppenheimer MidCap Fund
Oppenheimer Capital Appreciation Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer Pennsylvania Municipal
Oppenheimer Capital Income Fund 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
Oppenheimer Discovery Fund Fund, Inc.
Oppenheimer Quest International
Oppenheimer Dividend Growth Fund Value Fund, Inc.
Oppenheimer Quest Opportunity Value
Oppenheimer Emerging Growth Fund Fund
Oppenheimer Emerging Technologies Fund Oppenheimer Quest Value Fund, Inc.
Oppenheimer Enterprise Fund Oppenheimer Real Asset Fund
Oppenheimer Equity Fund, Inc. Oppenheimer Real Estate Fund
Oppenheimer Rochester National
Oppenheimer Global Fund Municipals
Oppenheimer Global Opportunities Fund Oppenheimer Select Value Fund
Oppenheimer Gold & Special Minerals Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Small- & Mid- Cap Value
Oppenheimer Growth Fund Fund
Oppenheimer High Yield Fund Oppenheimer Strategic Income Fund
Oppenheimer International Bond Fund Oppenheimer Total Return Bond Fund
Oppenheimer International Diversified
Fund Oppenheimer U.S. Government Trust
Oppenheimer International Growth Fund Oppenheimer Value Fund
Oppenheimer International Small Company
Fund Limited-Term New York Municipal Fund
Oppenheimer International Value Fund Rochester Fund Municipals

Oppenheimer Limited Term California
Municipal Fund Oppenheimer Portfolio Series:
Active Allocation Fund
Aggressive Investor Fund
Conservative Investor Fund
Oppenheimer Limited-Term Government Fund Moderate Investor Fund

And the following money market funds:

Oppenheimer Cash Reserves Centennial Money Market Trust
Centennial New York Tax Exempt
Oppenheimer Money Market Fund, Inc. 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 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 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, Inc. 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
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 and Class C shares of other Oppenheimer funds acquired subject
to a contingent deferred sales charge, and
(c) Class A, Class B or Class C 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 or Class C 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.

If you make payments from your bank account to purchase shares of the
Fund, your bank account will be debited automatically. Normally the debit
will be made two business days prior to the investment dates you selected on
your application. Neither the Distributor, the Transfer Agent nor the Fund
shall be responsible for any delays in purchasing shares that result from
delays in ACH transmissions.

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

Retirement Plans. Certain types of retirement plans are entitled to purchase
shares of the Fund without sales charges or at reduced sales charge rates, as
described in Appendix B to this Statement of Additional Information. Certain
special sales charge arrangements described in that Appendix apply to
retirement plans whose records are maintained on a daily valuation basis by
Merrill Lynch Pierce Fenner & Smith, Inc. ("Merrill Lynch") or an independent
record keeper that has a contract or special arrangement with Merrill Lynch.
If on the date the plan sponsor signed the Merrill Lynch record keeping
service agreement the plan has less than $1 million in assets invested in
applicable investments (other than assets invested in money market funds),
then the retirement plan may purchase only Class C shares of the Oppenheimer
funds. If on the date the plan sponsor signed the Merrill Lynch record
keeping service agreement the plan has $1 million or more in assets but less
than $5 million in assets invested in applicable investments (other than
assets invested in money market funds), then the retirement plan may purchase
only Class N shares of the Oppenheimer funds. If on the date the plan
sponsor signed the Merrill Lynch record keeping service agreement the plan
has $5 million or more in assets invested in applicable investments (other
than assets invested in money market funds), then the retirement plan may
purchase only Class A shares of the Oppenheimer funds.

OppenheimerFunds has entered into arrangements with certain record
keepers whereby the Transfer Agent compensates the record keeper for its
record keeping and account servicing functions that it performs on behalf of
the participant level accounts of a retirement plan. While such compensation
may act to reduce the record keeping fees charged by the retirement plan's
record keeper, that compensation arrangement may be terminated at any time,
potentially affecting the record keeping fees charged by the retirement
plan's record keeper.

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

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

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

The Distributor will not accept a purchase order of more than $100,000
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).

Class B, Class C or Class N shares may not be purchased by an investor
directly from the Distributor without the investor designating another
registered broker-dealer.

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

|X| Class B Conversion. Under current interpretations of applicable
federal income tax law by the Internal Revenue Service, the conversion of
Class B shares to Class A shares 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| Availability of Class N Shares. In addition to the description of
the types of retirement plans which may purchase Class N shares contained in
the prospectus, Class N shares also are offered to the following:
o to all rollover IRAs (including SEP IRAs and SIMPLE IRAs),
o to all rollover contributions made to Individual 401(k) plans,
Profit-Sharing Plans and Money Purchase Pension Plans,
o to all direct rollovers from OppenheimerFunds-sponsored Pinnacle and
Ascender retirement plans,
o to all trustee-to-trustee IRA transfers,
o to all 90-24 type 403(b) transfers,
o to Group Retirement Plans (as defined in Appendix B to this Statement
of Additional Information) which have entered into a special
agreement with the Distributor for that purpose,
o to Retirement Plans qualified under Sections 401(a) or 401(k) of the
Internal Revenue Code, the recordkeeper or the plan sponsor for
which has entered into a special agreement with the Distributor,
o to Retirement Plans of a plan sponsor where the aggregate assets of all
such plans invested in the Oppenheimer funds is $500,000 or more,
o to Retirement Plans with at least 100 eligible employees or $500,000 or
more in plan assets,
o to OppenheimerFunds-sponsored Ascender 401(k) plans that pay for the
purchase with the redemption proceeds of Class A shares of one or
more Oppenheimer funds, and
o to certain customers of broker-dealers and financial advisors that are
identified in a special agreement between the broker-dealer or
financial advisor and the Distributor for that purpose.

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

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

|X| Allocation of Expenses. The Fund pays expenses related to its
daily operations, such as custodian fees, 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
in 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:
o 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 NYSE on each day that the NYSE 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 NYSE 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 NYSE's most recent annual announcement (which is
subject to change) states that it will close on New Year's Day, Martin Luther
King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving Day and Christmas Day. It may also close on other
days.

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

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

|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 Equity securities traded on a U.S. securities exchange or on NASDAQ(R)
are valued as follows:
(1) if last sale information is regularly reported, they are valued at the
last reported sale price on the principal exchange on which
they are traded or on NASDAQ(R), as applicable, on that day, or
(2) if last sale information is not available on a valuation date, they are
valued at the last reported sale price preceding the valuation
date if it is within the spread of the closing "bid" and
"asked" prices on the valuation date or, if not, at the
closing "bid" price on the valuation date.
o Equity securities traded on a foreign securities exchange generally are
valued in one of the following ways:
(1) at the last sale price available to the pricing service approved by the
Board of Trustees, or
(2) at the last sale price obtained by the Manager from the report of the
principal exchange on which the security is traded at its last
trading session on or immediately before the valuation date, or
(3) at the mean between the "bid" and "asked" prices obtained from the
principal exchange on which the security is traded or, on the
basis of reasonable inquiry, from two market makers in the
security.
o Long-term debt securities having a remaining maturity in excess of 60
days are valued based on the mean between the "bid" and "asked" prices
determined by a portfolio pricing service approved by the Fund's Board of
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 U.S. government securities, mortgage-backed securities,
corporate bonds and foreign government securities, when last sale information
is not generally available, the Manager may use pricing services approved by
the Board of 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.

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

Puts, calls, and futures are valued at the last sale price on the
principal exchange on which they are traded or on NASDAQ(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 or put
written by the Fund is exercised, the proceeds are increased by the premium
received. If a call or put written by the Fund expires, the Fund has a gain
in the amount of the premium. If the Fund enters into a closing purchase
transaction, it will have a gain or loss, depending on whether the premium
received was more or less than the cost of the closing transaction. If the
Fund exercises a put it holds, the amount the Fund receives on its sale of
the underlying investment is reduced by the amount of premium paid by the
Fund.

How to Sell Shares

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

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

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

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

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 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,
Class C and Class N contingent deferred sales charge will be followed in
determining the order in which shares are transferred.

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

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

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

Special Arrangements for Repurchase of Shares from Dealers and Brokers. The
Distributor is the Fund's agent to repurchase its shares from authorized
dealers or brokers on behalf of their customers. Shareholders should contact
their broker or dealer to arrange this type of redemption. The repurchase
price per share will be the net asset value next computed after the
Distributor receives an order placed by the dealer or broker. However, if the
Distributor receives a repurchase order from a dealer or broker after the
close of the NYSE 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 NYSE closes. Normally, the NYSE 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, Class C and Class N shareholders should not establish automatic
withdrawal plans, because of the potential imposition of the contingent
deferred sales charge on such withdrawals (except where the Class B, Class C
or Class N contingent deferred sales charge is waived as described in
Appendix B 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.

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

The following funds do not offer Class N shares:
Limited Term New York Municipal Fund Oppenheimer New Jersey Municipal Fund
Oppenheimer AMT-Free Municipals Oppenheimer Principal Protected Main
Street Fund II
Oppenheimer AMT-Free New York Oppenheimer Pennsylvania Municipal
Municipals Fund
Oppenheimer California Municipal Fund Oppenheimer Rochester National
Municipals
Oppenheimer International Value Fund Oppenheimer Senior Floating Rate Fund
Oppenheimer Limited Term California Rochester Fund Municipals
Municipal Fund
Oppenheimer Limited Term Municipal
Fund
Oppenheimer Money Market Fund, Inc.

The following funds do not offer Class Y shares:
Limited Term New York Municipal Fund Oppenheimer Limited Term Municipal Fund
Oppenheimer AMT-Free Municipals Oppenheimer New Jersey Municipal Fund
Oppenheimer AMT-Free New York Municipals Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Balanced Fund Oppenheimer Principal Protected Main
Street Fund
Oppenheimer California Municipal Fund Oppenheimer Principal Protected Main
Street Fund II
Oppenheimer Capital Income Fund Oppenheimer Principal Protected Main
Street Fund III
Oppenheimer Cash Reserves Oppenheimer Quest Capital Value Fund,
Inc.
Oppenheimer Champion Income Fund Oppenheimer Quest International Value
Fund, Inc.
Oppenheimer Convertible Securities Fund Oppenheimer Rochester National Municipals
Oppenheimer Disciplined Allocation Fund Oppenheimer Total Return Bond Fund
Oppenheimer Dividend Growth Fund
Oppenheimer Gold & Special Minerals Fund
Oppenheimer Limited Term California
Municipal Fund

o Oppenheimer Money Market Fund, Inc. only offers Class A and Class Y
shares.
o Class B and Class C 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, Inc. or Oppenheimer Cash Reserves acquired by exchange of Class M
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
(12/16/2011).

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 Except with respect to the Class B shares described in the next two
paragraphs, the 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 Oppenheimer Limited Term California
Municipal Fund, Oppenheimer Limited-Term Government Fund, Oppenheimer Limited
Term Municipal Fund, Limited Term New York Municipal Fund and Oppenheimer
Senior Floating Rate Fund, the Class B contingent deferred sales charge is
imposed on the acquired shares if they are redeemed within five years of the
initial purchase of the exchanged Class B shares.

o With respect to Class B shares of Cash Reserves that were acquired
through the exchange of Class B shares initially purchased in the Oppenheimer
Capital Preservation Fund, the Class B contingent deferred sales charge is
imposed on the acquired shares if they are redeemed within five years of that
initial purchase.

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

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

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

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

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

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

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

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

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

|X| Excise Tax on Regulated Investment Companies. Under the Internal
Revenue Code, by December 31 each year, the Fund must distribute 98% of its
taxable investment income earned from January 1 through December 31 of that
year and 98% of its capital gains realized in the period from November 1 of
the prior year through October 31 of the current year. If it does not, the
Fund must pay an excise tax on the amounts not distributed. It is presently
anticipated that the Fund will meet those requirements. To meet this
requirement, in certain circumstances 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 anticipates distributing
substantially all of its investment company taxable income for each taxable
year. Those distributions will be taxable to shareholders as ordinary income
and treated as dividends for federal income tax purposes.

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

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

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

Investment income that may be received by the Fund from sources within
foreign countries may be subject to foreign taxes withheld at the source. The
United States has entered into tax treaties with many foreign countries which
entitle the Fund to a reduced rate of, or exemption from, taxes on such
income. The Fund may be subject to U.S. Federal income tax, and an interest
charge, on certain distributions or gains from the sale of shares of a
foreign company considered to be a PFIC, even if those amounts are paid out
as dividends to shareholders. To avoid imposition of the interest charge, the
Fund may elect to "mark to market" all PFIC shares that it holds at the end
of each taxable year. In that case, any increase or decrease in the value of
those shares would be recognized as ordinary income or as ordinary loss (but
only to the extent of previously recognized "mark-to-market" gains).

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

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

The Fund will be required in certain cases to withhold 28% of ordinary
income dividends, capital gains distributions and the proceeds of the
redemption of shares, paid to any shareholder (1) who has failed to provide a
correct taxpayer identification number or to properly certify that number
when required, (2) who is subject to backup withholding for failure to report
the receipt of interest or dividend income properly, or (3) who has failed to
certify to the Fund that the shareholder is not subject to backup withholding
or is an "exempt recipient" (such as a corporation). 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.

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

In general, any gain or loss arising from the redemption of shares of
the Fund will be considered capital gain or loss, if the shares were held as
a capital asset. It will be long-term capital gain or loss if the shares were
held for more than one year. However, any capital loss arising from the
redemption of shares held for six months or less will be treated as a
long-term capital loss to the extent of the amount of capital gain dividends
received on those shares. Special holding period rules under the Internal
Revenue Code apply in this case to determine the holding period of shares and
there are limits on the deductibility of capital losses in any year.

|X| Foreign Shareholders. Under U.S. tax law, taxation of a shareholder who
is a foreign person (to include, but not limited to, a nonresident alien
individual, a foreign trust, a foreign estate, a foreign corporation, or a
foreign partnership) primarily depends on whether the foreign person's income
from the Fund is effectively connected with the conduct of a U.S. trade or
business. Typically, ordinary income dividends paid from a mutual fund are
not considered "effectively connected" income.

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, capital gains distributions and the proceeds of
the redemption of shares, paid to any foreign person. 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.

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 into which you may exchange
shares. 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 may be invested in shares of this Fund on the same basis.

Additional Information About the Fund

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

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

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

Independent 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.



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
THE BOARD OF TRUSTEES AND SHAREHOLDERS OF OPPENHEIMER ENTERPRISE FUND:

We have audited the accompanying statement of assets and liabilities of
Oppenheimer Enterprise Fund, including the statement of investments, as of
August 31, 2005, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the years in the
two-year period then ended, and the financial highlights for each of the years
in the five-year period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.

      We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. Our procedures included
confirmation of securities owned as of August 31, 2005, by correspondence with
the custodian. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

      In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Enterprise Fund as of August 31, 2005, the results of its operations
for the year then ended, the changes in its net assets for each of the years in
the two-year period then ended, and the financial highlights for each of the
years in the five-year period then ended, in conformity with U.S. generally
accepted accounting principles.

KPMG LLP

Denver, Colorado
October 17, 2005



                        20 | OPPENHEIMER ENTERPRISE FUND


STATEMENT OF INVESTMENTS  August 31, 2005
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                         SHARES      SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--100.0%
- --------------------------------------------------------------------------------
CONSUMER DISCRETIONARY--19.1%
- --------------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE--3.6%
Cheesecake Factory, Inc.
(The) 1                                                  54,000   $   1,710,180
- --------------------------------------------------------------------------------
Life Time Fitness, Inc. 1                                57,000       1,909,500
- --------------------------------------------------------------------------------
Scientific Games Corp.,
Cl. A 1                                                 101,000       3,044,140
                                                                  --------------
                                                                      6,663,820

- --------------------------------------------------------------------------------
INTERNET & CATALOG RETAIL--1.1%
eBay, Inc. 1                                             50,000       2,024,500
- --------------------------------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS--1.9%
Brunswick Corp.                                          78,400       3,449,600
- --------------------------------------------------------------------------------
MEDIA--3.5%
Univision Communications,
Inc., Cl. A 1                                            90,000       2,421,000
- --------------------------------------------------------------------------------
Walt Disney Co. (The)                                   164,000       4,131,160
                                                                  --------------
                                                                      6,552,160

- --------------------------------------------------------------------------------
SPECIALTY RETAIL--5.0%
Best Buy Co., Inc.                                      118,500       5,647,710
- --------------------------------------------------------------------------------
Urban Outfitters, Inc. 1                                 65,900       3,667,994
                                                                  --------------
                                                                      9,315,704
- --------------------------------------------------------------------------------
TEXTILES, APPAREL & LUXURY GOODS--4.0%
Coach, Inc. 1                                           110,400       3,664,176
- --------------------------------------------------------------------------------
Polo Ralph Lauren Corp.                                  75,000       3,716,250
                                                                  --------------
                                                                      7,380,426

- --------------------------------------------------------------------------------
CONSUMER STAPLES--2.1%
- --------------------------------------------------------------------------------
BEVERAGES--2.1%
PepsiCo, Inc.                                            71,000       3,894,350
- --------------------------------------------------------------------------------
ENERGY--6.8%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--1.9%
Halliburton Co.                                          55,300       3,426,941
- --------------------------------------------------------------------------------
OIL & GAS--4.9%
Amerada Hess Corp.                                       37,000       4,702,700
- --------------------------------------------------------------------------------
Apache Corp.                                             62,000       4,440,440
                                                                  --------------
                                                                      9,143,140

                                                                          VALUE
                                                         SHARES      SEE NOTE 1
- --------------------------------------------------------------------------------
FINANCIALS--6.4%
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--5.1%
American Express Co.                                    102,000   $   5,634,480
- --------------------------------------------------------------------------------
Goldman Sachs
Group, Inc. (The)                                        34,000       3,780,120
                                                                  --------------
                                                                      9,414,600

- --------------------------------------------------------------------------------
INSURANCE--1.3%
AMBAC Financial
Group, Inc.                                              35,700       2,448,306
- --------------------------------------------------------------------------------
HEALTH CARE--20.3%
- --------------------------------------------------------------------------------
BIOTECHNOLOGY--8.4%
Amgen, Inc. 1                                            73,000       5,832,700
- --------------------------------------------------------------------------------
Genentech, Inc. 1                                        34,500       3,240,930
- --------------------------------------------------------------------------------
Genzyme Corp.
(General Division) 1                                     42,000       2,989,140
- --------------------------------------------------------------------------------
Gilead Sciences, Inc. 1                                  41,000       1,763,000
- --------------------------------------------------------------------------------
Martek Biosciences
Corp. 1                                                  34,900       1,779,900
                                                                  --------------
                                                                     15,605,670

- --------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SUPPLIES--4.5%
Bard (C.R.), Inc.                                        28,000       1,801,240
- --------------------------------------------------------------------------------
Gen-Probe, Inc. 1                                        39,200       1,784,384
- --------------------------------------------------------------------------------
Immucor, Inc. 1                                          40,000         946,800
- --------------------------------------------------------------------------------
Varian Medical
Systems, Inc. 1                                          98,400       3,918,288
                                                                  --------------
                                                                      8,450,712

- --------------------------------------------------------------------------------
HEALTH CARE PROVIDERS & SERVICES--5.4%
Coventry Health
Care, Inc. 1                                             43,000       3,440,000
- --------------------------------------------------------------------------------
Lincare Holdings, Inc. 1                                 40,000       1,693,600
- --------------------------------------------------------------------------------
UnitedHealth Group, Inc.                                 51,000       2,626,500
- --------------------------------------------------------------------------------
WellCare Health
Plans, Inc. 1                                            58,000       2,180,800
                                                                  --------------
                                                                      9,940,900

- --------------------------------------------------------------------------------
PHARMACEUTICALS--2.0%
Allergan, Inc.                                           20,000       1,841,000
- --------------------------------------------------------------------------------
Pfizer, Inc.                                             76,000       1,935,720
                                                                  --------------
                                                                      3,776,720


                        21 | OPPENHEIMER ENTERPRISE FUND


STATEMENT OF INVESTMENTS  Continued
- --------------------------------------------------------------------------------

                                                                          VALUE
                                                         SHARES      SEE NOTE 1
- --------------------------------------------------------------------------------
INDUSTRIALS--8.5%
- --------------------------------------------------------------------------------
AEROSPACE & DEFENSE--2.0%
Rockwell Collins, Inc.                                   77,000   $   3,706,010
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--2.2%
Corporate Executive
Board Co.                                                24,500       1,978,865
- --------------------------------------------------------------------------------
Stericycle, Inc. 1                                       36,000       2,092,680
                                                                  --------------
                                                                      4,071,545

- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--2.2%
General Electric Co.                                    118,000       3,965,980
- --------------------------------------------------------------------------------
MACHINERY--1.1%
Donaldson Co., Inc.                                      68,200       2,089,648
- --------------------------------------------------------------------------------
TRADING COMPANIES & DISTRIBUTORS--1.0%
Fastenal Co.                                             31,000       1,877,980
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--35.6%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--8.4%
Avaya, Inc. 1                                           267,000       2,723,400
- --------------------------------------------------------------------------------
Cisco Systems, Inc. 1                                   175,500       3,092,310
- --------------------------------------------------------------------------------
Comverse
Technology, Inc. 1                                      147,400       3,799,972
- --------------------------------------------------------------------------------
QUALCOMM, Inc.                                          148,000       5,877,080
                                                                  --------------
                                                                     15,492,762

- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--4.3%
Dell, Inc. 1                                             91,000       3,239,600
- --------------------------------------------------------------------------------
EMC Corp. 1                                             362,000       4,655,320
                                                                  --------------
                                                                      7,894,920

- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--4.8%
Google, Inc., Cl. A 1                                    13,000       3,718,000
- --------------------------------------------------------------------------------
VeriSign, Inc. 1                                         49,000       1,068,200
- --------------------------------------------------------------------------------
Yahoo!, Inc. 1                                          125,000       4,167,500
                                                                  --------------
                                                                      8,953,700

- --------------------------------------------------------------------------------
IT SERVICES--1.5%
Cognizant Technology
Solutions Corp. 1                                        61,000       2,777,330
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT--7.0%
Broadcom Corp., Cl. A 1                                 116,000       5,046,000
- --------------------------------------------------------------------------------
Linear Technology Corp.                                  97,000       3,679,210

                                                                          VALUE
                                                         SHARES      SEE NOTE 1
- --------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT Continued
Texas Instruments, Inc.                                 130,600   $   4,268,008
                                                                  --------------
                                                                     12,993,218

- --------------------------------------------------------------------------------
SOFTWARE--9.6%
Amdocs Ltd. 1                                           108,000       3,169,800
- --------------------------------------------------------------------------------
Autodesk, Inc.                                          107,000       4,622,400
- --------------------------------------------------------------------------------
Mercury Interactive
Corp. 1                                                  62,000       2,273,540
- --------------------------------------------------------------------------------
Microsoft Corp.                                         219,000       6,000,600
- --------------------------------------------------------------------------------
SAP AG, Sponsored ADR                                    43,000       1,834,810
                                                                  --------------
                                                                     17,901,150

- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--1.2%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION
SERVICES--1.2%
American Tower Corp. 1                                   95,810       2,284,110
                                                                  --------------
Total Common Stocks
(Cost $153,349,430)                                                 185,495,902

- --------------------------------------------------------------------------------
PREFERRED STOCKS--0.0%
- --------------------------------------------------------------------------------
Multiplex, Inc., Cv.,
Series C 1,2,3
(Cost $3,999,998)                                       543,478           9,348

                                                      PRINCIPAL
                                                         AMOUNT
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--0.4%
- --------------------------------------------------------------------------------
Undivided interest of 0.06% in joint
repurchase agreement (Principal
Amount/Value $1,184,643,000, with
a maturity value of $1,184,759,490)
with UBS Warburg LLC, 3.54%, dated
8/31/05, to be repurchased at
$660,065 on 9/1/05, collateralized by
Federal National Mortgage Assn., 6%,
4/1/35, with a value of $1,209,814,832
(Cost $660,000)                                       $ 660,000         660,000

- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $158,009,428)                                       100.4%    186,165,250
- --------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF
OTHER ASSETS                                               (0.4)       (672,776)
                                                      --------------------------
NET ASSETS                                                100.0%  $ 185,492,474
                                                      ==========================


                        22 | OPPENHEIMER ENTERPRISE FUND


FOOTNOTES TO STATEMENT OF INVESTMENTS

1. Non-income producing security.

2. Illiquid or restricted security. The aggregate value of illiquid or
restricted securities as of August 31, 2005 was $9,348, which represents 0.01%
of the Fund's net assets, all of which is considered restricted. See Note 5 of
Notes to Financial Statements.

3. Affiliated company. Represents ownership of at least 5% of the voting
securities of the issuer, and is or was an affiliate, as defined in the
Investment Company Act of 1940, at or during the period ended August 31, 2005.
The aggregate fair value of securities of affiliated companies held by the Fund
as of August 31, 2005 amounts to $9,348. Transactions during the period in which
the issuer was an affiliate are as follows:

                                          SHARES       GROSS        GROSS            SHARES
                                 AUGUST 31, 2004   ADDITIONS   REDUCTIONS   AUGUST 31, 2005
- -------------------------------------------------------------------------------------------
Axsun Technologies, Inc., Cv.,
Series C                                 514,139          --      514,139                --
Multiplex, Inc., Cv., Series C           543,478          --           --           543,478

                                                       VALUE     DIVIDEND          REALIZED
                                                  SEE NOTE 1       INCOME              LOSS
- -------------------------------------------------------------------------------------------
Axsun Technologies, Inc., Cv., Series C           $       --     $     --       $ 5,691,519
Multiplex, Inc., Cv., Series C                         9,348           --                --
                                                  -----------------------------------------
                                                  $    9,348     $     --       $ 5,691,519
                                                  =========================================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        23 | OPPENHEIMER ENTERPRISE FUND


STATEMENT OF ASSETS AND LIABILITIES  August 31, 2005
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
Investments, at value--see accompanying statement of
investments:
Unaffiliated companies (cost $154,009,430)                       $  186,155,902
Affiliated companies (cost $3,999,998)                                    9,348
                                                                 ---------------
                                                                    186,165,250
- --------------------------------------------------------------------------------
Cash                                                                  1,250,578
- --------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold                                      125,145
Interest and dividends                                                   90,285
Other                                                                    11,713
                                                                 ---------------
Total assets                                                        187,642,971

- --------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------
Payables and other liabilities:
Shares of beneficial interest redeemed                                1,866,124
Trustees' compensation                                                   71,983
Distribution and service plan fees                                       71,397
Shareholder communications                                               63,683
Transfer and shareholder servicing agent fees                            55,240
Other                                                                    22,070
                                                                 ---------------
Total liabilities                                                     2,150,497

- --------------------------------------------------------------------------------
NET ASSETS                                                       $  185,492,474
                                                                 ===============

- --------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- --------------------------------------------------------------------------------
Paid-in capital                                                  $  508,649,138
- --------------------------------------------------------------------------------
Accumulated net investment loss                                         (71,013)
- --------------------------------------------------------------------------------
Accumulated net realized loss on investments                       (351,241,473)
- --------------------------------------------------------------------------------
Net unrealized appreciation on investments                           28,155,822
                                                                 ---------------
NET ASSETS                                                       $  185,492,474
                                                                 ===============


                        24 | OPPENHEIMER ENTERPRISE FUND


- --------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- --------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$121,097,278 and 8,637,234 shares of beneficial interest outstanding)          $14.02
Maximum offering price per share (net asset value plus sales charge of 5.75%
of offering price)                                                             $14.88
- --------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$35,358,723 and 2,738,559 shares of beneficial interest outstanding)           $12.91
- --------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$13,600,233 and 1,051,902 shares of beneficial interest outstanding)           $12.93
- --------------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of
$1,196,092 and 86,416 shares of beneficial interest outstanding)               $13.84
- --------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $14,240,148 and 992,229 shares of beneficial interest
outstanding)                                                                   $14.35

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        25 | OPPENHEIMER ENTERPRISE FUND


STATEMENT OF OPERATIONS  For the Year Ended August 31, 2005
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
INVESTMENT INCOME
- --------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $2,419)             $  2,056,332
- --------------------------------------------------------------------------------
Interest                                                                 52,514
                                                                   -------------
Total investment income                                               2,108,846

- --------------------------------------------------------------------------------
EXPENSES
- --------------------------------------------------------------------------------
Management fees                                                       1,376,470
- --------------------------------------------------------------------------------
Distribution and service plan fees:
Class A                                                                 271,075
Class B                                                                 416,415
Class C                                                                 134,083
Class N                                                                   5,237
- --------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A                                                                 619,525
Class B                                                                 176,515
Class C                                                                  78,329
Class N                                                                   7,113
Class Y                                                                  38,437
- --------------------------------------------------------------------------------
Shareholder communications:
Class A                                                                  60,466
Class B                                                                  35,501
Class C                                                                   7,947
Class N                                                                     668
Class Y                                                                   1,112
- --------------------------------------------------------------------------------
Custodian fees and expenses                                               1,214
- --------------------------------------------------------------------------------
Other                                                                    38,255
                                                                   -------------
Total expenses                                                        3,268,362
Less reduction to custodian expenses                                       (320)
Less waivers and reimbursements of expenses                            (294,242)
                                                                   -------------
Net expenses                                                          2,973,800

- --------------------------------------------------------------------------------
NET INVESTMENT LOSS                                                    (864,954)

- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments:
   Unaffiliated companies                                            21,575,756
   Affiliated companies                                              (5,691,519)
                                                                   -------------
Net realized gain                                                    15,884,237
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on investments                 23,895,338

- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS               $ 38,914,621
                                                                   =============

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        26 | OPPENHEIMER ENTERPRISE FUND


STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

YEAR ENDED AUGUST 31,                                                     2005             2004
- ------------------------------------------------------------------------------------------------
OPERATIONS
- ------------------------------------------------------------------------------------------------
Net investment loss                                               $   (864,954)  $   (2,602,893)
- ------------------------------------------------------------------------------------------------
Net realized gain                                                   15,884,237       33,150,760
- ------------------------------------------------------------------------------------------------
Net change in unrealized appreciation                               23,895,338      (33,391,546)
                                                                  ------------------------------
Net increase (decrease) in net assets resulting from operations     38,914,621       (2,843,679)

- ------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
beneficial interest transactions:
Class A                                                             (5,010,689)     (16,438,579)
Class B                                                            (19,223,491)     (15,321,229)
Class C                                                             (1,976,711)      (1,474,060)
Class N                                                                150,576          165,189
Class Y                                                             (3,205,423)      (8,254,492)

- ------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------
Total increase (decrease)                                            9,648,883      (44,166,850)
- ------------------------------------------------------------------------------------------------
Beginning of period                                                175,843,591      220,010,441
                                                                  ------------------------------
End of period (including accumulated net investment
loss of $71,013 and $78,723, respectively)                        $185,492,474   $  175,843,591
                                                                  ==============================

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        27 | OPPENHEIMER ENTERPRISE FUND


FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

CLASS A YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  11.29      $  11.50    $   8.91   $  14.92   $  39.08
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.04) 1,2     (.12) 1     (.06)      (.09)      (.18)
Net realized and unrealized gain (loss)               2.77          (.09) 1     2.65      (5.92)    (21.40)
                                                  ----------------------------------------------------------
Total from investment operations                      2.73          (.21)       2.59      (6.01)    (21.58)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  14.02      $  11.29    $  11.50   $   8.91   $  14.92
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   24.18%        (1.83)%     29.07%    (40.28)%   (57.56)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $121,097      $101,934    $120,101   $103,105   $233,045
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $113,233      $111,924    $100,922   $166,632   $357,113
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (0.29)% 2     (1.07)%     (0.93)%    (1.09)%    (0.81)%
Total expenses                                        1.61%         1.66%       1.83%      1.95%      1.33%
Expenses after payments and waivers and
reduction to custodian expenses                       1.42%         1.44%       1.29%      1.60%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        28 | OPPENHEIMER ENTERPRISE FUND


CLASS B YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  10.48      $  10.76    $   8.40   $  14.17   $  37.57
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.11) 1,2     (.20) 1     (.20)      (.41)      (.30)
Net realized and unrealized gain (loss)               2.54          (.08) 1     2.56      (5.36)    (20.52)
                                                  ----------------------------------------------------------
Total from investment operations                      2.43          (.28)       2.36      (5.77)    (20.82)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  12.91      $  10.48    $  10.76   $   8.40   $  14.17
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   23.19%        (2.60)%     28.10%    (40.72)%   (57.87)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 35,359      $ 45,904    $ 62,170   $ 52,633   $125,772
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 41,821      $ 54,878    $ 52,441   $ 86,628   $181,217
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (0.96)% 2     (1.86)%     (1.69)%    (1.85)%    (1.58)%
Total expenses                                        2.27%         2.53%       2.79%      2.71%      2.10%
Expenses after payments and waivers and
reduction to custodian expenses                       2.18%         2.23%       2.05%      2.36%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        29 | OPPENHEIMER ENTERPRISE FUND


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

CLASS C YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  10.49      $  10.77    $   8.41   $  14.19   $  37.61
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.12) 1,2     (.20) 1     (.17)      (.37)      (.32)
Net realized and unrealized gain (loss)               2.56          (.08) 1     2.53      (5.41)    (20.52)
                                                  ----------------------------------------------------------
Total from investment operations                      2.44          (.28)       2.36      (5.78)    (20.84)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --      (2.58)
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  12.93      $  10.49    $  10.77   $   8.41   $  14.19
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                   23.26%        (2.60)%     28.06%    (40.73)%   (57.86)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $ 13,600      $ 12,790    $ 14,594   $ 11,578   $ 25,468
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $ 13,458      $ 13,979    $ 12,521   $ 18,550   $ 37,410
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss                                  (1.03)% 2     (1.83)%     (1.70)%    (1.85)%    (1.57)%
Total expenses                                        2.41%         2.59%       2.80%      2.71%      2.10%
Expenses after payments and waivers and
reduction to custodian expenses                       2.18%         2.20%       2.06%      2.36%       N/A 5
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        30 | OPPENHEIMER ENTERPRISE FUND


CLASS N YEAR ENDED AUGUST 31,                         2005          2004        2003       2002       2001 1
- ------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period              $  11.18      $  11.41    $   8.87   $  14.90   $  17.74
- ------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss                                   (.08) 2,3     (.15) 2     (.13)      (.28)      (.01)
Net realized and unrealized gain (loss)               2.74          (.08) 2     2.67      (5.75)     (2.83)
                                                  ----------------------------------------------------------
Total from investment operations                      2.66          (.23)       2.54      (6.03)     (2.84)
- ------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                    --            --          --         --         --
- ------------------------------------------------------------------------------------------------------------
Net asset value, end of period                    $  13.84      $  11.18    $  11.41   $   8.87   $  14.90
                                                  ==========================================================

- ------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 4                   23.79%        (2.02)%     28.64%    (40.47)%   (16.01)%
- ------------------------------------------------------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)          $  1,196      $    839    $    685   $    456   $     83
- ------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                 $  1,058      $    781    $    537   $    249   $     12
- ------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 5
Net investment loss                                  (0.66)% 3     (1.32)%     (1.24)%    (1.44)%    (0.94)%
Total expenses                                        2.00%         2.10%       2.09%      2.25%      1.75%
Expenses after payments and waivers and
reduction to custodian expenses                       1.68%         1.70%       1.60%      1.90%       N/A 6
- ------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                 59%          123%        103%       150%       160%

1. For the period from March 1, 2001 (inception of offering) to August 31, 2001.

2. Per share amounts calculated based on the average shares outstanding during
the period.

3. Net investment loss per share and the net investment loss ratio include $.08
and 0.64%, respectively, resulting from a special dividend from Microsoft Corp.
in November 2004.

4. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

5. Annualized for periods of less than one full year.

6. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        31 | OPPENHEIMER ENTERPRISE FUND


FINANCIAL HIGHLIGHTS  Continued
- --------------------------------------------------------------------------------

CLASS Y  YEAR ENDED AUGUST 31,                                         2005          2004         2003       2002        2001
- --------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period                               $  11.52      $  11.67     $   9.02   $  15.05   $   39.32
- --------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss)                                            .01 1,2      (.07) 1      (.10)      (.10)       (.09)
Net realized and unrealized gain (loss)                                2.82          (.08) 1      2.75      (5.93)     (21.60)
                                                                   -------------------------------------------------------------
Total from investment operations                                       2.83          (.15)        2.65      (6.03)     (21.69)
- --------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain                                     --            --           --         --       (2.58)
- --------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period                                     $  14.35      $  11.52     $  11.67   $   9.02   $   15.05
                                                                   =============================================================

- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3                                    24.57%        (1.29)%      29.38%    (40.07)%    (57.48)%
- --------------------------------------------------------------------------------------------------------------------------------

- --------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- --------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands)                           $ 14,240      $ 14,376     $ 22,461   $ 16,020   $  25,450
- --------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands)                                  $ 14,157      $ 19,642     $ 16,675   $ 19,590   $  49,978
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss)                                           0.10% 2      (0.62)%      (0.67)%    (0.70)%     (0.67)%
Total expenses                                                         1.05%         0.98%        1.72%      2.16%       1.36% 5
Expenses after payments and waivers and reduction to custodian
expenses                                                                N/A 6         N/A 6       1.03%      1.19%       1.20%
- --------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate                                                  59%          123%         103%       150%        160%

1. Per share amounts calculated based on the average shares outstanding during
the period.

2. Net investment income per share and the net investment income ratio include
$.08 and 0.64%, respectively, resulting from a special dividend from Microsoft
Corp. in November 2004.

3. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.

4. Annualized for periods of less than one full year.

5. Added since August 31, 2001 to reflect expenses before reduction to custodian
expenses and voluntary waiver of transfer agent fees.

6. Reduction to custodian expenses less than 0.01%.

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.


                        32 | OPPENHEIMER ENTERPRISE FUND


NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES

Oppenheimer Enterprise Fund (the Fund) is registered under the Investment
Company Act of 1940, as amended, as an open-end management investment company.
The Fund's investment objective is to seek capital appreciation. The Fund's
investment advisor is OppenheimerFunds, Inc. (the Manager).

      The Fund offers Class A, Class B, Class C, Class N and Class Y shares.
Class A shares are sold at their offering price, which is normally net asset
value plus a front-end sales charge. Class B, Class C and Class N shares are
sold without a front-end sales charge but may be subject to a contingent
deferred sales charge (CDSC). Class N shares are sold only through retirement
plans. Retirement plans that offer Class N shares may impose charges on those
accounts. Class Y shares are sold to certain institutional investors without
either a front-end sales charge or a CDSC, however, the institutional investor
may impose charges on those accounts. All classes of shares have identical
rights and voting privileges with respect to the Fund in general and exclusive
voting rights on matters that affect that class alone. Earnings, net assets and
net asset value per share may differ due to each class having its own expenses,
such as transfer and shareholder servicing agent fees and shareholder
communications, directly attributable to that class. Class A, B, C and N have
separate distribution and/or service plans. No such plan has been adopted for
Class Y shares. Class B shares will automatically convert to Class A shares six
years after the date of purchase.

      The following is a summary of significant accounting policies consistently
followed by the Fund.

- --------------------------------------------------------------------------------
SECURITIES VALUATION. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. Securities listed
or traded on National Stock Exchanges or other domestic exchanges are valued
based on the last sale price of the security traded on that exchange prior to
the time when the Fund's assets are valued. Securities traded on NASDAQ are
valued based on the closing price provided by NASDAQ prior to the time when the
Fund's assets are valued. In the absence of a sale, the security is valued at
the last sale price on the prior trading day, if it is within the spread of the
closing "bid" and "asked" prices, and if not, at the closing bid price.
Securities traded on foreign exchanges are valued based on the last sale price
on the principal exchange on which the security is traded, in the country that
is identified by the portfolio pricing service, prior to the time when the
Fund's assets are valued. In the absence of a sale, the security is valued at
the official closing price on the principal exchange. Corporate, government and
municipal debt instruments having a remaining maturity in excess of sixty days
and all mortgage-backed securities will be valued at the mean between the "bid"
and "asked" prices. Futures contracts traded on a commodities or futures
exchange will be valued at the final settlement price or official closing price
on the principal exchange as reported by such principal exchange at its trading
session ending at, or most recently prior to, the time when the Fund's assets
are valued. Securities


                        33 | OPPENHEIMER ENTERPRISE FUND


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

may be valued primarily using dealer-supplied valuations or a portfolio pricing
service authorized by the Board of Trustees. Securities (including restricted
securities) for which market quotations are not readily available are valued at
their fair value. Foreign and domestic securities whose values have been
materially affected by what the Manager identifies as a significant event
occurring before the Fund's assets are valued but after the close of their
respective exchanges will be fair valued. Fair value is determined in good faith
using consistently applied procedures under the supervision of the Board of
Trustees. Short-term "money market type" debt securities with remaining
maturities of sixty days or less are valued at amortized cost (which
approximates market value).

- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. The values of securities denominated in foreign currencies and
amounts related to the purchase and sale of foreign securities and foreign
investment income are translated into U.S. dollars as of the close of The New
York Stock Exchange (the Exchange), normally 4:00 P.M. Eastern time, on each day
the Exchange is open for business. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.

      Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.

      The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.

- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint trading
accounts on a daily basis. These balances are invested in one or more repurchase
agreements. Securities pledged as collateral for repurchase agreements are held
by a custodian bank until the agreements mature. Each agreement requires that
the market value of the collateral be sufficient to cover payments of interest
and principal. In the event of default by the other party to the agreement,
retention of the collateral may be subject to legal proceedings.

- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such


                        34 | OPPENHEIMER ENTERPRISE FUND


class. Operating expenses directly attributable to a specific class are charged
against the operations of that class.

- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders, therefore, no federal income or excise tax provision is
required.

The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.

                                                                 NET UNREALIZED
                                                                   APPRECIATION
                                                               BASED ON COST OF
 UNDISTRIBUTED    UNDISTRIBUTED          ACCUMULATED       SECURITIES AND OTHER
 NET INVESTMENT       LONG-TERM                 LOSS    INVESTMENTS FOR FEDERAL
 INCOME                    GAIN   CARRYFORWARD 1,2,3        INCOME TAX PURPOSES
 ------------------------------------------------------------------------------
 $--                        $--         $351,162,938                $28,078,603

1. As of August 31, 2005, the Fund had $351,162,938 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of August 31, 2005, details
of the capital loss carryforwards were as follows:

                          EXPIRING
                          ---------------------------
                          2009       $     14,520,519
                          2010            257,289,240
                          2011             79,353,179
                                     ----------------
                          Total      $    351,162,938
                                     ================

2. During the fiscal year ended August 31, 2005, the Fund utilized $15,837,193
of capital loss carryforward to offset capital gains realized in that fiscal
year.

3. During the fiscal year ended August 31, 2004, the Fund utilized $16,574,046
of capital loss carryforward to offset capital gains realized in that fiscal
year.

Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund. Accordingly, the
following amounts have been reclassified for August 31, 2005. Net assets of the
Fund were unaffected by the reclassifications.

                                            REDUCTION TO
                       REDUCTION TO      ACCUMULATED NET
                       PAID-IN CAPITAL   INVESTMENT LOSS
                       ---------------------------------
                       $872,664                 $872,664

No distributions were paid during the years ended August 31, 2005 and August 31,
2004.


                        35 | OPPENHEIMER ENTERPRISE FUND


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued

The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of August 31, 2005 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.

                Federal tax cost of securities   $ 158,086,647
                                                 ==============

                Gross unrealized appreciation    $  36,953,342
                Gross unrealized depreciation       (8,874,739)
                                                 --------------
                Net unrealized appreciation      $  28,078,603
                                                 ==============

- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Fund has adopted an unfunded retirement plan for the
Fund's independent trustees. Benefits are based on years of service and fees
paid to each trustee during the years of service. During the year ended August
31, 2005, the Fund's projected benefit obligations were decreased by $6,508 and
payments of $4,038 were made to retired trustees, resulting in an accumulated
liability of $61,229 as of August 31, 2005.

      The Board of Trustees has adopted a deferred compensation plan for
independent trustees that enables trustees to elect to defer receipt of all or a
portion of the annual compensation they are entitled to receive from the Fund.
For purposes of determining the amount owed to the Trustee under the plan,
deferred amounts are treated as though equal dollar amounts had been invested in
shares of the Fund or in other Oppenheimer funds selected by the Trustee. The
Fund purchases shares of the funds selected for deferral by the Trustee in
amounts equal to his or her deemed investment, resulting in a Fund asset equal
to the deferred compensation liability. Such assets are included as a component
of "Other" within the asset section of the Statement of Assets and Liabilities.
Deferral of trustees' fees under the plan will not affect the net assets of the
Fund, and will not materially affect the Fund's assets, liabilities or net
investment income per share. Amounts will be deferred until distributed in
accordance to the Plan.

- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.

- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.


                        36 | OPPENHEIMER ENTERPRISE FUND


- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.

- --------------------------------------------------------------------------------
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.

- --------------------------------------------------------------------------------
OTHER. The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST

The Fund has authorized an unlimited number of no par value shares of beneficial
interest of each class. Transactions in shares of beneficial interest were as
follows:

               YEAR ENDED AUGUST 31, 2005     YEAR ENDED AUGUST 31, 2004
                   SHARES          AMOUNT       SHARES            AMOUNT
- -------------------------------------------------------------------------
CLASS A
Sold            2,612,694   $  33,590,367    2,293,436   $    26,926,960
Redeemed       (3,001,115)    (38,601,056)  (3,712,460)      (43,365,539)
               ----------------------------------------------------------
Net decrease     (388,421)  $  (5,010,689)  (1,419,024)  $   (16,438,579)
               ==========================================================

- -------------------------------------------------------------------------
CLASS B
Sold              461,518   $   5,482,893      668,395   $     7,283,657
Redeemed       (2,102,913)    (24,706,384)  (2,068,855)      (22,604,886)
               ----------------------------------------------------------
Net decrease   (1,641,395)  $ (19,223,491)  (1,400,460)  $   (15,321,229)
               ==========================================================

- -------------------------------------------------------------------------
CLASS C
Sold              206,244   $   2,454,142      280,027   $     3,055,473
Redeemed         (373,116)     (4,430,853)    (416,728)       (4,529,533)
               ----------------------------------------------------------
Net decrease     (166,872)  $  (1,976,711)    (136,701)  $    (1,474,060)
               ==========================================================

- -------------------------------------------------------------------------
CLASS N
Sold               35,566   $     453,829       41,224   $       468,639
Redeemed          (24,213)       (303,253)     (26,171)         (303,450)
               ----------------------------------------------------------
Net increase       11,353   $     150,576       15,053   $       165,189
               ==========================================================


                        37 | OPPENHEIMER ENTERPRISE FUND


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST Continued

               YEAR ENDED AUGUST 31, 2005     YEAR ENDED AUGUST 31, 2004
                  SHARES           AMOUNT        SHARES           AMOUNT
- -------------------------------------------------------------------------
CLASS Y
Sold             384,526     $  5,169,594       631,010     $  7,496,024
Redeemed        (640,386)      (8,375,017)   (1,306,902)     (15,750,516)
               ----------------------------------------------------------
Net decrease    (255,860)    $ (3,205,423)     (675,892)    $ (8,254,492)
               ==========================================================

- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES

The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended August 31, 2005, were as
follows:

                                        PURCHASES          SALES
              --------------------------------------------------
              Investment securities  $105,737,885   $130,702,524

- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES

MANAGEMENT FEES. Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for a fee at an
annual rate of 0.75% of the first $200 million of average annual net assets,
0.72% of the next $200 million, 0.69% of the next $200 million, 0.66% of the
next $200 million, 0.60% of the next $700 million, and 0.58% of average annual
net assets over $1.5 billion.

- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended August 31, 2005, the Fund paid
$624,132 to OFS for services to the Fund.

      Additionally, Class Y shares are subject to minimum fees of $10,000 per
annum for assets of $10 million or more. The Class Y shares are subject to the
minimum fees in the event that the per account fee does not equal or exceed the
applicable minimum fees. OFS may voluntarily waive the minimum fees.

- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLAN (12b-1) FEES. Under its General Distributor's
Agreement with the Fund, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the Fund's principal underwriter in the continuous public offering of
the Fund's classes of shares.

- --------------------------------------------------------------------------------
SERVICE PLAN FOR CLASS A SHARES. The Fund has adopted a Service Plan for Class A
shares. It reimburses the Distributor for a portion of its costs incurred for
services provided to accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate of up to 0.25% of the average annual net assets of
Class A shares of the Fund. The Distributor currently uses all of those fees to
pay dealers, brokers, banks and other financial institutions quarterly for
providing personal services and maintenance of accounts of their customers that
hold Class A shares. Any unreimbursed expenses the Distributor incurs with
respect to Class A shares in any fiscal year cannot be recovered in subsequent
years. Fees incurred by the Fund under the Plan are detailed in the Statement of
Operations.


                        38 | OPPENHEIMER ENTERPRISE FUND


- --------------------------------------------------------------------------------
DISTRIBUTION AND SERVICE PLANS FOR CLASS B, CLASS C AND CLASS N SHARES. The Fund
has adopted Distribution and Service Plans for Class B, Class C and Class N
shares to compensate the Distributor for its services in connection with the
distribution of those 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 and Class C shares and 0.25% per year on Class N shares. The Distributor
also receives a service fee of 0.25% per year under each plan. If either the
Class B, Class C or Class N plan is terminated by the Fund or by the
shareholders of a class, the Board of Trustees and its independent trustees must
determine whether the Distributor shall be entitled to payment from the Fund of
all or a portion of the service fee and/or asset-based sales charge in respect
to shares sold prior to the effective date of such termination. The
Distributor's aggregate uncompensated expenses under the plan at August 31, 2005
for Class B, Class C and Class N shares were $983,004, $358,698 and $11,322,
respectively. Fees incurred by the Fund under the plans are detailed in the
Statement of Operations.

- --------------------------------------------------------------------------------
SALES CHARGES. Front-end sales charges and contingent deferred sales charges
(CDSC) do not represent expenses of the Fund. They are deducted from the
proceeds of sales of Fund shares prior to investment or from redemption proceeds
prior to remittance, as applicable. The sales charges retained by the
Distributor from the sale of shares and the CDSC retained by the Distributor on
the redemption of shares is shown in the table below for the period indicated.

                                        CLASS A         CLASS B         CLASS C         CLASS N
                        CLASS A      CONTINGENT      CONTINGENT      CONTINGENT      CONTINGENT
                      FRONT-END        DEFERRED        DEFERRED        DEFERRED        DEFERRED
                  SALES CHARGES   SALES CHARGES   SALES CHARGES   SALES CHARGES   SALES CHARGES
                    RETAINED BY     RETAINED BY     RETAINED BY     RETAINED BY     RETAINED BY
YEAR ENDED          DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR     DISTRIBUTOR
- -----------------------------------------------------------------------------------------------
August 31, 2005        $ 62,821         $ 8,702       $ 100,671         $ 3,245         $ 2,350

- --------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS OF EXPENSES. OFS has voluntarily agreed to limit
transfer and shareholder servicing agent fees for all classes to 0.35% of
average annual net assets per class. During the year ended August 31, 2005, OFS
waived $221,006, $38,649, $31,219 and $3,368 for Class A, Class B, Class C and
Class N shares, respectively. This undertaking may be amended or withdrawn at
any time.

- --------------------------------------------------------------------------------
5. ILLIQUID OR RESTRICTED SECURITIES

As of August 31, 2005, investments in securities included issues that are
illiquid or restricted. Restricted securities are purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of Trustees as reflecting fair value. A security may also be considered
illiquid if it lacks a readily available market or if its valuation has not
changed for a certain period of time. The Fund will not invest more than 10% of
its net assets (determined at the time of purchase and reviewed periodically)


                        39 | OPPENHEIMER ENTERPRISE FUND


NOTES TO FINANCIAL STATEMENTS  Continued
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
5. ILLIQUID OR RESTRICTED SECURITIES Continued

in illiquid or restricted securities. Certain restricted securities, eligible
for resale to qualified institutional investors, are not subject to that
limitation. Securities that are illiquid or restricted are marked with the
applicable footnote on the Statement of Investments. Information concerning
restricted securities is as follows:

                                 ACQUISITION                 VALUATION AS OF     UNREALIZED
SECURITY                                DATE         COST    AUGUST 31, 2005   DEPRECIATION
- -------------------------------------------------------------------------------------------
Multiplex, Inc., Cv., Series C        2/9/01   $3,999,998             $9,348     $3,990,650

- --------------------------------------------------------------------------------
6. LITIGATION

A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor, as well as 51 of the
Oppenheimer funds (as "Nominal Defendants") including the Fund, 30 present and
former Directors or Trustees and 8 present and former officers of the funds.
This complaint, initially filed in the U.S. District Court for the Southern
District of New York on January 10, 2005 and amended on March 4, 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 assets of the funds to make
those payments in violation of the Investment Company Act of 1940 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 shareholders of the funds under the Investment Company Act of 1940 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 defendants believe that the allegations contained in the Complaints
are without merit and that they have meritorious defenses against the claims
asserted. The defendants intend to defend these lawsuits vigorously and to
contest any claimed liability. The defendants believe that it is premature to
render any opinion as to the likelihood of an outcome unfavorable to them and
that no estimate can yet be made with any degree of certainty as to the amount
or range of any potential loss.

                                     A-1
                                  Appendix A

                           Industry Classifications

   -----------------------------------------------------------------------------
   Aerospace & Defense                  Household Products
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Air Freight & Couriers               Industrial Conglomerates
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Airlines                             Insurance
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Auto Components                      Internet & Catalog Retail
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Automobiles                          Internet Software & Services
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Beverages                            IT Services
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Biotechnology                        Leisure Equipment & Products
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Building Products                    Machinery
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Chemicals                            Marine
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Consumer Finance                     Media
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Commercial Banks                     Metals & Mining
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Commercial Services & Supplies       Multiline Retail
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Communications Equipment             Multi-Utilities
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Computers & Peripherals              Office Electronics
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Construction & Engineering           Oil & Gas
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Construction Materials               Paper & Forest Products
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Containers & Packaging               Personal Products
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Distributors                         Pharmaceuticals
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Diversified Financial Services       Real Estate
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Diversified Telecommunication        Road & Rail
   Services
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Electric Utilities                   Semiconductors and Semiconductor
                                        Equipment
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Electrical Equipment                 Software
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Electronic Equipment & Instruments   Specialty Retail
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Energy Equipment & Services          Textiles, Apparel & Luxury Goods
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Food & Staples Retailing             Thrifts & Mortgage Finance
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Food Products                        Tobacco
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Gas Utilities                        Trading Companies & Distributors
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Health Care Equipment & Supplies     Transportation Infrastructure
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Health Care Providers & Services     Water Utilities
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Hotels Restaurants & Leisure         Wireless Telecommunication Services
   -----------------------------------------------------------------------------
   -----------------------------------------------------------------------------
   Household Durables
   -----------------------------------------------------------------------------






                                     B-1

                                  Appendix B

        OppenheimerFunds Special Sales Charge Arrangements and Waivers

In certain cases, the initial sales charge that applies to purchases of Class
A shares(1) 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 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 created or qualified under Sections 401(a) or 401(k) of
             the Internal Revenue Code,
         2) non-qualified deferred compensation plans,
         3) employee benefit plans(3)
         4) Group Retirement Plans(4)
         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.
o





                                     B-11
- ------------------------------------------------------------------------------
                                     B-2
o      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."(1) This waiver provision applies to:
o     Purchases of Class A shares aggregating $1 million or more.
o     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.
o     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.
o     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 $5 million or more of its assets (excluding assets
            invested in money market funds) invested in Applicable
            Investments.
         3) The record keeping for a Retirement Plan is handled under a
            service agreement with Merrill Lynch and on the date the plan
            sponsor signs that agreement, the Plan has 500 or more eligible
            employees (as determined by the Merrill Lynch plan conversion
            manager).
o






            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.
|_|   Effective October 1, 2005, taxable accounts established with the
         proceeds of Required Minimum Distributions from Retirement Plans.

B. Waivers of the Class A Initial and Contingent Deferred Sales Charges in
Certain Transactions.

1.    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 or
         unit investment trusts for which reinvestment arrangements have been
         made with the Distributor.
|_|   Shares purchased by certain Retirement Plans that are part of a
         retirement plan or platform offered by banks, broker-dealers,
         financial advisors or insurance companies, or serviced by
         recordkeepers.
|_|   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.

2.    Class A shares issued and purchased in the following transactions are
   not subject to sales charges (a dealer concession at the annual rate of
   0.25% is paid by the Distributor on purchases made within the first 6
   months of plan establishment):
|_|   Retirement Plans that have $5 million or more in plan assets.
|_|   Retirement Plans with a single plan sponsor that have $5 million or
         more in aggregate assets invested in Oppenheimer funds.

C. Waivers of the Class A Contingent Deferred Sales Charge for Certain
Redemptions.

The Class A contingent deferred sales charge is also waived if shares that
would otherwise be subject to the contingent deferred sales charge are
redeemed in the following cases:
|_|   To make Automatic Withdrawal Plan payments that are limited annually to
         no more than 12% of the account value adjusted annually.
|_|   Involuntary redemptions of shares by operation of law or involuntary
         redemptions of small accounts (please refer to "Shareholder Account
         Rules and Policies," in the applicable fund Prospectus).
|_|   For distributions from Retirement Plans, deferred compensation plans or
         other employee benefit plans for any of the following purposes:
         1) Following the death or disability (as defined in the Internal
            Revenue Code) of the participant or beneficiary. The death or
            disability must occur after the participant's account was
            established.
         2) To return excess contributions.
         3) To return contributions made due to a mistake of fact.
4)    Hardship withdrawals, as defined in the plan.(2)
         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.(3)
         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.
o       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 (as defined in the
         Internal Revenue Code).
|_|   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.
|_|   Distributions(4) 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.(5)
         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.(6)
         9) On account of the participant's 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) 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.

o          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- & Mid- 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.

- --------------------------------------------------------------------------------
Number of Eligible    Initial Sales       Initial Sales Charge   Concession as
                      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.
o          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 Core Bond Fund,
   Oppenheimer Value Fund and
   Oppenheimer Disciplined Allocation Fund
are modified as described below for those Fund shareholders who were
shareholders of the following funds (referred to as the "Former Connecticut
Mutual Funds") on March 1, 1996, when OppenheimerFunds, Inc. became the
investment adviser to the Former Connecticut Mutual Funds:
   Connecticut Mutual Liquid Account         Connecticut Mutual Total Return
   Account
   Connecticut Mutual Government Securities Account   CMIA LifeSpan Capital
   Appreciation Account
   Connecticut Mutual Income Account         CMIA LifeSpan Balanced Account
   Connecticut Mutual Growth Account         CMIA Diversified Income Account

A. Prior Class A CDSC and Class A Sales Charge Waivers.

|X|   Class A Contingent Deferred Sales Charge. Certain shareholders of a
Fund and the other Former Connecticut Mutual Funds are entitled to continue
to make additional purchases of Class A shares at net asset value without a
Class A initial sales charge, but subject to the Class A contingent deferred
sales charge that was in effect prior to March 18, 1996 (the "prior Class A
CDSC"). Under the prior Class A CDSC, if any of those shares are redeemed
within one year of purchase, they will be assessed a 1% contingent deferred
sales charge on an amount equal to the current market value or the original
purchase price of the shares sold, whichever is smaller (in such redemptions,
any shares not subject to the prior Class A CDSC will be redeemed first).

      Those shareholders who are eligible for the prior Class A CDSC are:
         1) persons whose purchases of Class A shares of a Fund and other
            Former Connecticut Mutual Funds were $500,000 prior to March 18,
            1996, as a result of direct purchases or purchases pursuant to
            the Fund's policies on Combined Purchases or Rights of
            Accumulation, who still hold those shares in that Fund or other
            Former Connecticut Mutual Funds, and
         2) persons whose intended purchases under a Statement of Intention
            entered into prior to March 18, 1996, with the former general
            distributor of the Former Connecticut Mutual Funds to purchase
            shares valued at $500,000 or more over a 13-month period entitled
            those persons to purchase shares at net asset value without being
            subject to the Class A initial sales charge

      Any of the Class A shares of a Fund and the other Former Connecticut
Mutual Funds that were purchased at net asset value prior to March 18, 1996,
remain subject to the prior Class A CDSC, or if any additional shares are
purchased by those shareholders at net asset value pursuant to this
arrangement they will be subject to the prior Class A CDSC.

|X|   Class A Sales Charge Waivers. Additional Class A shares of a Fund may
be purchased without a sales charge, by a person who was in one (or more) of
the categories below and acquired Class A shares prior to March 18, 1996, and
still holds Class A shares:
      1) any purchaser, provided the total initial amount invested in the
         Fund or any one or more of the Former Connecticut Mutual Funds
         totaled $500,000 or more, including investments made pursuant to the
         Combined Purchases, Statement of Intention and Rights of
         Accumulation features available at the time of the initial purchase
         and such investment is still held in one or more of the Former
         Connecticut Mutual Funds or a Fund into which such Fund merged;
      2) any participant in a qualified plan, provided that the total initial
         amount invested by the plan in the Fund or any one or more of the
         Former Connecticut Mutual Funds totaled $500,000 or more;
      3) Directors of the Fund or any one or more of the Former Connecticut
         Mutual Funds and members of their immediate families;
      4) employee benefit plans sponsored by Connecticut Mutual Financial
         Services, L.L.C. ("CMFS"), the prior distributor of the Former
         Connecticut Mutual Funds, and its affiliated companies;
      5) one or more members of a group of at least 1,000 persons (and
         persons who are retirees from such group) engaged in a common
         business, profession, civic or charitable endeavor or other
         activity, and the spouses and minor dependent children of such
         persons, pursuant to a marketing program between CMFS and such
         group; and
      6) an institution acting as a fiduciary on behalf of an individual or
         individuals, if such institution was directly compensated by the
         individual(s) for recommending the purchase of the shares of the
         Fund or any one or more of the Former Connecticut Mutual Funds,
         provided the institution had an agreement with CMFS.

      Purchases of Class A shares made pursuant to (1) and (2) above may be
subject to the Class A CDSC of the Former Connecticut Mutual Funds described
above.

      Additionally, Class A shares of a Fund may be purchased without a sales
charge by any holder of a variable annuity contract issued in New York State
by Connecticut Mutual Life Insurance Company through the Panorama Separate
Account which is beyond the applicable surrender charge period and which was
used to fund a qualified plan, if that holder exchanges the variable annuity
contract proceeds to buy Class A shares of the Fund.

B. Class A and Class B Contingent Deferred Sales Charge Waivers.

In addition to the waivers set forth in the Prospectus and in this Appendix,
above, the contingent deferred sales charge will be waived for redemptions of
Class A and Class B shares of a Fund and exchanges of Class A or Class B
shares of a Fund into Class A or Class B shares of a Former Connecticut
Mutual Fund provided that the Class A or Class B shares of the Fund to be
redeemed or exchanged were (i) acquired prior to March 18, 1996 or (ii) were
acquired by exchange from an Oppenheimer fund that was a Former Connecticut
Mutual Fund. Additionally, the shares of such Former Connecticut Mutual Fund
must have been purchased prior to March 18, 1996:
   1) by the estate of a deceased shareholder;
   2) upon the disability of a shareholder, as defined in Section 72(m)(7) of
      the Internal Revenue Code;
   3) for retirement distributions (or loans) to participants or
      beneficiaries from retirement plans qualified under Sections 401(a) or
      403(b)(7)of the Code, or from IRAs, deferred compensation plans created
      under Section 457 of the Code, or other employee benefit plans;
4)    as tax-free returns of excess contributions to such retirement or
      employee benefit plans;
   5) in whole or in part, in connection with shares sold to any state,
      county, or city, or any instrumentality, department, authority, or
      agency thereof, that is prohibited by applicable investment laws from
      paying a sales charge or concession in connection with the purchase of
      shares of any registered investment management company;
   6) in connection with the redemption of shares of the Fund due to a
      combination with another investment company by virtue of a merger,
      acquisition or similar reorganization transaction;
   7) in connection with the Fund's right to involuntarily redeem or
      liquidate the Fund;
   8) in connection with automatic redemptions of Class A shares and Class B
      shares in certain retirement plan accounts pursuant to an Automatic
      Withdrawal Plan but limited to no more than 12% of the original value
      annually; or
   9) as involuntary redemptions of shares by operation of law, or under
      procedures set forth in the Fund's Articles of Incorporation, or as
      adopted by the Board of Directors of the Fund.
o         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%.
o        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.







Oppenheimer Enterprise Fund

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.CALL.OPP (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


PX885.001.1205



(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.
(1) 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.
(2) This provision does not apply to IRAs.
(3) 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.
(4) The distribution must be requested prior to Plan termination or the
elimination of the Oppenheimer funds as an investment option under the Plan.
(5) This provision does not apply to IRAs.
(6) This provision does not apply to loans from 403(b)(7) custodial plans and
loans from the OppenheimerFunds-sponsored Single K retirement plan.
(7) This provision does not apply to 403(b)(7) custodial plans if the
participant is less than age 55, nor to IRAs.

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